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© 2019 Hitesman & Wold, P.A. MEDSURETY, LLC Cafeteria Plan 1-888-816-4234, www.medsurety.com Basic Plan Document 8 ARTICLE IV. CONTRIBUTIONS 4.1 Salary Reduction Contributions. To the extent the Participant’s cost of an Optional Benefit exceeds the Employer Contribution (if any), a Participant may ele ct in accordance with the Election procedures described in Article V to receive his or her full Compensation in cash, or to have a portion of such Compensation applied by the Employer toward the Participant’s cost of Optional Benefits. If so elected, the Participant’s Compensation will be reduced, and an amount equal to the reduction shall be allocated by the Employer to the Optional Benefits designated by the Participant. A Participant’s Compensation shall be reduced by pro-rata amounts of the Participant’s total salary reduction Election. Salary reduction is done on a pre-tax basis before any withholdings have been made. The frequency of salary reduction co ntributions shall be as specified in the Adoption Agreement. Notwithstanding the forgoing, if participation in an Optional Benefit extends to the last day of the month in which a Participant’s employment terminates, if necessary, additional salary reduction contributions shall be taken from the Participant’s final pay check to pay for the coverage provided during the period of time following the date on which the Participant’s employment terminates. 4.2 Imputation of Income. To the extent a Participant participates in an Optional Benefit that covers a Dependent who is not the Participant’s Spouse or Tax Dependent, the entire cost of coverage for which the Participant is responsible shall be paid pre-tax through this Plan and the fair market value of the coverage for that Dependent shall be imputed as income to the Participant as the coverage is provided (pursuant to Cafeteria Plan Regulations). This provision applies regardless of whether the cost of coverage is paid by salary reduction or allocation of available Employer Contributions, if any. 4.3 Employer Contribution. The Employer may make a fixed dollar contribution per Plan Year, or portion of the Plan Year (e.g., month, pay period), per Participant. The amount of the Employer Contribution and any restrictions on the use thereof shall be identified in the Adoption Agreement and communicated to the Participants prior to the start of each Plan Year so that they may consider it in making their Elections. The annual Employer Contribution amount shall be prorate d and made available in equal monthly installments except that any Employer Contribution allocated to the Health Flexible Spending Account or Limited Scope Health Flexible Spending Account shall be made available on the first day of the Plan Year (or the P articipant’s Entry Date if later than the first day of the Plan Year). The amount of the Employer Contribution may change from year to year as announced by the Employer prior to the Plan Year start and reflected in the Adoption Agreement. Unless otherwise specified in the Adoption Agreement, no Employer Contribution shall be credited to any Employee during a period of leave of absence, whether authorized or unauthorized, unless required by the Family Medical Leave Act (“FMLA”), if applicable. Unless otherwise specified in the Adoption Agreement, Employees who are not eligible for participation on the first day of the Plan Year shall have their annual Employer Contribution pro-rated by multiplying the annual available Employer Contribution by a fraction, the numerator of which is the number of months the Employee is eligible for participation for the Plan Year, the denominator which is twelve. 4.4 Maximum Under the Plan. Under no circumstances may a Participant’s total salary reduction exceed the sum of (a) the cost of benefits paid on a pre-tax basis provided through insurance or insurance types of benefits plus (b) the maximum Election amounts permitted under the reimbursement-type Optional Benefits plus (c) the maximum Election permitted under the HSA Contribution Feature (if applicable) minus (d) the Employer Contribution, if any. 4.5 No Trust. Nothing in this Plan is intended to require the establishment of a trust. Employer Contributions made to this Plan remain the Employer’s general assets until used to pay benefits or purchase coverage through the Plan. Participant contributions to the Plan including, but not limited to, salary reduction contributions, are Plan assets. To the extent ERISA applies, such Plan