eTrade 2008 Annual Report Download - page 208

If this is not a successor plan, for the first Plan Year the Plan permits any Participant to make Elective Deferral
Contributions, for purposes of the foregoing tests, the prior year’s Nonhighly Compensated Employees’ ADP shall
be 3 percent, unless the Employer has elected to use the Plan Year’s ADP for these Eligible Participants.
If the Employer has elected to use the current year testing method, that election cannot be changed unless (i) the
Plan has been using the current year testing method for the preceding five Plan Years, or if less, the number of Plan
Years the Plan has been in existence; or (ii) if as a result of a merger or acquisition described in Code Section 410(b)
(6)(C)(i), the Employer maintains both a plan using the prior year testing method and a plan using the current year
testing method and the change is made within the transition period described in Code Section 410(b)(6)(C)(ii).
A Participant is a Highly Compensated Employee for a particular Plan Year if he meets the definition of a Highly
Compensated Employee in effect for that Plan Year. Similarly, a Participant is a Nonhighly Compensated Employee for a
particular Plan Year if he does not meet the definition of a Highly Compensated Employee in effect for that Plan Year.
The Deferral Percentage for any Eligible Participant who is a Highly Compensated Employee for the Plan Year and who is
eligible to have Elective Deferral Contributions (and Qualified Nonelective Contributions or Qualified Matching
Contributions, or both, if treated as Elective Deferral Contributions for purposes of the ADP Test) allocated to his account
under two or more arrangements described in Code Section 401(k) that are maintained by the Employer or a Controlled
Group member shall be determined as if such Elective Deferral Contributions (and, if applicable, such Qualified
Nonelective Contributions or Qualified Matching Contributions, or both) were made under a single arrangement. For Plan
Years beginning on or after January 1, 2006, if a Highly Compensated Employee participates in two or more cash or
deferred arrangements of the Employer or of a Controlled Group member that have different plan years, all Elective
Deferral Contributions made during the Plan Year shall be aggregated. For Plan Years beginning before January 1, 2006,
all such cash or deferred arrangements ending with or within the same calendar
(2) Current Year Testing Method. The ADP for a Plan Year for Eligible Participants who are Highly Compensated
Employees for each Plan Year and the ADP for Eligible Participants who are Nonhighly Compensated Employees
for the Plan Year must satisfy one of the following tests:
(i) The ADP for a Plan Year for Eligible Participants who are Highly Compensated Employees for the Plan Year
shall not exceed the ADP for Eligible Participants who are Nonhighly Compensated Employees for the Plan
Year multiplied by 1.25; or
(ii) The ADP for a Plan Year for Eligible Participants who are Highly Compensated Employees for the Plan Year:
A. shall not exceed the ADP for Eligible Participants who are Nonhighly Compensated Employees for the
Plan Year multiplied by 2, and
B. the difference between such ADP’s is not more than 2.
RESTATEMENT DECEMBER 15, 2006 41 ARTICLE III (5-19047)