Most Group Health Plans offer Employees and their families the opportunity for a temporary extension of health coverage (called "continuation coverage") at group rates in certain instances where Coverage under the Plan would otherwise end. If you are covered by an ERISA exempt Plan, you have no access to COBRA continuation. This notice is intended to inform you, in a summary fashion, of your rights and obligations under the continuation coverage provisions.

If you are a Covered Person, you have the right to choose continuation coverage if you lose your group health coverage because of a reduction in your hours of employment with the Company (for reasons other than gross misconduct on your part).

If you are a Spouse of a Covered Person, you have the right to choose continuation coverage for yourself if you lose your group health coverage under this Plan for any of the following four reasons:

1. the death of your Spouse;
2. a termination of your Spouse's employment (for reasons other than gross misconduct) or reduction in your Spouse's hours of employment with the Company;
3. divorce or legal separation from your Spouse; or
4. your Spouse becomes entitled to Medicare.

1. the death of a Parent;
2. a termination of Parent's employment (for reasons other than gross misconduct) or reduction in a Parent's hours of employment with the Company;
3. parent's divorce or legal separation;
4. a Parent becomes entitled to Medicare; or
5. the Dependent child ceases to be a "Dependent child" as defined by this Plan.

Under the law, the Employee or a family member has the responsibility to inform the Third Party Administrator and the Company of a divorce, legal separation, or a child losing Dependent status (as defined by this Plan) within sixty (60) days of the date of the event or the date in which Coverage would end under this Plan because of the event, whichever is later. Similar rights may apply to certain Retirees, Spouses, and Dependent children if the Company commences a bankruptcy proceeding and these individuals lose Coverage.

When the Company is notified that one of these events has happened, the Third Party Administrator will in turn notify you that you have the right to choose continuation coverage. Under the law, you have at least sixty (60) days from the date you would lose Coverage because of one of the events described above, or the date notice of your election rights is sent to you, whichever is later, to inform the Third Party Administrator that you want continuation coverage.

If you do not choose continuation coverage, your group health insurance will end on the last day of the month in which your COBRA qualifying event occurred.

If you choose continuation coverage, the Company will give you Coverage which, as of the time Coverage is being provided, is identical to the Coverage provided under this Plan to similarly situated Employees or family members. You will be able to maintain continuation coverage for thirty-six (36) months unless you lost group health coverage because of a termination of employment or a reduction in hours. In that case, the required continuation coverage period is eighteen (18) months. This eighteen (18) months may be extended to thirty-six (36) months if other events (such as death, divorce, legal separation, or Medicare entitlement) occur during that eighteen (18)-month period.

The eighteen (18) months may be extended to twenty-nine (29) months if a Covered Person is determined to be disabled (for Social Security disability purposes) within the first sixty (60) days of COBRA continuation coverage and the Covered Person sends the Third Party Administrator notice of the determination of disability under the Social Security Act within the eighteen (18)-month coverage period and within sixty (60) days after the date of the determination. The Covered Person must notify the Third Party Administrator within thirty (30) days that the disability determination has changed. In no event will continuation coverage last beyond thirty-six (36) months from the date of the event that originally made a qualified beneficiary eligible to elect Coverage.

However, the law also provides that your continuation coverage may be terminated for any of the following five reasons:

1. the Company no longer provides group health coverage to any of its Employees;
2. the premium for your continuation coverage is not paid on time;
3. you become covered by another group plan, unless the plan contains any exclusions or limitations with respect to any Pre-Existing condition you or your covered Dependents may have. Under the Federal Health Insurance Portability and Accountability Act of 1996, an exclusion or limitation of the other group health plan may not apply to, or may be satisfied by, you depending on the length of your coverage under the Plan or another health plan (Creditable Coverage). Pre-existing conditions cannot be applied to pregnancy;
4. you or your covered Dependents become entitled to Medicare; or
5. you or your covered Dependents extend coverage for up to twenty-nine (29) months due to your disability and there has been a final determination that you are no longer disabled. (For the additional eleven (11) months of continuation, the premium may be set at 150% of the applicable premium rather than 102%.)

You do not have to show that you are insurable to choose continuation coverage. However, under the law, you may have to pay all or part of the premium for your continuation coverage.

If COBRA is elected while you are enrolled under another group plan, COBRA will only cover Pre-Existing conditions not immediately covered under your new plan. A Pre-Existing condition must be defined as Pre-Existing (i.e. coverage denied for a specific time period) by the other group insurance company. Under the Federal Health Insurance Portability and Accountability Act of 1996, an exclusion or limitation of the other group health plan may not apply to, or may be satisfied by, you depending on the length of your coverage under the Plan or another health Plan (Creditable Coverage). Pre-existing conditions cannot be applied to pregnancy. The bill needs to be submitted with an Explanation of Benefits from your other coverage showing the charge denied as a Pre-Existing condition.

MONTHLY COST: The Monthly Cost must be paid by the Covered Person to the Third Party Administrator. The Monthly Cost will not exceed 102% of the total average monthly cost (determined by the Third Party Administrator on an actuarial basis) for Coverage of a similarly situated Covered Person whose Coverage had not otherwise terminated.

The Monthly Cost must be made in monthly installments in the form of a cashier's check or money order. Without further notice from the Third Party Administrator, the Covered Person must pay the Monthly Cost by the first day of each month for which Coverage is continued. You have a thirty (30)-day grace period. If payment is postmarked later than the thirty (30)-day grace period, coverage will automatically cease. Within forty-five (45) days of the date of election, the Covered Person must pay the entire cost of the Plan from the date your coverage ceased under your former Employer. Failure to pay the initial premiums will result in termination of coverage retroactive to the date of the qualifying event. Once a COBRA premium is received it cannot be refunded.

PAYMENT OF CLAIMS: No claim will be payable under the COBRA Provision until the Third Party Administrator receives the applicable monthly cost by, or on behalf of, the Covered Person.

This is the Consolidated Omnibus Budget Reconciliation Act of 1986 and the 1989 COBRA Amendments, and you have been notified of the COBRA rights.

The Third Party Administrator governs the form of coverage, benefits, and the amounts. The COBRA rates may differ from those under this Plan.

Your Employer and the Third Party Administrator will comply with all Federal COBRA regulations. Any changes in the COBRA regulations will be implemented as soon as the federal notices have been received and affected persons have been notified.

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