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4 5 7 P I an'. Loa n Cui d t I ; n t s VII. Loan interest rate The rate of interest for loans of five (5) years or less will be based on prime plus 0.5%. The rate of interest for loans for a principal residence will be based on the FHA/VA rate. Interest rates are determined on the last business day of the month preceding the month the loan is disbursed. The interest rate is locked in at the time a loan is approved and remains constant throughout the life of the loan. The prime interest rate is determined on the last business day of each month using the Wall Street Journal as the source. The FHA/VA interest rate is also determined on the last business day of each month using the Telerate Information Service as the source. Loan interest rates for new loans may fluctuate upward or downward monthly, depending on the movement of the prime and FHA/VA interest rates. The employer may modify the manner in which loan interest rates will be determined, but only with respect to future loans. VIII. Loan application procedure All loans must be requested in writing on an application approved by the plan administrator. The application must be signed by the participant. The employer ~ust review and approve the application. The participant will be required to sign a promissory note evidencing the loan and a disclosure statement that includes an amortization schedule prior to receiving a loan check. Loan checks will generally be issued on the Friday following the receipt of a complete loan application. The loan check, promissory note, disclosure statement and truth-in-Iending recision notice will be sent to the employer, who will obtain the necessary signatures and deliver the check to the participan~All executed documents must be returned to the plan administrator within 10 calendar days from the date the check is issued. IX. Security/Collateral That portion of a participant's account balance that is equal to the amount of the loan is used as collateral for the loan. The collateral amount may not exceed 50 percent of the participant's account balance at the time the loan is taken. Only that portion of the account balance that corresponds to the amount of the outstanding loan balance is used as collateral. I, X. Acceleration [select one] o All loans are due and payable in full upon separation from service. m All loans are due and payable when a participant receives a distribution of all of his/her account balance after separation from service. The amount of the outstanding loan balance will be reported as a distribution in addition to the amount of cash distributed from the plan. o All loans are due and payable when a participant receives a distribution of part of his/her account balance after separation from service. The amount of the outstanding loan balance will be reported as a distribution in addition to the amount of cash distributed from the plan. ..............................................,...........,... I....... I..... I.................... three