Summary Plan Descriptions TABLE of CONTENTS

The Benefits of Living Well 2015 Summary Plan Descriptions TABLE OF CONTENTS

...... CHAPTER

General and Administrative Information...... Introduction

Medical Plans...... 1

Medical Coverage During Retirement...... 1a

Dental Plans...... 2

Vision Plan...... 3

Disability Plan...... 4

Life and Accident Insurance Plans...... 5

Health Care Flexible Spending Account Plan...... 6

Dependent Care Flexible Spending Account Plan...... 7

General Information Retirement Income Program...... 8

401(k) Savings Plan...... 9

Pension Account Plan...... 10

Severance Plan...... 11

This Summary Plan Description (SPD) is merely a summary of the terms of the Plan. In the event of a conflict between the actual terms of the Plan and this summary, the terms of the Plan shall control. The Company reserves the right to unilaterally amend, modify or terminate the Plan in its sole discretion at any time for any reason. General and Administrative Information CONTENTS

...... Page

Introduction...... Intro-1

Eligibility...... Intro-2

• Eligible Dependents ...... Intro-2

• Same-Sex Spouses or Same-Sex Domestic Partners ...... Intro-2

Enrolling in Signature Select...... Intro-3

• Default ...... Intro-3

• Annual Enrollment ...... Intro-3

Changing Your Coverage...... Intro-4

• Changes in Status...... Intro-4

Paying for Your Benefits...... Intro-7

When There is Other Coverage...... Intro-8

• Coordination of Benefits ...... Intro-8

When Coverage Ends...... Intro-10

COBRA Continuation of Coverage...... Intro-11

Plan Identification...... Intro-14

Plan Insurers/Claim Administrators...... Intro-15

...... Intro-16

Plan Administration...... Intro-16

Claim Denial and Appeal ...... Intro-17

Changing or Terminating the Plan ...... Intro-21

Your Rights...... Intro-21

• Your Rights Under ERISA...... Intro-21

• Your Rights Under WHCRA...... Intro-22

• HIPAA Privacy Notice...... Intro-22

Independent Contractors...... Intro-27

Employment at Will...... Intro-27

GENERAL & ADMINISTRATIVE INFORMATION INTRODUCTION

Berryville Graphics, Inc. and Coral Graphic Services, Inc., including its Dynamic Graphic Finishing division, which are part of BE Printers America, a division of Bertelsmann, Inc., are participating employers (each a “Participating Employer” or “Company”) in the Bertelsmann Employee Protection Plan, sponsored by Bertelsmann, Inc. and generally known as the Signature Select Benefits Program (“Signature Select” or the “Plan”). Signature Select is a comprehensive and flexible benefits program that provides choice and protection for eligible employees of BE Printers America (often referred to in this document as “Employees” or, simply, “you”) and their eligible dependents. Signature Select gives you the opportunity to choose from a variety of options in the following coverages: • Medical and Prescription Drug • Dental • Vision Care • Disability Income • Employee Life and Accidental Death & Dismemberment Insurance (Basic, Supplemental) • Business Travel Accident • Dependent Life Insurance • Health Care Flexible Spending Account (FSA) • Dependent Care Flexible Spending Account (FSA) You choose the level of coverage you need under each option, or in some cases, you can decline coverage entirely. Your cost of coverage depends on the types and levels of coverage that you select, and for certain coverages, your salary. Unless stated differently, this Summary Plan Description (SPD) describes the available coverages and benefits under the Plan as of January 1, 2015.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-1 ELIGIBILITY

You are generally eligible to participate in Signature Select if you otherwise terminated due to age. To qualify for coverage, disabled are a regular, full-time employee of the Company who is regularly dependents must have been disabled prior to age 26 and covered scheduled to work at least 30 hours per week, provided that you under Signature Select medical coverage or another medical are not subject to an employment agreement with the Company plan. that specifically excludes participation. * An exception applies for Dependent Life Insurance. Foster As a regular full-time employee, your coverage under Signature children are not eligible dependents for this coverage. Select is effective the first of the month following 60 days of service, provided that you timely complete applicable enrollment Eligible Dependents – Dependent Care Account requirements (see Enrolling in Signature Select below). If you are Eligible dependents for purposes of the Dependent Care Account not in “active employment” status (e.g., if you are disabled or on an are those who live with you at least half of the year and who are: approved leave of absence) when your coverage would otherwise become effective, your coverage will be postponed until the first • Your children under the age of 13 (natural, legally adopted, day you commence (or return to) active employment. foster or stepchildren), or If you are eligible to participate in the Medical, Dental, Vision Care • Your spouse or other dependent (e.g., a parent or spouse’s or Dependent Life Insurance options, you may also choose to parent) who spend at least half the year at your home and is cover your eligible dependents. mentally or physically incapable of caring for himself or herself.

Eligible Dependents – Medical, Dental, Vision Important Information Regarding Same-Sex Care and Dependent Life Insurance Spouses

Eligible dependents who may be enrolled in Medical, Dental, The Plan makes spousal benefits available to married same-sex Vision Care, and/or Dependent Life Coverage under Signature couples that reside in states that recognize same-sex marriage. Select include your: Upon enrollment of a same-sex spouse, ConSova (our third-party • Spouse or same-sex domestic partner (please see page Intro-2 vendor who handles ongoing dependent eligibility audits) will for important information) complete a dependent verification audit as they do for all new spouses added to Signature Select. • Dependent children under age 26, including your (or your spouse’s or same-sex domestic partner’s): At the time of publication of this SPD, 37 states (Alabama, Alaska, º Natural children Arizona, California, Colorado, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Maine, Maryland, º Legally adopted children Massachusetts, Minnesota, Montana, Nevada, New Hampshire, Foster children* º New Jersey, New Mexico, New York, North Carolina, Oklahoma, º Stepchildren Oregon, Pennsylvania, Rhode Island, South Carolina, Utah, Disabled dependent children can continue to receive Medical, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Dental, Vision Care and Dependent Life insurance coverage Wyoming) and the District of Columbia recognize same-sex beyond age 25. Proof of the child’s continuing disability must be marriage. This list is subject to change and provided only as a provided within 31 days after the child’s coverage would have convenient reference as of the time of publication of this SPD.

Same-Sex Domestic Partner Coverage Eligibility Signature Select offers same-sex domestic partner benefit coverage only to employees residing in states that do not recognize same-sex marriage. However, if you live in a state that recognizes same-sex marriage, you need to be married to your same-sex partner in order to enroll the partner in Plan benefits. In states that do not recognize same-sex marriage, same-sex domestic partners (including same-sex couples who were married in a state where same-sex marriage is permitted) are eligible for Plan coverage only if they live together with you in an exclusive and committed relationship and are financially interdependent (as verified by approved documentation). Qualified same-sex domestic partners may be enrolled for Medical, Dental, Vision Care and Dependent Life Insurance coverages under the Plan. To the extent additional states recognize same-sex marriage, employees in the affected states with existing same-sex domestic partner coverage will be provided with 12 months of continued same-sex domestic partner coverage following the effective date of the new law, referendum or court decision, as applicable. At the end of the 12-month period, same-sex domestic partner coverage will no longer be available. Please note that federal law governs the taxation of employee benefits and, as such, IRS regulations generally require employees to pay after-tax contributions toward same-sex domestic partner coverage and require any contributions made by the Company to be imputed back to you as taxable income. However, legally married same-sex couples receive the same favorable federal tax treatment as any married couple, even if they reside in a state that does not recognize same-sex marriage.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-2 Dependent Audits The Plan conducts verification audits and may require employees to provide written documentation of proof of dependent eligibility. Verification of dependents may include, but is not limited to, marriage certificates, tax filings, proof of shared residence and finances, same-sex domestic partnership state registration (if applicable), birth certificates, adoption certificates, court orders for legal custody or placement, and validation of disability. Any dependent that cannot be adequately verified will be removed from Plan coverage (retroactively in some cases, for example if the Plan determines that there was an attempt to mislead as to material facts).

ENROLLING IN SIGNATURE SELECT

To enroll in Signature Select for the first time, you must complete an enrollment form, as directed by your Human Resources Department. The Benefits Department or local Human Resources Representative will provide you with a Benefits Guide that provides a summary of the Plan and coverage options available to you. If you do not receive enrollment information, please contact your Benefits Department or local Human Resources Representative. You must enroll in the Plan within 31 days of your eligibility date. Make sure that you complete all applicable areas for enrollment and submit your enrollment form to your Human Resources or Benefits Department.

Default Elections Your Benefits Department or local Human Resources Representative will announce the annual enrollment dates in If you do not enroll in the Plan within 31 days of the date on which advance, provide you with information on plan changes, and let you first become eligible, you will automatically be enrolled in the you know what you need to do to make changes. Enrollment following default elections: changes generally become effective on the following January 1st (exceptions may apply, such as when evidence of insurability is • Medical: No coverage required, as explained in the Disability Income Chapter 4 and the • Dental: No coverage Life Insurance Chapter 5). • Vision Care: No coverage If You Do Not Enroll • Disability Income: Basic options (see Chapter 4) If you do not enroll by the annual enrollment deadline, you will • Employee Life Insurance: One times your annual earnings (see not be able to make any pre-tax contributions to the Health Chapter 5) Care or Dependent Care Flexible Spending Accounts during the • Dependent Life Insurance: No coverage following year (whether or not you have previously participated in either FSA). Your other benefit elections (to the extent the specific • Health Care FSA: No contribution coverage(s) continue to be offered in the new year) will remain in • Dependent Care FSA: No contribution effect with rates and plan modifications that apply for the next You will not be able to change these default elections until the year, unless you are otherwise notified. next annual enrollment period for the following plan year (i.e., calendar year), unless you experience a qualified change in status Eligibility Verification (see page Intro-4). You may be required to provide satisfactory proof of a dependent’s eligibility for Signature Select coverage, whether at Annual Enrollment the time of initial enrollment or at any other time. Failure to timely provide the required proof (such as marriage certificate, birth Once your initial enrollment is made (whether by your election or certificate, or other documentation as deemed appropriate by the by default), you have the opportunity to change and/or re-enroll Plan Administrator or its designee) will preclude the enrollment of in most Signature Select Benefits each year during the annual a dependent not yet enrolled or cause an enrolled dependent’s enrollment period (subject to any restrictions and/or eligibility coverage to terminate. In the event the Plan Administrator finds requirements described in this SPD or in enrollment materials). attempted or actual fraud or intentional misrepresentation of This allows you to reconsider your elections each year, and material facts, coverage may be terminated on a retroactive basis change your coverage as your needs change. You should actively and other penalties may also apply. review your benefit elections during the annual enrollment period and make an informed decision about your choices for the coming year. The annual enrollment period usually begins in October or November and generally lasts for approximately two weeks.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-3 CHANGING YOUR COVERAGE

You may change your elections during the year (other than during the annual enrollment period) only as permitted under the following rules.

Special Enrollment Period Change in Status If you initially declined enrollment in Signature Select medical coverage (for yourself and/or your dependents) because of In the event of a “Change in Status” as described below, you may enrollment in other coverage, but you now wish to enroll in revoke your old election under Signature Select and make a Signature Select medical coverage (for yourself or with your new election for the remainder of the year, provided that both the dependents) because that other coverage has been lost (i) on revocation and new election are on account of and correspond account of losing eligibility for that coverage or having refused or with the Change in Status (as further described below). Events that exhausted COBRA continuation coverage or (ii) because employer qualify as a Change in Status include the following, as well as any contributions for that other non-COBRA coverage have ceased, other events that the Plan Administrator determines are permitted then you and any of your otherwise eligible dependents not under IRS regulations: already enrolled may enroll within 30 days following the date of • A change in your legal marital status (such as marriage, legal loss of the other coverage. separation, annulment, or divorce); In addition, if you are enrolled in Signature Select medical • A change in the number of your tax dependents (such as coverage (or are not enrolled but otherwise eligible for such the birth of a child, adoption or placement for adoption of a coverage) and you have a new dependent as a result of marriage, dependent, or death of a dependent); birth, adoption or placement for adoption, your newly acquired dependent may be enrolled for coverage (as well as yourself, if • Any employment status change for you, your spouse, or your not already enrolled), provided that you request and complete dependent that affects benefit eligibility under thisSignature enrollment within 30 days after the date of marriage, birth, Select Program or another employee benefit plan of yours, adoption or placement for adoption. Upon enrollment, the effective your spouse, or your dependents, including: termination date of coverage will be: or commencement of employment; a strike or lockout; commencement of or return from an unpaid leave of absence; a • In the case of a dependent’s birth, the date of birth; change in worksite; switching from salaried to hourly-paid, union • In the case of a dependent’s adoption or placement for to non-union, or part-time to full-time; a reduction or increase in adoption, the date of adoption or placement for adoption; and hours of employment; or any other similar change which makes the individual become (or cease to be) eligible for a particular • In the case of marriage, not later than the first day of the first employee benefit; month following the date the completed request for enrollment is received. • An event that causes your dependent to satisfy or cease to satisfy an eligibility requirement for a particular benefit (such as attaining a specified age); • A change in your, your spouse’s or your dependent’s place of residence.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-4 The following restrictions apply to elections made based on a Change in Status: Thirty One (31) Day Notice and Election Requirement. If a Change in Status occurs and you want to make a corresponding election change, you must inform your Benefits Department or local Human Resources Representative and complete a new election within 30 days following the date of the event. Consistency Rule. The election change must be on account of and correspond with the Change in Status event as determined by the Plan Administrator. Election changes based on a Change in Status are effective only prospectively (but note that Special Enrollment resulting from birth, placement for adoption or adoption allows for a retroactive effective date). As a general rule, a desired election change will be found to be consistent with a Change in Status event if the event affects eligibility for coverage. A Change in Status affects eligibility for coverage if it results in an increase or decrease in the number of Dependents who may benefit under the Plan. In addition, the following specific requirements apply: • Loss of Dependent Eligibility. For a Change in Status involving a loss of dependent eligibility (i.e., your divorce, annulment or legal separation from your spouse; the death of your spouse or your dependent; or your dependent ceasing to satisfy the eligibility requirements for coverage), you may not change any non-affected dependent’s existing coverage. • Gain of Coverage Eligibility Under Another Employer’s Plan. For a Change in Status in which you, your spouse, or your dependent gain eligibility for coverage under another employer’s “cafeteria plan” (within the meaning of Section 125 of the Internal Revenue Code) as a result of a change in your marital status or a change in your, your spouse’s, or your dependent’s employment status, you may cease or decrease Signature Select coverage for that individual only if coverage for that individual becomes effective or is increased under the other employer’s plan. • Dependent Care Spending Account Benefits. You may change or terminate your Signature Select Dependent Care Flexible Spending Account election only if your election change is on account of and corresponds with a Change in Status that affects the eligibility of dependent care expenses for the available tax exclusion (under Section 129 of the Internal Revenue Code), such as your child attaining age 13 or a change in your spouse’s employment from part-time to full-time (or vice versa). • Disability Income, Group Term Life and AD&D Insurance. The only permitted mid-year election change on account of a Change in Status is the election of dependent life coverage for newly eligible dependents (e.g., as a result of marriage, child birth, or adoption), subject to any restrictions as may be imposed under the Insurance Contract or by the Plan Administrator.

Change in Cost Judgments, Decrees and Orders If the cost of your Signature Select coverage significantly To the extent required by a judgment, decree or order (an “Order”) increases in the middle of the year, you can, by contacting your resulting from a divorce, legal separation, annulment or change Benefits Department or local Human Resources Representative in legal custody, you may prospectively change your Signature and completing change procedures within 30 days following the Select Medical, Dental, Vision or Health Care Flexible Spending event, (i) continue your coverage and elect an increase in your account elections to provide or revoke coverage (as applicable) for contributions, (ii) revoke your election and receive coverage under your child. another Signature Select option that provides similar coverage To elect coverage pursuant to an Order, your child must be an (i.e., same type of benefits for the same individuals) or (iii) revoke eligible dependent and the Order must contain sufficient details your election and drop coverage if no other Signature Select to qualify as a Qualified Medical Child Support Order (QMCSO). option providing similar coverage is available. If the cost of a Upon receipt of an Order requiring coverage of your child, you will Signature Select coverage significantly decreases in the middle be notified if the order constitutes a QMCSO as required under of the year and you are not currently enrolled in such coverage, federal law. If you have any questions or would like to receive a you can, by contacting your Benefits Department or local Human copy of the QMCSO procedures at no charge, please contact your Resources Representative and completing change procedures Benefits Department or local Human Resources Representative. within 30 days following the event, revoke your current election and enroll in such coverage. To revoke coverage pursuant to an Order, the Order must require that another individual (such as your current or former spouse) For insignificant increases or decreases in the cost of benefits, provide coverage for the child and such coverage must actually be however, your election will automatically be adjusted to reflect the provided. minor change in cost. The Plan Administrator (in its sole discretion) will decide, on a uniform and consistent basis, whether increases Change in Coverage Under This Plan or decreases in costs are “significant” or “insignificant” based upon all the surrounding facts and circumstances. This Change If your Signature Select coverage is significantly curtailed in Cost provision does not apply to the Health Care Flexible mid-year (such as a significant mid-year increase in deductibles), Spending Account, the Dependent Care Flexible Spending you can, by contacting your Benefits Department or local Human Account, Disability Income, or Life and AD&D Insurance. Resources Representative and completing change procedures within 30 days following the event, prospectively revoke your election and elect coverage under another Signature Select option that provides similar coverage (i.e., same type of benefits for the same individuals), if available.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-5 In the event a Signature Select coverage option is added or Medicare, Medicaid, Children’s Health Insurance Program eliminated during the year, you may, by contacting your Benefits (CHIP) and Other Plans Department or local Human Resources Representative and You may prospectively reduce or cancel your or your dependent’s completing change procedures within 30 days following the event, existing Signature Select Medical, Dental, Vision or Health Care elect the newly-added option or, if an option has been eliminated, Flexible Spending Account coverage if you (or your dependent, either elect another Signature Select option which provides as applicable) become entitled to Medicare or Medicaid (other similar coverage or drop coverage altogether if similar coverage is than Medicaid coverage only for pediatric vaccines) and you not available. This Change in Coverage provision does not apply to contact your Benefits Department or local Human Resources the Health Care Flexible Spending Account, Disability Income, or Representative and complete necessary change procedures Life and AD&D Insurance. within 30 days following the event. You may prospectively elect to enroll yourself and your eligible Change in Coverage Under Other Employer Plan dependents in Signature Select Medical, Dental, Vision or Health You may make a prospective election change that is on account Care Flexible Spending Account coverage upon the occurrence of and corresponds with a change made under the plan of your of any of the following events by contacting your Benefits spouse’s, former spouse’s or dependent’s employer, so long as: Department or local Human Resources Representative and (i) his or her employer’s plan permits its participants to make an completing necessary change procedures within 60 days of the election change permitted under the IRS regulations; or event: (ii) Signature Select has a period of coverage which is different • You or your eligible dependent become eligible for premium from the period of coverage under his or her employer’s plan (e.g., assistance under Medicaid or Medicaid’s Children’s Health calendar year vs. non-calendar year coverage periods). Insurance Program (CHIP); This Change in Coverage provision does not apply to the Health Care Flexible Spending Account, Disability Income, or Life and • You or your eligible dependent lose coverage under Medicare, AD&D Insurance. Medicaid or CHIP and as a result of loss of eligibility for such coverage; or Special Rule Dependent Life Insurance • You or your eligible dependent lose coverage under any You may decrease or cancel your dependent life insurance other group health coverage sponsored by a government or coverage at any time on a prospective basis. education institution, including a medical care program of an Indian Tribal government, the Indian Health Service, or a tribal ACA Marketplace Enrollment organization; a state health benefits risk pool; or a foreign government group health plan, in each case subject to the You may prospectively revoke your election for Signature Select terms and limitations of the applicable Signature Select Benefit medical coverage if you are eligible for and intend to enroll in coverage. health coverage through the Affordable Care Act Marketplace (during its special enrollment period or annual open enrollment Tax Law Requirements period) that is effective beginning no later than the day immediately following the last day of the Signature Select coverage that is Your elections relating to Signature Select coverage may revoked. This ACA Marketplace Enrollment exception does not be modified by the Plan Administrator or the participating apply to the Health Care Flexible Spending Account. employers to the extent necessary to ensure compliance with the requirements of Code Section 125 and implementing regulations.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-6 PAYING FOR YOUR BENEFITS

The Company contributes toward the total cost of coverage the Company-paid Basic option will be treated as taxable income. (“Company contribution”) for most of your benefits elections. If you The tax rules at the state and local level may vary. Please consult choose to cover your eligible dependent(s) under the Medical and/ your tax advisor for an assessment of the tax impact in your or Dental coverage under the Plan, the Company will contribute specific situation. an amount to apply toward the increased cost of coverage Employee contributions to Employee Life Insurance and associated with adding dependent coverage. Dependent Life Insurance are withheld on an after-tax basis. In Each year, you will receive an annual enrollment packet that addition, a portion of Company contributions toward the cost of provides information about the options available, your required your Employee Life Insurance may be treated as taxable income contribution for each coverage option, and ways to easily calculate (see Chapter 5 for additional information). your required contribution. Once your required contribution is paid, Employee contributions to Health Care and Dependent Care FSAs the Company contribution is made in the amount necessary to are not taxed and reimbursements provided under the FSAs are pay the total cost of coverage. Your required contribution will be also tax-free. Once you are reimbursed for an eligible health care deducted from each paycheck for the year. or dependent care expense, you may not take a corresponding deduction on your income tax return because these expenses Tax Treatment of Employee Contributions have been paid through the FSAs with tax-free dollars. Employee contributions for the following Plan coverages are paid on a before-tax basis: Same-Sex Domestic Partner Coverage • Medical Employee contributions for coverage of same-sex domestic partner and children of same-sex domestic partner must be • Dental made on an after-tax basis in accordance with IRS regulations, • Vision Care unless the domestic partner and the children of domestic partner When you pay for benefits with “before-tax” dollars, the cost qualify as the employee’s tax dependent. Similarly, the amount is set aside from your paycheck before federal, Social Security of Company contributions relating to the coverage of same-sex and, in most cases, state and local income taxes are deducted, domestic partner and children of domestic partner will be imputed which results in a tax savings for you. Since you do not pay Social to you as taxable income unless it is shown that they are the Security taxes on your before-tax employee contributions, your Employee’s tax dependents. future Social Security benefits could be slightly reduced. Although If you live in a state that does not recognize same-sex marriage this reduction is usually minimal, it could be more significant if your and have same-sex domestic partner coverage under the Plan, taxable pay is below the Social Security wage base. but you and your partner have in fact been validly married in another state that recognizes same-sex marriage, you may qualify Tax Savings for Medical Coverage Example for pre-tax treatment for contributions toward same-sex domestic partner coverage. Please contact your Human Resources Let’s assume that you are taxed at a rate of 25% of your pay and Department for details. that your required employee contribution for Medical coverage under the Plan for the year is $800. Annual Employee Contribution $800.00 Total cost if paid with after-tax dollars: $1,066.67 (including $266.67 in taxes) Total cost if paid with pre-tax dollars: $800.00 (tax-free) Your Annual Tax Savings $266.67

If you elect the Premium Short-Term Disability or Premium Long-Term Disability options (see Chapter 4 for additional information), you will be required to contribute toward the cost of your disability coverage. Please check with your Benefits Department or local Human Resources Representative to determine if your contributions are deducted from your pay on a before-tax or after-tax basis. If you pay on a before-tax basis, disability income you may receive in the future will be treated as taxable income. On the other hand, if you pay on an after-tax basis, the Premium portion of your disability income which you pay for and may receive in the future will not be taxable. In either case, disability income received from

GENERAL & ADMINISTRATIVE INFORMATION | Intro-7 WHEN THERE IS OTHER COVERAGE

Coordination of Benefits

Since it’s possible for you or your covered dependents to be covered by more than one group or coverage plan, Signature Select, like many employer-sponsored plans, has a non-duplication feature to prevent duplication of payments. This is often referred to as “Coordination of Benefits” (COB). For purposes of COB relating to the Signature Select’s health coverage, group or coverage plans include, without limitation: • An employer-sponsored or group-sponsored insurance or prepayment medical and dental plan • Coverage under Medicare or other governmental benefits, as permitted or required by law • Medical care components of group long-term care contracts, such as skilled nursing care • Medical coverage under group or individual automobile insurance policy, including “no-fault” automobile insurance coverage required by law The plan that pays first is called the primary plan. Other plans are secondary, and take over payments after the primary plan. When a claim is made for an employee or dependent that has coverage under more than one plan, the primary plan pays its usual benefits for the expenses and the secondary plan reduces its benefits in accordance with its COB provision. Neither plan pays more than it would ordinarily pay. A plan without a COB provision is always the primary plan. If all plans have such a provision, this is the order of payment for coordination of benefits: • The plan that covers the person who is an employee pays first. This means yourSignature Select Medical or Dental coverage will always be primary for you, because you’re the employee. • If your spouse or same-sex domestic partner has coverage from his or her employer, that plan will be primary for your spouse or same- sex domestic partner even if you’ve enrolled your spouse or same sex domestic partner as a dependent under Signature Select. Signature Select is primary only if your spouse or same-sex domestic partner does not participate in his or her employer-sponsored coverage. • Signature Select will always be secondary to medical payment coverage or personal injury protection (PIP) coverage under any auto liability or no-fault insurance policy. When Signature Select is the primary plan, it pays the usual benefits, as described throughout this SPD. WhenSignature Select is the secondary plan, its usual benefits are reduced by the benefit amount that is payable under the primary plan. Therefore, the combined benefit amount from this plan and the primary plan will never be more than the amount of benefit that would have been paid under Signature Select if there were no other coverage.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-8 Coordinating Benefits for Covered Children If your children are covered by both parents’ employer-sponsored plans, the “birthday rule” determines which plan is primary. When you submit bills for children covered by both your and your spouse’s (or domestic partner’s) plans:

If Then

Your birth date (month and day) occurs first in the calendar The Signature Select Medical or Dental coverage is primary year and pays first. After your plan has paid, you should submit any unpaid bills to your spouse’s (or domestic partner’s) plan.

Your spouse or domestic partner’s birth date is first Your spouse’s (or domestic partner’s) plan is primary; submit your children’s bills to your spouse’s (or domestic partner’s) plan first. Expenses not covered under your spouse’s (or domestic partner’s) plan may be covered by the Signature Select Plan.

You and your spouse (or domestic partner) have the same The plan covering you or your spouse (or domestic partner) for birth date the longer period of time will pay first.

The other parent’s plan does not use the birthday rule to The other plan’s rule will determine the order of payment. determine priority and the plans do not agree on the order of benefits

You are divorced or separated The primary plan will be determined in the following order if the child is covered under more than one plan and all such plans contain a Coordination of Benefits provision: • The plan of the parent with financial responsibility for the health care expenses of the child • The plan of the parent with custody of the child • The plan of the stepparent married to the parent with custody of the child • The plan of the parent not having custody of the child • The plan of the spouse of the parent not having custody of the child

When the primary plan cannot be determined by application of these rules, the plan covering the child longest is primary.

Example: Coordination of Benefits David is enrolled in dental coverage under Signature Select. His wife, Laura, is employed by another company and has dental coverage through her employer’s plan (not an HMO) as well as through David’s plan. When Laura has a root canal costing $500, her plan is primary and pays first. Her plan covers 50% of the charges, or $250. Then, Signature Select pays the difference between what Laura’s plan paid and the benefitsSignature Select would have paid if it were primary. Signature Select would have paid 80%, or $400, so Laura is reimbursed the difference of $150. This way, her total reimbursement equals $400—the amount Signature Select would pay if it were her primary plan.

Coordination of Benefits may work differently for insured benefits underSignature Select, in accordance with the terms of the insurance certificate(s) governing such matters.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-9 Medicare WHEN COVERAGE ENDS Signature Select reduces its benefits as described below for covered persons who are eligible for Medicare when Medicare Except as specifically provided otherwise in this document or in would be the primary plan. the applicable insurance certificates, any of the following events Medicare Benefits are determined as if the full amount that would will result in termination of Signature Select coverage: have been payable under Medicare was actually paid under • Termination of Signature Select, i.e., the Bertelsmann Medicare, even if: Employee Protection Plan (or termination of the portion of the • The person is entitled but not enrolled for Medicare. Medicare Plan that provides the relevant coverage); Benefits are determined as if the person were covered under • Termination or cancellation of the underlying insurance policy for Medicare Parts A and B. any reason; • The person is enrolled in a Medicare+Choice (Medicare Part C) • Ceasing to be eligible for Signature Select coverage (whether plan and receives non-covered services because the person as a result of a status change or a Plan amendment); did not follow all rules of that plan. Medicare Benefits are determined as if the services were covered under Medicare • Failure to complete dependent eligibility verification Parts A and B. requirements; • The person receives services from a provider who has elected • Except as otherwise required by law (USERRA), the date of to opt out of Medicare. Medicare Benefits are determined as commencement of military leave; if the services were covered under Medicare Parts A and B • Failure to make contributions for any coverage that requires and the provider had agreed to limit charges to the amount of contributions; charges allowed under Medicare rules. • Fraud, intentional misrepresentation or misconduct attempted • The services are provided in any facility that is not eligible for with regard to any Signature Select coverage or benefits; Medicare reimbursements, including a Veterans Administration • Termination of the Employee’s employment; or facility, facility of the Uniformed Services, or other facility of the federal government. Medicare Benefits are determined • The Employee’s death. as if the services were provided by a facility that is eligible for Termination of employment generally results in termination of reimbursement under Medicare. all Signature Select coverage at the end of the last day of • The person is enrolled under a plan with a Medicare Medical employment (subject to any continuation pursuant to COBRA as Savings Account. Medicare Benefits are determined as if the described below), except for Employee life insurance coverage, person were covered under Medicare Parts A and B. which will be deemed to continue for up to 31 days following termination of employment (or transfer to an ineligible employee One exception to this rule is that Signature Select is the primary classification). The actual date on which coverage terminates for plan, to the extent required under Medicare law, for the first other reasons may vary depending on factors such as the event 30 months of Medicare coverage for certain individuals whose causing the coverage termination and applicable insurer or legal Medicare coverage is on the basis of having end-stage renal requirements. For example, medical coverage for an enrolled disease (ESRD). child who loses eligibility due to attaining age 26 will terminate at the end of the month in which the 26th birthday occurs. Please refer to the additional provisions below, as well as provisions in the benefits-specific chapters and applicable insurer coverage documents.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-10 COBRA CONTINUATION OF COVERAGE

The right to continuation of health coverage was created by a Your dependent children will become qualified beneficiaries if they federal law, the Consolidated Omnibus Budget Reconciliation Act lose health coverage under the Plan because any of the following of 1985 (COBRA). COBRA continuation coverage can become qualifying events happens: available to you or members of your family when you would • The parent-employee dies; otherwise lose your coverage under Signature Select because of a life event known as a “qualifying event.” COBRA continuation • The parent-employee’s hours of employment are reduced; applies to Medical, Dental, Vision Care, Healthcare FSA and • The parent-employee’s employment ends for any reason other Employee Assistance Program only. COBRA continuation does than his or her gross misconduct; not apply to Life Insurance, AD&D Insurance, Disability Insurance • The parents become divorced or legally separated (or terminate or a Dependent Care Flexible Spending Account. same-sex domestic partnership); or After a qualifying event, COBRA continuation coverage must be • The child stops being eligible for coverage under the plan as a offered to each person who is a “qualified beneficiary.” You, your “dependent child” (e.g., due to attaining age 26). spouse (or same-sex domestic partner) and your dependent children could become qualified beneficiaries if health coverage Notify the Plan Administrator under the Plan is lost because of the qualifying event. Qualified beneficiaries who elect COBRA continuation coverage must pay The Plan will offer COBRA continuation coverage to qualified for COBRA continuation coverage except as otherwise provided beneficiaries only after the Plan Administrator has been notified under a severance agreement or other separate agreement with that a qualifying event has occurred. When the qualifying event the Company. is the end of employment or reduction of hours of employment, death of the employee, or commencement of a proceeding in You May Have Other Options When You Lose Group Health bankruptcy with respect to the employer, the employer notifies Coverage WageWorks of the qualifying event. For example, you may be eligible to buy an individual plan through For the other qualifying events (divorce or legal separation of the the Health Insurance Marketplace. By enrolling in coverage employee and spouse or a dependent child’s losing eligibility for through the Marketplace, you may qualify for lower costs on your coverage as a dependent child), you must notify your Benefits monthly premiums and lower out-of-pocket costs. Additionally, Department or local Human Resources Representative within 60 you may qualify for a 30-day special enrollment period for another days after the later of (i) the date of the qualifying event and (ii) group health plan for which you are eligible (such as a spouse’s the date on which coverage is (or would be) lost as a result of the plan), even if that plan generally doesn’t accept late enrollees. qualifying event. Failure to timely provide required notice will result in the loss of COBRA continuation coverage rights. COBRA Qualifying Events Upon providing notice of a qualifying event, you may be requested If you are an employee, you will become a qualified beneficiary if to provide additional information and required documentation to you lose your health coverage under the Plan because either one the Benefits Department. of the following qualifying events happens: Electing and Paying for COBRA Coverage • Your hours of employment are reduced, or Once WageWorks receives notice that a qualifying event has • Your employment ends for any reason other than your gross occurred, COBRA continuation coverage will be offered to each misconduct. of the qualified beneficiaries. Each qualified beneficiary will have The spouse (or same-sex domestic partner) of an employee an independent right to elect COBRA continuation coverage. will become a qualified beneficiary if the spouse (or same-sex Covered employees may elect COBRA continuation coverage domestic partner) loses health coverage under the Plan because on behalf of their spouses, and parents may elect COBRA any of the following qualifying events happens: continuation coverage on behalf of their children. Any qualified • The employee dies; beneficiary for whom COBRA is not elected within the 60-day election period specified in the Plan’s COBRA election notice • The employee’s hours of employment are reduced; will lose their rights to elect COBRA. • The employees’ employment ends for any reason other than his The full cost of COBRA continuation coverage, plus an or her gross misconduct; or administrative fee of up to 2% of the cost of coverage, is the • The spouse or domestic partner becomes divorced or legally responsibility of the qualified beneficiary. The initial premium separated (including due to termination of same-sex domestic payment for COBRA continuation coverage must be postmarked partnership) from the employee. within 45 days of the COBRA continuation coverage election, and each subsequent monthly premium payment for coverage must be postmarked within the 30-day grace period for payment.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-11 Length of Coverage employee or former employee dies, or gets divorced or legally separated, or if the dependent child stops being eligible under COBRA continuation coverage is a temporary continuation of the Plan as a dependent child, but only if the event would have coverage. When the qualifying event is the end of employment caused the spouse (or same-sex dependent) or dependent or reduction of the employee’s hours of employment, COBRA child to lose coverage under the Plan had the first qualifying continuation coverage generally lasts for up to a total of 18 event not occurred. This extension due to a second qualifying months. When the qualifying event is the end of employment event is available only if you notify the Benefits Department or reduction of the employee’s hours of employment, and the in writing of the second qualifying event with 60 days of the employee became entitled to Medicare benefits less than 18 second qualifying event. Any qualified beneficiary for whom this months before the qualifying event, COBRA continuation coverage procedure is not followed will lose their rights to an extension for qualified beneficiaries other than the employee lasts until 36 of COBRA continuation coverage due to a second qualifying months after the date of Medicare entitlement. For example, if event. a covered employee becomes entitled to Medicare 8 months before the date on which his employment terminates, COBRA continuation coverage for his spouse and children can last up to Special Rule – COBRA Coverage for Health Care FSA 36 months after the date of Medicare entitlement, which is equal COBRA coverage under the Health Care Flexible Spending to 28 months after the date of the qualifying event (36 months Account (Health Care FSA) will be offered only to qualified minus 8 months). When the qualifying event is the death of the beneficiaries losing coverage who have underspent accounts. A employee, your divorce or legal separation (or termination of qualified beneficiary has an underspent account if the annual limit same-sex domestic partnership), or a dependent child’s losing elected by the covered employee, reduced by the reimbursable eligibility as a dependent child, COBRA continuation coverage claims submitted up to the time of the qualifying event, is equal lasts for up to a total of 36 months. to or more than the amount of the premiums for Health Care FSA There are two ways in which the 18-month period of COBRA COBRA coverage that will be charged for the remainder of the continuation coverage can be extended: plan year. • Disability Extension: If you or anyone in your family COBRA coverage will consist of the Health Care FSA coverage covered under the Plan is determined by the Social Security in force at the time of the qualifying event (i.e., the elected annual Administration to be disabled and you notify the Benefits limit reduced by reimbursable claims submitted up to the time Department in a timely fashion, you and your entire family may of the qualifying event). Unless otherwise elected, all qualified be entitled to receive up to an additional 11 months of COBRA beneficiaries who were covered under the Health Care FSA will be continuation coverage (but not for the Health Care Flexible covered together for Health Care FSA COBRA coverage. However, Spending Account), for a total maximum of 29 months. The each qualified beneficiary could alternatively elect separate disability would have to have started at some time before the COBRA coverage to cover that beneficiary only, with a separate 60th day of COBRA continuation coverage and must last at Health Care FSA annual limit and a separate premium. least until the end of the initial 18-month period of COBRA continuation coverage. The disability extension is available only When COBRA Coverage Ends if you notify the Benefits Department, in writing, of the Social COBRA continuation coverage ends when: Security Administration’s determination of disability within • The covered person becomes covered under another group 60 days after the latest of: (i) the date of the Social Security medical plan; Administration’s disability determination; (ii) the date of the covered employee’s termination of employment or reduction • The covered person becomes entitled to Medicare benefits; of hours; and (iii) the date on which the qualified beneficiary • The period during which COBRA coverage was applied ends; loses (or would lose) coverage under the terms of the Plan as a result of the covered employee’s termination of employment or • The cost of the continued coverage is not paid on or before the reduction of hours. You must also provide this notice within 18 due date; months after the covered employee’s termination of employment • The Social Security Administration determines, during the or reduction of hours in order to be entitled to a disability 11-month disability extension (see above), that the covered extension. Upon providing notice of a qualifying event, you may person is no longer disabled, or be requested to provide additional information and required • The Signature Select Plan is terminated (or no longer provides documentation to the Benefits Department. Any qualified health coverage) and neither the Company nor any of its beneficiary for whom this procedure is not followed will lose their affiliates sponsor any other employee group health plans. rights to a disability extension of COBRA continuation coverage.

• Second Qualifying Event Extension: If your family For More Information About COBRA experiences another qualifying event while receiving up to • For additional information about your rights and obligations 18 months of COBRA continuation coverage, the spouse (or regarding COBRA continuation coverage under the Plan, you same-sex dependent) and dependent children in your family should contact WageWorks. can get up to 18 additional months of COBRA continuation coverage, for a maximum of 36 months, if notice of the second • Questions concerning your Plan or your COBRA continuation qualifying event is properly given to the Plan. This extension coverage rights should be addressed to your Benefits may be available to the spouse (or same-sex dependent) and Department or local Human Resources Representative. any dependent children receiving continuation coverage if the

GENERAL & ADMINISTRATIVE INFORMATION | Intro-12 • For more information about your rights under ERISA, including The reinstatement time period may be extended for an approved COBRA, the Health Insurance Portability and Accountability Act leave of absence taken in accordance with the provisions of the (HIPAA), and other laws affecting group health plans, contact federal law regarding USERRA. the nearest Regional or District Office of the U.S. Department For more information on this continuation provision, please of Labor’s Employee Benefits Security Administration (EBSA) contact your Benefits Department or local Human Resources in your area or visit the EBSA website at www.dol.gov/ebsa. Representative. (Addresses and phone numbers of Regional and District EBSA Offices are available through EBSA’s website.) The Trade Act of 2002 • In order to protect your family’s rights, you should keep the The Trade Act of 2002 created a special second COBRA election Plan Administrator informed of any changes in the addresses of period for certain displaced workers receiving Trade Adjustment family members. You should also keep a copy, for your records, Assistance (TAA) under the Trade Act of 1974, as amended. If of any notices you send to the Plan Administrator. you are certified for TAA benefits and you did not elect COBRA continuation coverage during the initial 60-day election period In the Event of Your Death following your employment termination, your second-chance If you die while you are a regular full-time employee, your eligible COBRA election period of up to 60 days begins on the first day dependents may elect to continue their health coverage under of the month in which you are certified for TAA benefits. Note, the Plan for up to 36 months, as explained above. However, if however, that election for COBRA continuation coverage must be you were age 55 or over and had met the eligibility requirements made no later than six months after the date of the TAA-related described in Chapter 1A, Medical Coverage During Retirement: loss of coverage. If you elect COBRA continuation coverage during this second-chance election period, your continuation coverage • Your surviving spouse will be eligible to continue coverage for will begin on the first day of the 60-day “second-chance” election the rest of his or her life, and period and your maximum period of continuation coverage will be • Your surviving dependent children will be eligible to continue based on the date of your original qualifying event. coverage for as long as they qualify as eligible dependents. If you have questions about continuation coverage, please If your dependent spouse continues to work after your retirement contact your Benefits Department or local Human Resources and has coverage through their employer, you may add them Representative. to the Retiree Medical coverage under Signature Select within 31 days of their retirement date, as long as they were a covered Your Rights Under the Family and Medical Leave Act (FMLA) eligible dependent upon your retirement. If you die during this deferral period, your spouse may be eligible for Retiree Medical If you are eligible for unpaid leave and benefits under the terms of coverage under Signature Select provided your spouse enrolls the Family and Medical Leave Act of 1993, as amended (FMLA), within 31 days of the date of your death. you have the right to continue your Medical, Dental, Vision Care, and/or the Health Care Flexible Spending Account coverage for up Contributions for coverage under this special provision are to 12 weeks during a 12-month period. explained in Chapter 1A, Medical Coverage During Retirement, of this SPD. Contributions made by you and any participating employer are required and may be made through direct billing from the Company. You are responsible for making payments on or before Your Rights Under USERRA the due date; otherwise your coverage will terminate. If coverage This is a general summary of the Uniformed Services Employment under the Plan terminates during an approved FMLA leave and and Reemployment Rights Act of 1994 (“USERRA”) and how it you return to active service immediately upon completion of that affects the Plan. USERRA requires that if your coverage would leave, the previous coverage (if still available under the Plan) will otherwise end because of your absence to perform military be reinstated effective on the date you return, and any required service, you may elect to continue coverage (including dependent contributions will resume. In addition, certain coverages that coverage) in accordance with the provisions of USERRA. are not continued during FMLA leave may be reinstated on your If active employment ends because of your absence to perform return, and any required contributions will resume. military service, coverage may be continued until the earliest of: If you fail to return from an FMLA leave, you may be required to • The date the Plan is terminated repay any contributions paid by the Company on your behalf during an unpaid leave. This repayment will be required only if your • The end of the period for which contributions have been made if failure to return from such leave is not related to a serious health you fail to make timely payment of the required contribution condition, as defined in FMLA, or events beyond your control. • The date 24 months after the date you begin your absence to Contact your Benefits Department or local Human Resources perform military service Representative for more information. • The date after the day in which you fail to return to active employment or apply for reemployment with the employer within the time periods required by USERRA The continuation provision will be in addition to any other continuation provisions described in the Plan for sickness, injury, layoff, or approved leave of absence, if any.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-13 PLAN IDENTIFICATION

Name of Plan: Bertelsmann Employee Protection Plan (“Signature Select”)

Plan Number: 503

Type of Plan: Welfare Plan with IRS Section 125 arrangement

Type of Administration: Insurer or Third-Party Administrator (based on funding arrangement)

Plan Sponsor: Bertelsmann, Inc. c/o Corporate Benefits Department 1745 Broadway 14th Floor New York, NY 10019

Employer Identification Number: 95-2949493

Plan Year: January 1 through December 31

Plan Administrator: Welfare Benefit Plan Committee c/o Corporate Benefits Department Bertelsmann, Inc. 1745 Broadway, 14th Floor New York, NY 10019

Agent for Service of Legal Process: Chief Legal Counsel c/o Bertelsmann, Inc. 1745 Broadway, 20th Floor New York, NY 10019 Service of legal process may also be made upon the Plan Administrator.

Plan Funding: Insurance Policies, Company General Assets, and Employee Contributions

GENERAL & ADMINISTRATIVE INFORMATION | Intro-14 PLAN INSURERS/CLAIM ADMINISTRATORS

Medical Life Insurance (Employee and Dependent)

Anthem BlueCross BlueShield Voya Financial PO Box 105187 P.O. Box 20 Atlanta, GA 30348-5187 Route 7812 1-855-702-1127 Minneapolis, MN 55440 Group # 3330119 855-663-8692 www.anthem.com Policy # 681491 www.voya.com Express Scripts (Prescription Drug Coverage) 1 Express Way Accidental Death & Dismemberment St. Louis, MO 63121 1-800-711-0917 Voya Financial Group # 2680 P.O. Box 20 Contract ID – Coral Graphics – CoralG21 Route 7812 Contract ID – Berryville Graphics – BerryG11 Minneapolis, MN 55440 Contract ID – Dynamic Graphics – Dynami23 855-663-8692 www.express-scripts.com Policy # 681491 www.voya.com Health Advocate, Inc. 3043 Walton Road Business Travel Accident Suite 150 Plymouth Meeting, PA 19462 CIGNA Life Insurance Company of New York 1-866-695-8622 140 East 45th Street www.healthadvocate.net New York, NY 10017 1-800-362-4462 Dental Policy # ABL 651709 www.CIGNA.com Delta Dental of New York One Delta Drive Health Care and Dependent Care Flexible Mechanicsburg, PA 17055 1-800-932-0783 Spending Accounts Group # - Coral Graphics - 02165 Group # - Berryville Graphics - 01523 PayFlex Systems USA, Inc. Group # - Dynamic Graphics - 04382 Flex Dept. P.O. Box 3039 www.deltadentalins.com Omaha, NE 68103-3039 1-800-284-4885 Vision Care www.healthhub.com

United Healthcare Vision P.O. Box 30978 COBRA Administrator Salt Lake City, UT 84130 1-800-638-3120 WageWorks, Inc. Policy # 704082 P.O. Box 14055 Lexington, KY 40512 www.myuhcvision.com 1-877-502-6272 www.wageworks.com Disability Income

CIGNA Life Insurance Company of New York 1600 West Carson Street, Suite 300 Pittsburgh, PA 15219 1-800-362-4462 Policy # STD – SHY800501 / LTD – NYK980002 Note: Mailing addresses for Evidence of Insurability (EOI) forms vary. www.CIGNA.com

GENERAL & ADMINISTRATIVE INFORMATION | Intro-15 PLAN DOCUMENTS

This SPD describes the key features of Signature Select (as This SPD does not cover all Plan details. The full terms and part of the Bertelsmann, Inc. Employee Protection Plan) as conditions of the Plan are provided in the Plan Document, which applicable to employees of BE Printers America. Separate SPDs includes relevant insurance policies and supplemental documents. are distributed to employees of other Bertelsmann companies that The Plan Document legally governs the operations of the Plan. participate in Signature Select, describing the specific provisions In the event that the content of this SPD, or any oral or written that are applicable to them. representation made by any person regarding the Plan, conflicts or The language used in this SPD is not intended to create, nor is it is consistent with any provisions of the applicable Plan Document, to be construed to create, a contract between the Company (or the provisions of the applicable Plan Document (including any any other participating company) and any one of its employees or related insurance contract(s)) are controlling and will govern. former employees. Copies of the Plan Document, as well as the Summary Annual Reports of plan operations filed with the Internal Revenue Service, are available for review during normal business hours at your Benefits Department or local Human Resources Office.

PLAN ADMINISTRATION

The Plan is administered by the Welfare Benefit Plan Committee • Execute an agreement provided by the Claims Administrator (the “Committee”), which is referred to in this document as acknowledging the Plan’s right of recovery, agreeing to repay the Plan Administrator. The Plan Administrator may allocate or any claims paid by the Plan, pledging amounts recovered by the delegate certain functions as it deems appropriate, but the Plan Covered Individual from the third party as security for repayment Administrator retains the sole and final discretion and authority to of any claims paid by the Plan, and to the extent provided determine eligibility for participation and to interpret the provisions below, assigning the Covered Individual’s cause of action or of the Plan and this SPD. The decisions of the Plan Administrator other right of recovery to the Plan. If the Covered Individual or its delegate are final and binding. References in this SPD to fails to execute such an agreement, by filing claims (assigning “Plan Administrator” include any person(s) or entity(ies) to whom benefits or having claims filed on your behalf) related to such act the Plan Administrator has delegated its authority. of a third party, the Covered Individual shall be deemed to agree to the terms of this reimbursement provision; See the Plan Insurers/Claims Administrators section of this chapter for the names and addresses of the insurers and • Provide such information as the Claims Administrator may claims administrators, which are entities authorized to make request; certain discretionary determinations on whether a participant or • Notify the Claims Administrator in writing by copy of the beneficiary is entitled to a benefit. complaint or other pleading of the commencement of any action by the Covered Individual to recover damages from a third Right of Recovery party; This section describes the Plan’s right to seek reimbursement • Agree to notify the Claims Administrator of any recovery. of expenses that are paid by the Plan on behalf of you or your The Plan’s right to recover the benefits it has paid is not subject to covered Dependents (referred to in this section as a “Covered reduction for attorney’s fees and other expenses of recovery. The Individual”) if those expenses are related to the acts of a third Plan’s right to recover benefits shall apply to the entire proceeds party (for example, if you are involved in an automobile accident). of any recovery by the Covered Individual. This includes any The Program may seek reimbursement of these expenses from recovery by judgment, settlement, arbitration award or otherwise. any recovery the Covered Individual may receive from the third The Plan’s right to recover shall not be limited by application party or another source, including from any insurance proceeds, of any statutory or common law “make whole” doctrine (i.e., settlement amounts or amounts recovered in a lawsuit. The terms the Plan has a right of first reimbursement out of any recovery, of the Plan’s reimbursement rights are described below: even if the Covered Individual is not fully compensated) or If a Covered Individual incurs expenses covered by the Plan as a the characterization of the nature or purpose of the amounts result of the act or omission of a third party (person or entity) you recovered or by the identity of the party from which recovery is may receive benefits pursuant to the terms of the Plan. However, obtained. the Covered Individual shall be required to refund to the Plan all The Plan shall have a lien against the proceeds of any recovery benefits paid if the Covered Individual recovers from any other by the Covered Individual and against future benefits due under party (such as proceeds from a settlement, judgment, lawsuit or the Plan in the amount of any claims paid. The lien shall attach as otherwise as a result of the act). The Covered Individual may be soon as any person or entity agrees to pay any money to or on required to: behalf of any Covered Individual that could be subject to the Plan’s right of recovery if and when received by the Covered Individual. If the Covered Individual fails to repay the Plan from the proceeds

GENERAL & ADMINISTRATIVE INFORMATION | Intro-16 of any recovery, the Plan Administrator may satisfy the lien by to the Plan by the person for whom the payments were made deducting the amount from future claims otherwise payable under (you or a beneficiary) or from any other insurance company or the Plan. organization through voluntary payments, legal action, or by an offset of future benefits equal to the amount of the overpayment. If the Covered Individual fails to take action against a responsible third party to recover damages within one year or within 30 The Plan Administrator may delegate these functions to a third days after the Plan requests, the Plan shall be deemed to have party. acquired, by assignment or subrogation, a portion of the Covered Individual’s claim equal to the amounts the Plan has paid on the Limitation of Action Covered Individual’s behalf. The Plan may thereafter commence You must follow the claim and appeal procedure carefully and proceedings directly against any responsible third party. The completely and you must file your claim before the deadlines Plan shall not be deemed to waive its rights to commence action explained above. If you do not do so, you will give up important against a third party if it fails to act after the expiration of one year legal rights. nor shall the Plan’s failure to act be deemed a waiver or discharge of the lien described above. You must submit your claim for benefits within one (1) year after the earlier of the date on which you were denied benefits or The Covered Individual shall cooperate fully with the Plan in received benefits at a different level than you believed the Plan asserting claims against a responsible third party and such provides. After you file your claim, you must complete the entire cooperation shall include, where requested, the filing of suit by the claim and review process before you can sue over your claim. It Covered Individual against a responsible third party and the giving is important that you include all the facts and arguments that you of testimony in any action filed by the Plan. If a Covered Individual want considered during the claim and appeal process. fails or refuses to cooperate in connection with the assertion of claims against a responsible third party, the Plan Administrator Any legal action to receive benefits must be filed the earlier of: may deny payment of claims and treat prior claims paid as • Six months from the date a determination is made under the overpayments recoverable by offset against future Plan benefits or Plan or should have been made in accordance with the Plan’s by other action of the Plan Administrator. claims review procedures, or In addition, the Plan has a right to recover benefits that were paid • One year from the date the service or treatment was provided or in error (e.g., benefits paid to an ineligible person), or benefits that the date the claim arose, whichever is earlier. were obtained through fraudulence, as determined by the Plan Your failure to file suit within this time limit results in the loss/waiver Administrator. Benefits may be recovered by either direct payment of your right to file suit.

CLAIMS DENIAL AND APPEAL

The following is a general description of the benefit claim • Provide participants with reasonable notification of their benefits review and appeal procedures for Signature Select health as may be approved or denied. and welfare benefits. To the extent it is inconsistent with the If your benefit claim results in an adverse benefit determination, in procedures described in a benefit-specific chapter of this SPD whole or in part, you’ll receive written notification from the Claim (or in an insurance company document), the procedures in the Administrator within the time frames noted below. The following benefit-specific chapter (or the insurance coverage document, if situations each constitute an “adverse benefit determination”: (1) applicable) will govern. The benefit-specific chapters of this SPD denial, reduction, or termination of a benefit; (2) failure to provide also contain additional information, such as instructions for filing or make payment (in whole or in part) for a benefit; or (3) rescission benefit claims. of health benefit coverage, whether or not the rescission has an A “benefit claim” is a claim for a particular benefit. It will typically adverse impact on any particular benefit at this time. include your initial request for benefits. An example of a benefit claim is a claim to receive coverage for a particular type of Timing of Benefit Claim Decisions surgery. For each type of Signature Select benefit, benefit claims Medical & Dental are handled by the entity serving as the Claim Administrator, which may be the insurer (for insured benefits) or a third-party See the Medical Plans and Dental Plans chapters. administrator (for non-insured benefits). Vision Care When you file a benefit claim, the Claim Administrator reviews the Notice of Claim Decision: Within a reasonable time, but not later claim and makes a decision to either approve or deny the claim. than 30 days after the Claim Administrator receives your claim. In this process, the Claim Administrator has the full discretionary Extension: Initial notification may be extended by up to 15 days authority to: if additional information is needed or an extension is necessary • Interpret relevant provisions of the Plan; due to matters beyond the control of the Plan. You’ll be notified • Determine whether claimed benefits are covered; before the end of the first 30-day period as to why the extension is necessary and when the Plan expects to make a decision. If • Approve or deny reimbursement requests and authorize the you failed to submit necessary information, the notice will specify payment of approved benefits; and

GENERAL & ADMINISTRATIVE INFORMATION | Intro-17 what information is necessary, and you’ll have at least 45 days to If Your Benefit Claim Is Denied provide it. If provided within the 45 days, the Claim Administrator If your claim for benefits is denied (or if your health coverage has will notify you of its decision within 15 days after the information is been rescinded), in whole or in part, you’ll receive a written notice received. If not received within 45 days, the claim is denied. that contains all of the following: • The specific reason(s) for the denial. For medical benefit claims, Health Care Flexible Spending Account the reason(s) will include any applicable denial code and its Notice of Claim Decision: Within a reasonable time, but not later corresponding meaning, as well as a description of the Plan’s than 30 days after the Plan receives your claim. (or the insurer’s) standard, if any, that was used in denying the Extension: Initial notification may be extended by up to 15 days claim. if additional information is needed or an extension is necessary • Reference to the specific Plan provision(s) on which the denial is due to matters beyond the control of the Plan. You’ll be notified based. before the end of the first 30-day period as to why the extension • For a health or disability benefit claim, if an internal rule, is necessary and when the Plan expects to make a decision. If guideline, protocol or other similar criterion was relied on to you failed to submit necessary information, the notice will specify determine the claim, you’ll receive either a copy of the actual what information is necessary, and you’ll have at least 45 days to rule, guideline, protocol or other criterion, or a statement that provide it. If provided within the 45 days, the Claims Administrator the rule, guideline, protocol or other criterion was used and how will notify you of its decision within 15 days after the information is you can request a copy free of charge. received. If not received within 45 days, the claim is denied. • A description of any additional material or information needed to Disability Income (Short-Term and Long-Term) perfect the claim and an explanation of why it’s necessary. Notice of Claim Decision: Within a reasonable time, but not later • An explanation of the Plan’s claim appeal procedures, than 45 days after the Claim Administrator receives your claim. applicable time limits and your rights to bring a civil action under ERISA section 502(a) following a final denial on your second Extension: Initial notification may be extended up to 30 days if an level appeal. extension is necessary due to matters beyond the control of the Plan. You’ll be notified before the end of the first 45-day period • For health or disability benefit claims, if the denial is based on a as to why the extension is necessary and when the Plan expects provision such as medical necessity, experimental treatment or to make a decision. Notification may be extended again up to a similar exclusion or limit, you’ll receive either an explanation of 30 days if an extension is necessary due to matters beyond the the scientific or clinical judgment for the determination based on control of the Plan. You’ll be notified before the end of the first 30- the Plan terms and your medical circumstances, or a statement day extension as to why the extension is necessary and when the that you can receive the explanation free of charge upon Plan expects to make a decision. If you failed to submit necessary request. information, the notice will specify what information is necessary, • For medical benefit claims (not applicable to Health Care and you’ll have at least 45 days to provide it. If an extension is Flexible Spending Accounts): (i) information sufficient to identify necessary because you failed to submit necessary information, the claim involved, including the date of service, the health care the days from the date the Claim Administrator sends you the provider, and the claim amount (if applicable), (ii) a statement extension notice until you respond to the request for additional describing the availability, upon request, of the diagnosis code, information are not counted as part of the claim determination the treatment code, and their corresponding meanings and period. (iii) a statement describing the availability of, and contact information for, any applicable office of health insurance Life Insurance, Accidental Death and Dismemberment consumer assistance or ombudsman established under the (AD&D) and Business Travel Accident (BTA) Insurance Affordable Care Act to assist individuals with the internal claims Notice of Claim Decision: Within a reasonable time, but not later and appeals and external review processes. than 90 days after the Claim Administrator receives your claim. • For health benefit claims involving an urgent care claim, an Extension: Initial notification may be extended up to 90 days if an explanation of the expedited claim review procedure. The Plan extension is necessary due to matters beyond the control of the may notify you by phone or fax and follow up with a written Plan. You’ll be notified before the end of the first 90-day period notice no later than three days after the notification. why the extension is necessary and when the Plan expects to make a decision.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-18 Filing an Appeal You, your beneficiary or your authorized representative may appeal a benefit claim decision by writing to your Claim Administrator. You must make your request for appeal in writing within the time limits shown below:

Type of Appeal Deadline for Filing an Appeal Request

Medical and Dental See Medical Plans and Dental Plans chapters

Vision Care and Health Care Flexible Spending Account 180 days of receipt of an adverse benefit determination

Disability Income 180 days of receipt of an adverse benefit determination

Life Insurance, AD&D and BTA 60 days of receipt of an adverse benefit determination

Dependent Care Flexible Spending Account 60 days of receipt of an adverse benefit determination

During the applicable time period, you or your authorized representative will be given reasonable access to all documents, records and information relevant to the claim for benefits, and you may receive a copy free of charge upon request. You can also submit to your Claim Administrator written comments, documents, records and other information relating to the claim for benefits. Review of your claim will take into account all comments, documents, records and other information, without regard to whether such information was submitted or considered in the initial benefit determination. If the appeal relates to a health care benefit (including Health Care • If the denial was based, in whole or in part, on a medical Flexible Spending Account), your request for appeal must include judgment, the person will consult with a health care professional the following: who has appropriate training and experience in the field involving the medical judgment. This health care professional • The patient’s name and the identifying Employee information cannot be the same person who made the initial decision of • The date of the medical service denial, nor a subordinate of the person. Medical or vocational • The doctor’s name experts who are consulted in the appeal process are identified in the final decision without regard to whether the advice was • The reason you believe the claim should be paid relied upon in making the appeal determination. • Any documentation or other written information to support your • For an urgent care appeal, there will be an expedited review request for claim payment process where you can submit, orally or in writing, a request for For Medical, Dental, Vision, Life Insurance/AD&D, and Disability review. Necessary information may be transmitted between you claims, the Claim Administrators are responsible for the appeals and the Plan by phone, fax or any other similarly expeditious review and determination. For Health Care Flexible Spending method. Account and Dependent Day Care Flexible Spending Account In addition, for an appeal of a medical benefit claim (not applicable claims, the Plan Administrator (or its designee) is responsible for to Health Care Flexible Spending Accounts): the appeals review and determination. • You will receive, free of charge, any new or additional evidence Appeal Decision considered, relied upon, or generated by the Plan (or the insurer) in connection with the claim. Such evidence will be provided The claim (and for any second level appeal of a medical claim, as soon as possible and sufficiently in advance of the date on the first level appeal) will be reviewed again and a decision which the notice of final internal adverse benefit determination made based on all comments, documents, records and other is provided in order to give you a reasonable opportunity to information you’ve submitted. For a health or disability benefit respond prior to that date. claim appeal: • Before the Plan (or the insurer) issues a final internal adverse • The appeal review (i) will not afford deference to the initial benefit determination based on a new or additional rationale, adverse benefit determination, and (ii) will be conducted by a you will receive the rationale, free of charge, as soon as possible person who is neither the original reviewer nor a subordinate of and sufficiently in advance of the date on which the notice of the original reviewer. internal adverse benefit determination is provided in order to give you a reasonable opportunity to respond prior to that date.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-19 Notification of Appeal Decision In most cases, you’ll receive the Claim Administrator’s written notification of the decision within the following time frames after the Claim Administrator receives your request for review:

Type of Benefit Claim Appeal Timing of Notification

Medical and Dental See Medical Plans and Dental Plans chapters

Vision Care A reasonable time, but not later than 60 days after the Plan receives the request for review provided

Health Care Flexible Spending Account A reasonable time, but not later than 60 days after the Plan receives the request for review. If necessary, the period may be extended for an additional 60 days.

Disability Income A reasonable time, but not later than 45 days after the Plan receives the request for review. If necessary, the period may be extended for an additional 45 days.

Life Insurance, AD&D, BTA and Dependent Day Care A reasonable time, but not later than 60 days after the Plan Flexible Spending Account receives the request for review. If necessary, the period may be extended for an additional 60 days.

If your appeal is denied, in whole or in part, you’ll receive a written • If an internal rule, guideline, protocol or other similar criterion notice that contains all of the following: was relied on to determine a claim, you’ll receive either a copy of the actual rule, guideline, protocol or other criterion, or a • The specific reasons for the denial. For medical benefit appeals statement that the rule, guideline, protocol or other criterion was (not applicable to Health Care Flexible Spending Accounts), used and how you can request a copy free of charge. the reason(s) will include: (i) any applicable denial code and its corresponding meaning, (ii) a description of the Plan’s (or the • If the denial is based on a provision such as medical necessity, insurer’s) standard, if any, that was used in denying the claim, experimental treatment, or a similar exclusion or limit, you’ll (iii) a discussion of the denial decision, and (iv) a statement receive either an explanation of the scientific or clinical judgment describing the availability of, and contact information for, any for the determination based on the Plan terms and your applicable office of health insurance consumer assistance or medical circumstances, or a statement that you can receive the ombudsman established under the Affordable Care Act to assist explanation free of charge upon request. individuals with the internal claims and appeals and external • A statement regarding how to look into other voluntary review processes. alternative dispute resolution options that may be available, such • For medical benefit appeals (not applicable to Health Care as mediation (e.g., by contacting the local U.S. Department of Flexible Spending Accounts), information sufficient to identify Labor office and the State insurance regulatory agency). the claim involved, including the date of service, the health Decisions by the Claim Administrators (including insurers) are care provide, the claim amount (if applicable), and a statement conclusive and binding. With limited exceptions, you must exhaust describing the availability, upon request, of the diagnosis code, these internal claims and appeal procedures before filing a civil the treatment code, and their corresponding meanings. action for benefits under Section 502(a) of ERISA. • A reference to the specific Plan provisions on which the denial is based. Benefit Claims vs. Eligibility Claims • A statement that you are entitled to receive, upon request and Questions or claims solely regarding eligibility to participate in the free of charge, access to and copies of all documents, records Plan (referred to here as “eligibility claims”) are not subject to the and other information relevant to the claim. above rules regarding claims and appeals. For eligibility claims, • A statement describing any additional appeal procedures the Plan Administrator (or such other person as designated by the under the Plan, your right to get information about such appeal Plan Administrator) is authorized to interpret the terms of the Plan procedures (if any), and your right to bring a civil action under and make determinations. For appeal of an eligibility claim that ERISA 501(a) (if applicable). has been denied, the Committee has reserved the authority to review and make its determination, which will be final and binding • For health or disability benefit appeals: on all persons. All eligibility claims and appeals of denied eligibility claims must be submitted in writing to the Human Resources Department with sufficient details explaining the claim or the appeal (as applicable). You will be notified of the eligibility claim determination in writing and within a reasonable period of time, which is usually not later than 60 days after receipt by the Human GENERAL & ADMINISTRATIVE INFORMATION | Intro-20 Resources Department of the written eligibility claim or appeal. CHANGING OR TERMINATING THE PLANS

The Plan has been established with the expectation that it will be continued indefinitely. Nevertheless, Bertelsmann, Inc., as the sponsor of the Plan, reserves the right to amend or terminate the Plan, in whole or in part, at any time in any manner. The right to amend or terminate the Plan applies to all coverage and benefits under this Plan for any individual. The decision to amend or terminate the Plans may be due to changes in federal or state laws, the requirements of the Internal Revenue Code or the Employee Retirement Income Security Act (ERISA) of 1974 or any other reason. A Plan change may involve current employees (whether active or inactive), former employees (including retirees), and/or their dependents. If the Plan is amended or terminated, coverage may be discontinued with or without the availability of any other arrangement or substitute coverage.

YOUR RIGHTS

Your rights under Signature Select are protected by laws such as Enforce your rights. If your claim for a welfare benefit is denied the Employee Retirement Income Security Act of 1974 (ERISA) and in whole or in part, you have a right to know why this was done, the Health Insurance Portability and Accountability Act of 1996 to obtain copies of documents relating to the decision without (HIPAA). charge, and to appeal any denial, all within certain time schedules. Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request a copy of Plan documents Your Rights Under ERISA or the latest annual reports from the Plan and do not receive them within 30 days, you may file suit in a federal court. In such The Plan is an employee welfare benefit plan covered by the a case, the court may require the Plan Administrator to provide Employee Retirement Income Security Act of 1974 (ERISA). As the materials and pay you up to $110 a day until you receive the a participant in the Plan, you have certain rights and protection materials, unless the materials were not sent because of reasons under ERISA. ERISA provides that, as a Plan participant, you are beyond the control of the Administrator. If you have a claim for entitled to… benefits which is denied or ignored in whole or in part, you may file Receive information about your Plan and benefits. You may suit in a state or federal court. In addition, if you disagree with the examine, without charge, at the Plan Administrator’s office and Plan’s decision or lack thereof concerning the qualified status of a at other specified locations such as work-sites, all documents domestic relations order or a medical child support order, you may governing the Plan, including insurance contracts and a copy file suit in federal court. If it should happen that Plan fiduciaries of the latest annual report (Form 5500 series) filed by the Plan misuse the Plan’s money, or if you are discriminated against for with the U.S. Department of Labor and available at the Public asserting your rights, you may seek assistance from the U.S. Disclosure Room of the Employee Benefit Security Administration. Department of Labor, or you may file suit in a federal court. The You may obtain, upon written request to the Plan Administrator, court will decide who should pay court costs and legal fees. If you copies of all documents governing the operation of the Plan, are successful, the court may order the person you have sued including insurance contracts and copies of the latest annual to pay these costs and fees. If you lose, the court may order you report (Form 5500 series) and updated summary plan description. to pay these costs and fees, for example, if it finds your claim is The Plan Administrator may make a reasonable charge for the frivolous. copies. You may receive a summary of the Plan’s annual financial Assistance with your questions. If you have any questions report. The Plan Administrator is required by law to furnish each about the Plan, you should contact the Plan Administrator. If you participant with a copy of this summary annual report. have any questions about this statement or about your rights Continue Group Health Plan coverage. You may continue under ERISA, or if you need assistance obtaining documents health care coverage for yourself, spouse or dependents if there from the Plan Administrator, you should contact the nearest is a loss of coverage under the Plan as a result of a qualifying office of the Employee Benefit Security Administration, U.S. event. You or your dependents will have to pay for such coverage. Department of Labor, listed in your telephone directory, or Division You should review this summary plan description for information of Technical Assistance and Inquiries, Employee Benefits Security concerning your COBRA continuation coverage rights. Administration, U.S. Department of Labor, 200 Constitution Prudent actions by Plan fiduciaries. In addition to creating Ave., N.W., Washington, D.C. 20210. You may also obtain certain rights for plan participants, ERISA imposes duties upon the people publications about your rights and responsibilities under ERISA by who are responsible for the operation of the employee benefit calling the publications hotline of the Employee Benefits Security plan. The people who operate your Plan, called “fiduciaries” of the Administration. Plan, have a duty to do so prudently and in the interest of the Plan participants and beneficiaries. No one, including your employer or any other person, may fire you or otherwise discriminate against you in any way to prevent you from obtaining a welfare benefit from the Plan, or from exercising your rights under ERISA.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-21 Your Rights Under WHCRA the HIPAA Privacy Rule, which is contained in the Code of Federal Regulations at 45 CFR Parts 160 and 164. Any terms that are If you have had or are going to have a mastectomy, you may not defined in this Notice have the same meaning as they have in be entitled to certain benefits under the Women’s Health and the HIPAA Privacy Rule. The HIPAA Privacy Rule supersedes any Cancer Rights Act of 1998 (WHCRA). For individuals receiving discrepancy between the information in this notice and the HIPAA mastectomy-related benefits, coverage will be provided in a Privacy Rule. The privacy laws of a particular state or other federal manner determined in consultation with the attending physician laws might impose a stricter privacy standard. If these stricter laws and the patient, for: apply and are not superseded by federal ERISA pre-emption, the Plan will comply with such laws. • All stages of reconstruction of the breast on which the mastectomy was performed; Uses and Disclosures of Protected Health Information • Surgery and reconstruction of the other breast to produce a symmetrical appearance; The Plan will not disclose your protected health information unless it is permitted or required to do so. The Plan may use and disclose • Prostheses; and protected health information for the Plan’s purpose of providing • Treatment of physical complications of the mastectomy, you with coverage under the health care components of the including lymphedemas. Plan. The main reason that the Plan will use and disclose your protected health information will be to evaluate and process any These benefits will be provided subject to the same deductibles request for coverage and claims for benefits under the Plan. The and coinsurance applicable to other medical and surgical Plan will not, however, disclose your protected health information benefits provided underSignature Select. If you would like more to any other entity for their use in marketing products to you. This information on WHCRA benefits, call your Benefits Department or section describes these and other uses of your protected health local Human Resources Representative. information, together with some examples. The Plan may disclose your protected health information without your authorization HIPAA Notice of Privacy Practices for the purposes described in this section, except that: (i) your authorization to disclose your protected health information may THIS NOTICE DESCRIBES HOW MEDICAL INFORMATION be required as described under the last two items in this section; ABOUT YOU MAY BE USED AND DISCLOSED AND HOW YOU and (ii) you may request a restriction on the disclosure of your CAN GET ACCESS TO THIS INFORMATION. PLEASE REVIEW IT protected health information as described in the third-to-last item CAREFULLY. described in this section. This Notice of Privacy Practices describes how the self-insured Payment, Treatment and Health Care Operations. The Plan has Medical, Dental, Employee Assistance Program, and Health Care the right to use and disclose your protected health information for Flexible Spending Account components of Signature Select may all activities that are included within the definitions of “payment,” use and disclose your protected health information, and describes “treatment” and “health care operations” in the HIPAA Privacy your rights with respect to such information. It does not apply Rule. to any insured health benefits, nor does it apply to any disability Payment. The Plan will use or disclose your protected health or life and dismemberment benefit. If you participate in a fully- information to fulfill its responsibilities for providing coverage and insured group health coverage (e.g. UHC Vision), you will receive a processing benefit claims under the Plan. For example, the Plan separate notice directly from the insurer. may disclose your protected health information when a provider Your “protected health information” includes your individually requests information regarding your eligibility for benefits under the identifiable information that is created or received by the Plan Plan, or it may use your information to determine if a treatment that and relates to: (i) your past, present or future physical or mental you received was medically necessary. health or condition; (ii) the provision of health care to you; or (iii) Treatment. The Plan may use and disclose your protected the past, present or future payment for the provision of health health information to assist your health care providers (doctors, care to you. Health information about you that the plan sponsor pharmacies, hospitals and others) in your diagnosis and (or a participating affiliate) creates or receives in its role as your treatment. For example, we may disclose information about your employer, however, is not protected health information. Thus, prior prescriptions to a pharmacist to help determine if a new information such as your sick leave records, Family and Medical prescription could cause health problems because it conflicts with Leave Act (FMLA) leave information, employment-related drug prior prescriptions. testing results, Workers Compensation files and OSHA records are not protected health information and not covered by this Notice. Health Care Operations. The Plan will use or disclose your protected health information to support the Plan’s related The Plan is required by law to maintain the privacy of your functions. These functions include, but are not limited to: quality protected health information and is required to provide you assessment and improvement, underwriting, reviewing provider with a copy of this notice under regulations implementing performance, case management, obtaining legal services, the Health Insurance Portability and Accountability Act and auditing. For example, the Plan may use or disclose your (“HIPAA“). This Notice sets forth the Plan’s legal duties and protected health information: (i) to provide you with information its privacy practices with respect to your protected health about a disease management program; (ii) to respond to a information, and describes your rights to access and control your customer service inquiry from you; (iii) in connection with fraud protected health information. The Plan must abide by the terms and abuse detection and compliance programs, or (iv) to of this Notice. This Notice has been drafted in accordance with

GENERAL & ADMINISTRATIVE INFORMATION | Intro-22 survey you concerning how effectively the Plan is providing a subpoena, a discovery request, or other lawful process. services, among other issues. HIPAA, however, prohibits any Abuse or Neglect. The Plan may disclose your protected health use or disclosure of protected health information that is genetic information to a government authority that is authorized by information for underwriting purposes. Genetic information means law to receive reports of abuse, neglect, or domestic violence. information about (1) your or your family members’ genetic tests, Additionally, as required by law, if the Plan believes you have (2) manifestation of a disease or disorder in your family members, been a victim of abuse, neglect, or domestic violence, it may or (3) your or your family members’ requests for, or receipt of, a disclose your protected health information to a governmental entity genetic test, counseling or education, or participation in clinical authorized to receive such information. research which includes such test, counseling or education. Law Enforcement. Under certain conditions, the Plan also may Business Associates. The Plan has various service providers – disclose your protected health information to law enforcement called business associates – who perform various functions on officials for law enforcement purposes. These law enforcement its behalf. For example, the Plan may have one or more service purposes include, for example, (1) responding to a court order providers who perform the administrative functions necessary to or similar process; (2) locating or identifying a suspect, fugitive, pay your medical claims. To perform these functions or to provide material witness, or missing person; or (3) providing information the services, business associates will receive, create, maintain, relating to the victim of a crime. use, or disclose protected health information, but only after the Plan and the business associate agree in writing to contract terms Coroners, Medical Examiners, and Funeral Directors. The requiring the business associate to appropriately safeguard your Plan may disclose protected health information to a coroner or information. medical examiner when necessary for identifying a deceased person or determining a cause of death, or for such other duties Other Covered Entities. The Plan may use or disclose your as authorized by law. The Plan also may disclose protected health protected health information to assist health care providers in information to funeral directors as necessary to carry out their connection with their treatment or payment activities, or to assist duties with respect to the decedent. other covered entities in connection with certain health care operations. For example, the Plan may disclose your protected Organ and Tissue Donation. The Plan may disclose protected health information to a health care provider when needed by the health information to organizations that handle organ, eye, or provider to render treatment to you, and the Plan may disclose tissue donation and transplantation. protected health information to another covered entity to conduct Research. The Plan may disclose your protected health health care operations in the areas of quality assurance and information to researchers when (1) their research has been improvement activities, or accreditation, certification, licensing, approved by an institutional review board that has reviewed or credentialing. This also means that the Plan may disclose or the research proposal and established protocols to ensure the share your protected health information with other health care privacy of your protected health information, or (2) the research programs or insurance carriers (such as Medicare) in order to involves a limited data set which includes no unique identifiers (i.e., coordinate benefits, if you or your family members have other information such as name, address, social security number, etc., health insurance or coverage. that can identify you). Required by Law. The Plan may use or disclose your protected To Prevent a Serious Threat to Health or Safety. Consistent health information to the extent required by federal, state, or local with applicable laws, the Plan may disclose your protected health law. information if disclosure is necessary to prevent or lessen a Public Health Activities. The Plan may use or disclose your serious and imminent threat to the health or safety of a person or protected health information for public health activities that the public. It also may disclose protected health information if it is are permitted or required by law. For example, it may use or necessary for law enforcement authorities to identify or apprehend disclose information for the purpose of preventing or controlling a an individual. communicable disease. Military. Under certain conditions, the Plan may disclose your Health Oversight Activities. The Plan may disclose your protected health information for activities deemed necessary by protected health information to a health oversight agency for appropriate military command authorities if you are or were in the activities authorized by law. For example, these oversight activities Armed Forces. If you are a member of a foreign military service, may include audits; investigations; inspections; licensure or the Plan may, in certain circumstances, disclose your information disciplinary actions; or civil, administrative, or criminal proceedings to the foreign military authority. or actions. Oversight agencies seeking this information include National Security and Protective Services. The Plan may government agencies that oversee the health care system, disclose your protected health information to authorized federal government benefit programs, other government regulatory officials for conducting national security and intelligence activities, programs, and government agencies that ensure compliance with and for the protection of the President, other authorized persons, civil rights laws. or heads of state. Lawsuits and Other Legal Proceedings. The Plan may disclose Inmates. If you are an inmate of a correctional institution or under your protected health information in the course of any judicial or the custody of a law enforcement official, the Plan may disclose administrative proceeding or in response to an order of a court or your protected health information to the correctional institution or administrative tribunal (to the extent such disclosure is expressly to a law enforcement official for: (1) the institution to provide health authorized by such order). If certain conditions are met, the Plan care to you; (2) your health and safety, and the health and safety of may also disclose your protected health information in response to others; or (3) the safety and security of the correctional institution.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-23 Workers’ Compensation. The Plan may disclose your protected Disclosures to the Plan Sponsor health information to comply with workers’ compensation laws The Plan may disclose your protected health information to the and other similar programs that provide benefits for work-related plan sponsor. For example, the Plan may inform the plan sponsor injuries or illnesses. that you are enrolled in the Plan because the plan sponsor Schools. The Plan may disclose proof of immunization to a performs some of the administrative functions necessary for the school where the school is legally required to obtain proof of an management and operation of the Plan, such as withholding the individual’s immunizations before admitting the individual as a employee’s share of premiums from an employee’s paycheck student, but only with the parent’s consent (or, if the student is old for any employee enrolled in the Plan. In addition, the Plan may enough, the student’s consent). disclose summary health information in the form of a limited data set (that is, a list of information that summarizes claims history, Disclosures to the Secretary of the U.S. Department of claims expenses or types of claims without identifying you) to Health and Human Services. The Plan is required to disclose the plan sponsor for purposes of health care operations, such as your protected health information to the Secretary of the U.S. for the purpose of conducting cost-management and planning- Department of Health and Human Services when the Secretary is related analyses related to managing and operating the Plan. investigating or determining the Plan’s compliance with the HIPAA Privacy Rule. Other Uses and Disclosures of Your Protected Health Disclosures to Others Involved in Your Health Care. The Information Plan may disclose your protected health information to a friend or family member that is involved in your health care, unless you Psychotherapy Notes. The Plan must obtain your authorization request a restriction in accordance with the process described for any use or disclosure of psychotherapy notes, except in below under “Right to Request Restrictions.” The Plan also may cases of (1) use by the originator of the psychotherapy notes disclose your information to an entity assisting in a disaster relief for treatment, (2) use or disclosure by the Plan to defend itself effort so that your family can be notified about your condition, in a legal action or other proceeding brought by you, (3) use or status, and location. If you are not present or able to agree to disclosure when required for government audits or when required these disclosures of your protected health information, then the by law, (4) use or disclosure for health oversight activities regarding Plan may determine whether the disclosure is in your best interest. the originator of the psychotherapy notes, (5) disclosure to Unless you inform the Plan otherwise before your death, the Plan coroners or medical examiners, or (6) use or disclosure to avert a may disclose protected health information about you to your serious threat to health or safety. family members, other relatives or close personal friends to the Marketing. The Plan must obtain your authorization for any extent relevant to such person’s involvement, prior to your death, use or disclosure of your protected health information to make in your care or payment for health care. To protect those who a communication promoting a product or service, except for depend on others to exercise their rights under the HIPAA Privacy communications in the form of (1) any face-to-face communication Rules, the Plan may, in certain circumstances, deny a friend or the Plan has with you or (2) a promotional gift of nominal value family member that is involved in your health care access to your that the Plan provides. If marketing involves the Plan’s receipt of protected health information. any payment from or on behalf of a third party whose product or Disclosures to You. The Plan is required to disclose to you service is being described, the authorization will state that such or your personal representative most of your protected health payment is involved. information when you request access to this information. The Plan Sale of PHI. The Plan must obtain your authorization before any will disclose your protected health information to an individual who sale of protected health information, and such an authorization has been designated by you as your personal representative and will state that the disclosure will result in the Plan’s receipt of who has qualified for such designation in accordance with relevant remuneration. It is not considered a sale of protected health law. Your personal representative will be required to produce information, however, if the disclosure is required by law or is for evidence of his or her authority to act on your behalf before that purposes of (1) a sale, transfer, merger or consolidation of all or person will be given access to your protected health information part of the Plan with or into another HIPAA-covered entity, (2) or allowed to take any action for you. Proof of such authority the Plan’s subcontractors (or others on their behalf) performing may take any of the following forms, or such other form as the legitimate services and receiving payment from the Plan only for Plan determines is appropriate under the circumstances: (1) the the performance of such services, or (3) for any other purpose person provides a power of attorney for health care purposes permitted by the HIPAA privacy rule where the only remuneration that is notarized by a notary public; or (2) the person provides a the Plan (or its business associates) receives is a reasonable court order appointing himself or herself as your conservator or cost-based fee for preparing and transmitting the protected health guardian. A person who is the parent or legal guardian of a minor information or such other fee expressly permitted by law. child or legally-incompetent child will be deemed to have authority Any other uses and disclosures of your protected health to access the child’s protected health information and to take any information that are not described in this Notice will be made action for such child. The Plan may elect not to treat the person only with your written authorization. For example, if you ask as your personal representative if it has a reasonable belief that your local Human Resources Representative and/or advocacy you have been, or may be, subjected to domestic violence, abuse, service to assist you in obtaining benefits under the Plan, you or neglect by such person; treating such person as your personal must complete and sign an authorization and give it to your local representative could endanger you; or the Plan determines that Human Resources Representative and/or advocacy service before it is not in your best interest to treat the person as your personal the Plan will disclose your protected health information to the representative. Human Resources Representative and/or advocacy service; if you GENERAL & ADMINISTRATIVE INFORMATION | Intro-24 do not sign an authorization in this situation, the Plan will not be health information in a manner inconsistent with your instructions able to disclose any of your protected health information to the would put you in danger. The Plan will accommodate a request Human Resources Representative and/or advocacy service and, for confidential communications that is reasonable and that therefore, the Human Resources Representative and/or advocacy states that the disclosure of all or part of your protected health service may not be able to provide you with effective assistance. information could endanger you. If you provide the Plan with an authorization, you may revoke Right to Request Access. You or your personal representative the authorization in writing, and this revocation will be effective has the right to inspect and copy your protected health information for future uses and disclosures of protected health information. in a “Designated Record Set” if you believe that information is However, the revocation will not be effective for information that incorrect or incomplete. A “Designated Record Set” includes the Plan has used or disclosed in reliance on the authorization. enrollment, payment, billing, claims adjudication and case or To the extent the authorization was obtained as a condition of medical management record systems maintained by or for the obtaining insurance coverage, other law may provide the insurer Plan. Information that is used for quality control or peer review with the right to contest a claim under the policy or the policy itself. analyses, that is not used to make decisions about an individual, is not included as part of the Designated Record Set. If you want Contacting You to inspect and/or copy this information, your request must be The Plan (or its health insurance issuers or third-party submitted in writing using the Contact Information at the end of administrators) may contact you about treatment alternatives or this Notice. other health benefits or services that might be of interest to you. Please note that, under federal law, you may not inspect or copy the following records that are created or received by the Your Rights Plan: psychotherapy notes; information compiled in reasonable The following is a description of each individual’s rights with anticipation of, or use in, a civil, criminal, or administrative action or respect to his or her protected health information. Each and proceeding; and protected health information that is subject to law every employee, retiree, spouse, and child who is over the age of that prohibits access to protected health information. majority and who is covered by the Plan has an independent right Your written request to inspect and copy your protected health to exercise the rights described in this section. information should be addressed to the person listed in the Right to Request a Restriction. You have the right to request Contact Information at the end of this Notice. If you request a restriction on the protected health information the Plan uses copies, the Plan will charge you a reasonable fee to copy your or discloses about you for payment or health care operations. protected health information, as well as postage if you request that You also have a right to request a limit on disclosures of your copies be mailed to you or your personal representative. protected health information to family members or friends who You have a right to receive electronic copies of your protected are involved in your care or the payment for your care. If you want health information in a Designated Record Set, but only to the to request such a restriction, your request must be submitted in extent it is electronically maintained. writing using the Contact Information at the end of this Notice. If you request access to protected health information and that While the Plan will consider your request, the Plan is not required access is denied, in some, but not all, circumstances, you may to agree to any restriction that you request, except for requests have a right to have the decision to deny access reviewed. relating to protected health information that pertains solely to The review will be conducted by an individual chosen by a a health care item or service that you (or others, other than the representative of the Plan who was not involved in the decision to Plan, on your behalf) paid for in full out-of-pocket. In addition, deny your request to access the information. the Plan will not agree to restrictions on the use or disclosure of protected health information if such use or disclosure is legally Right to Request an Amendment. You have the right to request required, or is necessary to administer the Plan. If the Plan agrees an amendment of your protected health information held by the to the restriction on the use or disclosure of your protected Plan in a Designated Record Set. If you request an amendment health information, it can stop complying with the restriction of your protected health information, your request must be upon providing notice to you. Your request must describe (i) the submitted in writing using the Contact Information at the end of protected health information you wish to limit, (ii) whether you want this Notice, and must set forth one or more reasons in support of to limit the Plan’s use, disclosure, or both, and (iii) if applicable, to the proposed amendment. whom you want the limitations to apply (for example, restricting The Plan has 60 days after your request to amend your protected disclosures to your spouse). health information to act on the request, except that an additional Right to Request Confidential Communications. If you believe 30-day period is allowed if the Plan is unable to comply with your that a disclosure of all or part of your protected health information request within the initial 60-day period and the Plan gives you a may endanger you, you may request that the Plan communicate written statement of the reasons for the delay and the date by with you in an alternative manner or at an alternative location. which the Plan will make a decision on your request. For example, you may ask that all communications be sent to In certain cases, the Plan may deny your request for an your work address. If you request confidential communications, amendment. For example, the Plan may deny your request if the your request must be submitted in writing using the Contact information you want to amend is accurate and complete or was Information at the end of this Notice. Your request must specify not created by the Plan. If the Plan denies your request, you have the alternative means or location for communication with you. It the right to file a statement of disagreement. Your statement of also must state that the disclosure of all or part of the protected disagreement will be linked with the disputed information and all

GENERAL & ADMINISTRATIVE INFORMATION | Intro-25 future disclosures of the disputed information will include your Complaints statement. If you believe the Plan has violated your privacy rights, you may Right to Request an Accounting. You have the right to request complain to the Plan or to the Secretary of the U.S. Department an accounting of certain disclosures the Plan has made of of Health and Human Services. You may file a complaint with the your protected health information. The list of disclosures will Plan using the Contact Information at the end of this Notice. The not include, among other disclosures, disclosures made for Plan will not penalize you for filing a complaint. treatment, payment, health care operations, for purposes of national security, to law enforcement or to corrections personnel, Changes to This Notice pursuant to your authorization or directly to you. If you request an The Plan reserves the right to change the provisions of this Notice accounting, your request must be submitted in writing using the and make the new provisions effective for all protected health Contact Information at the end of this Notice. You can request an information that it maintains. If the Plan makes a material change accounting of disclosures made up to six years prior to the date of to this Notice, it will provide a revised Notice to you by e-mail if you your request. Your request must state the time period from which are a current employee who has agreed to electronic notification, you want to receive a list of disclosures. You are entitled to one by distribution of a paper copy at your workplace, or by mail to the accounting free of charge during a 12-month period. There will be address that the Plan has on record for you. a charge to cover the Plan’s costs for additional requests within that 12-month period. The Plan will notify you of the cost involved Effective Date and you may choose to withdraw or modify your request before any costs are incurred. The Plan has 60 days after your request This Notice of Privacy Practices is effective as of September 23, for an accounting to act on the request, except that an additional 2013. 30-day period is allowed if the Plan is unable to comply with your request within the initial 60-day period and the Plan gives you a Contact Information written statement of the reasons for the delay and the date by If you (i) have any questions or want additional information about which the accounting will be provided. this Notice, the policies and procedures described in the Notice, Right to Designate a Personal Representative. You have (ii) want to exercise any of the rights described in this Notice, or (iii) the right to request that the Plan disclose your protected file a complaint, please contact: health information to your personal representative. “Personal Privacy Official representative” is an individual you designate to act on your Bertelsmann Employee Protection Plan behalf and make decisions about your medical care. If you want HIPAA Privacy Officer the Plan to disclose your protected health information to your 1745 Broadway 14th Floor personal representative, submit a written statement giving the Plan New York, NY 10019 permission to release your protected health information to your personal representative and documentation that this individual qualifies as your personal representative under state law, such as a power of attorney authorizing the individual to make health care decisions for you. Right to a Paper Copy of This Notice. If you have received this notice electronically, you have the right to a paper copy of this Notice. The simplest way to obtain a paper copy of this Notice is to print a copy of this Notice on your local or network printer. You may also obtain a paper copy of this notice by calling the Privacy Official at the contact address listed below.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-26 INDEPENDENT CONTRACTORS

Any person who is classified by the Company as an independent contractor shall not be eligible for coverage underSignature Select. In the event that any court or government agency judgment determines that such person is, in fact (or by common law), an employee of the Company (rather than an independent contractor), that person will become eligible for coverage under Signature Select on and after the date such judgment is issued or, if later, the date on which the Company actually begins to withhold federal income taxes from pay.

EMPLOYMENT AT WILL

Participation in Signature Select does not create or imply an employment contract with the Company or any participating affiliate.

The following sections contain summaries describing the key features of Signature Select. These summaries do not cover all details. The full terms and conditions of the Plan are provided in the Plan Document and Contracts.

GENERAL & ADMINISTRATIVE INFORMATION | Intro-27 CHAPTER 1

Medical Plans CONTENTS

...... Page

Highlights Of Signature Select Medical Plan Options ...... 1-1

The Signature Select Medical Plans ...... 1-2

• Introduction...... 1-2

• National EPO or PPO Plans...... 1-2

How the Plans Work...... 1-2

• Deductible...... 1-2

• Out-of-Pocket Maximum...... 1-2

• Maximum Allowed Amount...... 1-3

• How the Anthem BlueCross BlueShield HDHP EPO Plan Works ...... 1-4

• How the Anthem BlueCross BlueShield High EPO Plan Works ...... 1-4

• How the Anthem BlueCross BlueShield PPO Plan Works ...... 1-5

• Finding a Network Provider...... 1-6

• Pre-certification...... 1-6

What the Plans Cover...... 1-6

• Covered Services...... 1-6

What the Plans Do Not Cover...... 1-15

Prescription Drug Coverage...... 1-19

• How It Works...... 1-19

• Mail Order Service...... 1-20

• What is Not Covered Under Prescription Drug Coverage...... 1-21

Health Advocate...... 1-21

Appealing Claims...... 1-21

• Filing Health Claims Under the Plan ...... 1-21

Other Important Information...... 1-24

• Patient Protection Notices...... 1-24

MEDICAL PLANS HIGHLIGHTS OF THE SIGNATURE SELECT MEDICAL PLAN OPTIONS

HDHP EPO HIGH EPO PPO PLAN PLAN PLAN

In-network In-network In-network Out-of- Only Only network

Annual deductible • Employee $3,000 $375 $1,000 $2,000 • Employee + 1 dependent or more dependents $6,000 $750 $2,000 $4,000

Office visits 60% after • Preventive (wellness) 100% 100% 100% deductible

• PCP, including outpatient mental health care, 80% after $20 co-pay $40 co-pay 60% after convenience care clinics, non-preventive lab deductible deductible

• Specialist 80% after $35 co-pay $40 co-pay 60% after deductible deductible

Hospital stays 80% after 80% after 80% after 60% after deductible deductible deductible deductible (including inpatient mental health care)

Emergency room 80% after 100% after 100% after 100% after deductible $100 co-pay $200 co-pay $200 co-pay per visit* per visit* per visit*

Urgent care 80% after 100% after 100% after 60%, after deductible $35 co-pay $100 co-pay deductible per visit per visit

Infertility treatments Not Covered Not Covered Not Covered Not Covered

Annual Chiropractic Care 80% after 100% after 100% after 60%, after deductible $35 co-pay $40 co-pay deductible (up to 30 visits per year) per visit** per visit**

Out-of-Pocket Maximum (includes co-pays, deductible and coinsurance) • Employee $4,350 $2,500 $2,500 $3,500

• Employee + 1 or more dependents $7,000 $5,000 $5,000 $7,000

Prescription drugs Provided through Express Scripts. See page 1-19.

* Co-pay waived if admitted within 24 hours ** Co-pay waived if applied same day, same provider

MEDICAL PLANS | 1-1 THE SIGNATURE SELECT MEDICAL PLAN OPTIONS

Introduction National EPO or PPO Plan Options

When it comes to benefits, everyone has different needs. The Three medical plan options are available nationally: a High Signature Select Benefits program gives you the opportunity to Deductible Health Plan (HDHP) Exclusive Provider Organization select medical coverage that best meets your needs and those of (EPO) Plan, a High EPO Plan and a Preferred Provider your family. Organization (PPO) Plan. Coverage is provided by Anthem BlueCross BlueShield. Your Plan choices vary by: • Benefit levels Both the EPO plan options cover in-network care only and when • Degree of freedom you have in choosing medical providers you use in-network providers, you pay less in out-of-pocket costs • Premium cost and your contribution toward the cost (both since the rates the providers charge are pre-negotiated with the deductions from your paycheck and out-of-pocket costs) insurance carrier. Regardless of which medical plan option you choose, preventive The PPO plan provides both in- and out-of-network care, but you services with in-network providers are covered at 100%. will pay a higher deductible and a higher coinsurance rate when you see out-of-network providers. This is because your costs are You also have the choice to decline medical coverage. If you based on actual charges, instead of lower, negotiated rates. decline medical coverage, you will not be able to make changes to this election until the next annual enrollment This SPD provides a general summary of the benefits provided period unless you have a qualified change in status during under each medical plan option. For additional information, you the year. Qualified changes in status are described in the General may call Anthem BlueCross BlueShield at 1-855-702-1127 or visit and Administrative Information chapter. www.anthem.com.

HOW THE PLANS WORK

When you have a medical care expense, your Plan pays a percentage of the total cost. The percentage is based on the type of service you or your covered dependents receive, the medical plan option you are enrolled in, whether the provider is in or out of the network and whether or not Maximum Allowed Amount charges apply (see page 1-3 for more detail on Maximum Allowed Amount). Certain procedures must be followed in order to obtain benefits for your care, such as pre-certification and obtaining emergency or urgent care services, depending on the plan.

Deductible Out-Of-Pocket Maximum

A deductible will apply for most services. The plans limit the amount you’ll pay each year. This is called your out-of-pocket maximum, which prevents you from incurring Individual Deductible - When medical services (other than when excessive costs in any year when your medical expenses are a co-pay applies) are performed by in-network or out-of-network high. The out-of-pocket maximum is based on the plan and the providers, you and your dependent(s) are required to meet an coverage level you choose. Your out-of-pocket maximum includes individual deductible before the Medical Plan pays any benefits. your coinsurance, deductibles and any co-pays. Once you reach To meet the individual deductible, you or your dependent must this limit, the Plan pays all remaining expenses for the rest of the incur eligible expenses in a calendar year (January 1 through calendar year at 100%, except for out-of-network claims under the December 31), which are at least equal to the individual deductible PPO Plan, which are subject to Maximum Allowed Amount fees amount. The Medical Plan then pays the applicable percentage (the amounts that the Plan determines are the normal range of of eligible expenses (in excess of the deductible) incurred by that payment for a specific health-related service or medical procedure individual during the remainder of the calendar year. in a given area). Family Deductible - When you or your covered family members Family Out-of-Pocket Limit – If two or more covered family incur eligible expenses (other than when a co-pay applies) members incur out-of-pocket expenses in the same calendar performed by in-network or out-of-network providers and your year and such out-of-pocket expenses equal or exceed the combined deductible expenses equal or exceed the applicable family out-of-pocket limit, the out-of-pocket limit will be met for all family deductible amount, the deductible will be met for all covered family members for the remainder of the calendar year. covered family members for the remainder of the calendar year. In determining if the family out-of-pocket limit has been satisfied, No participant will pay more than the individual deductible. In only eligible expenses that have been applied toward the individual determining if the family deductible has been satisfied, only out-of-pocket limit can be counted. eligible expenses that have been applied toward the individual The out-of-pocket limit does not apply to any expenses that are deductible(s) can be counted. not covered medical services under the Medical Plan (such as expenses that exceed Maximum Allowed Amount Charges). MEDICAL PLANS | 1-2 Maximum Allowed Amount An in-network provider is a provider who is in the managed network for this specific product or in a special Center of The medical plan options base payment on what is considered Excellence or other closely managed specialty network, or who to be a reasonable and customary charge for an expense, known has a participation contract with the Claims Administrator. For as the Maximum Allowed Amount. Reimbursement for services covered services performed by a network provider, the Maximum rendered by in-network and out-of-network providers is based on Allowed Amount for this Plan is the rate the provider has agreed the Maximum Allowed Amount for the covered service that you with the Claims Administrator to accept as reimbursement for receive. The Maximum Allowed Amount is the maximum amount the covered services. Because network providers have agreed to of reimbursement Anthem will allow for services and supplies: accept the Maximum Allowed Amount as payment in full for those covered services, they should not send you a bill or collect for • That meet our definition of covered services, to the extent such amounts above the Maximum Allowed Amount. However, you may services and supplies are covered under your Plan and are not receive a bill or be asked to pay all or a portion of the Maximum excluded; Allowed Amount to the extent you have not met your deductible • That are medically necessary; and or have a co-payment or coinsurance. Please call customer • That are provided in accordance with all applicable service for help in finding an in-network provider or visit preauthorization, utilization management or other requirements www.anthem.com. set forth in your Plan. Providers who have not signed any contract with the Claims You will be required to pay a portion of the Maximum Allowed Administrator and are not in any of the Claims Administrator’s Amount to the extent you have not met your deductible or have a networks are out-of-network providers, subject to BlueCross co-payment or coinsurance. In addition, when you receive covered BlueShield Association rules governing claims filed by certain services from an out-of-network provider, you may be responsible ancillary providers. for paying any difference between the Maximum Allowed Amount For covered services you receive from an out-of-network provider, and the provider’s actual charges. This amount can be significant. the Maximum Allowed Amount for this Plan will be one of the When you receive covered services from a provider, the Claims following as determined by the Claims Administrator: Administrator will, to the extent applicable, apply claim processing 1. An amount based on the Claims Administrator’s out-of-network rules to the claim submitted for those covered services. These provider fee schedule/rate, which the Claims Administrator has rules evaluate the claim information and, among other things, established in its discretion, and which the Claims Administrator determine the accuracy and appropriateness of the procedure and reserves the right to modify from time to time, after considering diagnosis codes included in the claim. Applying these rules may one or more of the following: reimbursement amounts affect the Claims Administrator’s determination of the Maximum accepted by like/similar providers contracted with the Claims Allowed Amount. The Claims Administrator’s application of these Administrator, reimbursement amounts paid by the Centers rules does not mean that the covered services you received for Medicare and Medicaid Services for the same services or were not medically necessary. It means the Claims Administrator supplies, and other industry cost, reimbursement and utilization has determined that the claim was submitted inconsistent with data; or procedure coding rules and/or reimbursement policies. For 2. An amount based on reimbursement or cost information from example, your provider may have submitted the claim using the Centers for Medicare and Medicaid Services (“CMS”). When several procedure codes when there is a single procedure code basing the Maximum Allowed amount upon the level or method that includes all of the procedures that were performed. When this of reimbursement used by CMS, the Administrator will update occurs, the Maximum Allowed Amount will be based on the single such information, which is unadjusted for geographic locality, no procedure code rather than a separate Maximum Allowed Amount less than annually; or for each billed code. 3. An amount based on information provided by a third-party Likewise, when multiple procedures are performed on the same vendor, which may reflect one or more of the following factors: day by the same physician or other healthcare professional, (1) the complexity or severity of treatment; (2) level of skill the Plan may reduce the Maximum Allowed Amounts for those and experience required for the treatment; or (3) comparable secondary and subsequent procedures because reimbursement providers’ fees and costs to deliver care; or at 100% of the Maximum Allowed Amount for those procedures would represent duplicative payment for components of the 4. An amount negotiated by the Claims Administrator or a primary procedure that may be considered incidental or inclusive. third-party vendor which has been agreed to by the provider. This may include rates for services coordinated through case Provider Network Status management; or The Maximum Allowed Amount may vary depending upon 5. An amount based on or derived from the total charges billed by whether the provider is an in-network provider or an out-of- the out-of-network provider. network provider. Providers who are not contracted for this product, but contracted for other products with the Claims Administrator are also considered out-of-network. For this Plan, the Maximum Allowed Amount for services from these providers will be one of the five methods shown above unless the contract between the Claims Administrator and that provider specifies a different amount.

MEDICAL PLANS | 1-3 Unlike in-network providers, out-of-network providers may send Customer service is also available to assist you in determining this you a bill and collect for the amount of the provider’s charge Plan’s Maximum Allowed Amount for a particular service from an that exceeds the Plan’s Maximum Allowed Amount. You are out-of-network provider. In order for the Claims Administrator to responsible for paying the difference between the Maximum assist you, you will need to obtain from your provider the specific Allowed Amount and the amount the provider charges. This procedure code(s) and diagnosis code(s) for the services the amount can be significant. Choosing a network provider will likely provider will render. You will also need to know the provider’s result in lower out of pocket costs to you. Please call customer charges to calculate your out-of-pocket responsibility. Although service for help in finding an in-network provider or visit the Claims customer service can assist you with this pre-service information, Administrator’s website at www.anthem.com. the final Maximum Allowed Amount for your claim will be based on the actual claim submitted by the provider.

HOW THE ANTHEM BLUECROSS BLUESHIELD HDHP EPO PLAN WORKS

The Anthem BlueCross BlueShield High Deductible Health Plan (HDHP) EPO Plan offers in-network benefits only. You do not need to select a Primary Care Physician (PCP), and you do not need a referral from your PCP to see another provider or specialist in the EPO network. However, your provider is responsible for coordinating all covered medical services. Except for emergency care, the EPO does not cover services received outside of the EPO network. The HDHP has a lower premium cost than the other medical plan options, but features a higher deductible and out-of-pocket maximum. • The HDHP EPO Plan covers in-network PCP and specialist office visits, in-network inpatient hospital expenses and most other covered medical services at 80%, after you meet an annual deductible of $3,000 for employee-only coverage and a $6,000 deductible for employee plus one or more dependents. • Your total out-of-pocket expenses are limited to $4,350 for employee-only coverage or $7,000 for employee plus one or more dependents. • In-network preventive care is covered at 100%. • Urgent care centers and emergency room visits are covered subject to the Maximum Allowed Amount. Urgent care centers provide medical care for urgent but not emergency care. If you need to use an emergency room or an urgent care center, the Plan pays 80% after you pay the deductible. • Co-pays, deductibles, and coinsurance are included in the out-of-pocket maximum. Prescription drug benefits have a separate out-of- pocket maximum and are provided through Express Scripts which is described in more detail under Prescription Drug Coverage. • To view an Anthem provider directory, visit www.anthem.com, or contact Anthem at 1-855-702-1127. (See page 1-6 for how to find a network provider.)

HOW THE ANTHEM BLUECROSS BLUESHIELD HIGH EPO PLAN WORKS

The Anthem BlueCross BlueShield High EPO Plan offers in-network benefits only. You do not need to select a PCP, and you do not need a referral from your PCP to see another provider or specialist in the EPO network. However, your provider is responsible for coordinating all covered medical services. Except for emergency care, the EPO does not cover services received outside of the EPO network. • The High EPO Plan covers in-network PCP visits at a $20 co-pay and specialist office visits at a $35 co-pay. In-network inpatient hospital expenses and most other covered medical services are covered at 80% after you meet an annual deductible of $375 for employee-only coverage and a $750 deductible for employee plus one or more dependents. • Your total out-of-pocket expenses are limited to $2,500 for employee-only coverage or $5,000 for employee plus one or more dependents. • In-network preventive care is covered at 100%. • Urgent care centers provide medical care for urgent but not emergency care. There is a $35 co-pay required for any urgent care visit. If you need to use an emergency room, a $100 co-pay applies. • Co-pays, deductibles, and coinsurance are included in the out-of-pocket maximum. Prescription drug benefits have a separate out-of- pocket maximum and are provided through Express Scripts which is described in more detail under Prescription Drug Coverage. • To view an Anthem provider directory, visit www.anthem.com, or contact Anthem at 1-855-702-1127. (See page 1-6 for how to find a network provider.)

MEDICAL PLANS | 1-4 HOW THE ANTHEM BLUECROSS BLUESHIELD PPO PLAN WORKS

The Anthem BlueCross BlueShield PPO Plan offers a choice in providers you can visit. You can choose whether to go in-network or out- of-network each time you need care. When you stay in-network, you save money by using network providers who provide their services at negotiated rates. When you go out-of-network, you can visit any doctor or hospital you want, but you’ll pay a greater share of the cost. You do not need to select a PCP, and you do not need a referral from your PCP to see another provider or specialist in the PPO network.

In-Network Benefits To receive in-network benefits, you must visit a provider in Anthem PPO network. You do not have to select a PCP. You can visit any network provider. When you use an in-network provider, you lower your overall costs and avoid filing claims: • The PPO Plan covers in-network PCP and specialist office visits at a $40 co-pay. In-network inpatient hospital expenses and most other covered medical services are covered at 80% after you meet an annual deductible of $1,000 for employee-only coverage and a $2,000 deductible for employee plus one or more dependents. • Your total out-of-pocket expenses are limited to $2,500 for employee-only coverage or $5,000 for employee plus one or more dependents. • In-network preventive care is covered at 100%. • Urgent care centers provide medical care for urgent but not emergency care. There is a $100 co-pay required for any urgent care visit. If you need to use an emergency room, a $200 co-pay applies. • Co-pays, deductibles, and coinsurance are included in the out-of-pocket maximum. Prescription drug benefits have a separate out-of- pocket maximum and are provided through Express Scripts which is described in more detail under Prescription Drug Coverage.

Out-of-Network Benefits Under the Anthem PPO Plan, you can visit providers who do not participate in the network and still receive some level of coverage. However, you will pay more for covered medical services. • When you receive care from an out-of-network provider, you must first meet an annual deductible of $2,000 for employee-only coverage or a deductible of $4,000 for employee plus one or more dependents. Then, the Medical Plan pays 60% toward the cost of covered medical services (subject to Maximum Allowed Amount), and you pay the rest. • Out-of-network doctors can choose to directly bill you the amount over the Maximum Allowable Amount charges discussed in the next section. • If you need to use an emergency room, emergency room and physician services are covered at the in-network benefit level subject to the Maximum Allowable Amount. • Your total out-of-pocket expenses are limited to $3,500 for employee-only coverage or $7,000 for employee plus one or more dependents. • Co-pays, deductibles, and coinsurance are included in the out-of-pocket maximum. Prescription drug benefits have a separate out-of- pocket maximum and are provided through Express Scripts which is described in more detail under Prescription Drug Coverage.

When you receive out-of-network services: • You are responsible for filing claim forms for reimbursement and for contacting Anthem to notify them of hospital stays and certain outpatient procedures. • Call Anthem at the phone number shown on your ID card to notify them of these services.

Comparison of In-Network and Out-of-Network Benefits for Anthem PPO Plan

In-network Out-of-network Benefits A higher level of benefits means less cost to you. A lower level of benefits means a greater cost to you. Who should notify In general, network providers handle notification. You should notify the insurance company for certain the insurance However, there are exceptions when you should notify covered medical services. (See When to Notify company the insurance company for certain covered medical Anthem.) services. (See When to Notify Anthem.) Who should file Your network provider will file claims. The Medical Plan You must file claims for reimbursement from the claims pays the network provider directly. Medical Plan

MEDICAL PLANS | 1-5 FINDING A NETWORK PROVIDER

It is wise to choose network providers that meet the medical needs of you and your family. By choosing a network provider you will lower your out-of-pocket costs. If you enroll in an EPO plan, you must use in-network providers, except for an emergency room visit. You can contact Anthem to find a network provider by phone or via the Internet. • Call: 1-855-702-1127 • Go Online: Go to www.anthem.com and click “Find a Doctor.” Enter your provider’s name, specialty and zip code. Then search by plan by entering your state, Plan type/network (PPO) and Plan name (National PPO -- BlueCard PPO). There is one network of doctors for the EPO and PPO plan options.

Pre-Certification

Prior Authorization: Members are required to obtain prior pre-certification is needed for childbirth if inpatient stay exceeds authorization in order for you to receive benefits for certain 48 hours for normal delivery and 96 hours after a cesarean services. Prior authorization criteria will be based on multiple delivery. sources including medical policy, clinical guidelines, and pharmacy Pre-determination – An optional, voluntary prospective or and therapeutics guidelines. The Claims Administrator may concurrent request for a benefit coverage determination for determine that a service that was initially prescribed or requested a service or treatment. The Claims Administrator will review is not medically necessary if you have not previously tried your Plan to determine if there is an exclusion for the service or alternative treatments which are more cost effective. treatment. If there is a related clinical coverage guideline, the For a list of all services that require prior authorization or benefit coverage review will include a review to determine whether pre-certification, call the customer service telephone number on the service meets the definition of Medical Necessity under this your Identification Card or visitwww.anthem.com . Plan or is experimental/investigative as that term is defined in this Plan. Types of Requests: Post-Service Clinical Claims Review – A retrospective review Pre-certification – A required review of a service, treatment or for a benefit coverage determination to determine the medical admission for a benefit coverage determination which must be necessity or experimental/investigative nature of a service, obtained prior to the service, treatment or admission start date. treatment or admission that did not require pre-certification and For emergency admissions, you, your authorized representative or did not have a pre-determination review performed. Medical physician must notify the Claims Administrator within two calendar reviews occur for a service, treatment or admission in which the days after the admission. For childbirth admissions, Claims Administrator has a related clinical coverage guideline and are typically initiated by the Claims Administrator.

WHAT THE PLANS COVER

Many preventive and routine medical expenses as well as expenses incurred for a serious illness or injury are covered. Only expenses incurred for the services and supplies shown in this section are covered expenses. Limitations and exclusions may apply.

Covered Services

Ambulance Service Between a hospital and a Skilled Nursing Facility or other approved facility. Medically necessary ambulance services are a covered service when one or more of the following criteria are met: • For air or water ambulance, you are taken: From the scene of an accident or medical emergency to a • You are transported by a state-licensed vehicle that is designed, hospital; equipped, and used only to transport the sick and injured and staffed by Emergency Medical Technicians (EMT), paramedics, Between hospitals, including when the Claims Administrator or other certified medical professionals. This includes ground, requires you to move from an out-of-network hospital to a water, fixed wing, and rotary wing air transportation. network hospital; Between a hospital and an approved facility. • For ground ambulance, you are taken: From your home, the scene of an accident or medical Ambulance services are subject to medical necessity reviews emergency to a hospital; by the Claims Administrator. When using an air ambulance, the Claims Administrator reserves the right to select the air ambulance Between hospitals, including when the Claims Administrator provider. If you do not use the air ambulance provider the Claims requires you to move from an out-of-network hospital to a Administrator selects, the out-of-network provider may bill you for network hospital; any charges that exceed the Plan’s Maximum Allowed Amount. MEDICAL PLANS | 1-6 You must be taken to the nearest facility that can give care for your Residential Treatment condition. In certain cases the Claims Administrator may approve Benefits also include services for Substance Abuse Residential benefits for transportation to a facility that is not the nearest facility. Treatment which is specialized 24-hour care that occurs in a Benefits also include medically necessary treatment of a sickness licensed Residential Treatment Center (RTC) or intermediate or injury by medical professionals from an ambulance service, care facility. It offers individualized and intensive treatment in a even if you are not taken to a facility. residential setting and includes: • Observation and assessment by a psychiatrist weekly or more Important Notes on Air Ambulance Benefits frequently Benefits are only available for air ambulance when it is not • An individualized program of rehabilitation, therapy, appropriate to use a ground or water ambulance. For example, if education, and recreational or social activities in compliance using a ground ambulance would endanger your health and your with existing law medical condition requires a more rapid transport to a facility Residential treatment provides an intermediate-term approach to than the ground ambulance can provide, the Plan will cover the treatment that attempts to return the patient to the community. air ambulance. Air ambulance will also be covered if you are in an area that a ground or water ambulance cannot reach. Note: To be reimbursable, care must be given by a psychiatrist, psychologist, neuropsychologist, or a mid-level provider such Air ambulance will not be covered if you are taken to a hospital as a licensed clinical social worker, mental health clinical that is not an acute care hospital (such as a Skilled Nursing nurse specialist, a marriage and family therapist, or a licensed Facility), or if you are taken to a physician’s office or your home. professional counselor.

Hospital-to-Hospital Transport Breast Cancer Care If you are moving from one hospital to another, air ambulance will Covered services are provided for inpatient care following a only be covered if using a ground ambulance would endanger mastectomy or lymph node dissection until the completion of your health and if the hospital that first treats cannot give you an appropriate period of stay as determined by the attending the medical services you need. Certain specialized services are physician in consultation with the member. Follow-up visits are not available at all hospitals. For example, burn care, cardiac also included and may be conducted at home or at the physician’s care, trauma care, and critical care are only available at certain office as determined by the attending physician in consultation hospitals. To be covered, you must be taken to the closest with the member. hospital that can treat you. Coverage is not available for air ambulance transfers simply because you, your family, or your provider prefers a specific hospital or physician. Breast Reconstructive Surgery Covered services are provided following a mastectomy for Assistant Surgery reconstruction of the breast on which the mastectomy was performed, surgery and reconstruction of the other breast Services rendered by an assistant surgeon are covered based on to produce a symmetrical appearance, and prostheses and Medical Necessity. treatment of physical complications, including lymphedemas.

Behavioral Health Care and Substance Abuse Treatment Cardiac Rehabilitation Coverage for the diagnosis and treatment of Behavioral Health Cardiac rehabilitation is a program of multidisciplinary Care and Substance Abuse Treatment on an inpatient or interventions, designed to assist clinically suitable individuals outpatient basis will not be subject to deductibles or co-payment/ to attain and maintain their optimal level of functioning. Please coinsurance provisions that are less favorable than the deductibles contact Anthem Member Services for detailed information or co-payment/coinsurance provisions that apply to a physical regarding covered services. illness as covered under this benefit booklet.

Hospital Inpatient Care Clinical Trials Benefits for Inpatient hospital and physician charges are covered Benefits include coverage for services given to you as a services. participant in an approved clinical trial if the services are covered services under this Plan. An “approved clinical trial” means a Professional Outpatient Care phase I, phase II, phase III, or phase IV clinical trial that studies Covered services include: the prevention, detection, or treatment of cancer or other life- threatening conditions. The term life-threatening condition means • Professional care in the outpatient department of a hospital; any disease or condition from which death is likely unless the • Physician’s office visits; and disease or condition is treated. • Services within the lawful scope of practice of a licensed, approved provider.

MEDICAL PLANS | 1-7 Benefits are limited to the following trials: Consultation Services 1. Federally funded trials approved or funded by one of the Covered when the special skill and knowledge of a consulting following: physician is required for the diagnosis or treatment of an illness or injury. Second surgical opinion consultations are covered. a. The National Institutes of Health. Staff consultations required by hospital rules are excluded. b. The Centers for Disease Control and Prevention. Referrals, the transfer of a patient from one physician to another c. The Agency for Health Care Research and Quality. for treatment, are not consultations under this Plan. d. The Centers for Medicare & Medicaid Services. Dental Services e. Cooperative group or center of any of the entities described in (a) through (d) or the Department of Defense or the Related to Accidental Injury Department of Veterans Affairs. Your Plan includes benefits for dental work required for the initial f. A qualified non-governmental research entity identified in repair of an injury to the jaw, sound natural teeth, mouth or face the guidelines issued by the National Institutes of Health for which are required as a result of an accident and are not excessive center support grants. in scope, duration, or intensity to provide safe, adequate, and appropriate treatment without adversely affecting the member’s g. Any of the following in i-iii below if the study or investigation condition. Injury as a result of chewing or biting is not considered has been reviewed and approved through a system of peer an accidental injury. Treatment must be completed within 12 review that the Secretary determines 1) to be comparable to months of the accident. the system of peer review of studies and investigations used by the National Institutes of Health, and 2) assures unbiased review of the highest scientific standards by qualified Other Dental Services individuals who have no interest in the outcome of the review. Your Plan also includes benefits for hospital charges and i. The Department of Veterans Affairs. anesthetics provided for dental care if the member meets any of the following conditions: ii. The Department of Defense. • The member is under the age of five (5); iii. The Department of Energy. • The member has a severe disability that requires hospitalization 2. Studies or investigations done as part of an investigational new or general anesthesia for dental care; or drug application reviewed by the Food and Drug Administration; • The member has a medical condition that requires 3. Studies or investigations done for drug trials which are exempt hospitalization or general anesthesia for dental care. from the investigational new drug application. Your Plan may require you to use a network provider to maximize Diabetes your benefits. Equipment and outpatient self-management training and When a requested service is part of an approved clinical trial, it is a education, including nutritional therapy for individuals with covered service even though it might otherwise be Investigational insulin-dependent diabetes, insulin-using diabetes, gestational as defined by this Plan. All other requests for clinical trials services diabetes, and non-insulin using diabetes as prescribed by the that are not part of approved clinical trials will be reviewed physician. Covered services for outpatient self-management according to our Clinical Coverage Guidelines, related policies and training and education must be provided by a certified, registered procedures. or licensed health care professional with expertise in diabetes. Your Plan is not required to provide benefits for the following Screenings for gestational diabetes are covered under “Preventive services. The Plan reserves its right to exclude any of the following Care.” services Dialysis Treatment i. The Experimental/Investigative item, device, or service, itself; or The Plan covers covered services for Dialysis treatment. If ii. Items and services that are given only to satisfy data collection applicable, the Plan will pay secondary to Medicare Part B, even if and analysis needs and that are not used in the direct clinical a member has not applied for eligible coverage available through management of the patient; or Medicare. iii. A service that is clearly inconsistent with widely accepted and established standards of care for a particular diagnosis; or Durable Medical Equipment iv. Any item or service that is paid for, or should have been paid for, This Plan will pay the rental charge up to the purchase price of the by the sponsor of the trial. equipment. In addition to meeting criteria for medical necessity, and applicable pre-certification requirements, the equipment must also be used to improve the functions of a malformed part of the body or to prevent or slow further decline of the member’s medical condition. The equipment must be ordered and/or prescribed by a physician and be appropriate for in-home use.

MEDICAL PLANS | 1-8 The equipment must meet the following criteria: General Anesthesia Services • It can stand repeated use; Covered when ordered by the attending physician and administered by another physician who customarily bills for such • It is manufactured solely to serve a medical purpose; services, in connection with a covered procedure. • It is not merely for comfort or convenience; Such anesthesia service includes the following procedures which • It is normally not useful to a person not ill or injured; are given to cause muscle relaxation, loss of feeling, or loss of • It is ordered by a physician; consciousness: • The physician certifies in writing the medical necessity for the • Spinal or regional anesthesia; equipment. The physician also states the length of time the • Injection or inhalation of a drug or other agent (local infiltration is equipment will be required. The Plan may require proof at any excluded). time of the continuing medical necessity of any item; Anesthesia services administered by a Certified Registered • It is related to the member’s physical disorder. Nurse Anesthetist (CRNA) are only covered when billed by the supervising anesthesiologist. Emergency Services - Life-Threatening Medical Emergency or Serious Accidental Injury Home Health Care Services Coverage is provided for hospital emergency room care including Home Health Care provides a program for the member’s care a medical screening examination that is within the capability of the and treatment in the home. The program consists of required emergency department of a hospital, including ancillary services intermittent skilled care, which may include observation, routinely available to the emergency department to evaluate an evaluation, teaching and nursing services consistent with the emergency medical condition; and within the capabilities of the diagnosis, established and approved in writing by the member’s staff and facilities available at the hospital, such further medical attending physician. Services may be performed by either network examination and treatment as are required to stabilize the patient. or out-of-network providers. Home Health Care is limited to 60 Emergency service care does not require any prior authorization visits per calendar year. from the Plan. Some special conditions apply: Stabilize means, with respect to an emergency medical condition: to provide such medical treatment of the condition as may be • The physician’s statement and recommended program must be necessary to assure, within reasonable medical probability that pre-certified. no material deterioration of the condition is likely to result from • Claims will be reviewed to verify that services consist of skilled or occur during the transfer of the individual from a facility. With care that is medically consistent with the diagnosis. Note: respect to a pregnant woman who is having contractions, the term Covered services available under Home Health Care do NOT “stabilize” also means to deliver (including the placenta), if there is reduce outpatient benefits available under the Physical Therapy inadequate time to effect a safe transfer to another hospital before section shown in this Plan. delivery or transfer may pose a threat to the health or safety of the woman or the unborn child. • A member must be essentially confined at home. The Maximum Allowed Amount for emergency care from an out- Covered Services: of-network provider will be the greatest of the following: • Visits by an RN or LPN. Benefits cannot be provided for services • The amount negotiated with network providers for the if the nurse is related to the member. emergency service furnished; • Visits by a qualified physiotherapist or speech therapist and • The amount for the emergency service calculated using the by an inhalation therapist certified by the National Board of same method the Claims Administrator generally uses to Respiratory Therapy. determine payments for out-of-network services but substituting the network cost-sharing provisions for the out-of-network • Visits to render services and/or supplies of a licensed Medical cost-sharing provisions; or Social Services Worker when medically necessary to enable the member to understand the emotional, social, and environmental • The amount that would be paid under Medicare for the factors resulting from or affecting the member’s illness. emergency service. • Visits by a Home Health Nursing Aide when rendered under the The co-payment and/or coinsurance percentage may apply for direct supervision of an RN. both network and out-of-network services. • Nutritional guidance when medically necessary. • Administration or infusion of prescribed drugs. • Oxygen and its administration.

MEDICAL PLANS | 1-9 Covered services for Home Health Care do not include: • Bereavement (grief) services, including a review of the needs of the bereaved family and the development of a care plan to • Food, housing, homemaker services, sitters, home-delivered meet those needs, both before and after the member’s death. meals. Bereavement services are available to surviving Members of • Home Health Care services which are not medically necessary the immediate family for one year after the member’s death. or of a non-skilled level of care. Immediate family means your spouse, children, stepchildren, • Services and/or supplies which are not included in the Home parents, brothers and sisters. Health Care plan as described. Your doctor and hospice medical director must certify that you • Services of a person who ordinarily resides in the member’s are terminally ill and likely have less than 12 months to live. Your home or is a member of the family of either the member or doctor must agree to care by the hospice and must be consulted member’s spouse. in the development of the care plan. The hospice must keep a written care plan on file and give it to the Claims Administrator • Any services for any period during which the member is not upon request. under the continuing care of a physician. With the HDHP EPO and High EPO plan options, hospice care is • Convalescent or custodial care where the member has spent limited to 180 days per lifetime. The PPO plan option limits hospice a period of time for recovery from an illness or surgery and care to 210 days per lifetime. where skilled care is not required or the services being rendered are only for aid in daily living, i.e., for the convenience of the Benefits for covered services beyond those listed above, such member. as chemotherapy and radiation therapy given as palliative care, are available to a member in hospice. These additional covered • Any services or supplies not specifically listed as covered services will be covered under other parts of this Benefit Booklet. services.

• Routine care and/or examination of a newborn child. Hospital Services • Dietician services. You may receive treatment at a network or an out-of-network • Maintenance therapy. hospital. However, payment is significantly reduced if services are received at an out-of-network hospital. Your Plan provides covered • Dialysis treatment. services when the following services are medically necessary. • Purchase or rental of dialysis equipment. Network Inpatient Services • Private duty nursing care, unless it is delivered in the home. Visits count toward the Home Health Care maximum of 60 • Inpatient room charges. Covered services include semiprivate visits. room and board, general nursing care and intensive or cardiac care. If you stay in a private room, the Maximum Allowed Hospice Care Services Amount is based on the hospital’s prevalent semiprivate rate. If you are admitted to a hospital that has only private rooms, the The services and supplies listed below are covered services Maximum Allowed Amount is based on the hospital’s prevalent when given by a hospice for the palliative care of pain and other room rate. symptoms that are part of a terminal disease. Palliative care means care that controls pain and relieves symptoms, but is not Service and Supplies meant to cure a terminal illness. Covered services include: • Services and supplies provided and billed by the hospital • Care from an interdisciplinary team with the development and while you’re an inpatient, including the use of operating, maintenance of an appropriate plan of care. recovery and delivery rooms. Laboratory and diagnostic • Short-term inpatient hospital care when needed in periods of examinations, intravenous solutions, basal metabolism crisis or as respite care. studies, electrocardiograms, electroencephalograms, x-ray examinations, and radiation and speech therapy are also • Skilled nursing services, home health aide services, and covered. homemaker services given by or under the supervision of a registered nurse. • Convenience items (such as radios, TVs, record, tape or CD players, telephones, visitors’ meals, etc.) will not be covered. • Social services and counseling services from a licensed social worker. Length of Stay • Nutritional support such as intravenous feeding and feeding • Determined by medical necessity. tubes. • Physical therapy, occupational therapy, speech therapy, and Out-of-network respiratory therapy given by a licensed therapist. Hospital Benefits • Pharmaceuticals, medical equipment, and supplies needed If you are confined in an out-of-network hospital, your benefits will for the palliative care of your condition, including oxygen and be significantly reduced. related respiratory therapy supplies.

MEDICAL PLANS | 1-10 Outpatient Hospital Services Licensed Speech Therapist Services The Plan provides covered services when the following outpatient Services must be ordered and supervised by a physician. Speech services are medically necessary: pre-admission tests, surgery, Therapy is not covered when rendered for the treatment of diagnostic X-rays and laboratory services. Certain procedures developmental delay. require pre-certification. Maternity Care & Infertility Services Hospital Visits Covered services are provided for network Maternity Care subject The physician’s visits to his or her patient in the hospital. Covered to the benefit limitations. If you choose an out-of-network provider, services are limited to one daily visit for each attending physician benefits are subject to the deductible and percentage payable specialty during the covered period of confinement. provisions.

Human Organ and Tissue Transplant Services Notification Abortion (Therapeutic or Elective) To maximize your benefits, you need to call the Claims Your Plan includes benefits for a therapeutic abortion, which is an Administrator’s transplant department to discuss benefit coverage abortion recommended by a provider that is performed to save when it is determined a transplant may be needed. You must do the life or health of the mother, or as a result of incest or rape. Your this before you have an evaluation and/or work-up for a transplant. Plan also provides benefits for an elective (voluntary) abortion, Your evaluation and work-up services must be provided by a which is an abortion performed for reasons other than those network transplant provider to receive the maximum benefits. The described above. maximum benefit allowance for the National Bone Marrow Donor Search is $25,000 per Transplant. Infertility Services Contact the customer service telephone number on your Your Plan also includes benefits for the diagnosis of, but not Identification Card and ask for the transplant coordinator. The treatment, of infertility. Covered services include diagnostic and Claims Administrator will then assist the member in maximizing exploratory procedures to determine whether a member suffers their benefits by providing coverage information including details from infertility. This includes surgical procedures to correct any regarding what is covered and whether any medical policies, diagnosed disease or condition affecting the reproductive organs. network requirements or benefit booklet exclusions are applicable. This includes, but is not limited to, endometriosis, (tissue lining Failure to obtain this information prior to receiving services could the uterus moves to other parts of the body), collapsed/clogged result in increased financial responsibility for the member. fallopian tubes or testicular failure. Benefit limitations, coinsurance and co-payment amounts apply. Covered Transplant Benefit Period Starts one day prior to a covered transplant procedure and Medical Care continues for the applicable case rate/global time period. The General diagnostic care and treatment of illness or injury. Some number of days will vary depending on the type of transplant procedures require pre-certification. received and the network transplant provider agreement. Contact the Claims Administrator for specific network transplant provider Nutritional Counseling information for services received at or coordinated by a network Nutritional counseling related to the medical management of a transplant provider facility. Coverage starts one day prior to disease state as stated under the terms of the Plan. a covered transplant procedure and continues to the date of discharge at an out-of-network transplant provider facility. Out-of-Network Freestanding Ambulatory Facility Transportation and Lodging Any services rendered or supplies provided while you are a patient The Plan will provide assistance with reasonable and necessary or receiving services at or from an out-of-network freestanding travel expenses as determined by the Claims Administrator when ambulatory facility will be payable at the Maximum Allowed you obtain prior approval and are required to travel more than 75 Amount. miles from your residence to reach the facility where your covered transplant procedure will be performed. The Plan’s assistance with Out-of-Network Hospital Benefits travel expenses includes transportation to and from the facility and If you are confined in an out-of-network hospital, your benefits will lodging for the transplant recipient member and one companion be significantly reduced. for an adult member, or two companions for a child patient. The maximum benefit amount for travel and lodging is $10,000 per Obesity transplant. Prescription drugs and any other services or supplies for the The member must submit itemized receipts for transportation and treatment of obesity are not covered. Surgical treatment of obesity lodging expenses in a form satisfactory to the Claims Administrator is only covered for patients meeting medical necessity criteria, as when claims are filed. The Plan’s lodging allowance is $125 per defined by the Plan. Pre-certification is required, and coverage is day for double occupancy. Contact the Claims Administrator for only provided for gastric bypass, vertically banded gastroplasty detailed information. The Claims Administrator will follow Internal and adjustable gastric banding procedure (lap band). Revenue Service (IRS) guidelines in determining what expenses can be paid.

MEDICAL PLANS | 1-11 Oral Surgery Outpatient Surgery Covered services include only the following: Network hospital outpatient department or network freestanding ambulatory facility charges are covered at regular Plan benefits. • Fracture of facial bones; Benefits for treatment by an out-of-network hospital are explained • Lesions of the mouth, lip, or tongue which require a pathological under “Hospital Services.” exam; • Incision of accessory sinuses, mouth salivary glands or ducts; Physical Therapy, Occupational Therapy, Chiropractic Care • Dislocations of the jaw; Services by a physician, a registered physical therapist (R.P.T.). a licensed occupational therapist (O.T.), or a licensed chiropractor • Treatment of temporomandibular joint syndrome (TMJ) or (D.C.). All services rendered must be within the lawful scope of myofacial pain including only removable appliances for TMJ practice of, and rendered personally by, the individual provider. repositioning and related surgery and diagnostic services. No coverage is available when such services are necessitated by Covered services do not include fixed or removable appliances developmental delay. Benefits are limited to 60 visits per calendar which involve movement or repositioning of the teeth, or year of combined physical, occupational and speech therapy. operative restoration of teeth (fillings), or prosthetics (crowns, Additional visits may be approved based on medical necessity. bridges, dentures); Chiropractic care is subject to a 30-visit maximum per calendar • Plastic repair of the mouth or lip necessary to correct traumatic year (includes office visits and manipulations only). Once this injuries or congenital defects that will lead to functional maximum is met, services by a chiropractor will no longer be impairments; and covered. • Initial services, supplies or appliances for dental care or treatment required as a result of, and directly related to, Physician Services accidental bodily injury to sound natural teeth or structure Depending on your plan option, you may receive treatment from occurring while a member is covered by this Plan and a network or out-of-network physician. However, payment is performed within approved timeframes after the accident. significantly reduced if services are received from an out-of- Although this Plan covers certain oral surgeries as listed above, network physician. Such services are subject to your deductible many oral surgeries (e.g. removal of wisdom teeth) are not and out-of-pocket requirements. covered. Covered services also include the following: • Orthognathic surgery for a physical abnormality that prevents Preventive Care normal function of the upper and/or lower jaw and is medically Preventive Care services include outpatient services and office necessary to attain functional capacity of the affected part. services. Screenings and other services are covered as Preventive • Oral/surgical correction of accidental injuries as indicated in the Care for adults and children with no current symptoms or prior Dental Services section. history of a medical condition associated with that screening or service. • Treatment of non-dental lesions, such as removal of tumors and biopsies. Members who have current symptoms or have been diagnosed with a medical condition are not considered to require Preventive • Incision and drainage of infection of soft tissue not including Care for that condition but instead benefits will be considered odontogenic cysts or abscesses. under the Diagnostic Services benefit. Preventive Care Services in this section shall meet requirements Other Covered Services as determined by federal and state law. Many preventive care Your Plan provides covered services when the following services services are covered by this Plan with no deductible, co-payments are medically necessary: or coinsurance from the member when provided by a network • Chemotherapy and radioisotope, radiation and nuclear medicine provider. That means the Plan pays 100% of the Maximum therapy Allowed Amount. These services fall under four broad categories as shown below: • Diagnostic x-ray and laboratory procedures 1. Services with an “A” or “B” rating from the United States • Dressings, splints, casts when provided by a physician Preventive Services Task Force. • Oxygen, blood and components, and administration Examples of these services are screenings for: • Pacemakers and electrodes a. Breast cancer; • Use of operating and treatment rooms and equipment b. Cervical cancer;

Outpatient CT Scans and MRIs c. Colorectal cancer; These services are covered at regular Plan benefits. d. High Blood Pressure; e. Type 2 Diabetes Mellitus; f. Cholesterol; g. Child and Adult Obesity.

MEDICAL PLANS | 1-12 2. Immunizations for children, adolescents, and adults Retail Health Clinic recommended by the Advisory Committee on Immunization Benefits are provided for covered services received at a Retail Practices of the Centers for Disease Control and Prevention; Health Clinic. 3. Preventive Care and screenings for infants, children and adolescents as provided for in the comprehensive Skilled Nursing Facility Care guidelines supported by the Health Resources and Services This care must be ordered by the attending physician. All Skilled Administration; and Nursing Facility admissions must be pre-certified. Claims will be 4. Additional Preventive Care and screening for women provided reviewed to verify that services consist of skilled convalescent for in the guidelines supported by the Health Resources and care that is medically consistent with the diagnosis. Benefits are Services Administration, including the following: limited to 120 days per calendar year. a. Breastfeeding support, supplies, and counseling. Benefits for Skilled convalescent care during a period of recovery is breast pumps are limited to one pump per benefit period. characterized by: b. Gestational diabetes screening. • A favorable prognosis; You may call Customer Service using the number on your ID card • A reasonably predictable recovery time; and for additional information about these services or view the federal • Services and/or facilities less intense than those of the acute government’s websites: general hospital, but greater than those normally available at the http://www.healthcare.gov/center/regulations/prevention.html member’s residence. http://www.ahrq.gov/clinic/uspstfix.htm; Covered services include: http://www.cdc.gov/vaccines/acip/index.html • Semiprivate or ward room charges including general nursing service, meals, and special diets. If a member stays in a private Prosthetic Appliances room, this Plan pays the semiprivate room rate toward the charge for the private room; Prosthetic devices to improve or correct conditions resulting from accidental injury or illness are covered if medically necessary and • Use of special care rooms; ordered by a physician. • Pathology and radiology; Prosthetic devices include: artificial limbs and accessories; artificial • Physical or speech therapy; eyes, one pair of glasses or contact lenses for eyes used after surgical removal of the lens(es) of the eye(s); arm braces, leg • Oxygen and other gas therapy; braces (and attached shoes); and external breast prostheses used • drugs and solutions used while a patient; or after breast removal. • Gauze, cotton, fabrics, solutions, plaster and other materials The following items are excluded: corrective shoes; dentures; used in dressings, bandages, and casts. replacing teeth or structures directly supporting teeth, except This benefit is available only if the patient requires a physician’s to correct traumatic Injuries; electrical or magnetic continence continuous care and 24-hour-a-day nursing care. aids (either anal or urethral); and implants for cosmetic purposes except for reconstruction following a mastectomy. Benefits will not be provided when: • A member reaches the maximum level of recovery possible and Reconstructive Surgery no longer requires other than routine care; Pre-certification is required. Reconstructive surgery does not • Care is primarily custodial care, not requiring definitive medical include any service otherwise excluded in this benefit booklet. or 24-hour-a-day nursing service; (See “What The Plans Do Not Cover.”) • Care is for mental illness including drug addiction, chronic brain Reconstructive surgery is covered only to the extent medically syndromes and alcoholism, and no specific medical conditions necessary: exist that require care in a skilled nursing facility; • To correct significant anatomic deformities which are not within • A member is undergoing senile deterioration, mental deficiency normal anatomic variation and which are caused by congenital or retardation, and has no medical condition requiring care; or developmental abnormalities, illness, or injury for the purpose • The care rendered is for other than skilled convalescent care. of improving the significant anatomic deformity toward a normal appearance; or Surgical Care • To correct medical complications or post-surgical deformity, Surgical procedures including the usual pre- and post-operative unless the previous surgery was not a covered service. care. Some procedures require pre-certification. Note: Coverage for reconstructive services does not apply to orthognathic surgery. See the Oral Surgery section for that benefit.

MEDICAL PLANS | 1-13 Treatment of Accidental Injury in a Physician’s Office healthcare professional, self-injected, or taken by mouth, specialty medications require an enhanced level of service. All outpatient surgical procedures related to the treatment of an accidental injury, when provided in a physician’s office, will be Specialty pharmaceuticals are covered under your prescription covered under the member’s physician’s office benefit if services drug and/or medical benefit program. are rendered by a network provider; services rendered by out- The Prescription Drug Plan requires that certain specialty of-network providers are subject to deductible and coinsurance medications be accessed through Accredo Health Group, Inc., requirements, if applicable. an Express Scripts specialty pharmacy. You will not be covered for those specialty medications through the Medical Plan. The Prescription Drugs Administered by a Medical Provider list of medications subject to the program is available by calling This Plan covers prescription drugs when they are administered as the number on your prescription drug ID card. If you are currently part of a doctor’s visit, home care visit, or at an outpatient facility. using specialty medications affected by this requirement and This includes drugs for infusion therapy, chemotherapy, specialty you do not obtain them through Accredo, you will be required drugs, blood products, and office-based injectables that must to transfer those prescriptions to Accredo. If you continue to be administered by a provider. This section applies when your purchase your medications from your doctor or another pharmacy, provider orders the drug and administers it to you. Benefits for you will be responsible for their full cost. When you order a drugs that you inject or get at a pharmacy (i.e., self-administered covered specialty medication through Accredo, your out-of-pocket injectable drugs) are not covered under this section. Benefits for cost will be limited to the applicable mail-order co-payment. those drugs are described in the Prescription Drug Coverage In order to provide you with sufficient time to transfer your section. prescriptions from your medical coverage to your pharmacy Note: When prescription drugs are covered under this benefit, benefit, you may appeal through the appropriate appeals process they will not also be covered under your employer’s Prescription for coverage for one additional prescription from your current Drug Plan. Also, if prescription drugs are covered under your provider. In addition, if you have an extenuating medical condition employer’s Prescription Drug Plan they will not be covered under that prevents you from transitioning to the pharmacy benefit, you this benefit. may be granted an override and continue on your medical benefit as long as there is a reviewed medical reason not to transition. Important Note Regarding Specialty Drugs The list of medications subject to this specialty drug program may Specialty medications are drugs that are used to treat complex change, and you should check the list before you fill a prescription conditions and illnesses, such as cancer, growth hormone for a specialty medication. deficiency, hemophilia, hepatitis C, immune deficiency, multiple To confirm whether a medication you take is part of the specialty sclerosis, and rheumatoid arthritis. These drugs usually require program, you may call the number on your prescription drug ID special handling, special administration, or intensive patient card. monitoring. Medications used to treat diabetes are not considered specialty medications. Whether they are administered by a

MEDICAL PLANS | 1-14 WHAT THE PLANS DO NOT COVER

As with all medical plans, there are some expenses that are not Cosmetic Surgery. This exclusion includes, but is not limited covered. to, surgery to correct gynecomastia and breast augmentation procedures, and otoplasties. Reduction mammoplasty • Admissions for Non-Inpatient Services - Admission or and services for the correction of asymmetry, except continued hospital or Skilled Nursing Facility stay for medical when determined to be medically necessary by the Claims care or diagnostic studies not medically required on an inpatient Administrator are not covered. basis. o This exclusion does not apply to surgery to restore function • Administrative Charges - Charges for any of the following: if any area has been altered by disease, trauma, congenital/ o Failure to keep a scheduled visit; developmental anomalies, or previous therapeutic processes. o Completion of claim forms or medical records or reports This exclusion does not apply to surgery to correct the results unless otherwise required by law; of injuries that caused the impairment, or as a continuation of a staged reconstruction procedure, or congenital defects o For physician or hospital’s stand-by services; necessary to restore normal bodily functions, including but o For holiday or overtime rates; not limited to, cleft lip and cleft palate. o Membership, administrative, or access fees charged by o This exclusion does not apply to Breast Reconstructive physicians or other providers. Examples of administrative fees Surgery. include, but are not limited to, fees charged for educational • Complications directly related to cosmetic services brochures or calling a patient to provide their test results; treatment or surgery - As determined by the Claims o Specific medical reports including those not directly related to Administrator, are not covered. This exclusion does not apply the treatment of the member, e.g., employment or insurance to conditions including, but not limited to: myocardial infarction; physicals, and reports prepared in connection with litigation. pulmonary embolism; thrombophlebitis; and exacerbation of co- • Allergy Services - Specific non-standard allergy services morbid conditions. and supplies, including but not limited to, skin titration (Rinkle • Court-Ordered Services - Court-ordered services, or those method), cytotoxicity testing (Bryan’s Test), treatment of non- required by court order as a condition of parole or probation specific candida sensitivity, and urine autoinjections. unless medically necessary and approved by the Plan. • Alternative Therapies - Hypnotherapy. Services or supplies • Crime and Incarceration - Injuries received while committing related to alternative or complementary medicine. Services in a crime as well as care required while incarcerated in a federal, this category include, but are not limited to, holistic medicine, state or local penal institution or required while in custody of homeopathy, hypnosis, aromatherapy, massage therapy at federal, state or local law enforcement authorities, including a salon, reiki therapy, herbal, vitamin or dietary products or work release programs, unless otherwise required by law or therapies, naturopathy, thermograph, orthomolecular therapy, regulation. This exclusion does not apply if you were the victim contact reflex analysis, bioenergial synchronization technique of a crime, including domestic violence. (BEST) and iridology-study of the iris. This exclusion also applies • Custodial Care and Rest Care - Custodial care, domiciliary to biofeedback, recreational or educational sleep therapy or care, rest cures, or travel expenses even if recommended other forms of self-care or non-medical self-help training and for health reasons by a physician. Inpatient room and board any related diagnostic testing. charges in connection with a hospital or Skilled Nursing Facility • Before Coverage Begins/After Coverage Ends - Services stay primarily for environmental change, physical therapy or rendered or supplies provided before coverage begins, i.e., treatment of chronic pain. before a member’s effective date, or after coverage ends. • Daily Room Charges - Daily room charges while the Plan is • Biomicroscopy - Biomicroscopy, field charting or aniseikonic paying for an intensive care, cardiac care, or other special care investigation. unit. • Comfort and Convenience Items - Personal comfort items • Dental Care - Dental care and treatment and oral surgery such as those that are furnished primarily for your personal (by physicians or dentists) including dental surgery; surgical comfort or convenience, including those services and supplies removal of impacted teeth; dental appliances; dental prostheses not directly related to medical care, such as guest’s meals and such as crowns, bridges, or dentures; implants; orthodontic accommodations, barber services, telephone charges, radio care; operative restoration of teeth (fillings); dental extractions; and television rentals, homemaker services, travel expenses, endodontic care; apicoectomies; excision of radicular and take-home supplies. cysts or granuloma; treatment of dental caries, gingivitis, or • Complications - Complications of non-covered procedures are periodontal disease by gingivectomies or other periodontal not covered. surgery; vestibuloplasties; alveoplasties; dental procedures involving teeth and their bone- or tissue-supporting structures; • Cosmetic Services/Beautification Procedures - Cosmetic frenulectomy. Any treatment of teeth, gums or tooth-related Surgery, reconstructive surgery, pharmacological services, service except otherwise specified as covered in this Benefit nutritional regimens or other services for beautification, or Booklet. treatment relating to the consequences of, or as a result of,

MEDICAL PLANS | 1-15 • Educational/Behavioral Services - Educational services • Health Spa - Expenses incurred at a health spa or similar and treatment of behavioral disorders, together with services facility. for remedial education including evaluation or treatment of • Ineligible hospital - Any services rendered or supplies learning disabilities, minimal brain dysfunctions, developmental provided while you are confined in an ineligible hospital. and learning disorders, behavioral training, and cognitive rehabilitation. This includes services, treatment or educational • Infertility treatment – Benefits are limited to medical services testing and training related to behavioral (conduct) problems, to diagnose infertility only. Treatment of infertility is not covered. including but not limited to services for conditions related to • Ineligible provider - Any services rendered or supplies autistic disease of childhood (except to the same extent that provided while you are a patient or receive services at or from the Plan provides for neurological disorders), hyperkinetic an ineligible provider. syndromes, including attention deficit disorder and attention • Inpatient Rehabilitation Programs - Inpatient rehabilitation deficit hyperactivity disorder, learning disabilities, behavioral in the hospital or hospital-based rehabilitation facility, when the problems, and mental retardation. Special education, including member is medically stable and does not require skilled nursing lessons in sign language to instruct a member, whose ability to care or the constant availability of a physician or: speak has been lost or impaired, to function without that ability, is not covered. o The treatment is for maintenance therapy; or • Excessive Expenses - Expenses in excess of the Plan’s o The member has no restorative potential; or Maximum Allowed Amount. o The treatment is for congenital learning or neurological • Employer or Association Medical/Dental Department - disability/disorder; or Received from a dental or medical department maintained by o The treatment is for communication training, educational or on behalf of an employer, mutual benefit association, labor training or vocational training. union, trust or similar person or group. • International Services - Non-emergency treatment of chronic • Experimental/Investigative Services - Treatments, illnesses received outside the United States performed without procedures, equipment, drugs, devices or supplies (hereafter preauthorization. called “services”) which are, in the Claims Administrator’s • Maintenance Care - Services which are solely performed to judgment, experimental or investigative for the diagnosis preserve the present level of function or prevent regression of for which the member is being treated. An experimental or functions for an illness, injury or condition which is resolved or investigative service is not made eligible for coverage by the stable. fact that other treatment is considered by a member’s physician to be ineffective or not as effective as the service or that the • Marital Counseling - Religious, marital and sex counseling, service is prescribed as the most likely to prolong life. including services and treatment related to religious counseling, marital/relationship counseling and sex therapy. • Family Members - Services rendered by a provider who is a close relative or member of your household. Close relative • Medicare Benefits - Services paid under Medicare or which means wife or husband, parent or grandparent, child, brother or would have been paid if the member had applied for Medicare sister, by blood, marriage (including in-laws) or adoption. and claimed Medicare benefits. With respect to end-stage renal disease (ESRD), Medicare shall be treated as the primary payor • Foot Care - Foot care only to improve comfort or appearance, whether or not the member has enrolled in Medicare Part B. routine care of corns, bunions (except capsular or related For services provided pursuant to a private contract between surgery), calluses, toe nails (except surgical removal or the member and a provider, for which reimbursement under the care rendered as treatment of the diabetic foot or ingrown Medicare program is prohibited, as specified in Section 1802 toenail), flat feet, fallen arches, weak feet, chronic foot strain, (42 U.S.C. 1395a) of Title XVIII of the Social Security Act. or asymptomatic complaints related to the feet. Coverage is available, however, for medically necessary foot care required as • Never Events – The Plan will not pay for errors in medical care part of the treatment of diabetes and for Members with impaired that are clearly identifiable, preventable, and serious in their circulation to the lower extremities. consequences for patients, which indicate a problem exists in the safety and credibility of a health care facility. The provider • Free Services - Services and supplies for which you have no will be expected to absorb such costs. This exclusion includes, legal obligation to pay, or for which no charge has been made or but is not limited to, such errors as operating on the wrong side would be made if you had no health insurance coverage. of the body, operating on the wrong part of the body, using the • Government Programs - Treatment where payment is made wrong procedure, or operating on the wrong patient. by any local, state, or federal government (except Medicaid), or • Non-Covered Services - Any item, service, supply or care not for which payment would be made if the member had applied specifically listed as a covered service in this benefit booklet. for such benefits. Services that can be provided through a government program for which you as a member of the • Not Medically Necessary Services- Care, supplies, or community are eligible for participation. Such programs include, equipment not medically necessary, as determined by the but are not limited to, school speech and reading programs. Claims Administrator, for the treatment of an injury or illness. This includes, but is not limited to, care which does not meet • Hair - Hair transplants, hairpieces or wigs (except when the Claims Administrator’s medical policy, clinical coverage necessitated by disease) wig maintenance, or prescriptions or guidelines, or benefit policy guidelines. medications related to hair growth.

MEDICAL PLANS | 1-16 • Obesity Services - Any services or supplies for the treatment • Sexual Transformation - Surgical care or medical treatment of obesity, including but not limited to, weight reduction, medical or study related to the modification of sex (transsexualism) and care or prescription drugs, or dietary control (except as related related services, or the reversal thereof. to covered nutritional counseling). Nutritional supplements; • Shoes and Orthotics - Shoe inserts, orthotics (except when services, supplies and/or nutritional sustenance products (food) prescribed by a physician for diseases of the foot or systemic related to Enteral feeding except when it’s the sole means of diseases that affect the foot such as diabetes when deemed nutrition. Food supplements. Services for inpatient treatment medically necessary), and orthopedic shoes (except when an of bulimia, anorexia or other eating disorders which consist orthopedic shoe is joined to a brace). primarily of behavior modification, diet and weight monitoring and education. Any services or supplies that involve weight • Spider Veins - Treatment of telangiectatic dermal veins (spider reduction as the main method of treatment, including medical, veins) by any method. psychiatric care, or counseling. Weight loss programs include • Supplies or Equipment (Including Durable Medical but are not limited to, commercial weight loss programs Equipment) Not Medically Necessary - Supplies or (Weight Watchers, Jenny Craig, and LA Weight Loss), nutritional equipment not medically necessary for the treatment of an injury supplements, appetite suppressants, and supplies of a similar or illness. Non-covered supplies are inclusive of but not limited nature. This exclusion does not apply to morbid obesity surgery to: when approved by the Plan. o Band-aids, tape, non-sterile gloves, thermometers, heating • Prescription Drugs - Any prescription drugs purchased at a pads, hot water bottles, home enema equipment, sterile water retail or Home Delivery (Mail Service) Pharmacy. and bed boards; • Private Duty Nursing – For Private Duty Nursing services o Household supplies, including but not limited to, deluxe except when provided through the “Home Care” benefit. equipment, such as motor-driven chairs or bed, electric stair • Private Rooms - Private room, except as specified as covered chairs or elevator chairs; services. o The purchase or rental of exercise cycles, physical fitness, • Research Screenings – For examinations related to research exercise and massage equipment, ultraviolet/tanning screenings, unless required by law. equipment; • Reversal of Sterilization - Services related to or performed in o Water purifiers, hypo-allergenic pillows, mattresses, or conjunction with reverse sterilization. waterbeds, whirlpool, spa or swimming pools; • Routine Examinations - Routine physical examinations, o Escalators, elevators, ramps, stair glides, emergency alert screening procedures, and immunizations necessitated by equipment, handrails, heat appliances improvements made employment, foreign travel or participation in school athletic to a member’s house or place of business and adjustments programs, recreational camps or retreats or any insurance made to vehicles; program which are not called for by known symptoms of o Air conditioners, humidifiers, dehumidifiers, or purifiers; illness or injury except those which may be specifically listed as o Rental or purchase of equipment if you are in a facility which covered in this benefit booklet. provides such equipment; • Safe Surroundings - Care furnished to provide a safe o Other items of equipment that the Claims Administrator surrounding, including the charges for providing a surrounding determines do not meet the listed criteria. free from exposure that can worsen the disease or injury. • Therapy Services - Services for outpatient therapy or • Sclerotherapy - Sclerotherapy for the treatment of varicose rehabilitation other than those specifically listed as covered in veins of the lower extremities including ultrasonic guidance for this benefit booklet. Excluded forms of therapy include, but are needle and/or catheter placement and subsequent ultrasound not limited to, vestibular rehabilitation, primal therapy, chelation studies to assess the results of ongoing treatment of varicose therapy, rolfing, psychodrama, megavitamin therapy, purging, veins of the lower extremities with sclerotherapy. bioenergetic therapy, cognitive therapy, electromagnetic • Services Not Specified as Covered - No benefits are available therapy, salabrasion, chemosurgery and other such skin for services that are not specifically described as covered abrasion procedures associated with the removal of scars, services in this benefit booklet. This exclusion applies even if tattoos, actinic changes and/or which are performed as a your physician orders the service. treatment for acne. • Sexual Dysfunction - Medical/surgical services or supplies • Transplant Services - The following services and supplies for treatment of male or female sexual or erectile dysfunctions rendered in connection with organ/tissue/bone marrow or inadequacies, including treatment for impotency (except transplants: male organic erectile dysfunction) regardless of origin or cause. • Surgical or medical care related to animal organ transplants, This exclusion also includes penile prostheses or implants and animal tissue transplants, (except for porcine heart valves) vascular or artificial reconstruction, prescription drugs, and all artificial organ transplants or mechanical organ transplants; other procedures and equipment developed for or used in the treatment of impotency, and all related diagnostic testing. • Donation-related services or supplies, including search, associated with organ acquisition and procurement;

MEDICAL PLANS | 1-17 o Chemotherapy with autologous, allogenic or syngenic • Vision Surgeries - Related to radial keratotomy or hematopoietic stem cells transplant for treatment of any type keratomileusis or excimer laser photo refractive keratectomy; of cancer not specifically named as covered; any transplant and surgery, services or supplies for the surgical correction of not specifically listed as covered. nearsightedness and/or astigmatism or any other correction of vision due to a refractive problem. • Transportation - Transportation provided by other than a state-licensed professional ambulance service, and Ambulance • Waived Fees - Any portion of a provider’s fee or charge which Services that are not medically necessary. Transportation to is ordinarily due from a member but which has been waived. another area for medical care is also excluded except as stated If a provider routinely waives (does not require the member as covered under the Ambulance Service section. Ambulance to pay) an deductible or out-of-pocket amount, the Claims transportation from the hospital to the home is not covered. Administrator will calculate the actual provider fee or charge the fee or charge by the amount waived. • Travel Costs and Mileage - For mileage costs or other travel expenses, except as authorized by the Claims Administrator, on • War/Military Duty - Any disease or injury resulting from a war, behalf of the Employer. declared or not, or any military duty or any release of nuclear energy. Also excluded are charges for services directly related • Thermograms - Thermograms and thermography. to military service provided or available from the Veterans’ • Vision Care - Vision care services and supplies, including Administration or military facilities except as required by law. but not limited to eyeglasses, contact lenses, and related • Workers’ Compensation - Care for any condition or injury examinations and services. Analysis of vision or the testing of recognized or allowed as a compensable loss through any its acuity except as otherwise indicated in this benefit booklet. Workers’ Compensation, occupational disease or similar law. If Service or devices to correct vision or advice on such service. Workers’ Compensation Act benefits are not available to you, Orthoptic training is covered. This exclusion does not apply then this exclusion does not apply. This exclusion applies if for initial prosthetic lenses or sclera shells following intraocular you receive the benefits in whole or in part. This exclusion also surgery, or for soft contact lenses due to a medical condition, applies whether or not you claim the benefits or compensation. i.e. diabetes. It also applies whether or not you recover from any third party.

MEDICAL PLANS | 1-18 PRESCRIPTION DRUG COVERAGE

You will be provided with prescription drug coverage through Express Scripts if you elect medical coverage. The amount you pay for your prescriptions depends on whether you: • Choose generic or brand-name drugs • Purchase your prescription at a participating or non-participating pharmacy • Purchase your prescription at a retail pharmacy or through the mail-order service The program costs you less when you use generic drugs and the mail-order service.

Prescription Drug Benefits

Prescription drugs Plan Pays You Pay

Retail (30-day supply)

• Generic drugs 80% 20% ($10 min / $80 max)

• Brand-name drugs 70% 30% ($10 min / $80 max)

Mail-Order (90-day supply)

• Generic drugs 85% 15% ($20 min / $160 max)

• Brand-name drugs 80% 20% ($20 min / $160 max)

Annual Out-Of-Pocket Maximum: $2,000 per person, $6,000 per family per calendar year. Your out-of-pocket costs for all covered prescription drugs apply to this limit.

How It Works Using an Out-of-Network Pharmacy If you do not use a network pharmacy, you will pay the full cost Using a Network Pharmacy of the prescription, and you will need to file a claim with Express Scripts for reimbursement. You will be reimbursed at the price When you use a network retail pharmacy or the Mail-Order that would have been charged at a network pharmacy, less the Service, the Plan pays a percentage of the cost of the prescription applicable coinsurance amount. drug. You are responsible for the rest, but there is a flat-dollar minimum and maximum amount that you will have to pay, You can obtain a claim form on Express Scripts’s web site at protecting you against extremely high-priced drugs. www.express-scripts.com. Simply request the number of claim forms that you need to be mailed to your home, complete the If you use a network pharmacy, there are no claim forms to submit forms and submit them to Express Scripts for reimbursement. and no further cost incurred by you other than your coinsurance payment. If you do not present your Express Scripts ID card at Generic Prescription Drug Policy the network pharmacy, you will need to file a claim with Express Scripts for reimbursement. The reimbursement will be 100% less Your prescriptions will be filled automatically with a generic drug, if your coinsurance payment. available, unless your provider specifically requests a brand-name drug and writes “dispense as written” on your prescription. The Express Scripts has a large national network of retail pharmacies, Food and Drug Administration requires that generic drugs have the so even if you are away from home, you are likely to find a network same active ingredients and take the same form (e.g., pill or liquid) pharmacy. To find a network pharmacy near you, go to as brand-name drugs. If you request that a prescription be filled www.express-scripts.com or call 1-800-711-0917. with a brand-name drug when a generic substitute is available To find a network pharmacy on Express Scripts’s website at and the brand-name is not required by your provider, then you will www.express-scripts.com, you will need to register as a pay the generic coinsurance amount for the prescription plus the member. Once you are registered, you can log into the website difference in cost between the brand-name drug and the available using your e-mail address and password to locate a pharmacy. generic drug.

MEDICAL PLANS | 1-19 Prescription Drug Utilization Management Programs medications. Whether they are administered by a healthcare professional, self-injected, or taken by mouth, specialty Express Scripts offers programs that help you better manage both medications require an enhanced level of service. your medication and costs, and helps ensure your medication is covered, as follows: Specialty pharmaceuticals are covered under your prescription drug and/or medical benefit program. • Step Therapy - Step therapy is a program for people who take prescription drugs regularly to treat a medical condition, such as The Prescription Drug Plan requires that certain specialty arthritis, asthma or high blood pressure. It allows you and your medications be accessed through Accredo Health Group, Inc., family to receive the affordable treatment you need and helps an Express Scripts specialty pharmacy. You will not be covered your organization continue with prescription-drug coverage. for those specialty medications through the Medical Plan. The list of medications subject to the program is available by calling • Drug Quantity Management - Drug quantity management, the number on your prescription drug ID card. If you are currently also known as DQM, is a program in your pharmacy benefit using specialty medications affected by this requirement and that’s designed to make the use of prescription drugs safer and you do not obtain them through Accredo, you will be required more affordable. It provides the medication you need for your to transfer those prescriptions to Accredo. If you continue to good health and the health of your family, while making sure you purchase your medications from your doctor or another pharmacy, receive them in the amount — or quantity — considered safe. you will be responsible for their full cost. When you order a • Prior Authorization - Prior authorization is a program that covered specialty medication through Accredo, your out-of-pocket monitors certain prescription drugs and their costs to get you cost will be limited to the applicable mail-order co-payment. the medication you require while monitoring your safety and In order to provide you with sufficient time to transfer your reducing costs. Similar to healthcare plans that approve a prescriptions from your medical coverage to your pharmacy medical procedure before it’s done to ensure the necessity of benefit, you may appeal through the appropriate appeals process the test, if you’re prescribed a certain medication, that drug for coverage for one additional prescription from your current may need a prior authorization. This program makes sure you’re provider. In addition, if you have an extenuating medical condition getting a prescription that is suitable for the intended use and that prevents you from transitioning to the pharmacy benefit, you covered by your pharmacy benefit. For more information on may be granted an override and continue on your medical benefit which medications require prior authorization, contact Express as long as there is a reviewed medical reason not to transition. Scripts. The list of medications subject to this specialty drug program may • Medical Channel Management – Specialty medications change, and you should check the list before you fill a prescription are drugs that are used to treat complex conditions and for a specialty medication. illnesses, such as cancer, growth hormone deficiency, hemophilia, hepatitis C, immune deficiency, multiple sclerosis, To confirm whether a medication you take is part of the specialty and rheumatoid arthritis. These drugs usually require special program, you may call the number on your prescription drug ID handling, special administration, or intensive patient monitoring. card. Medications used to treat diabetes are not considered specialty

Mail-Order Service

The Mail-Order Service is best suited for individuals taking maintenance medications or those prescriptions taken on a regular basis over an extended period of time. This service will fill covered prescriptions for a maximum supply of 90 days and provides coverage as noted in the chart on page 1-19. To use the Mail-Order Service, you can obtain forms from Express Scripts’s customer service by phone at 1-800-711-0917 or from Express Scripts’s website at www.express-scripts.com. Complete the entire form, including: • Member Information and Order Information as requested on the form • The Patient Profile section for each new prescription • The Health, Allergy & Medication Questionnaire (HMQ) Mail the form with all the original prescription(s) or refill slip(s) and your coinsurance payment. You may either pay for your prescription with a credit card or include a check for the estimated payment amount. You can obtain an estimate by contacting Express Scripts, either by phone or via the Internet. If the final cost is not the same as the estimate, Express Scripts will send you a bill for the difference when they send you your prescription or credit your account. Prescriptions are delivered, postage-paid, directly to your home address within two weeks from the date you mail your order. If you need to start taking your prescription immediately, then you should ask your provider for one 30-day retail prescription along with a prescription for the Mail-Order Service that includes refills. You can send prescriptions to the Mail-Order Service for up to a 90-day supply. Mail-order refills can be obtained by phone or via the Internet.

MEDICAL PLANS | 1-20 Limitations On Prescription Drug Coverage HEALTH ADVOCATE The Company reserves the right to put in programs or limitations to encourage the use of over-the-counter drugs or to limit certain Health Advocate is an independent patient advocacy service that classifications of drugs in accordance with standard prescribing helps you navigate the complexities of the health care system. It guidelines. is designed to help you handle health care-related issues that you or your family members may experience. This service will connect What Is Not Covered Under you with a Personal Health Advocate, typically a registered nurse. Prescription Drug Coverage This service is available to you no matter which Medical Plan you elect or whether you decline coverage. There is no cost to you to Most prescription drugs are covered under the Medical Plans. use this service. However, some types of prescription drugs are not covered, Health Advocate can assist you with the following services: including, but not limited to: • Finding providers that best meet your or your family’s medical • Non-federal legend drugs needs • Non-systemic contraceptives or implants • Providing referrals to services for your elderly parents • Some injectable medications • Scheduling timely appointments, especially with specialist • Dental fluoride products physicians • Glucowatch/sensors • Help when faced with a serious illness or injury • Ostomy supplies • Help with insurance claims and billing inquiries • Mifeprex There are times when it is vital for you to have accurate information and someone that you can trust to help you through the clinical • Therapeutic devices or appliances choices and administration process. Health Advocate is objective • Drugs whose sole purpose is to promote or stimulate hair and independent and will provide you with the help that you need growth (i.e., Rogaine®, Propecia®) or for cosmetic purposes only while maintaining your privacy and confidentiality. (i.e., Renova®, Vaniqa®, Tri-Luma®, Botox-Cosmetic®, Solage®, Your entire family is able to use Health Advocate’s services. In Avage®, Epiquin®). addition to you, your spouse or children, your parents and the • Allergy serums parents of your spouse are covered under this program. • Biologicals, immunization agents or vaccines Health Advocate does not provide medical coverage nor can it • Blood or blood plasma products obtain insurance benefits for you or your family. • Drugs labeled “Caution – limited by federal law to investigational You can find more information about Health Advocate at use” or experimental drugs, even though a charge is made to www.healthadvocate.net, or by calling 1-866-695-8622. the individual • Medication for which the cost is recoverable under any Workers’ Compensation or occupational disease law or any state or APPEALING CLAIMS governmental agency, or medication furnished by any other drug or medical service for which no charge is made to the member Filing Health Claims Under the Plan • Medication which is to be taken by or administered to an individual, in whole or in part, while he or she is a patient in Under the Plan, you may file claims for Plan benefits and appeal a licensed hospital, rest home, sanitarium, Extended Care adverse claim determinations. Any reference to “you” in this Facility, Skilled Nursing Facility, Convalescent Facility, nursing Claims, Appeals and External Review section includes you and home or similar institution which operates on its premises, or your Authorized Representative. An “Authorized Representative” allows to be operated on its premises, a facility for dispensing is a person you authorize, in writing, to act on your behalf. The pharmaceuticals Plan will also recognize a court order giving a person authority to submit claims on your behalf. In the case of an urgent care claim, • Any prescription refilled in excess of the number of refills a health care professional with knowledge of your condition may specified by the physician, or any refill dispensed after one year always act as your Authorized Representative. from the physician’s original order

• Charges for the administration or injection of any drug Anthem Appeals You have the right to appeal an adverse benefit determination (claim denial or rescission of coverage). You or your authorized representative must file your appeal within 180 calendar days after you are notified of the denial or rescission. You will have the opportunity to submit written comments, documents, records, and other information supporting your claim. The Claims

MEDICAL PLANS | 1-21 Administrator’s review of your claim will take into account all The Claims Administrator will also provide you, free of charge, information You submit, regardless of whether it was submitted or with any new or additional evidence considered, relied upon, or considered in the initial benefit determination. generated in connection with your claim. In addition, before you receive an adverse benefit determination on review based on a The Claims Administrator shall offer a single mandatory level of new or additional rationale, the Claims Administrator will provide appeal and an additional voluntary second level of appeal which you, free of charge, with the rationale. may be a panel review, independent review, or other process consistent with the entity reviewing the appeal. The time frame allowed for the Claims Administrator to complete its review is For Out-of-State Appeals dependent upon the type of review involved (e.g., pre-service, You have to file provider appeals with the Host Plan. This means concurrent, post-service, urgent, etc.). providers must file appeals with the same plan to which the claim For pre-service claims involving urgent/concurrent care, was filed. you may obtain an expedited appeal. You or your authorized representative may request it orally or in writing. All necessary How Your Appeal Will Be Decided information, including the Claims Administrator’s decision, When the Claims Administrator considers your appeal, the Claims can be sent between the Claims Administrator and you by Administrator will not rely upon the initial benefit determination telephone, facsimile or other similar method. To file an appeal for or, for voluntary second-level appeals, on the earlier appeal a claim involving urgent/concurrent care, you or your authorized determination. The review will be conducted by an appropriate representative must contact the Claims Administrator at [the reviewer who did not make the initial determination and who does number shown on your identification card] and provide at least the not work for the person who made the initial determination. A following information: voluntary second-level review will be conducted by an appropriate • The identity of the claimant; reviewer who did not make the initial determination or the first-level appeal determination and who does not work for the person who • The date(s) of the medical service; made the initial determination or first-level appeal determination. • The specific medical condition or symptom; If the denial was based in whole or in part on a medical judgment, • The provider’s name; including whether the treatment is experimental, investigational, • The service or supply for which approval of benefits was sought; or not medically necessary, the reviewer will consult with a health and care professional who has the appropriate training and experience in the medical field involved in making the judgment. This health • Any reasons why the appeal should be processed on a more care professional will not be one who was consulted in making an expedited basis. earlier determination or who works for one who was consulted in All other requests for appeals should be submitted in writing by making an earlier determination. the member or the member’s authorized representative, except where the acceptance of oral appeals is otherwise required by Notification of the Outcome of the Appeal the nature of the appeal (e.g., urgent care). You or your authorized If you appeal a claim involving urgent/concurrent care, the representative must submit a request for review to: Claims Administrator will notify you of the outcome of the appeal Anthem BlueCross and BlueShield as soon as possible, but not later than 72 hours after receipt of ATTN: Appeals your request for appeal. P.O. Box 105568 If you appeal any other pre-service claim, the Claims Atlanta, Georgia 30348 Administrator will notify you of the outcome of the appeal within 30 You must include your Member Identification Number when days after receipt of your request for appeal. submitting an appeal. If you appeal a post-service claim, the Claims Administrator Upon request, the Claims Administrator will provide, without will notify you of the outcome of the appeal within 60 days after charge, reasonable access to, and copies of, all documents, receipt of your request for appeal. records, and other information relevant to your claim. “Relevant” means that the document, record, or other information: Appeal Denial • Was relied on in making the benefit determination; or If your appeal is denied, that denial will be considered an • Was submitted, considered, or produced in the course of adverse benefit determination. The notification from the Claims making the benefit determination; or Administrator will include all of the information set forth in the above section entitled Anthem Appeals. • Demonstrates compliance with processes and safeguards to ensure that claim determinations are made in accordance with the terms of the Plan, applied consistently for similarly-situated claimants; or • Is a statement of the Plan’s policy or guidance about the treatment or benefit relative to your diagnosis.

MEDICAL PLANS | 1-22 Voluntary Second Level Appeals This is not an additional step that you must take in order to fulfill your appeal procedure obligations described above. Your decision If you are dissatisfied with the Plan’s mandatory first-level appeal to seek External Review will not affect your rights to any other decision, a voluntary second-level appeal may be available. If you benefits under this health care plan. There is no charge for you would like to initiate a second-level appeal, please write to the to initiate an independent External Review. The External Review address listed above. Voluntary appeals must be submitted within decision is final and binding on all parties except for any relief 60 calendar days of the denial of the first-level appeal. You are available through applicable state laws or ERISA. not required to complete a voluntary second-level appeal prior to submitting a request for an independent external review. Requirement to File an Appeal Before Filing a Lawsuit External Review No lawsuit or legal action of any kind related to a benefit decision may be filed by you in a court of law or in any other forum, unless If the outcome of the mandatory first-level appeal is adverse to you it is commenced within three years of the Plan’s final decision and it was based on medical judgment, you may be eligible for an on the claim or other request for benefits. If the Plan decides independent External Review pursuant to federal law. an appeal is untimely, the Plan’s latest decision on the merits of You must submit your request for External Review to the Claims the underlying claim or benefit request is the final decision date. Administrator within four (4) months of the notice of your final You must exhaust the Plan’s internal Appeals Procedure but not internal adverse determination. including any voluntary level of appeal, before filing a lawsuit or A request for an External Review must be in writing unless the taking other legal action of any kind against the Plan. If your health Claims Administrator determines that it is not reasonable to benefit plan is sponsored by your employer and subject to the require a written statement. You do not have to re-send the Employee Retirement Income Security Act of 1974 (ERISA) and information that you submitted for internal appeal. However, you your appeal as described above results in an adverse benefit are encouraged to submit any additional information that you think determination, you have a right to bring a civil action under Section is important for review. 502(a) of ERISA. For pre-service claims involving urgent/concurrent care, you The Claims Administrator reserves the right to modify the may proceed with an Expedited External Review without policies, procedures and timeframes in this section upon filing an internal appeal or while simultaneously pursuing an further clarification from Department of Health and Human expedited appeal through the Claims Administrator’s internal Services and Department of Labor. appeal process. You or your authorized representative may request it orally or in writing. All necessary information, including the Claims Administrator’s decision, can be sent between the Claims Administrator and you by telephone, facsimile or other similar method. To proceed with an Expedited External Review, you or your authorized representative must contact the Claims Administrator at [the number shown on your identification card] and provide at least the following information: • the identity of the claimant; • the date(s) of the medical service; • the specific medical condition or symptom; • the provider’s name; • the service or supply for which approval of benefits was sought; and • any reasons why the appeal should be processed on a more expedited basis. All other requests for External Review should be submitted in writing unless the Claims Administrator determines that it is not reasonable to require a written statement. Such requests should be submitted by you or your authorized representative to: Anthem BlueCross and BlueShield ATTN: Appeals P.O. Box 105568 Atlanta, Georgia 30348 You must include Your Member Identification Number when submitting an appeal.

MEDICAL PLANS | 1-23 OTHER IMPORTANT INFORMATION

Important information, such as your rights as a Plan participant and other administrative details, can be found in the General and Administrative Information chapter of this SPD. Information about claims appeals can also be found in that section and following this chapter.

Patient Protection Notices

The Claim Administrator generally allows the designation of a primary care provider. You have the right to designate any primary care provider who participates in the Claim Administrator’s network and who is available to accept you or your family members. For information on how to select a primary care provider, and for a list of the participating primary care providers, contact the Claim Administrator at the number on the back of your ID card. For children, you may designate a pediatrician as the primary care provider. You do not need prior authorization from the Claim Administrator or from any other person (including a primary care provider) in order to obtain access to obstetrical or gynecological care from a health care professional in the Claim Administrator’s network who specializes in obstetrics or gynecology. The health care professional, however, may be required to comply with certain procedures, including obtaining prior authorization for certain services, following a pre-approved treatment plan, or procedures for making referrals. For a list of participating health care professionals who specialize in obstetrics or gynecology, contact the Claim Administrator at the number on the back of your ID card.

MEDICAL PLANS | 1-24 CHAPTER 1A

Medical Coverage During Retirement CONTENTS

...... Page

Introduction...... 1A-1

Eligibility...... 1A-1

• Eligible Dependents ...... 1A-1

Rehires...... 1A-2

Enrollment and Effective Date of Coverage...... 1A-2

Pre-Medicare Medical Coverage ...... 1A-2

Coverage for Medicare-Eligible Retirees and Dependents...... 1A-3

Prescription Drug Coverage...... 1A-3

• Pre-Medicare and Medicare Prescription Drug Coverage...... 1A-3

• Features...... 1A-3

• Co-payments...... 1A-3

• Mail Service Pharmacy...... 1A-4

Paying for Retiree Medical Coverage...... 1A-4

Continuation of Coverage for Surviving Dependents...... 1A-4

Termination of Retiree Coverage...... 1A-5

Questions/Contact Information...... 1A-5

Other Important Information...... 1A-5

MEDICAL COVERAGE DURING RETIREMENT INTRODUCTION

You and your enrolled dependents may be eligible to continue Signature Select retiree medical coverage into your retirement years if you retire from Berryville Graphics, Inc. or the Dynamic Graphic Finishing division of Coral Graphic Services, Inc. and meet certain eligibility and enrollment requirements. The type of medical coverage available upon retirement depends on whether you (or your enrolled dependents) are eligible for Medicare. Retirees are responsible for the entire cost of coverage. For purposes of this Chapter 1A, “Company” refers only to either Berryville Graphics, Inc. or the Dynamic Graphic Finishing division of Coral Graphic Services, Inc., whichever has employed you. You can verify your eligibility for retiree medical coverage with your Benefits Department or local Human Resources Representative.

ELIGIBILITY

If you were hired by Dynamic Graphic Finishing on or before December 31, 2009 and were at least age 35 as of December 31, 2009, Signature Select retiree medical coverage is available upon retirement if you have Signature Select medical coverage immediately prior to retirement and you retire from the Company at age 55* or over, have at least 10 years of service, and the sum of your age plus your years of service as of your retirement date equals or exceeds 75, in accordance with the following chart:

Minimum Required Years of Service at Total Age at Retirement Retirement (Age+Service) 55 20 75 56 19 75 57 18 75 58 17 75 59 16 75 60 15 75 61 14 75 62 13 75 63 12 75 64 11 75 Age 65 or over 10 75

If you were hired by Berryville Graphics, Inc. on or before December 31, 2009 and were at least age 35 as of December 31, 2009, Signature Select retiree medical coverage is available upon retirement if you have Signature Select medical coverage immediately prior to retirement and you retire from the Company at age 55* or over and have at least 20 years of regular full-time service or if you retire at age 65 or over and have at least 10 years of regular full-time service. Your years of service include all continuous, full-time service with Dynamic Graphic Finishing or Berryville Graphics, Inc. and/or any other affiliated Bertelsmann companies. If you are rehired by the Company, you will not receive credit for your prior service. Your years of service also include any pre-Bertelsmann service with any other company acquired by Bertelsmann.

Eligible Dependents Eligible dependents include: Your spouse or same-sex domestic partner** If you elect Signature Select retiree medical coverage, you Your dependent children up to age 26, including your (or your may also elect to continue the medical coverage for any eligible spouse’s or same-sex domestic partner’s): dependents (spouse and/or children) that were enrolled in Signature Select medical coverage immediately prior to your • Natural children retirement. • Legally adopted children (or placed for adoption) • Foster children (placed through an authorized agency) Once retired, you may not add additional dependents to your coverage. (An exception may apply for a dependent spouse who • Stepchildren continues working and has coverage through their employer. Disabled dependent children can be covered beyond age 25 if Please see the section Enrollment and Effective Date of Coverage disabled prior to that age (and were covered under Signature for more details.) Select medical coverage or another medical plan) immediately prior to your retirement. Proof of the child’s disability must be provided within 31 days after the child’s coverage would have otherwise terminated, and also from time to time upon request by the Plan Administrator. MEDICAL COVERAGE DURING RETIREMENT | 1A-1 Occasionally, you may be asked for proof of dependent status for your enrolled dependents. Failure to timely provide satisfactory ENROLLMENT AND EFFECTIVE proof may result in retroactive termination of coverage, and you may be required to reimburse the Plan for any benefits paid for an DATE OF COVERAGE ineligible dependent’s expenses. To elect Signature Select retiree medical coverage for yourself and any eligible dependents, you must enroll within 31 days after **Same-Sex Spouses and Domestic Partners your retirement from the Company. In the event of your death, your Same-sex domestic partners are eligible for dependent coverage enrolled dependents, if eligible, must enroll in coverage within 31 under this Plan only if the laws of your State of residence do days after your death. not permit same-sex marriage. For each State in which its laws If you enroll prior to your retirement date or within 31 days change to permit same-sex marriage, the Plan provides for a thereafter, your coverage as a retiree will begin as of your 12-month period (beginning with the date of the law change) retirement date (i.e., your coverage as an active employee will be during which enrolled same-sex domestic partners may continue continued into retirement or, if you are eligible for Medicare, you Plan coverage by entering into marriage. You will be required to can enroll in Medicare supplemental coverage and/or Medicare provide proof of such marriage. prescription drug coverage as described later in this chapter). If you live in a state that recognizes same sex marriage and you However, if you do not enroll before the enrollment deadline (i.e., choose not to marry, your same sex domestic partner will lose 31 days after your retirement date), your coverage will terminate as their eligibility for coverage. of your last date of employment and you will not be able to enroll In order to qualify for eligible dependent coverage, same- at any later time. sex domestic partners must live together in an exclusive and A special rule applies for your spouse if he or she is working and committed relationship and be financially interdependent (as has medical coverage through his or her employer at the time verified by approved documentation). of your retirement (“Working Spouse”). A Working Spouse is Whenever we say ‘spouse’ in this chapter, we mean spouse or eligible to be enrolled in dependent coverage under Signature same-sex domestic partner, as applicable. Select retiree medical coverage even though he or she was not enrolled in Signature Select medical coverage at the time of your retirement. In addition, you may enroll your Working Spouse in dependent coverage under Signature Select retiree medical at REHIRES a later time – within 31 days of the Working Spouse’s retirement date. If you die during this deferral period, your Working Spouse If you are rehired as an active employee after you have retired from may be eligible for Signature Select retiree medical coverage the Company, any Signature Select retiree medical coverage for provided he or she enrolls within 31 days after the date of your you and your dependents is subject to suspension if you become death. eligible for and enroll in Signature Select medical coverage as an active employee. You cannot receive medical coverage intended You may elect Signature Select retiree medical coverage only if for both active employees and retirees at the same time. Once you you were covered under the Signature Select medical coverage cease employment with the Company, you will be able to elect immediately prior to your retirement. If you are over age 65, the retiree medical coverage that is available at that time. Special you may elect Medicare supplemental coverage and Medicare circumstances may apply in this situation; please check with your prescription drug coverage separately. local Human Resources Representative or Benefits Department.

* If you become totally and permanently disabled before age 55, you will be eligible for Signature Select retiree medical coverage upon termination of PRE-MEDICARE MEDICAL employment if you have completed at least 20 years of service with the Company. If you terminate employment for any other reason prior to age 55 and/or before COVERAGE completing the required years of service, coverage will not be available (whether or not you have an entitlement to a pension benefit from the Company). When a retiree or covered dependent is not eligible for Medicare (e.g., under age 65), the Signature Select medical coverage provided immediately before retirement may be continued until reaching Medicare eligibility, unless coverage is otherwise terminated or changed (for example, due to failure to pay premiums or due to changes in Plan offerings or insurers). You will be allowed to make changes during annual enrollment each year among the options offered, but you may not add any dependents at that time. (An exception applies if your spouse is a Working Spouse – refer to the Enrollment and Effective Date of Coverage section.) If you drop your or your dependent’s coverage during annual enrollment, you or your dependent (as applicable) will not be able to re-enroll, whether in following year or at any later time.

MEDICAL COVERAGE DURING RETIREMENT | 1A-2 D prescription drug coverage. You can keep coverage through COVERAGE FOR Signature Select and not pay an extra fee if you later decide to MEDICARE-ELIGIBLE RETIREES enroll in a different Medicare Part D prescription drug coverage. If you decide to drop or opt-out of the prescription drug coverage AND DEPENDENTS offered through Signature Select, you cannot re-enroll in prescription drug coverage later. If you or your enrolled dependent is – or becomes – eligible for You should also know that if you drop or lose your prescription Medicare (e.g., age 65), the coverage available under Signature drug coverage through Signature Select and do not enroll in Select is United Healthcare’s AARP Medicare Supplement Medicare Part D prescription drug coverage after your coverage Insurance Plans and the Medicare prescription drug coverage (as ends, you may have to pay more to enroll at a later date. You will described on the next page). You may choose among the plans have to pay the higher premium as long as you have Medicare available to you based on the state where you live. Each of these coverage. In addition, you may have to wait until Medicare’s next plans is designed to supplement your Medicare coverage. open enrollment period to sign up. Signature Select retiree medical coverage is made available with the assumption that a person who is eligible for Medicare has full Medicare coverage (Part A and Part B) and uses Medicare Medicare Prescription Drug Features for all expenses that are payable by Medicare. Therefore, it is Here are some of the key features of the prescription drug important for you and your eligible dependents to apply for coverage: Medicare (Part A and Part B) as soon as you are eligible. • No annual deductible • Flat co-pays – as low as $10.00 for generic drugs PRESCRIPTION DRUG • No coverage gaps COVERAGE • A formulary – A complete formulary listing is available online at www.express-scripts.com • National pharmacy network with over 60,000 locations in the Pre-Medicare Prescription Drug Coverage United States If you (or your dependents) are not eligible for Medicare, the prescription drug coverage available under Signature Select Medicare Prescription Drug - Four Levels of retiree medical is generally the same as the prescription drug coverage available to active employees. Co-Payments

The prescription drug coverage offered through Signature Medicare Prescription Drug Coverage Select has four different levels of co-pays for a 31-day supply of prescription drugs. Coverage for Medicare-eligible retirees and/or dependents is provided through a Medicare Part D qualified prescription drug Contracted Retail Pharmacy Type of Medication plan with Express Scripts and administered by Benistar. If you Co-pay Levels become Medicare-eligible as a retiree, you may sign up for this plan when you first become eligible for Medicare (generally three Tier 1 Most generic drugs, lowest months before the month you turn age 65 until three months after Generic Drugs: $10 co-pay you turn age 65). If you get Medicare due to a disability, you can Tier 2 Preferred Brand Drugs join from three months before to three months after your 25th Preferred Brand Drugs: $30 month of Social Security Disability payments. Tier 3 You may choose to enroll in Medicare Supplemental Insurance Non-Preferred Brand Drugs: Non-Preferred Brand Drugs Plan but not in a Medicare Part D prescription drug plan (or $50 vice versa). If you decide not to enroll in the Signature Select Tier 4 Specialty Drugs prescription drug plan, Signature Select will not cover any Specialty Tier - $50 prescription drug costs. Likewise, if you decide not to enroll in a Medicare Supplemental Insurance Plan, Signature Select will not cover any medical costs. If you don’t sign up for Medicare when you are first eligible, you may pay a penalty. If you didn’t join Medicare Part D when you were first eligible, your next opportunity to join will be during the next Medicare open enrollment period. It has been determined that the prescription drug coverage offered through Signature Select is, on average for all our plan participants, at least as good as standard Medicare Part

MEDICAL COVERAGE DURING RETIREMENT | 1A-3 Use Network Pharmacies Under Medicare PAYING FOR RETIREE MEDICAL Prescription Drug Coverage COVERAGE To keep your costs low, you should fill your prescriptions at a Different premium costs apply to retirees and dependents eligible network pharmacy. The pharmacy network includes more than for Medicare versus those who are not eligible for Medicare. 60,000 pharmacies nationwide including retail, mail-order, long- Generally, the premium cost for Medicare-eligible retirees and term care and home infusion pharmacy services. A complete dependents is considerably lower than the premium cost for listing of the pharmacies is available by calling 1-888-345-2560 – pre-Medicare retirees and dependents. 24 hours a day, 7 days a week (TTY/TDD users should call 1-800- 716-3231 24 hours a day, 7 days a week) or going online at Retirees pay the full cost of coverage for themselves and for any www.express-scripts.com. enrolled dependents to the Company’s Direct Billing Third-Party Administrator. Your Benefits Department can provide you with information regarding current premium rates. Medicare Prescription Drug Coverage Generally, any changes to premium amounts are effective Mail Service Pharmacy January 1.

You can have convenient home delivery when you order prescriptions through the mail service pharmacy. CONTINUATION OF COVERAGE • Tier 1: Generic Drugs $25 co-pay for a three-month (90-day) supply of drugs in this FOR SURVIVING DEPENDENTS tier from the Express Scripts mail-order pharmacy. • Tier 2: Preferred Brand Drugs In the event of your death after retiring, your covered dependents $80 co-pay for a three-month (90-day) supply of drugs in this (spouse and any children) may elect to continue their Signature tier from the Express Scripts mail-order pharmacy. Select retiree medical coverage. • Tier 3: Non-Preferred Brand Drugs If you die before retiring, and you met the age and service eligibility $135 co-pay for a three-month (90-day) supply of drugs in this requirements (see the Eligibility section of this chapter) at the tier from the Express Scripts mail-order pharmacy. time of your death, your dependents will be eligible to enroll in Signature Select retiree medical coverage provided they were • Tier 4: Specialty Tier Drugs enrolled in Signature Select medical coverage immediately prior $135 co-pay for a three-month (90-day) supply of drugs in this to your death. Your dependents must enroll within 31 days after tier from the Express Scripts mail-order pharmacy. the date of your death. If you die before retiring and you did not meet the age and service requirements described in the Eligibility Medicare Prescription Drug section at the time of your death, your dependents will not be eligible to enroll in Signature Select retiree medical coverage. A Catastrophic Coverage covered employee’s death is also an event that permits COBRA continuation coverage for enrolled dependents. See the COBRA After your yearly out-of-pocket costs reach $4,700, the amount Continuation Coverage section of the General and Administrative you pay will change. You will pay the greater of: Information chapter for more information. • $2.65 for a generic drug (including brand drugs treated as If you die during the deferral period for your Working Spouse generics) and $6.60 for all other covered drugs, or (see the Enrollment and Effective Date of Coverage section of • 5% of the total cost, with a maximum not to exceed the this chapter), your Working Spouse may be eligible for Signature standard cost-sharing amount during the initial coverage stage. Select retiree medical coverage provided he or she enrolls within 31 days after the date of your death. Additional Information for All Retiree Prescription Drug Coverage

If you enroll in prescription drug coverage, you will receive a membership ID card and a welcome kit in the mail that thoroughly explains the coverage. If you have questions, you can call 1-888-345-2560 – 24 hours a day, 7 days a week. TTY/TDD users should call 1-800-716-3231 24 hours a day, 7 days a week. More information can be found at www.express-scripts.com. For more information on Medicare programs, call Medicare toll free: 1-800-MEDICARE (1-800-633-4227), TTY/TDD 1-877-486-2048, 24 hours a day, 7 days a week or visit the www.medicare.gov website.

MEDICAL COVERAGE DURING RETIREMENT | 1A-4 TERMINATION OF RETIREE COVERAGE

Signature Select retiree medical coverage (including any Medicare Part D Prescription Drug coverage) will terminate upon: • Your request to cancel coverage • Failure to pay your premium within the 60-day grace period after each premium due date • Termination of Signature Select, i.e., the Bertelsmann Employee Protection Plan (or termination of the portion of the Plan that provides the relevant coverage) • Termination or cancellation of the underlying insurance policy for any reason • Ceasing to be eligible for Signature Select retiree medical coverage (whether as a result a Plan amendment or due to loss of eligibility resulting from divorce, legal separation, attainment of age 26, or other events) • Failure to complete dependent eligibility verification requirements • Fraud, intentional misrepresentation or misconduct attempted with regard to any Signature Select retiree medical coverage or benefits Notwithstanding any other provisions of this SPD, the plan sponsor of Signature Select may amend or terminate the Signature Select retiree medical program at any time at its sole discretion.

QUESTIONS/CONTACT INFORMATION

Medical Coverage (if you are pre-Medicare) Prescription Drug Coverage (if you are Medicare eligible) Anthem BlueCross BlueShield Express Scripts Medicare Prescription Plan PO Box 105187 1-888-345-2560– 24 hours a day, 7 days a week Atlanta, GA 30348-5187 TTY/TDD: 1-800-716-3231 1-855-702-1127 Group # 2680 Group # 3330119 Contract ID – Berryville Graphics – BerryG11 www.anthem.com Contract ID – Dynamic Graphics – Dynami23 www.express-scripts.com Medical Coverage (if you are Medicare eligible) AARP Health Care Options Customer Service Medicare 1-800-545-1797 – Weekdays, 7 a.m. to 11 p.m. Eastern Time and 1-800-MEDICARE (1-800-633-4227) Saturdays, 9 a.m. to 5 p.m. Eastern Time TTY: 1-877-486-2048 TTY: 1-800-232-7773 – Weekdays, 9 a.m. to 5 p.m. Eastern Time www.medicare.gov Group #860 – Berryville Graphics Inc. Group #1363 – Dynamic Graphics COBRA Administrator www.aarphealthcare.com WageWorks, Inc. P.O. Box 14055 Prescription Drug Coverage (if you are pre-Medicare) Lexington, KY 40512 Express Scripts 1-877-502-6272 1 Express Way www.wageworks.com St. Louis, MO 63121 1-800-711-0917 Group # 2680 Contract ID – Berryville Graphics – BerryG11 Contract ID – Dynamic Graphics – Dynami23 www.express-scripts.com

OTHER IMPORTANT INFORMATION

Important information, such as your rights as a Plan participant and other administrative details, can be found in the General and Administrative Information chapter of this SPD. Descriptions regarding Signature Select retiree medical coverage contained in booklets provided by authorized insurers and administrators (for example, regarding benefits, how to make a claim for benefits, appealing denied benefits, and various legally required disclosures) are incorporated by reference into this chapter and deemed to be a part of this SPD. In the event of a conflict between the provisions in the above sections and in any insurer- or administrator-provided documents, the provisions in the above sections will govern with respect to enrollment eligibility, and the provisions in the insurer- or administrator- provided documents will govern in all other respects.

MEDICAL COVERAGE DURING RETIREMENT | 1A-5 CHAPTER 2

Dental Plans CONTENTS

...... Page

Key Terms to Know...... 2-1

The Signature Select Dental Plans...... 2-2

The Core and High Dental Preferred Provider Organization (DPPO) Plans ...... 2-2

• Using Network Providers...... 2-2

• Finding a Delta Dental DPPO Network Provider...... 2-2

How the Plans Work...... 2-3

• Differences Between the Core and High DPPO Plans...... 2-4

What the DPPO Plans Cover...... 2-5

• Covered Services...... 2-5

• Maximum Plan Allowance (MPA) ...... 2-6

What the DPPO Plans Do Not Cover...... 2-6

Filing Claims ...... 2-7

• For In-Network Dental Expenses ...... 2-7

• For Out-of-Network Dental Expenses...... 2-7

• How to File a Claim...... 2-7

• Pre-Treatment Estimate for Services Over $300 ...... 2-7

Other Important Information...... 2-8

Appendix A – Delta Dental Denial Appeal...... 2-9

Appendix B – Delta Dental Utilization Review...... 2-10

Exhibit A – Notice of Adverse Determination...... 2-14

Exhibit B – Notice of Final Adverse Determination...... 2-15

DENTAL PLANS KEY TERMS TO KNOW

Here are a few important terms that are used to describe the Dental Plans in this SPD. Knowing these benefit terms will help you better understand how the Plans work.

Allowed Amount As the full payment for services, Delta Dental’s participating dentists accept Delta Dental’s Maximum Plan Allowances or their charged fees, whichever is less (allowed amount). Delta Dental pays the allowed amount, less co-payments, deductibles, amounts over contractual limitations and other maximums, directly to the participating dentist. The patient is only responsible to the participating dentist for the Patient Payment, i.e., the difference between the allowed amount and the Delta Dental Payment.

Annual Deductible The Annual Deductible is the amount you pay for eligible dental services before the Plan will begin to reimburse you. Under both the Core and High DPPO Plans, the Annual Deductible period is a calendar year.

Annual Maximum The Annual Maximum is the most that a covered individual can receive in dental benefits in one calendar year.

Coinsurance The specific percentage you pay toward the cost of certain covered services. For example, if the Plan pays 80 percent of covered services, you are responsible for paying the remaining 20 percent.

Co-payment A Co-payment is a flat dollar amount paid for a medical or dental service by an insured person. It is a generally a small portion of the actual cost of the service.

Maximum Plan Allowance (MPA) (also known as Usual, Customary and Reasonable) Delta Dental refers to its reimbursement levels as Maximum Plan Allowance (MPA). Delta Dental calculates an MPA for use in payment to participating and non-participating fee-for-service dentists, and is based upon charges submitted on a regional basis for a given service by dentists of similar training, within the same geographical area. Delta Dental blends the claim charges with dentist fee information from a number of other sources, including dentist fee filings, using various factors, subject to regulatory limitations and adjustment for extreme difficulty or unusual circumstances. (For more information, see the section MPA on page 2-6.)

Reimbursement Level The Reimbursement Level is the percentage of covered expenses paid by the Plan once the deductible is met.

DENTAL PLANS | 2-1 THE SIGNATURE SELECT DENTAL PLANS

Good dental care is an important part of your overall health. The Signature Select Dental plan options encourage preventive care, while offering protection against a wide range of dental expenses. The plans can help you and your covered dependents prevent dental problems with regular checkups—and provide protection if you need major dental work. Your participation in a dental plan is voluntary. At annual enrollment, or as a new hire, you can elect or decline coverage. You have flexibility in choosing a dental plan to best meet your needs and the needs of your eligible dependents. You may choose one of the following dental plan options, or you may decline dental coverage. • Core Dental Preferred Provider Organization (DPPO) • High Dental Preferred Provider Organization (DPPO)

The Core and High DPPO Plans

The Core and High DPPO Plans are administered by Delta Dental Using Network Providers and cover most of the same dental expenses, but at different coverage levels. With these Plans, you can: For the Core and High DPPO Plans, you have access to two Delta • Lower your overall costs - If you use a participating Premier or Dental provider networks, the Delta Dental Premier® Network and PPO dental provider, they will accept Delta Dental’s Maximum the Delta Dental PPO Network. Plan Allowance (MPA) as full payment. Payments will be made You can choose a dentist from the larger Delta Dental Premier directly to your dental provider, which reduces your “up-front” Network anytime you need to, or you can take advantage of the expenses. You will be responsible for all deductible and/or lower allowances – and lower out-of-pocket costs – associated coinsurance amounts. with dentists who participate in the smaller Delta Dental PPO • Avoid filing claims - When you stay in-network under the Core Network. You can also choose a dentist who does not participate and High DPPO Plans, there are no claim forms to file; your with Delta Dental and receive applicable benefits. participating dental provider is paid directly by the Plan. And, The dental providers in both networks agree to provide services you don’t have to worry about charges that exceed the MPA at the applicable allowed amount as payment in full for covered • Have flexibility – You are free to go to any dentist of your services. You save money because your share of the cost is based choice. However, if you receive your care from a dental provider on the reduced fees. You have complete freedom of choice in outside the Delta Dental Network, that provider may charge fees selecting a dentist. Your choice of dentist can determine the cost in excess of MPA because there aren’t any agreements in place savings you receive. with Delta Dental. You will be responsible for paying the dental provider when services are rendered and submitting the claim Finding a Delta Dental DPPO Network Provider for reimbursement to Delta Dental. You are responsible for fees in excess of the MPA rate. If you are in the Core or High DPPO Plan, using a Delta Dental participating dental provider will ensure that you minimize your out-of-pocket costs for any dental expenses. You can visit Delta Dental’s website at www.deltadentalins.com for an up-to-date listing of dental providers in your area, or you can contact them by telephone at 1-800-932-0783 (between 8:00 a.m. and 8:00 p.m. Eastern Time).

DENTAL PLANS | 2-2 HOW THE PLANS WORK

When you have a dental care expense, the Plan pays a percentage of your cost. The percentage is based on the type of service you or your covered dependents receive, the Dental Plan you are enrolled in, if the dentist is in the network and the allowed amount. In the Core and High DPPO Plans, for certain types of expenses, a covered employee or dependent is required to meet his or her individual annual deductible before Plan coverage begins (excluding preventive and diagnostic services). To meet the deductible, an individual must incur eligible deductible dental expenses in a calendar year (January 1 through December 31) that are equal to the individual deductible amount. After you meet the deductible, the plan pays benefits up to a maximum benefit for each covered individual each year.

Here is a quick overview of how the Plans work:

DELTA DENTAL CORE DPPO DELTA DENTAL HIGH DPPO

In-Network Out-of-Network In-Network Out-of-Network

Annual deductible per person* $100 $100 $50 $50

Annual maximum benefit per person* $1,000 $1,500

Reimbursement Level - After deductible, Plan pays:

Preventive & diagnostic services* 70% 70% 100% 80% (such as exams, cleanings, x-rays, sealants)

Basic restorative services (such as fillings, extractions, root canals, 60% 60% 80% 80% surgical and non-surgical treatment of gums)

Major restorative services (such as crowns, inlays, onlays and cast 50% 50% 60% 60% restorations)

Implants 50% 50% 50% 50%

50%, $1,500 50%, $1,500 Orthodontia Not covered Not covered Lifetime Lifetime (dependent children to age 19)** Maximum Maximum

* Preventive and diagnostic services do not have a deductible and will not apply toward the annual maximum benefit limit. ** Orthodontia coverage ends the day they turn age 19

DENTAL PLANS | 2-3 Differences Between the Core and High DPPO Plans

Core DPPO Plan High DDPO Plan

• The Core DPPO Plan has a higher deductible but lower • The Core DPPO Plan provides a more moderate level of premium contributions, so you pay less out of each paycheck coverage and a lower annual per person maximum benefit. but more when you need care.

• The High DPPO Plan has a lower deductible but higher • The High DPPO Plan provides a higher level of in-network premium contributions, so you pay more out of each coverage for most services, and a higher annual per person paycheck but less when you need care. maximum benefit.

Example of How the Plan Pays

Anne lives in New York and is enrolled in the High DPPO Plan. She visits a dentist and has a tooth filled. Here is an example of Anne’s responsibility whether she receives care from a PPO, Premier or non-participating dentist.

PPO Dentist Premier Dentist Non-Participating Dentist

Dentist’s Charge $117.0 0 $117.0 0 $117.0 0

Delta Dental’s MPA $90.00 $100.00 $110.00

Deductible $50.00 $50.00 $50.00

Coinsurance 80% 80% 80%

Delta Dental Pays $32.00 $40.00 $48.00 [($90.00- $50.00) x 80%] [($100.00 - $50.00) x 80%] [($110.00 - $50.00) x 80%]

Anne’s responsibility $58.00 $60.00 $69.00 ($90.00 - $32.00) ($100.00 - $40.00) ($117.00 - $48.00)

DENTAL PLANS | 2-4 WHAT THE DPPO PLANS COVER

The Core and High DPPO Plans pay benefits for covered services Basic Restorative Services and supplies provided by a legally licensed dentist or doctor (or • Fillings, amalgam (silver) and restorations (white) a licensed hygienist for the cleaning and scaling of teeth under a dentist’s supervision). These services and supplies must be • Oral surgery, including extractions (unless covered under the necessary for the care, diagnosis, prevention or treatment of non- Medical Plan) occupational dental conditions, injuries or diseases. • Anesthesia, for covered oral surgery procedures The DPPO Plans categorize treatments and services as follows: • Endodontics (pulpal and root canal therapy), for the treatment • Preventive and Diagnostic Services of dental pulp diseases • Basic Services • Periodontics, services related to diseases of the gums and supporting structures of your teeth; benefits for surgery in the • Major Services same quadrant (e.g. upper right side of mouth) are limited to • Orthodontic Services (to age 19) once in any five-year period • Implants Major Restorative Services • TMJ • Crowns, inlays and onlays (and replacement once in any five- Each of these categories is reimbursed at a different percentage year period in the event that the existing one is not satisfactory (other than orthodontic services and implants) based on the and cannot be made satisfactory) participating status of the dentist and the plan you selected. To find out the reimbursement level for a specific procedure, ask • Prosthodontics (bridges and dentures), procedures and your dentist to request a “Pre-Treatment Estimate.” For more materials related to bridges and dentures (and replacement information, see the Pre-Treatment Estimate section later in this of dentures once in any five-year period in the event that chapter. the existing ones are not satisfactory and cannot be made satisfactory) Covered Services • Injectable antibiotics, antibiotic drugs that are administered by injection. The following services will be covered at the appropriate reimbursement level under each DPPO Plan when necessary and Orthodontia customary as determined by the standards of generally accepted • Braces, retainers and other services related to the straightening dental practice. Certain limits apply. of teeth (for children only). Orthodontic care corrects the positioning of teeth or an abnormal bite through braces or other Preventive and Diagnostic Services appliances. This care includes the installation and adjustment • Oral exams, once every six months of braces and appliances as well as regular examinations by an orthodontist according to an approved orthodontic treatment • Cleaning of teeth, once every six months; includes scaling and plan. polishing Dental implants, appliances placed into bone serving as • X-rays, bitewings twice every calendar year; full-mouth once prosthodontic abutments every three years Temporomandibular joint dysfunction (TMJ), if non-medical in • Fluoride treatments, once every six months for children to nature, reversible procedures for treatment of temporomandibular age 19 joint dysfunctions • Space maintainers, for children to age 14 • Sealants, once in any 36-month period on unfilled permanent first and second molars for children to age 14

Understanding How Orthodontic Benefits Are Paid

Once a treatment plan is approved, you’ll need to work out a payment arrangement with the orthodontist. You should know that: • The Plan covers orthodontic benefits for eligible dependents until the day they turn age 19. • The Plan reimburses for the cost of eligible expenses incurred during treatment. You may not file claims for expenses incurred after the date treatment is completed. • Orthodontic benefits are paid on a quarterly basis while you are covered by the Plan. Orthodontic benefits cease when you are no longer covered, even though the treatment plan was approved in advance.

DENTAL PLANS | 2-5 Maximum Plan Allowance (MPA) Payment for services performed by a non-participating dentist is calculated using a maximum fee level that may be higher Payment for services performed for you by participating dentists than Delta Dental’s Maximum Plan Allowance. The Delta Dental who are Delta Dental PPO dentists or Delta Dental “Premier” payment will be made to you, and you are responsible for payment dentists only is calculated by Delta Dental on the basis of a of the non-participating dentist’s total fee, which may include reduced Maximum Plan Allowance (“reduced MPA”) or the fee additional amounts and services not covered by the contract. charged, whichever is less (“PPO allowed amount” or “Delta Remember, when you stay in-network, there are no claims to file; Dental Premier allowed amount”). Participating dentists who are the participating dentist is paid directly by the Plan and you don’t Delta Dental PPO dentists or Delta Dental Premier dentists only have to worry about charges that exceed the allowed amount or have agreed to accept the PPO allowed amount or Delta Dental MPA. If you go to a non-participating dentist, you generally will be Premier allowed amount as full payment for services covered by asked to pay the total cost of your care at the time of your visit and the contract. submit a claim to Delta Dental for reimbursement. Delta Dental calculates its share of the PPO allowed amount or Delta Dental Premier allowed amount based on its co-payment Limitation on Optional Treatment Plan schedule (“Delta Dental Payment”) and sends it to the participating In all cases in which there are optional plans of treatment with dentist. Delta Dental advises you of any charges not payable for different treatment costs, payment will be made based upon the which you are responsible (“Patient Payment”). If your Dentist least costly course of treatment that will restore the oral condition is a Delta Dental PPO or Premier dentist, the Patient Payment in a professionally accepted manner. is generally the difference between the Delta Dental Payment and the PPO allowed amount – i.e., co-payments, deductibles, charges where maximums have been exceeded – and charges for services not covered by the contract.

WHAT THE DPPO PLANS DO NOT COVER

Expenses Not Covered There are some expenses that the Core and High DPPO Plans do not cover. These include (but are not limited to): • Any dental services or supplies otherwise covered under the Medical Plan • Orthodontic treatment for dependents over 19. Coverage ends the day a dependent turns 19. • Charges for hospitalization, including hospital visits • Services or supplies that are not specifically covered under the Plan • Services or supplies required as a result of a job-related accident or injury or an act of war • Services or supplies provided or paid for by any governmental agency • Services or supplies to the extent that they exceed Delta Dental’s allowed amount • Procedures to correct congenital or developmental malformations, except for covered dependent children or newborn children eligible at birth • Procedures for increasing vertical dimension of an occlusion • Replacement of tooth structure lost by attrition or erosion • Services or supplies which, in the exclusive judgment of the Plan, are cosmetic or experimental in nature • Services or supplies for which there is no legal obligation to pay • Periodontal splinting • Gnathological recordings (recordings of bite measurement) • Services for equilibration • Plaque control programs, including oral hygiene instruction • Prescription drugs, pre-medications, analgesics and separate charges for local anesthetics • General anesthesia, except with covered oral surgery procedures of one or more simple extractions and/or with surgical extractions for patients under age 19; and except with three or more simple extractions and/or surgical extractions for patients age 19 and over • Replacement of a prosthetic device within five years of its installation or previous replacement

DENTAL PLANS | 2-6 FILING CLAIMS

For In-Network Dental Expenses Pre-Treatment Estimate for Services over $300

For the DPPO plans, you will not need to file a claim if you use It’s a good idea to find out exactly how much a dental treatment a participating provider. Your dentist will file the claim with Delta will cost and how much the plan will pay before you have the Dental, and you will be notified of any balance due. dental work done. In order to avoid any misunderstanding between you, your dental provider and Delta Dental, you or your dental provider may submit a pre-treatment estimate in advance For Out-of-Network Dental Expenses of any basic or major restorative service or any orthodontic or periodontic treatment (particularly if total charges may exceed When you receive dental care from an out-of-network provider, $300). This will help you understand what the Plan covers based you may be responsible for paying the full cost at the time the upon the treatment plan submitted and if certain services are not service is performed. In some cases, your provider may agree to covered by the Plan. wait for payment. It’s up to you to make that arrangement. After you pay the full cost, you or your provider must submit an itemized To file a pre-treatment estimate, you or your dental provider can claim for covered expenses. submit a claim form to: You can obtain claim forms with the group number below by Delta Dental contacting your Human Resources department. You can also P.O. Box 2105 obtain claim forms Delta Dental’s website at Mechanicsburg, PA 17055-2105 www.deltadentalins.com. Delta Dental will return a predetermination voucher to your dental • Berryville Graphics - #01523 provider with your eligibility, scope of benefits and a period for completion of services. Once the services are completed, the • Dynamic Graphics - #04382 voucher with service dates and signatures should be submitted to • Coral Graphics - #02165 Delta Dental for payment.

How to File a Claim If Your DPPO Claim Is Denied Delta Dental administers claim denial and appeal processes, as 1. Obtain a claim form. Claim forms can be obtained on approved by the State of New York, for: Delta Dental’s website at www.deltadentalins.com. On the homepage, click on “Individuals and Enrollees” and “How to • Denial of payment based upon lack of coverage of benefit File a Dental Claim.” Then select Delta Dental of New York Inc., under the Plan or your eligibility status, i.e., claim benefit which will allow you to view and print a claim form. determinations that are not considered Utilization Review under Article 49 of the New York Insurance Law (see Appendix A). 2. Complete the claim form. Complete the employee section of the claim form. Bring the form with you to your appointment. • Denial of a covered benefit where the service is not dentally Ask your dentist to complete the Attending Dentist’s Statement. necessary, appropriate or efficient, i.e., claim benefit All claim forms must be completed with the appropriate patient determinations that are considered Utilization Review under information and with the Company’s group number (included Article 49 of the New York Insurance Law (see Appendix B). above). An itemized bill may be attached to the claim form as an Please review Appendices A and B for a more detailed explanation alternative to completing the dentist’s information section. of Delta Dental’s claim denial and appeal processes for the above 3. Send the claim form. Mail the completed form to: claim benefit determinations. Delta Dental P.O. Box 2105 Mechanicsburg, PA 17055-2105 You will receive an Explanation of Benefits (EOB) statement when your claim is processed. If Delta Dental cannot fully evaluate your claim, you will be notified in writing to provide the additional information requested.

DENTAL PLANS | 2-7 OTHER IMPORTANT INFORMATION

Important information, such as your rights as a Plan participant and other administrative details, can be found in the General and Administrative Information chapter of this SPD and also following this chapter. • Appendix A – Delta Dental Claim Denials and Appeals • Appendix B – Delta Dental Utilization Review Denials and Appeals • Exhibit A – Notice of Adverse Determination • Exhibit B – Notice of Final Adverse Determination

DENTAL PLANS | 2-8 APPENDIX A – DELTA DENTAL DENIALS AND APPEALS

Delta Dental administers claim denial and appeal processes, as approved by the State of New York, for: • Denial of payment based upon lack of coverage of benefit under the Plan or your eligibility status i.e., claim benefit determinations that are not considered Utilization Review under Article 49 of the New York Insurance Law

If a post-service claim is denied in whole or in part, Delta Dental terms of the contract, Delta Dental shall consult with a dentist shall notify you and the attending dentist of the denial in writing who has appropriate training and experience in the pertinent field within thirty (30) days after the claim is filed, unless special of dentistry and who is neither the Delta Dental dental consultant circumstances require an extension of time, not exceeding fifteen who made the claim denial nor the subordinate of such consultant. (15) days, for processing. If there is an extension, you and the The identity of the Delta Dental dental consultant whose advice attending dentist shall be notified of the extension and the reason was obtained in connection with the denial of the claim whether or for the extension within the original thirty (30) day period. If an not the advice was relied upon in making the benefit determination extension is necessary because either you or the attending dentist is also available to you or the attending dentist upon request. In did not submit the information necessary to decide the claim, making the review, Delta Dental will not afford deference to the the notice of extension shall specifically describe the required initial adverse benefit determination. information. You or the attending dentist shall be afforded at If after review, Delta Dental continues to deny the claim, Delta least forty-five (45) days from receipt of the notice within which to Dental shall notify you and the attending dentist in writing of the provide the specific information. The extension period (15 days) – decision on the request for review within thirty (30) days of the within which a decision must be made by Delta Dental – will begin date the request is received. Delta Dental shall send to you or to run from the date on which your response is received by the the attending dentist a notice, which contains the specific reason Plan (without regard to whether all of the requested information or reasons for the adverse determination and reference to the is provided) or, if earlier, the due date established by the Plan for specific contract provisions on which the benefit determination is furnishing the requested information (at least 45 days). based. The notice will state that you are entitled to receive, upon The notice of denial will explain the specific reason or reasons request and free of charge, reasonable access to, and copies of all why the claim was denied in whole or in part, including a specific documents, records and other information relevant to your claim reference to the pertinent contract provisions on which the denial for benefits. The notice shall refer to any internal rule, guideline, is based, a description of any additional material or information and protocol that was relied upon (and that a copy will be provided necessary for you to perfect the claim and an explanation as to free of charge upon request). The notice will state that if the claim why such information is necessary. The notice of denial will also denial is based on lack of dental necessity, experimental treatment contain an explanation of Delta Dental’s claim review and appeal or a clinical judgment in applying the terms of the contract, an process and the time limits applicable to such process, including explanation is available free of charge upon request by either you a statement of your right to bring a civil action under ERISA upon or the attending dentist. The notice shall also state that you have completion of Delta Dental’s second level of review. The notice a right to bring an action under ERISA upon completion of Delta shall refer to any internal rule, guideline, and protocol that was Dental’s second level of review, and will state: “You and your plan relied upon (and that a copy will be provided free of charge upon may have other voluntary alternative dispute resolution options, request). such as mediation. One way to find out what may be available is to contact your local U.S. Department of Labor Office and your State If you or the attending dentist wants the denial of benefits insurance regulatory agency.” reviewed, you or the attending dentist must write to Delta Dental within one hundred eighty (180) days of the date on the denial If in the opinion of you or the attending dentist, the matter warrants letter. In the letter, you or the attending dentist should state why further consideration, you or the attending dentist should advise the claim should not have been denied. Also any other documents, Delta Dental in writing as soon as possible. The matter shall data, information or comments which are thought to have bearing then be immediately referred to Delta Dental’s Dental Affairs on the claim including the denial notice, should accompany Committee. This stage can include a clinical examination, if not the request for review. You or the attending dentist is entitled done previously, and a hearing before Delta Dental’s Dental Affairs to receive upon request and free of charge reasonable access Committee if requested by you or the attending dentist. The to and copies of all documents, records, and other information Dental Affairs Committee will render a decision within thirty (30) relevant to the denied claim. The review will take into account all days of the request for further consideration. The decision of the comments, documents, records, or other information, regardless Dental Affairs Committee shall be final insofar as Delta Dental is of whether such information was submitted or considered in the concerned. Recourse thereafter would be to the state regulatory initial benefit determination. The review shall be conducted on agency, a designated state administrative review board, or to the behalf of Delta Dental by a person who is neither the individual courts with an ERISA or other civil action. who made the claim denial that is the subject of the review, nor the subordinate of such individual. If the review is of a claim denial based in whole or in part on a clinical judgment in applying the

DENTAL PLANS | 2-9 APPENDIX B – DELTA DENTAL UTILIZATION REVIEW DENIALS AND APPEALS

Delta Dental administers claim denial and appeal processes, as approved by the State of New York, for: • Denial of a covered benefit where the service is not dentally necessary, appropriate or efficient, i.e., claim benefit determinations that are considered Utilization Review under Article 49 of the New York Insurance Law

I. Definitions

A. Adverse Determination shall mean a determination by a procedures, treatments or services, including services Utilization Review Agent that an admission, extension of provided within a clinical trial, and the provision of a stay, or other health care service, upon review based on the pharmaceutical product pursuant to prescription by the information provided, is not medically necessary. patient’s attending physician for a use other than those uses for which such pharmaceutical product has been approved B. Appeal Determination shall mean a determination by Delta for marketing by the Federal Food and Drug Administration to Dental of New York’s Dental Affairs Committee that a health the extent that coverage for such service is prohibited by law care service, upon review based on the information provided, from being excluded under the plan, or (2) in all other cases, is not medically necessary. health care procedures, treatments or services provided by C. Clinical Peer Reviewer shall mean a physician who a facility licensed pursuant to Article 28, 36, 44, or 47 of the possesses a current and valid non-restricted license to Public Health Law pursuant to Article 19, 23, 31, or 32 of the practice medicine or a health care professional other than Mental Hygiene Law, or provided by a health care professional, a licensed physician who: (1) where applicable, possesses and the provision of pharmaceutical products or services or a current and valid non-restricted license, certificate or durable medical equipment. registration or, where no provision for a license, certificate or J. Subscriber shall mean a person subject to Utilization Review. registration exists, is credentialed by the national accrediting body appropriate to the profession, and (2) is in the same K. Utilization Review shall mean the review to determine profession and same similar specialty as the Health Care whether a Health Care Service that has been provided is being Provider who typically manages the medical condition or provided or is proposed to be provided to a patient, whether disease or provides the Health Care Service or treatment undertaken prior to, concurrent with or subsequent to the under review. delivery of such service, is medically necessary. None of the following shall be considered Utilization Review: D. Clinical Standards shall mean those guidelines and (1) denials based on failure to obtain a Health Care Service standards set forth in the Utilization Review Plan by the from a designated or approved Health Care Provider as Utilization Review Agent whose Adverse Determination is required under a contract, (2) where any determination is under appeal. rendered pursuant to Subdivision 3(a) of Section 2807(c) of E. External Appeal shall mean an appeal conducted by an the Public Health Law, (3) the review of the appropriateness of External Appeal Agent pursuant to Section 4914 of the New the application of a particular coding to a patient, including the York Insurance Law. assignment of diagnosis and procedure, (4) any issues relating F. External Appeal Agent shall mean an entity certified by the to the determination of the amount or extent of payment other superintendent pursuant to Section 4911 of the New York than determinations to deny payment based on an Adverse Insurance Law. Determination, and (5) any determination of any coverage issues other than whether a Health Care Service is or was G. Final Adverse Determination shall mean an Adverse medically necessary. Determination which has been upheld by a Utilization Review Agent with respect to a proposed Health Care Service L. Utilization Review Agent shall mean any insurer subject to following a standard appeal, or an expedited appeal where Article 32 or 43 of the New York Insurance Law performing applicable, pursuant to Section 4904 of the New York Utilization Review and any independent Utilization Review Insurance Law. Agent performing Utilization Review under contract with such insurer. H. Health Care Provider shall mean a Health Care Service or a facility licensed pursuant to Article 28, 36, or 47 of the Public M. Utilization Review Plan shall mean: (1) a description of the Health Law or a facility licensed pursuant to Article 19, 23, 31, process for developing the written clinical review criteria, (2) or 32 of the Mental Hygiene Law. a description of the types of written clinical information which the plan might consider in its clinical review, including but not I. Health Care Service shall mean: (1) for purposes of appeals limited to a set of specific written clinical review criteria, (3) requested pursuant to Paragraph two of Subsection b of a description of practice guidelines and standards used by Section 4910 of Title 2 the New York Insurance Law, Health a Utilization Review Agent in carrying out a determination of Care Service shall mean experimental or investigational medical necessity, (4) the procedures for scheduled review

DENTAL PLANS | 2-10 and evaluation of the written clinical review criteria, and (5) a fifteen (15) days of the filing of the appeal. The letter or oral description of the qualifications and experience of the health request for appeal should state why the claim should not have care professionals who developed the criteria, who are been denied. Also any other documents, data, information or responsible for periodic evaluation of the criteria and of the comments which are thought to have bearing on the claim health care professionals or others who use the written clinical including the denial notice, should accompany the request review criteria in the process of Utilization Review. for review. Both the Subscriber and the attending dentist are entitled to receive upon request and free of charge reasonable access to and copies of all documents, records, and other II. Standard Claims & Appeals Procedure information relevant to the denied claim. A. Claims for Benefits: In the case of a post-service claim E. Notification of Information Necessary to Conduct the which has been denied on the basis that such service was not Appeal: If Delta Dental requires information necessary to dentally necessary, Delta Dental shall notify the Subscriber conduct a standard internal appeal, Delta Dental shall notify and the attending dentist of its Adverse Determination in the Subscriber and the attending dentist, in writing within writing within a reasonable period of time, but not later than fifteen (15) days of receipt of the appeal, to identify and request thirty (30) days after the claim is filed. However, this period the necessary information. In the event that only a portion of may be extended one time by Delta Dental for up to fifteen such necessary information is received, Delta Dental shall (15) days, if necessary due to the failure of the Subscriber to request the missing information, in writing, within five (5) submit the information necessary to decide the claim. If there business days of receipt of the partial information. is an extension, the Subscriber and the attending dentist shall F. The Review: The review shall be conducted for Delta Dental be notified of the extension and the reason for the extension by a Clinical Peer Reviewer who is neither the Clinical Peer within the original thirty (30) day period. The notice of Reviewer who made the claim denial that is the subject of extension shall specifically describe the required information, the review, nor the subordinate of such individual. The review and the Subscriber or the attending dentist shall be afforded at will take into account all comments, documents, records, or least forty-five (45) days from receipt of the notice within which other information, regardless of whether such information was to provide the specific information. The extension period (15 submitted or considered in the initial benefit determination. If days) – within which a decision must be made by Delta Dental the review is of a claim denial based in whole or in part on a – will begin to run from the date on which the Subscriber’s lack of dental necessity, experimental treatment, or a clinical response is received by the plan (without regard to whether judgment in applying the terms of the Contract, Delta Dental all of the requested information is provided) or, if earlier, the shall consult with a dentist who has appropriate training and due date established by the plan for furnishing the requested experience in the pertinent field of dentistry and who is neither information (at least 45 days). the Delta Dental dental consultant who made the claim denial B. Reconsideration of Adverse Determination: In the event nor the subordinate of such consultant. The identity of the the Utilization Review of a claim results in an Adverse Delta Dental dental consultant whose advice was obtained Determination, and this determination was made without in connection with the denial of the claim whether or not the attempting to discuss such matter with the attending dentist advice was relied upon in making the benefit determination who specifically recommended the health care service, is also available on request. In making the review, Delta procedure or treatment, the attending dentist shall have Dental will not afford deference to the initial Adverse the opportunity to request a reconsideration of the Adverse Determination. A clinical examination at Delta Dental’s cost Determination. Such reconsideration shall be conducted by may be implemented, along with discussion among dentist the attending dentist and the Clinical Peer Reviewer making consultants. At this point, the Subscriber may also request a the initial determination or a designated Clinical Peer Reviewer hearing. if the original Clinical Peer Reviewer cannot be available. If the G. Final Adverse Determination: Delta Dental shall make a Adverse Determination is upheld after reconsideration, Delta Final Adverse Determination within thirty (30) days of the Dental shall notify the Subscriber of the Adverse Determination date the request for appeal is received. Delta Dental shall as provided below in Section III(A). advise the Subscriber and the attending dentist of the Appeal C. Informal Inquiry Option: If a claim is denied in whole or in Determination within two (2) days of the rendering of such part, a Subscriber may make an informal inquiry regarding determination. Notification of the Final Adverse Determination general program and eligibility questions by contacting Delta will be provided in accordance with Section III(B) below. Dental via its toll-free number at 1-800-932-0783. Every caller H. Appeal to Delta Dental’s Dental Affairs Committee: If in has access to a supervisor if dissatisfied with the response. the opinion of the Subscriber or the attending dentist the D. Non-emergency Appeals of Adverse Determination: matter warrants further consideration and the Subscriber In lieu of making an informal inquiry, a Subscriber or his or chooses not to file an External Appeal pursuant to Section her attending dentist may choose to appeal the Adverse 4914 of the New York Insurance Article, the Subscriber or Determination. The Subscriber may do so within one hundred attending dentist should advise Delta Dental in writing as soon eighty (180) days, either by writing to Delta Dental or by calling as possible. The matter shall be immediately referred to Delta Delta Dental at its toll-free number. Written acknowledgement Dental’s Dental Affairs Committee. Delta Dental’s Dental Affairs of the filing of the appeal to the appealing party will be Committee, which contains at least one licensed dentist, will provided to the Subscriber and the attending dentist within review the claim and either approve payment for the dental

DENTAL PLANS | 2-11 service or issue an Adverse Determination. If the Dental Affairs B. Content of Notification of Adverse Determination on Committee requires information necessary to conduct the Review i.e., “Final Adverse Determination.”(See Exhibit B). Internal Appeal, Delta Dental shall notify the Subscriber or If after the claim is reviewed, Delta Dental continues to deny attending dentist, in writing within fifteen (15) days of receipt of the claim, Delta Dental shall send the Subscriber/attending the appeal, to identify and request the necessary information. dentist a notice, which contains: In the event that only a portion of such necessary information 1. A clear statement describing the basis and clinical rationale for is received, Delta Dental shall request the missing information, the denial as applicable to the insured including the specific in writing, within five (5) business days of receipt of the partial reason or reasons for the determination, reference to the information. This stage can include a clinical examination, if specific plan provisions upon which the Adverse Determination not done previously, and a hearing before the Dental Affairs is based; Committee if requested. The Dental Affairs Committee will 2. A clear statement that the notice constitutes the Final Adverse render a decision within thirty (30) days of the request for Determination; further consideration. The decision of the Dental Affairs Committee shall be final insofar as Delta Dental is concerned. 3. The insured’s coverage type; Recourse thereafter would be to the courts with an ERISA or 4. The name and full address of Delta Dental’s Utilization Review other civil action or the filing of an External Appeal pursuant Agent; to Section 4914 of the New York Insurance Article, if the time 5. Delta Dental’s contact person and his or her telephone period for doing so had not previously expired. number; 6. A description of the health care service that was denied, III. Distribution of Information to Subscribers/ including the dates of the service, the name of the facility Attending Dentists Upon Entry of Adverse and/or physician proposed to provide the treatment and the developer/manufacturer of the health care service; Determination 7. A statement that the Subscriber and the attending dentist A. Content of Notification of Adverse Determination may be eligible for an External Appeal and the time frames for (See Exhibit A). A notice of an initial Adverse Determination will requesting an appeal; include: 8. A clear statement written in bolded text that the forty-five (45) 1. The specific reason or reasons for the Adverse Determination day time frame for requesting an External Appeal begins upon including the clinical rationale, if any; receipt of the Final Adverse Determination of the first-level appeal, regardless of whether or not a second-level appeal is 2. Reference to the specific plan provisions on which the Adverse requested, and that by choosing the request a second-level Determination is based; internal appeal, the time may expire for the Subscriber to 3. Instructions on how to initiate standard and expedited appeals request an External Appeal; including a description of the Delta Dental’s review procedures 9. A copy of the standard description of the External Appeal and the time limits applicable to such procedures and a process as developed jointly by the superintendent and statement of the Subscriber’s right to bring a civil action under commission, including a form and instructions for requesting Section 502(a) of ERISA upon completion of the second level an External Appeal; of review of Delta Dental’s Internal Appeals Procedure; 10. A statement that the Subscriber is entitled to receive, upon 4. Instructions on how to initiate an External Appeal pursuant to request and free of charge, reasonable access to, and copies Section 4914 of the New York Insurance Law; of, all documents, records, and other information relevant to 5. If an internal rule, guideline, protocol, or other similar criterion the claimant’s claim for benefits; was relied upon in making the Adverse Determination, a 11. A statement that when the Subscriber completes the second statement that a copy of such will be provided free of charge level of Delta Dental’s Internal Appeals Procedure, the upon request; Subscriber will then have a right to bring an action under 6. If the Adverse Determination is based on dental necessity Section 502(a) of ERISA; or experimental treatment or similar exclusion or limit, a 12. If an internal rule, guideline, protocol, or other similar criterion statement that an explanation applying the terms of the plan was relied upon in making the Adverse Determination, a to the Subscriber’s medical circumstances is available upon statement that a copy of such will be provided free of charge request; upon request; 7. A description of any additional material or information 13. If the Adverse Determination is based on a medical necessity necessary for the claimant to perfect the claim and an or experimental treatment or similar exclusion or limit, a explanation of why such material or information is necessary. statement that an explanation applying the terms of the plan to the Subscriber’s medical circumstances is available upon request; 14. The following statement: “You and your plan may have other voluntary alternative dispute resolution options, such as mediation. One way to find out what may be available is to contact your local U.S. Department of Labor Office and your State insurance regulatory agency.” DENTAL PLANS | 2-12 IV. Cooperation with the External Appeal Agent

Delta Dental will facilitate the prompt completion of External Appeal requests by: A. Transmitting the Subscriber’s dental and treatment records pursuant to an appropriately completed release or release signed by the Subscriber or by a person authorized pursuant to law to consent to health care for the Subscriber and, in the case of dental necessity appeals, transmit the clinical standards used to determine medical necessity for the Health Care Service within three (3) business days of receiving notification regarding the identity and address of the certified External Appeal Agent to which the subject appeal is assigned. B. Providing information requested by the assigned certified External Appeal Agent as soon as is reasonably possible, but in no event shall Delta Dental take longer than two (2) business days to provide the requested information. C. Providing the form and instructions, developed jointly by the superintendent and commissioner, for the attending dentist to request an External Appeal in connection with a retrospective adverse utilization review determination under Section 4904 of the Insurance Law, within three (3) business days of an attending dentist’s request for a copy of the form. D. In the event that an Adverse Determination is overturned on External Appeal, or in the event that Delta Dental reverses a denial which is the subject of an External Appeal, Delta Dental shall make payment for the Health Care Service which is the basis of the External Appeal to the Subscriber. E. No fee will be charged by Delta Dental to a Subscriber for an External Appeal.

DENTAL PLANS | 2-13 EXHIBIT A – NOTICE OF ADVERSE DETERMINATION This notice, provided to you pursuant to the requirements of Article 49 of the New York Insurance Law and the United States Department of Labor Claims Procedure Regulations constitutes an Adverse Determination of your claim.

Reasons for the Determination If after review, Delta Dental continues to deny the claim, Delta Dental shall notify you and your attending dentist in writing of the The NOTICE OF PAYMENT OR ACTION attached hereto outlines decision on the request for review within thirty (30) days of the the specific reason(s) and the specific plan provision(s) on which date the request is received. Delta Dental shall send you and your the determination was based. attending dentist a notice, similar to this notice. If in the opinion of you or your attending dentist, the matter warrants further consideration, you have two choices: (1) you may continue to Availability of Clinical Review Criteria Relied avail yourself of Delta Dental’s Internal Appeals Procedure and Upon to Make this Determination eventually, upon completion of Delta Dental’s second level of review, file an action in the courts pursuant to section 502(a) of Upon request and free of charge, Delta Dental will provide to ERISA; or (2) you may file an External Appeal with the New York you a copy of any internal rule, guideline or protocol, and/or an Insurance Department. Attached hereto is “Standard Description explanation of the scientific or clinical judgment if relied upon in and Instructions for Health Care Consumers to Request an denying your claim. External Appeal.” More information on these two options will be provided to you after you complete the first level of review. Instructions on How to Initiate a Standard Additional Necessary Information Which Must Appeal & How to Initiate an External Appeal be Provided in Order for Delta Dental to Render If you or your attending dentist wants the denial of benefits reviewed, you or your attending dentist must contact Delta Dental, a Decision on Your Appeal either in writing or by calling Delta Dental’s toll-free number, If you should choose to avail yourself of Delta Dental’s Internal 1-800-932-0783. within one hundred eighty (180) days of the Appeals Procedure, Delta Dental may require additional date on this notice. Failure to comply with such requirements information in order to render a decision on your appeal. If this is may lead to forfeiture of your right to challenge this denial, the case, Delta Dental has attached to this notice a separate sheet You even when a request for clarification has been made. containing of a list of such necessary information, which also should state why the claim should not have been denied. Also, explains why such material or information is necessary. Please any other documents, data, information or comments which are submit such information to the address listed thereon. Please thought to have bearing on the claim including the denial notice, also include any other documents, data information or comments should accompany the request for review. You or your attending which you believe to have bearing on the claim including this dentist are entitled to receive, upon request and free of charge, denial notice. reasonable access to and copies of all documents, records, and other information relevant to the denied claim. The review will take into account all comments, documents, records, or other information, regardless of whether such information was submitted or considered initially. The review shall be conducted for Delta Dental by a Clinical Peer Reviewer who is neither the Clinical Peer Reviewer who made the claim denial that is the subject of the review, nor the subordinate of such individual. If the review of a claim denial is based in whole or in part on a lack of dental necessity, experimental treatment, or a clinical judgment in applying the terms of the Contract, Delta Dental shall consult with a dentist who has appropriate training and experience in the pertinent field of dentistry who is neither the Delta Dental dental consultant who made the claim denial nor the subordinate of such dental consultant. The identity of such dental consultant is available upon request whether or not the advice was relied upon. In making the review, Delta Dental will not afford deference to the initial Adverse Determination.

DENTAL PLANS | 2-14 EXHIBIT B – NOTICE OF FINAL ADVERSE DETERMINATION

This Notice is to inform you that upon review of your request for appeal of the Adverse Determination of your claim for benefits,Delta Dental continues to deny your claim. Attached are copies of the following: (1) a copy of the standard description of and instructions for initiating New York’s External Appeal process; and (2) an application form for requesting an External Appeal. Upon completion of the second level of Delta Dental’s Internal Appeals Procedure, you will then have a right to bring an action under Section 502(a) of ERISA. Please note that you or your attending dentist now have a right to file an External Appeal with the State of New York Insurance Department, but you must do so within forty-five (45) days from the date of your receipt of THIS NOTICE. Even though Delta Dental’s plan provides for two levels of review, the forty-five (45) day time period for requesting an External Appeal begins upon receipt of THIS NOTICE, the Final Adverse Determination of the first-level appeal, regardless of whether or not a second-level appeal is requested. By choosing to request a second-level internal appeal, the time may expire for you to request an External Appeal. Additionally, you and your plan may have other voluntary alternative dispute resolution options, such as mediation. One way to find out what may be available is to contact your local U.S. Department of Labor Office and your State insurance regulatory agency.

Availability of Clinical Review Criteria Relied Upon to Make this Determination

Upon request and free of charge, Delta Dental will provide to you a copy of any documents, records or other information relevant to your claim for benefits, as well as any internal rule, guideline or protocol, and/or an explanation of the scientific or clinical judgment if relied upon in denying your claim.

1. Coverage type:

2. Description of the service for which payment was denied:

3. Basis and clinical rationale for the denial:

DENTAL PLANS | 2-15 4. Specific criteria and standards, including interpretive guidelines on which the decision was based:

5. Plan provisions upon which the determination is based:

6. The following is the name, business address, and business telephone number of the Delta Dental representative who has responsibility for Delta Dental’s Internal Appeals Procedure:

7. The following is the name, business address, and business telephone number of the Utilization Review Agent, if different from the answer provided in number 6, above:

By:

Title:

Date:

DENTAL PLANS | 2-16 CHAPTER 3

Vision Care Plan CONTENTS

...... Page

Key Terms to Know...... 3-1

Highlights of the Vision Care Plan ...... 3-1

The Vision Care Plan ...... 3-2

How the Vision Care Plan Works...... 3-2

• United Healthcare Vision Network Providers ...... 3-2

• Using a Network Provider...... 3-2

• Using an Out-of-Network Provider...... 3-2

• Using a Combination of In-Network and Out-of-Network Providers...... 3-2

What the Plan Covers...... 3-3

What the Plan Does Not Cover...... 3-3

• Charges Not Covered...... 3-3

•Additional Charges Not Covered...... 3-3

Filing Claims ...... 3-4

• For In-Network Vision Care Expenses...... 3-4

• For Out-of-Network Vision Care Expenses ...... 3-4

• Appealing a Claim ...... 3-4

Other Important Information...... 3-5

• Questions About the Vision Plan...... 3-5

VISION CARE PLAN KEY TERMS TO KNOW

Here are a few important terms that are used to describe the Signature Select Vision Care benefits in this SPD. Knowing these terms will help you better understand how your vision coverage works.

Allowance An allowance is the allowed coverage amount for a particular service or supply. For example, an allowance may apply to the cost of a contact lens exam and contact lenses.

Reimbursement Level The reimbursement level is the amount the Plan will reimburse you for covered expenses you paid out of your own pocket.

Highlights of the Vision Care Plan

Reimbursement Level In-Network Out-of-Network

Vision Exam (once every 12 months) 100% Up to $40

Frames (once every 24 months) 100% Up to $45 (up to a retail value of $130)

Lenses (once every 12 months) • Single 100% Up to $40 • Bifocal 100% Up to $60 • Trifocal 100% Up to $80 • Lenticular 100% Up to $80 The Plan covers standard scratch resistant coating at 100%

Contact lenses (once every 12 months, Covered-in-full elective contact lenses Elective contact lenses in lieu of glasses) • The fitting/evaluation fees, contact • $200 reimbursed, for elective contacts If your provider considers your contacts lenses, and up to two follow-up visits are in lieu of eyeglasses (includes materials medically necessary, you should ask your covered in full only) provider to contact United Healthcare • If you choose disposable contacts, up to • Toric, gas permeable and bifocal contact Vision to confirm what reimbursement eight boxes are included when obtained lenses are not covered. applies before you purchase your contacts. from a network provider. • Medically necessary contact lenses are Medically necessary contact lenses determined at the provider’s discretion All other elective contact lenses for one or more of the following • $210 reimbursed, for necessary contacts conditions: • A $200.00 allowance is applied toward in lieu of eyeglasses (includes materials the fitting/evaluation fees and purchase only) o Following post cataract surgery of contact lenses outside the covered without intraocular lens implant selection. o To correct extreme vision problems • Toric, gas permeable and bifocal contact that cannot be corrected with lenses are not covered. spectacle lenses o With certain conditions of Medically necessary contact lenses anisometropia, keratoconus, irregular • Covered in full. corneal/astigmatism, aphakia, facial deformity or corneal deformity • Covered Contact Lens Selection does not apply at Costco, Walmart or Sam’s Club locations. The allowance for non- selection contact lenses will be applied toward the fitting/evaluation fee and purchase of all contacts.

Discounts The Plan offers discounts on lenses, coatings, tints, progressive lenses and other special eye care options, including laser surgery. For more information on available discounts, visit www.myuhcvision.com.

VISION CARE PLAN | 3-1 THE VISION CARE PLAN

Taking care of your vision is vital not only to your eyesight, but to your overall health. The Signature Select Vision Care Plan offers coverage for annual eye examinations and quality eyewear. Signature Select offers coverage for these services and supplies through a nationwide network of private practice optometrists and ophthalmologists as well as retail optical providers. Your participation in the Vision Care Plan is voluntary. At annual enrollment, or as a new hire, you can elect or decline coverage. If you elect coverage, then you pay a premium cost. The Vision Care Plan is administered by United Healthcare Vision, Inc.

HOW THE VISION CARE PLAN WORKS

When you have a covered vision care expense, the Vision Care Vision coverage. The network provider will verify your eligibility Plan reimburses you for all or a portion of the cost. There are two and receive authorization prior to your appointment. You will levels of coverage: be provided with two vision benefits reference cards for your convenience. Although these cards do not guarantee benefits, you • In-network may present them to your vision care provider to communicate • Out-of-network important vision coverage information. These cards are not When you use vision care services (including the purchase of required to visit a provider. eyewear), you can decide whether to receive your vision care services in-network with a United Healthcare Vision Network Using an Out-of-Network Provider Provider or out-of-network. In most cases, you will receive a higher If you choose to see an out-of-network provider: level of benefits if the services and supplies are provided through a United Healthcare Vision Network Provider. • Make an appointment and receive the necessary services from the provider. Pay the provider the full fee and obtain an itemized receipt. United Healthcare Vision Network Providers • You will be reimbursed directly by United Healthcare Vision If you choose to see a United Healthcare Vision network provider, according to the out-of-network reimbursement level. you can use United Healthcare Vision’s online Provider Locator 24-hours a day, 7 days a week to locate a network provider in • See the Filing Claims section in this chapter for instructions on your local area. You may also call United Healthcare Vision’s how to file an out-of-network claim for reimbursement. 24-hour, toll-free number at 1-800-638-3120 to locate a network provider. Following the voice prompts, simply enter your member Using a Combination of In-Network and identification number or your Social Security number and your Out-of-Network Providers work or home zip code. An automated response will provide you If you choose to see an out-of-network provider for an eye with a list of the names, addresses and telephone numbers of examination and have a United Healthcare Vision Network network providers in your local area. Provider fill your prescription for eyeglasses or contact lenses: For the online Provider Locator service, go to United Healthcare • Obtain an examination from the out-of-network provider and pay Vision’s website at www.myuhcvision.com and click on “Provider the provider the full exam fee. Request a receipt for the exam as Locator.” well as the prescription for your eyeglasses or contact lenses. The online Provider Locator will present a list of network providers • To fill your prescription, follow the procedures for locating a as well as the approximate distance and directions to each United Healthcare Vision Network Provider. Provider. The website also lists the services that each network provider offers, i.e., exam only, dispense only, exam and dispense. • Contact one of the United Healthcare Vision Network Providers in your local area who provides “Dispense Only” or “Exam and Using a Network Provider Dispense” services, as indicated in the online Provider Locator. If any problems arise with your eyeglasses or contact lenses Once you select a network provider, you can contact that due to an inaccurate prescription written by an out-of-network network provider directly to schedule an appointment. You will Provider, United Healthcare Vision and the United Healthcare need to give your name, member identification number or Social Vision Network Provider assume no responsibility. Security number, group name, patient’s name (if not yourself) and date of birth. Identify yourself as having United Healthcare • See the Filing Claims section in this chapter for further instructions.

VISION CARE PLAN | 3-2 WHAT THE PLAN COVERS

The Vision Care Plan covers the following vision care services and • Medically Necessary and Elective Contact Lenses – The supplies: reimbursement for medically necessary or elective lenses depends on whether you use an In-Network or Out-of-Network • Vision examination – A complete analysis of the eyes and Provider (see chart on page 3-1). related structures to determine the presence of vision problems is covered once every 12 months (from last date of service). An Medically necessary contact lenses are determined at the optometrist or ophthalmologist can provide a comprehensive provider’s discretion for one or more of the following conditions: vision examination. o Following post cataract surgery without intraocular lens • Eyeglass lenses – You may purchase a new pair of eyeglass implant lenses once every 12 months (from last date of service). All o To correct extreme vision problems that cannot be corrected clear, standard eyeglass lenses are covered. with spectacle lenses • Frames – You may purchase new eyeglass frames once every o With certain conditions of anisometropia, keratoconus, 24 months (from last date of service). However, if you select a irregular corneal/astigmatism, aphakia, facial deformity or frame that costs more than the amount allowed by the Program, corneal deformity you will be responsible for any additional charges. If your provider considers your contacts medically necessary, you • Prescription sunglasses in lieu of eyeglasses – You should ask your provider to contact United Healthcare Vision to may purchase sunglasses in lieu of eyeglasses. You will be confirm what reimbursement applies before you purchase your responsible for tint charges. contacts.

WHAT THE PLAN DOES NOT COVER

Charges Not Covered Additional Charges Not Covered

As with all vision plans, there are some expenses that may not be This Program is designed to cover vision needs rather than covered. These include (but are not limited to): cosmetic materials. You will be responsible for additional charges • Orthoptics or vision training incurred if you select any of the following items: • Post-cataract spectacle lenses • Non-prescription lenses • Tinted, coated (e.g., UV or anti-reflective) or laminated lenses • Two pairs of glasses in lieu of bifocals • Photochromic lenses • Medical or surgical services for eye disease that requires the • Polycarbonate/Hi-Index lenses services of a physician • Progressive/Seamless multifocal lenses • Refractive laser eye surgery such as LASIK, PRK and ASA • A frame that is not part of the United Healthcare Vision • Any eye examination or corrective eyewear required by an “Selection” employer as a condition of employment, unless it is your once a • Contact lenses in excess of the Program allowance year eye examination • Services or materials provided as a result of any Workers’ Compensation or similar law • Glasses and contacts during the same eligibility period • Any services or materials provided by any other vision plan or group benefit plan containing benefits for vision care Lenses and frames that are lost or broken will not be replaced except at the normal intervals when the services are otherwise available through the Program.

VISION CARE PLAN | 3-3 FILING CLAIMS

For In-Network Vision Care Expenses Appealing a Claim

When you or your enrolled dependents use United Healthcare If your claim is denied, you may file a written appeal and send to: Vision Network Providers, you are not required to file claim forms UHC Vision or obtain vouchers to pre-authorize services and materials. Attention: Appeals Instead, network providers are responsible for obtaining the pre- P.O. box 30978 authorization to perform services, provide materials and submit Salt Lake City, UT 84130 claims for reimbursement. For information on the Program’s procedures regarding claims and When visiting a United Healthcare Vision Network Provider, you appeals, including timing of benefits and appeal determinations, are only responsible for non-“Selection” supplies or options, such the manner in which appeals are conducted, and notice of as tints and coatings. If you choose a frame that is not part of the any adverse benefit determinations, see the General and United Healthcare Vision “Selection”, you will receive an allowance Administrative Information chapter of this SPD. and are only responsible for the difference between the allowance and the full cost of the frame.

For Out-of-Network Vision Care Expenses

When you receive care from an out-of-network provider, you are responsible for filing a claim. After you pay the full cost, you must submit a written request for reimbursement, along with your itemized receipt(s) in order to get reimbursed.

How to File a Claim 1. Pay the fee and obtain an itemized receipt. Be sure it includes all services and supplies received and the date(s) of purchase.

2. Include a note requesting reimbursement. Receipts for services and materials purchased on different dates must be submitted at the same time to receive reimbursement. The following information should be included with the itemized receipt submission: • Your name and address • Patient’s name and date of birth • Your member identification number (or Social Security number)

3. Send receipt and note to: United Healthcare Vision Claims Department P.O. Box 30978 Salt Lake City, UT 84130 Fax: 248-733-6060

VISION CARE PLAN | 3-4 OTHER IMPORTANT INFORMATION

Questions About the Vision Care Program

United Healthcare Vision’s Customer Service Representatives are available to answer any questions you may have regarding your vision care benefits. You can reach United Healthcare Vision’s Customer Service Department at 1-800-638-3120. Bilingual customer service representatives are available. The hours of operation for the Customer Service Department are Monday through Friday, from 8:30 a.m. to 8:00 p.m. Eastern Time and Saturday, from 9:00 a.m. to 5:00 p.m. Eastern Time. This chapter only provides a general summary of the Signature Select vision benefits. For additional information, you should review additional coverage materials available from your Benefits Department. These materials, provided by United Healthcare Vision, more fully describe the specific benefit provisions, limitations and exclusions. Important information, such as your rights as a participant and other administrative details, can be found in the General and Administrative Information chapter of this SPD.

VISION CARE PLAN | 3-5 CHAPTER 4

Disability Plan CONTENTS

...... Page

Key Terms to Know...... 4-1

Highlights of the Signature Select Disability Plan...... 4-2

The Signature Select Disability Plan...... 4-3

• How the Plan Works ...... 4-3

Short-Term Disability Benefits...... 4-4

• Your Benefit Amount ...... 4-4

• How Benefits Are Paid ...... 4-4

Long-Term Disability Benefits...... 4-5

• Your Benefit Amount ...... 4-5

• Offset of Benefits ...... 4-5

• How Long You Can Receive Benefits...... 4-6

Filing Claims ...... 4-7

• How to File a Short-Term Disability Claim...... 4-7

• Long-Term Disability Claims...... 4-7

What Is Not Covered ...... 4-8

• Short-Term Disability ...... 4-8

• Long-Term Disability...... 4-8

When Coverage Ends...... 4-9

Claims Appeal...... 4-9

Other Important Information...... 4-9

DISABILITY PLAN KEY TERMS TO KNOW

Here are a few important terms that are used to describe the Signature Select Disability Plan in this SPD. Knowing these benefits terms will help you better understand how the Plan works.

Benefit Waiting Period Pre-Existing Condition (Applies to Long-Term Disability only) The Benefit Waiting Period is the amount of time you must be disabled before benefits begin. For example, Short-Term Disability A pre-existing condition means any injury or sickness for which benefits will begin after you have been disabled for more than you incurred expenses; received medical treatment, care or seven consecutive calendar days. services, including diagnostic measures; took prescribed drugs or medicines; or for which a reasonable person would have Covered Earnings consulted a physician within three months before your most recent effective date of insurance. The insurance company will Covered Earnings refers to your salary or annualized base rate not pay benefits on account of any disability which is caused or of pay frozen as of a certain date. It may or may not include contributed to by, or results from, a pre-existing condition, until additional compensation. 12 months after the employee’s most recent effective date of • Berryville Graphics – Covered Earnings are frozen as of insurance. The pre-existing condition limitation will apply to any October 1st of the prior year. If you are a sales employee added benefits or increases in benefits. receiving commission, it would include commissions received from July 1st to June 30th of the prior years. Any other variable Disability/Disabled compensation is excluded. • You are considered to be Disabled if you are unable to perform • Coral Graphics – Covered Earnings are frozen as of October the material duties of your regular occupation, or if, solely due to 1st of the prior year. Excludes any variable compensation. injury or sickness, you are unable to earn 80% of your Covered • Dynamic Graphics – Covered Earnings are frozen as Earnings. of January 1st of the current year. Excludes any variable • After receiving Disability benefits for 24 months, you are compensation. considered to have a Total Disability if you are unable to perform Your coverage is based on your current Covered Earnings. Your the material duties of any occupation for which you are (or Covered Earnings will be determined before any pay reductions could become) reasonably qualified by education, training or from participation in a qualified retirement plan, a non-qualified experience, or solely due to injury or sickness, you are unable to retirement plan, Section 125 “cafeteria” benefit plan, Flexible earn more than 80% of your Indexed Covered Earnings. Spending Accounts or any other arrangement where your compensation is reduced on a voluntary basis.

Indexed Covered Earnings (Applicable to Work Incentive Benefit) For the first year you are disabled, your Indexed Covered Earnings will be equal to your Covered Earnings. After you have been disabled for one year, your Indexed covered Earnings will be your Covered Earnings plus an increase applied on each annual anniversary of the date you became disabled. The amount of each increase will be the lesser of: 1. 10% of your Indexed Covered Earnings during the preceding year of disability: or 2. The rate of increase in the Consumer Price Index (CPI-W) during the preceding calendar year.

DISABILITY PLAN | 4-1 Highlights of the Signature Select Disability Plan

Basic Option (Company Paid) Premium Option (Employee Paid)

Short-Term Disability (STD)

Benefit level 50% of Covered Earnings** 70% of Covered Earnings**

Benefit commencement* After 7 days* After 7 days*

Maximum benefit duration 26 weeks 26 weeks

Maximum Covered Earnings None None

Long-Term Disability (LTD)

Benefit level 50% of Covered Earnings 65% of Covered Earnings

Benefit commencement After 26 weeks of STD After 26 weeks of STD

Maximum benefit duration Age 65*** Age 65***

Maximum covered salary $360,000 $360,000

* STD has a seven-calendar-day “benefit waiting period” before benefits begin. However, if you are admitted as an inpatient in a hospital within these first seven days, then benefits begin on the first day of hospitalization or outpatient surgery. During the “benefit waiting period,” you may use any available sick days, personal or vacation days for continued income. ** Or the benefit required under the applicable California, New York or New Jersey State disability plan, if greater. ***For disabilities that begin at or after age 62, benefits may continue beyond age 65 as explained later in this SPD under How Long You Can Receive Benefits (see page 4-6). For disabilities related to a mental disorder or substance abuse, LTD benefits are limited to 24 months (unless confined to a hospital).

DISABILITY PLAN | 4-2 THE SIGNATURE SELECT DISABILITY PLAN

For most of us, becoming disabled is not something we expect to occur. Yet statistics provide an important reality check: One in eight workers will be disabled for five years or more during their working careers.1 Protecting your ability to earn an income is critical and a key component in a solid financial plan.

How the Plan Works You are required to remain in the disability options you elect for a two-year period. The two-year lock will be required each time you Signature Select offers you flexibility in choosing a disability change disability options. income option to best meet your needs. The Signature Select If you elect the Premium STD and/or LTD option(s), your Disability Plan provides continuous income if you are unable to contributions may be deducted pre-tax or post-tax from your work due to disability resulting from injury, sickness or pregnancy. paycheck, which will affect how your disability benefits are taxed if Your disability coverage includes two parts: you become disabled and are eligible to receive disability benefits • Short-Term Disability (STD) provides weekly disability benefits (see Taxation of Benefits on page 4-6). To determine whether your if you are disabled for more than seven consecutive days or deductions are made on a pre- or post-tax basis, contact your on the first day of inpatient hospital confinement. Benefits may Benefits Department or local Human Resources Representative. continue up to 26 weeks from the date disability begins. If you only enroll in the Basic STD and LTD options, you are not required to make any contributions toward this benefit. • Long-Term Disability (LTD) provides monthly disability benefits if you are disabled for more than 26 weeks. Changing Your Disability Election Disability benefits are based on your Covered Earnings as defined You may request a change to your disability income option in Key Terms to Know in this chapter. election during any annual enrollment period, however, you are While you are on Short-Term or Long-Term Disability, you will required to remain in the disability option you select for a two-year continue to pay for benefits at the same rate as if you were actively period. The two-year lock will be required each time you change at work or a lesser amount as determined by the Company. disability options. If you reduce the level of your coverage (i.e., from the Premium Eligibility Option to the Basic Option), your new coverage level will become You are eligible for Short- and Long-Term Disability coverage if you effective on the following January 1. are a regular full-time employee of the Company and eligible for However, if you elect to increase the level of your coverage (i.e., benefits. To qualify as a full-time employee, you must be regularly from the Basic Option to the Premium Option), you will need to scheduled to work at least 30 hours per week. submit an Evidence of Insurability form, and your new coverage Temporary or seasonal employees are not eligible for the level will become effective on the later of January 1st or the date Signature Select Disability Plan. of approval by Cigna Life Insurance Company of New York. If your request to increase coverage is denied, then your current level of When Coverage Begins disability benefits will continue. Disability coverage begins on the first of the month following 60 days of service. Coverage is provided for employees only (i.e., How Much Disability Protection Do I Need? dependents are not covered for disability benefits under this Plan). Benefit payments do not commence, however, until after you have As you consider how much disability protection you might need, satisfied your waiting period of either seven consecutive days here are some key questions to ask yourself: (STD) or 26 weeks (LTD). • Are you the sole wage earner? • Do you have a mortgage, car payments or other obligations? Disability Income Options • How much are your monthly expenses? The Company provides you a Basic level of Short- and Long-Term Disability coverage at no charge and offers you the option to elect • Do you have savings you could draw from in the event of illness Premium Short- and/or Long-Term Disability, which you pay for or injury? with payroll deductions. The answers may help you decide the amount of coverage that’s You can elect either Basic STD or Premium STD and either Basic right for you. LTD or Premium LTD. You are not required to have Premium STD in order to elect Premium LTD. Every eligible employee must elect an STD and LTD coverage option. If you do not elect an option upon initial eligibility, you will be enrolled in the Basic options for both STD and LTD.

1 Commissioner’s Disability Insurance Tables A and C, assuming equal weights by gender and occupation class, Council for Disability Awareness, 2013

DISABILITY PLAN | 4-3 SHORT-TERM DISABILITY BENEFITS

The Short-Term Disability Plan provides continuous weekly • Any Social Security disability or retirement benefits you or any income if you are Disabled for more than seven consecutive days third party receives (or is assumed to receive*) on your own (or immediately if you are admitted as an inpatient in a hospital). behalf or for your dependents; or which your dependents Disability means that solely because of a covered injury or receive (or are assumed to receive*) because of your entitlement sickness, you are unable to perform all the material duties of you to such benefits; regular occupation, or are unable to earn more than 80% of your • Any Retirement Plan benefits funded by the Employer. Covered Earnings. Benefits may continue up to 26 weeks from the “Retirement Plan” means any defined benefit or defined date disability begins. contribution plan sponsored or funded by the Employer. It does not include an individual deferred compensation agreement; a Your Benefit Amount profit sharing or any other retirement or savings plan maintained in addition to a defined benefit or other defined contribution Under Short-Term Disability coverage, your weekly benefit pension plan, or any employee savings plan including a thrift, depends on the option you choose: stock option or stock bonus plan, Individual Retirement Account (IRA) or 401(k) plan; • Basic option equal to 50% of Covered Earnings, or • Any proceeds payable under any franchise or group insurance • Premium option equal to 70% of Covered Earnings or similar plan. If other insurance applies to the same claim Your benefit is not subject to a maximum of Covered Earnings. for Disability, and contains the same or similar provision for Your weekly benefit will be reduced by any payment you receive or reduction because of other insurance, the Plan will pay for its are entitled to receive for the same weekly period under any state pro rata share of the total claim. “Pro rata share” means the law, including Workers’ Compensation. proportion of the total benefit that the amount payable under one policy, without other insurance, bears to the total benefits How Benefits Are Paid under all such policies; • Any amounts paid because of loss of earnings or earning You will receive a weekly benefit if you are disabled for more than capacity through settlement, judgment, arbitration or otherwise, seven consecutive calendar days. This is the Benefit Waiting where a third party may be liable, regardless of whether liability Period. If, however, you are admitted as an inpatient to a hospital is determined; within the first seven days of your disability, benefits are payable • Any wage or salary for work performed. from the first day of hospitalization.

Short-Term Disability benefits can be paid for up to 26 weeks Successive Periods of Disability for any one period of disability. You will need to provide periodic evidence of disability from your attending physician, and your case Once you are eligible to receive disability benefits under the Plan, will be subject to review by Cigna Life Insurance Company of New separate periods of disability resulting from the same or related York. causes are considered to be a continuous period of disability unless you return to active service for more than 14 consecutive calendar days. Offset of Benefits/Other Income Benefits A period of disability is not continuous if separate periods of While you are disabled, you may be eligible for benefits from other disability result from unrelated causes or the later disability occurs income sources. Your Short-Term Disability benefit will be offset after participation in the Plan ends. The Successive Periods of (reduced) by: Disability provision will not apply if you are eligible for coverage • Any amounts received (or assumed to be received) by you or under a plan that replaces this Plan. your dependents under: o The Canada and Quebec Pension Plans; If you are disabled more than once by the same or a related injury or illness, your absences will be considered as a single o The Railroad Retirement Act; period of disability unless separated by at least 14 consecutive o Any local, state, provincial or federal government disability or calendar days of regular, active employment. If your absences retirement plan or law payable for injury or sickness provided are considered to be a single period of disability, you will not be as a result of employment with the Employer; required to satisfy a new seven-day Benefit Waiting Period for o Any sick leave or salary continuation plan of the Employer; the later absence. However, your prior absence will be counted o Any work loss provision in mandatory “No-Fault” auto against the 26-week maximum benefit period. insurance; If you are disabled more than once due to unrelated illnesses or o Any workers’ compensation, occupational disease, injuries, your absences will be considered as separate periods unemployment compensation law or similar state or federal of disability provided you return to regular, active employment law payable for injury or sickness arising out of work with the between disabilities. If your absences are considered to be Employer, including all permanent and temporary disability separate periods of disability, you will be required to satisfy a new benefits. This includes any damages, compromises or seven-day Benefit Waiting Period before benefits can commence. settlement paid in place of such benefits, whether or not However, your prior period of disability will not count against the liability is admitted; 26-week maximum benefit period for your subsequent disability. DISABILITY PLAN | 4-4 Taxation of Benefits Offset of Benefits/Other Income Benefits Short-Term Disability benefits are subject to income and withholding taxes in accordance with lRS and any applicable While you are disabled, you may be eligible for benefits from other state, city and local income tax regulations. In general, benefits income sources. Your monthly Long-Term Disability benefit will be are taxable when paid by the Company and/or you with pre-tax offset (reduced) by: contributions. • Any amounts you or your dependents, if applicable, receive (or are assumed to receive) under: Benefits During a Leave o The Canada and Quebec Pension Plans; The Family and Medical Leave Act of 1993 o The Railroad Retirement Act; The Family and Medical Leave Act (FMLA) of 1993 is a federal o Any local, state, provincial or federal government disability or law that entitles eligible employees up to a maximum of 12 weeks retirement plan or law as it pertains to your employer; (84 calendar days) of job-protected leave in a 12-month period if you have worked for the Company for at least 12 months and o Any sick leave or salary continuation plan of your employer; for at least 1,250 hours in the last 12 months. If your FMLA- o Any work loss provision in any mandatory “no-fault” auto related leaves, including Short-Term Disability, do not exceed insurance; 12 workweeks in any 12-month period, you will be reinstated to • Any Social Security disability or retirement benefits you or any your former position or an equivalent position. Exceptions to this third party receive (or are assumed to receive) either on your provision may apply if business circumstances have changed. behalf or for your dependents; or, if applicable, which your dependents receive (or are assumed to receive) because of your entitlement to such benefits; LONG-TERM DISABILITY • Any retirement plan benefits funded by your employer. BENEFITS “Retirement plan” means any defined benefit or defined contribution plan sponsored or funded by your employer. It does not include an individual deferred compensation agreement; a The Long-Term Disability Plan provides continuous income if you profit sharing or any other retirement or savings plan maintained are Disabled for more than 26 weeks. in addition to a defined benefit or other defined contribution • You are considered to be Disabled if solely because of a pension plan; or any employee savings plan including a thrift, covered injury or sickness, you are unable to perform all the stock option or stock bonus plan, IRA or 401(k) plan; material duties of you regular occupation, or are unable to earn • Any proceeds payable under any franchise or group insurance more than 80% of your Covered Earnings. or similar plan. If there is other insurance that applies to the • After receiving Disability benefits for 24 months, you are same claim for disability and contains the same or similar considered to have a Total Disability if you are unable to perform provision for reduction because of other insurance, Cigna will the material duties of any occupation for which you are (or pay the pro rata share of the total claim. “Pro rata share” means could become) reasonably qualified by education, training or the proportion of the total benefit that the amount payable under experience, or solely due to injury or sickness, you are unable to one policy, without other insurance, bears to the total benefits earn more than 80% of your Indexed Covered Earnings. under all such policies; • Any amounts you or your dependents, if applicable, receive (or Your Benefit Amount are assumed to receive) under any Workers’ Compensation, occupational disease, unemployment compensation law or Your monthly Long-Term Disability benefit depends on the option similar state or federal law, including all permanent as well as you choose: temporary disability benefits; • Basic option equal to 50% of Covered Earnings, or • Any amounts paid on account of loss of earnings or earning • Premium option equal to 65% of Covered Earnings capacity through settlement, judgment, arbitration or otherwise, The minimum monthly Long-Term Disability benefit is $100 under where a third party may be liable, regardless of whether liability each option. For periods of less than one month, monthly benefits is determined; are prorated by 1/30 for each day of disability. Your maximum • Any wage or salary for work performed while disability benefits Covered Earnings under the LTD plan are $360,000. are payable, to the extent they exceed the amount allowed under the Work Incentive Benefit (see page 4-6). Benefits will also be offset by any damages recovered due to an act or omission of a third party, but only to the extent that such damages represent your loss of income. If you are paid other income benefits in a lump sum, they will be prorated: 1) over the period of time it would have been paid if not paid in a lump sum; or 2) if such period of time cannot be determined, over a period of 60 months.

DISABILITY PLAN | 4-5 Taxation of Benefits Work Incentive Benefit Long-Term Disability benefits are subject to income and For the first 12 months after you return to work, your disability withholding taxes in accordance with lRS and any applicable benefit is as shown on page 4-2. If, for any month during this state, city and local income tax regulations. In general, benefits period, the sum of your disability benefit, your current earnings are taxable when paid by the Company and/or you with pre-tax and any additional Other Income Benefits exceed 100% of your contributions. Indexed Covered Earnings, your disability benefit will be reduced by the excess amount. When Benefits Begin After 12 months, your disability benefit is as shown on page 4-2, Your monthly Long-Term Disability benefit will begin after you are reduced by 50% of your current earnings received during any disabled for 26 consecutive weeks. This is the Benefit Waiting month you return to work. If the sum of your disability benefit, your Period. However, you may return to work for up to 14 consecutive current earnings and any additional other income benefits exceed days on a “trial basis” during this period. These trial days will 80% of your monthly Indexed Covered Earnings, your disability neither cause the consecutive period of disability to end nor be benefit will be reduced by the excess amount. counted toward the 26-week Benefit Waiting Period. If you are working for another employer on a regular basis when your disability coverage begins, your earnings will include the How Long You Can Receive Benefits amount of any increase in the amount you are earning from this work while you are disabled. You will continue to receive monthly Long-Term Disability benefits Cigna will, from time to time, review your status and will require for up to 24 months, as long as because of injury or illness, you satisfactory proof of earnings and continued disability. are unable to perform the material duties of your occupation; or if, solely due to injury or sickness, you are unable to earn 80% of Rehabilitation During a Period of Disability your Indexed Covered Earnings. If it is determined that you are a suitable candidate for After receiving Disability benefits for 24 months, you will be rehabilitation, you may be required to participate in a rehabilitation eligible for continued benefits if you are considered to have a Total plan. Cigna has the sole discretion to approve your participation in Disability, which means you are unable to perform the material a rehabilitation plan and to approve a program as a rehabilitation duties of any occupation for which you are (or could become) plan. reasonably qualified by education, training or experience, or solely due to injury or sickness, you are unable to earn more than 80% of The rehabilitation plan may, at Cigna’s discretion, allow for your Indexed Covered Earnings. payment of your medical expense, education expense, moving expense, accommodation expense or family care expense while The Long-Term Disability Plan has a maximum benefit period, you participate in the program. which will provide a benefit to you until you turn age 65. The benefit period could extend beyond age 65, based on your age If you fail to fully cooperate in all required phases of the when disability began. rehabilitation plan without good cause, no disability benefits will be paid, and insurance will end. Age When Disability Maximum Benefit Period Begins If You Have a Second Disability If you are disabled more than once due to unrelated illnesses or Age 62 or under To age 65 or the date the injuries, your absences will be considered as separate periods of 42nd monthly benefit is disability if you return to active employment between disabilities. payable, if later As such, a new 26-week Benefit Waiting Period is required. If you are disabled more than once within a six-month period Age 63 36 months due to the same (or a related) illness or injury, your absences will be considered as part of the same period of disability. As such, Age 64 30 months you will not be required to satisfy a new 26-week Benefit Waiting Period. Age 65 24 months If you are again disabled after you have returned to work for Age 66 21 months more than six months, the second disability will be considered a separate disability and a new 26-week Benefit Waiting Period must be satisfied regardless of whether the disabilities are due to Age 67 18 months the same, related or separate cause. Age 68 15 months Survivor Benefit Age 69 or older 12 months The Plan will pay a survivor benefit if you die while disability benefits are payable and at least six monthly benefits have been payable to you for a continuous period of disability. The survivor benefit will equal 100% of the sum of the last full disability benefit

DISABILITY PLAN | 4-6 payable to you plus any current earnings by which the disability benefit was reduced for that month. A single lump-sum payment FILING CLAIMS equal to three monthly survivor benefits will be payable. The survivor benefit will be payable to the first surviving class of the How to File a Short-Term Disability Claim following living relatives: spouse, children, parents, brothers and If you are disabled for seven consecutive calendar days (or have sisters; or to the executors or administrators of your estate. been hospitalized for a disabling condition) you may qualify for Short-Term Disability benefits. Contact your HR Representative How the Plan Works – An Example and/or the Benefits Department as soon as possible. A claim for disability benefits must be initiated within 31 days after the Dan sustains a bad back injury, and his condition requires disability begins to avoid a possible reduction or forfeiture of surgery and months of physical therapy. Due to recurring benefits. pain, he can’t sit in a chair for long periods and can’t perform You can contact Cigna, the Plan’s disability administrator, at his job duties for a year. 1-800-362-4462. When you call, Cigna will ask you for the Dan’s Salary: $40,000 following information: Coverage: Premium Option • Your name, address, phone number, birth date, Social Security number and e-mail address Short-Term Disability Benefit Long-Term Disability Benefit • The reason you are filing the claim – illness or injury $538.46 per week after $2,166.66 per month satisfying the seven day • A description of your illness, symptoms and/or diagnosis, waiting period for up to 26 including the date the symptoms first appeared and whether or weeks not you had the illness or symptoms before • Whether you have filed or have plans to file a Workers' Coverage amounts may be reduced in the event you receive other income Compensation claim benefits, such as Social Security. This is a hypothetical illustration only. Your situation will differ as certain coverage exclusions, offsets, limitations, terms • Information regarding any visits you have made to a doctor, and conditions may apply. hospital or clinic for the claim • Employment information, including your hire date, job title and job description • Disclosure Authorization

Case Management A Cigna Case Manager may contact you to ask questions and discuss the claim process or to obtain any additional information that is required. The Cigna Case Manager will be responsible for managing your claim and will be your main contact for any questions you may have. The Cigna Case Manager will contact the Company for a description of your job requirements and will also contact your doctor for medical reports. For Short-Term Disability claims, once your claim is approved, you will receive an approval letter that shows the date you are expected to return to work and your weekly benefit. Cigna will also inform the Company of your claim approval and your anticipated return-to-work date.

Long-Term Disability Claims

If you expect to be disabled for more than 26 weeks and it is likely that you will qualify for Long-Term Disability benefits, your claim will be transferred by Cigna to Long-Term Disability. You do not need to file a new claim.

Questions About Your Claim Once you have provided all required information, you will receive an acknowledgment package by mail. If you have questions, call 1-800-36-CIGNA (24462) between 7 a.m. and 7 p.m. Central Time. If you call outside this time frame, please leave a voicemail message and a representative will respond the next business day.

DISABILITY PLAN | 4-7 WHAT IS NOT COVERED Short-Term Disability The Plan will not pay Disability Benefits for any period of Disability during which you: The Plan will not pay any disability benefits for a disability that • Are incarcerated in a penal or corrections institution results, directly or indirectly, from: • Are not receiving appropriate care • Suicide, attempted suicide or self-inflicted injury • Fail to cooperate with Cigna in the administration of the claim. • War or any act of war, whether or not declared Such cooperation includes, but is not limited to, providing • Active participation in a riot any information or documents needed to determine whether benefits are payable or the actual benefit due. • Injury or sickness while you are serving on full-time active duty in any armed forces • Refuse to participate in rehabilitation efforts as required by Cigna • Commission of a felony

• The revocation, restriction or non-renewal of your license, Long-Term Disability Limitations permit or certification necessary to perform the duties of your The Long-Term Disability Plan will pay disability benefits on a occupation unless due solely to injury or sickness otherwise limited basis for a disability caused or contributed to by any one or covered by the Plan more of the following conditions. The maximum benefits payable • Any cosmetic surgery or surgical procedure that is not medically for any of these conditions is 24 months. necessary. Medically necessary means the surgical procedure • Alcoholism is: (a) prescribed by a physician as required treatment of the injury or sickness; and (b) appropriate according to conventional • Anxiety disorders medical practice for the injury or sickness in the locality in • Delusional (paranoid) disorders which the surgery is performed. The Plan will pay benefits if • Depressive disorders the disability is caused by you donating an organ in a non- experimental organ transplant procedure. • Drug addiction • Injury or Sickness for which you are entitled to benefits from • Eating disorders Workers' Compensation • Mental illness • Injury or Sickness that is work-related If, before reaching the lifetime maximum benefit, you are confined in a hospital for more than 14 consecutive days, that The Plan will not pay disability benefits for any period of disability period of confinement will not count against the lifetime limit. during which you: The confinement must be for the appropriate care of any of the • Are incarcerated in a penal or corrections institution conditions listed above. • Are not receiving appropriate care • Fail to cooperate with the Plan in the administration of the claim. Long-Term Disability Pre-Existing Condition Limitation Such cooperation includes, but is not limited to, providing Cigna will not pay benefits on account of any disability which any information or documents needed to determine whether is caused or contributed to by, or results from, a Pre-Existing benefits are payable or the actual benefit amount due. Condition, until 12 months after the employee’s most recent effective date of insurance. No increase in benefits will be paid • Refuse to participate in rehabilitation efforts as required by the on account of any disability which is caused or contributed to by, Plan or results from, a pre-existing condition, until 12 months after the • Refuse to participate in a modified work arrangement effective date of the increase. A “pre-existing condition” means any injury or sickness for which Long-Term Disability the employee incurred expenses, received medical treatment, care or services including diagnostic measures, took prescribed The Plan will not pay any disability benefits for a disability that drugs or medicines, or for which a reasonable person would have results, indirectly or directly, from: consulted a physician within three months before his or her most • Suicide, attempted suicide, or self-inflicted injury recent effective date of insurance. • War or any act of war, whether or not declared Except for any amount of benefit in excess of a prior plan’s • An injury or sickness that occurs while engaged in the activities benefits, this limitation will not apply if you were covered under a of active duty service in the armed forces of any country or prior plan and satisfied the pre-existing condition limitation, if any, international organization. An injury or sickness that occurs under that plan. If you were covered under a prior plan, but did not while engaged in Reserve or National Guard training is not fully satisfy the pre-existing condition limitation of that plan, Cigna excluded until training extends beyond 31 days. will credit you for any time you did satisfy. Time will not be credited for any day you were not in active service or were not actively at • Commission of a felony or attempted felony work due to sickness.

DISABILITY PLAN | 4-8 WHEN COVERAGE ENDS Conversion of Coverage If your Long-Term Disability coverage terminates because of your termination of active employment (other than for retirement) or if Termination of Benefits you are no longer in an eligible classification of employees, you Your Short-Term Disability benefits will terminate upon: may be eligible for Long-Term Disability conversion insurance. To • The date you earn more in secondary income than the be eligible for the “converted policy,” you must have been covered percentage of annual salary used for payment of your disability under the Signature Select Long-Term Disability Plan for at least benefits 12 consecutive months and you must apply within 62 days of the termination of your Long-Term Disability coverage. • The date the Plan determines that you are no longer disabled Please see your Benefits Department for further information and • The end of the 26-week maximum benefit period restrictions. • The date you die • The date you refuse to participate in rehabilitation efforts as required by the Plan CLAIMS APPEAL • The date you are no longer receiving appropriate care from a physician Appeal Procedure for Denied Claims Whenever a claim is denied, you have the right to appeal the Your Long-Term Disability benefits will terminate on the earliest of decision. You (or your duly authorized representative) must make a the dates below: written statement for appeal to the Claim Administrator within 180 • The date you earn more than the percentage of your Indexed days from the date you receive the denial. If you do not make this Covered Earnings which is used to determine if you are disabled request within that time, you will have waived your right to appeal. • The date that Cigna determines you are no longer disabled Once your request has been received by the Claim Administrator, • The date the maximum benefit period ends a prompt and complete review of your claim must take place. This review will give no deference to the original claim decision, and will • The date you die not be made by the person who made the initial claim decision. During the review, you (or your duly authorized representative) Termination of Coverage have the right to review any documents that have a bearing on the Your Short-Term Disability coverage will terminate upon: claim, including the documents which establish and control the Plan. Any medical or vocational experts consulted by the Plan will • The earlier of the date of termination or the last day of active be identified. You may also submit issues and comments that you employment feel might affect the outcome of the review. • The date you transfer to an ineligible classification of employees The Plan has 45 days from the date it receives your request to • The date you enter active full-time military duty (other than for a review your claim and notify you of its decision. Under special training period of two months or less) circumstances, the Plan may require more time to review your • The day after the period for which premiums are paid claim. If this should happen, the Plan must notify you, in writing, that its review period has been extended for an additional 45 days. • The date the plan is terminated Once its review is complete, the Plan must notify you, in writing, of the results of the review and indicate the Plan provisions upon Your Long-Term Disability income coverage will terminate on the which it based its decision. earliest of the dates below: • The date you are eligible for coverage under a plan intended to replace this coverage OTHER IMPORTANT • The date the plan policy is terminated • The date you transfer to an ineligible classification of employees INFORMATION

• The day after the period for which premiums are paid Important information, such as your rights as a Plan participant • The date you are no longer in active service and other administrative details, can be found in the General and Administrative Information chapter of this SPD. Extension of Coverage If you are disabled at the time your coverage would otherwise terminate, your Short- and Long-Term Disability income coverage will be continued for the duration of your disability in accordance with the provisions of the Plan.

DISABILITY PLAN | 4-9 CHAPTER 5

Life and Accident Insurance Plans CONTENTS

...... Page

Key Terms to Know...... 5-1

Highlights of the Signature Select Life and Accident Insurance Plans...... 5-2

Signature Select Life and Accident Insurance ...... 5-3

• When Coverage Begins...... 5-3

Employee Life Insurance ...... 5-4

• Company-Provided Amount...... 5-4

Dependent Life Insurance...... 5-6

• Eligible Dependents ...... 5-6

Accidental Death & Dismemberment (AD&D) Insurance ...... 5-7

• Your AD&D Coverage Amount ...... 5-7

What Is Not Covered (Life & AD&D)...... 5-8

When Coverage Ends...... 5-8

Business Travel Accident Insurance ...... 5-9

• Your Business Travel Accident Insurance Coverage Amount...... 5-9

What Is Not Covered (BTA)...... 5-11

Filing a Claim ...... 5-11

When Coverage Ends (BTA)...... 5-11

Income Tax Considerations...... 5-11

Other Important Information...... 5-11

LIFE AND ACCIDENT PLANS KEY TERMS TO KNOW

Here are a few important terms that are used to describe the Signature Select Life and Accident Insurance plans in this SPD. Knowing these benefits terms will help you better understand how the Plans work.

Annual Insured Earnings Your Annual Insured Earnings (AIE) refers to your salary or annualized base rate of pay frozen as of a certain date. It may or may not include additional compensation. - Berryville Graphics – AIE is frozen as of October 1st of the prior year. If you are a sales employee receiving commission, it would include commissions received from July 1st to June 30th of the prior years. Any other variable compensation is excluded. - Coral Graphics – AIE is frozen as of October 1st of the prior year. Excludes any variable compensation. - Dynamic Graphics – AIE is frozen as of January 1st of the current year. If bonus eligible, includes prior year bonus. Any other variable compensation is excluded. Your coverage is based on your current AIE. Your AIE will be determined before any pay reductions from participation in a qualified retirement plan, a non-qualified retirement plan, Section 125 “cafeteria” benefit plan, Flexible Spending Accounts or any other arrangement where your compensation is reduced on a voluntary basis.

Evidence of Insurability Evidence of Insurability typically refers to “proof of good health” and may be required by the insurance company when electing coverage.

Imputed Income Imputed Income is the term the IRS applies to the value of any benefit or service that should be considered income for the purpose of calculating your federal taxes. One of the benefits that is considered Imputed Income is the value of employer-provided life insurance coverage greater than $50,000.

Terminal Illness Benefit If, while actively employed, you become terminally ill (with a prognosis of 12 months or less to live), you may elect to receive a portion of your Employee Life Insurance benefit while still living, if you meet certain requirements (see Terminal Illness section). This Terminal Illness Benefit equals the lesser of 50% of the Employee Life Insurance benefit in effect at the time the insurance company determines you to be terminally ill or $50,000. The remaining balance of your Employee Life Insurance benefit would be payable to your designated beneficiary upon your death.

Totally Disabled You are considered Totally Disabled if, because of injury or sickness, you are unable to perform all the essential duties of any occupation for which you are or may reasonably become qualified based on your education, training, or experience.

LIFE AND ACCIDENT PLANS | 5-1 HIGHLIGHTS OF THE SIGNATURE SELECT LIFE AND ACCIDENT INSURANCE PLANS

Employee Life Insurance Your options for Employee Life Insurance are: Subject to a maximum of • Basic, company-paid coverage up to 2 times your Annual Insured Earnings, rounded to the next $2,500,000 in coverage $1,000 of coverage (if not already a multiple of $1,000). • Supplemental, employee-paid coverage of an additional 1 to 3 times your Annual Insured Earnings, rounded to the next $1,000 of coverage (if not already a multiple of $1,000). • $50,000 flat amount*

Dependent Life Insurance Pays you a benefit in the event of a spouse, same-sex domestic partner and/or eligible child’s death. You have three coverage options to choose from (high, medium or low), or you may decline coverage.

Coverage Levels High Medium Low

Spouse $50,000 $25,000 $10,000

Each Child $15,000 $6,250 $2,500

Accidental Death & • Equals the Employee Life Insurance coverage amount you choose, up to a maximum of Dismemberment Insurance $2,500,000 in coverage. • Payable in addition to your Employee Life Insurance benefit.

Business Travel Accident • Equals 2 times your Annual Insured Earnings up to a maximum coverage amount of $2,000,000. Insurance • Payable in addition to your Employee Life Insurance and AD&D Insurance benefits.

* If you elect this option, you avoid income tax on the “imputed” value (“premium”) of Employee Life Insurance in excess of $50,000 (as required by IRS regulations). In accordance with IRS rules, if you have Employee Life Insurance coverage in excess of $50,000, the value will be treated as taxable income and will be indicated on your pay stubs and on your year-end W-2 Wage and Tax Statement.

LIFE AND ACCIDENT PLANS | 5-2 SIGNATURE SELECT LIFE AND ACCIDENT INSURANCE

Life and Accident insurance protects those you leave behind and can offer you peace of mind. Having adequate insurance is an important component in a solid financial plan. Your Signature Select Life and Accident Insurance coverage includes Employee Life Insurance, Dependent Life Insurance, Accidental Death and Dismemberment (AD&D) Insurance and Business Travel Accident Insurance. The coverage is designed to provide a measure of financial security to your beneficiary if you die, or to you if you are severely injured in an accident. Dependent Life Insurance coverage is also available for your spouse and/or children. As a regular, full-time employee eligible for life insurance coverage, you can choose the amount of your Employee Life Insurance, AD&D Insurance and Dependent Life Insurance from a number of available coverage options. The following table summarizes the main coverage features and benefits of the life and accident insurance coverage:

Covered Events Benefit

In the event of your death as the result of a covered cause The full Employee Life Insurance benefit is payable to your designated beneficiary.

In the event of your death as the result of a covered accident The full AD&D Insurance benefit is payable to your designated beneficiary in addition to your full Employee Life Insurance benefit.

If you suffer the loss of limb, sight, speech or hearing from a AD&D Insurance benefits are payable to you. covered accident

In the event of your death from a covered accident while The full Business Travel Accident Insurance benefit is payable to traveling on Company business your designated beneficiary in addition to your full Employee Life Insurance and AD&D Insurance benefits.

If you suffer the loss of limb, sight, speech or hearing or become The Business Travel Accident Insurance benefit is payable to totally and permanently disabled as a result of a covered you, in addition to your AD&D Insurance benefit. accident while traveling on Company business

In the event of your covered dependent’s death as the result of The Dependent Life Insurance benefit (if elected) is payable to a covered cause you.

If you become terminally ill A portion of your Employee Life Insurance benefit can be elected as a “living benefit.”

When Coverage Begins

Life and Accident insurance coverage begins the 1st of the month Coverage Based on Annual Insured Earnings following 60 days of service with the Company. The coverage available to you under the Signature Select Life You must complete a Signature Select Enrollment/Change Insurance Program (other than Dependent Life Insurance) is based form to: on your current Annual Insured Earnings (AIE). 1. Designate a beneficiary for Employee Life Insurance, AD&D Insurance and Business Travel Accident Insurance How Annual Insured Earnings Is Determined 2. Elect your coverage amounts from the available options If any portion of your covered pay is deferred under a qualified The Signature Select Enrollment/Change form is available from retirement plan, a non-qualified retirement plan, Section 125 your Benefits Department. “cafeteria” benefit plan, Flexible Spending Accounts or any other arrangement under which your compensation is reduced on a voluntary basis, your Life Insurance coverage will be determined using your current Annual Insured Earnings before any such reductions.

LIFE AND ACCIDENT PLANS | 5-3 EMPLOYEE LIFE INSURANCE

Your Employee Life Insurance benefit is payable to your designated beneficiary if you die from any cause while you are insured (except as listed in the What Is Not Covered section). You may choose any person or persons as your beneficiary and you may change your beneficiary at any time by completing the applicable sections of aSignature Select Enrollment/Change form and returning it to your Benefits Department.

Payment of Claims Death benefits for the Insured will be paid to the beneficiary named on file, if any. If there is no named beneficiary or surviving beneficiary, death benefits for the Insured will be paid in one sum to the first surviving class of the following: 1. Spouse of the Insured; 2. Child or children of the Insured; 3. Mother or father of the Insured; 4. Sisters or brothers of the Insured; or 5. The estate of the Insured.

Employee Life Insurance Options When you are first eligible for life insurance coverage, you may choose any one of the following Employee Life Insurance options:

Signature Select Employee Life Insurance Options

Group Term Life Insurance Basic, company-paid life Supplemental, $50,000 Flat Amount* insurance of 1 or 2 times employee-paid life insurance your AIE, rounded to the next of an additional 1 to 3 times $1,000 of coverage (if not your AIE, rounded to the already a multiple of $1,000) next $1,000 of coverage (if not already a multiple of $1,000)

Maximum Coverage Level $2,500,000

*If 2 times your AIE is less than $50,000, the difference between 2 times your AIE and $50,000 will be treated as Supplemental Life insurance.

Company-Provided Amount Changing Your Coverage Once you make your coverage election, you will not be able to The Company will pay the full premium cost for Employee Life and change your coverage amount until the next annual enrollment AD&D Insurance coverage of up to two times your Annual Insured period (usually held in October or November for coverage effective Earnings. January 1st). If you want to avoid paying income tax on the “imputed” value If you want to change your Signature Select Employee Life (“premium”) of Company-paid life insurance in excess of $50,000 Insurance during a subsequent annual enrollment period, you (as required by IRS regulations), you may elect the $50,000 will be required to provide Evidence of Insurability (EOI) to the Employee Life Insurance option. insurance company if the change results in an increase of more than one level in your Employee Life Insurance coverage amount, Employee Premiums or if you are electing coverage for the first time after initial eligibility. For example, if you want to increase your coverage amount of The premium cost for any amount of Employee Life and AD&D Employee Life Insurance from three times your AIE to five times Insurance you elect that is higher than the Company-provided your AIE, you will need to provide EOI for the amount above four amount is determined by the insurance company’s rates for your times your AIE. EOI is also required if you are increasing your age as of the end of the prior calendar year. Your life insurance Employee Life Insurance coverage from the Flat $50,000 option to premiums (for coverage above 2 times your Annual Insured 2 times your AIE. You may decrease your Employee Life Insurance Earnings) are paid with after-tax dollars. coverage amount during any annual enrollment period. In cases where EOI is necessary, your new higher level of coverage will become effective on the later of January 1st following your annual enrollment election or the date of approval by the

LIFE AND ACCIDENT PLANS | 5-4 insurance company, provided that you submit the applicable EOI severity of such condition, your life expectancy is no more form and that your application is subsequently approved by the than 12 months. The insurance company may require that you insurance company. Until your application is approved, an amount be examined by a doctor of their choosing. If required, the that is limited to one times higher than your prior level of coverage insurance company pays for the exam. will remain in place. • Provide to the insurance company written consent from any irrevocable beneficiary, assignee, and, in community property Terminal Illness Benefit states, from your spouse. If, while actively employed, you become terminally ill (with a prognosis of 12 months or less to live), you may elect to receive Continuation Benefit for Total and Permanent Disability a portion of your Employee Life Insurance benefit while still living. If you stop active work due to total and permanent disability*, then This Terminal Illness Benefit equals 50% of the Employee Life you may elect to either convert your Employee and/or Dependent Insurance benefit (Basic and Supplemental) in effect at the time Life Insurance or you may elect to cover yourself under a new the insurance company determines you to be terminally ill or certificate of term life insurance. If you want a new term life $50,000, whichever is less. This benefit is for employees only. The certificate, then you must notify the insurance company and apply remaining balance of your Employee Life Insurance benefit would for it within 31 days after your life insurance ends, pay the first be payable to your designated beneficiary upon your death. premium to the insurance company, and submit proof of total and To receive the Terminal Illness Benefit, you must meetall of the permanent disability. following requirements. You must: Premiums must be paid directly to the insurance company for • Request this benefit in writing while you are living. If legally coverage under the new term life certificate. Coverage does incapacitated, your legal representative may request it for you. not include AD&D insurance, the Terminal Illness Benefit, or • Be insured for life insurance benefits under the group policy. Dependent Life Insurance. Life Insurance under the new term life certificate will stop on the earliest of the following: • Have life insurance coverage of at least $5,000 as shown in the certificate. • The end of the period for which all due premiums are paid. • Provide a doctor’s statement which gives the diagnosis of your • The date your life insurance is converted. medical condition, and states that because of the nature and * As defined by the insurance company.

LIFE AND ACCIDENT PLANS | 5-5 DEPENDENT LIFE INSURANCE

Dependent Life Insurance benefits will be paid if one of your covered dependents dies from a covered cause while insured. You will always be the beneficiary of your Dependent Life Insurance coverage unless you specifically designate otherwise in writing.

Eligible Dependents 2. The Employee and Same-Sex Domestic Partner furnish a notarized affidavit/signed statement reflecting these Your eligible dependents include: requirements, and an agreement to notify the Company if the requirements cease to be met, on a form acceptable to the • Your spouse or same-sex domestic partner (unless insured as Company. an employee of the Company)

• Your children* under age 26, regardless of residence, marital Eligibility and Enrollment status, student status or financial dependency As an eligible employee, you are first eligible to elect Dependent • Your unmarried children* over age 26 who are unable to support Life Insurance on the later of your first day of active regular full-time themselves due to a mental or physical handicap that began employment with the Company after completing any applicable before age 26. Proof must be provided within 31 days of the waiting period or the day on which you first obtain an eligible child attaining age 26. dependent (e.g., through marriage, birth of a child, etc.). If you enroll for Dependent Life Insurance coverage within 31 Same-Sex Domestic Partners days after you first become eligible, that coverage will be effective Under the life insurance plan, “Same-Sex Domestic Partner” retroactively back to the date you first became eligible. If you do means a person who: not apply for Dependent Life Insurance coverage within 31 days 1. Shares the Employee’s permanent residence; after you first become eligible, you must wait until the next annual enrollment period. 2. Has resided with the Employee continuously for at least one year and is expected to continue to reside with the Employee indefinitely; Dependent Life Insurance Options 3. Is financially interdependent with the Employee in each of the You may choose from three levels of Dependent Life Insurance following ways: (High, Medium or Low), which includes coverage for both your a. By holding one or more credit or bank accounts, including a spouse/same-sex domestic partner and children, or you may checking account, as joint owners; decline coverage. Evidence of Insurability is not required for your spouse/same-sex domestic partner when they are initially eligible b. By owning or leasing their permanent residence as joint for coverage. EOI is never required for your child(ren). tenants; c. By naming, or being named by, the Employee as a Signature Select beneficiary of life insurance or under a will; Dependent Life High Medium Low d. By each agreeing in writing to assume financial responsibility Insurance Options for the welfare of the other; Spouse/Same-Sex 4. Has signed a domestic partner declaration with the Employee, $50,000 $25,000 $10,000 if the Employee resides in a jurisdiction which provides for Domestic Partner domestic partner declarations; Each Child $15,000 $ 6,250 $ 2,500 6. Has not signed a domestic partner declaration with any other person within the last 12 months; You will not be able to change your Dependent Life Insurance election 6. Is no less than 18 years of age; until the next annual enrollment period, except to decrease or drop coverage, unless you first become eligible for this benefit during the 7. Is legally prohibited from marrying the Employee; year. 8. Is not currently legally married to any other person; and is not a blood relative any closer than would prohibit legal marriage. Changing Your Coverage In addition to the above requirements, consent of either party to You may increase your Dependent Life Insurance during each the Domestic Partner relationship must not have been obtained by annual enrollment period. You are required to provide Evidence force, duress, or fraud. of Insurability if you elect to increase your spouse/same-sex domestic partner coverage after they are initially eligible. EOI is An Employee may be insured against covered loss to a Same-Sex not required for your dependent child(ren) if you are increasing Domestic Partner if all of the following conditions are met: their coverage. 1. The Same-Sex Domestic Partner is the only person meeting the You may decrease or drop your Dependent Life Insurance at Policy’s definition of “Same-Sex Domestic Partner” with respect any time. to the Employee. * Under the Plan, the term “children” includes adopted children, and stepchildren for whom you are legally responsible for support and maintenance.

LIFE AND ACCIDENT PLANS | 5-6 ACCIDENTAL DEATH AND DISMEMBERMENT (AD&D) INSURANCE

Accidental Death and Dismemberment (AD&D) Insurance benefits will be paid if, while you are insured, you suffer the loss of life, limb, sight, speech or hearing as a result of bodily injury caused solely as a result of an accident. The loss must occur within 90 days of the accident. AD&D Insurance benefits are payable in addition to any benefits that may be paid under Employee Life Insurance or Business Travel Accident Insurance.

Your AD&D Insurance Coverage Amount

Your AD&D Insurance coverage amount equals your Employee Life Insurance coverage amount, which is based on your election of one of the available coverage options. For example, if you have elected Employee Life Insurance coverage equal to three times your Annual Insured Earnings, you will have an equal amount of AD&D Insurance coverage (in addition to your Employee Life Insurance). Any increase or decrease in your Employee Life Insurance coverage will result in a corresponding increase or decrease in the amount of your AD&D Insurance coverage.

How Benefits Are Paid The amount of the AD&D Insurance benefit and to whom it is paid depends on the nature of your loss, as shown in the following table:

Covered AD&D Losses AD&D Benefit

The full AD&D Insurance benefit is payable to your designated Loss of life beneficiary in addition to your Employee Life Insurance benefit.

Loss of both hands, both feet or sight of both eyes The full AD&D Insurance benefit is payable to you.

Loss of one hand and one foot The full AD&D Insurance benefit is payable to you.

Loss of speech and hearing in both ears The full AD&D Insurance benefit is payable to you.

Loss of one hand or one foot and sight of one eye The full AD&D Insurance benefit is payable to you.

Loss of one hand or one foot or sight of one eye One-half the AD&D Insurance benefit is payable to you.

Loss of speech One-quarter the AD&D Insurance benefit is payable to you.

Loss of hearing in both ears One-quarter the AD&D Insurance benefit is payable to you.

Loss of thumb and index finger of same hand One-quarter the AD&D Insurance benefit is payable to you.

Quadriplegia The full AD&D Insurance benefit is payable to you.

Paraplegia One-half the AD&D Insurance benefit is payable to you.

Hemiplegia One-half the AD&D Insurance benefit is payable to you.

Only one amount, the largest to which you are entitled, is paid for all losses resulting from a single accident.

LIFE AND ACCIDENT PLANS | 5-7 WHAT IS NOT COVERED (LIFE & AD&D)

Employee and Dependent Life Insurance Accidental Death & Dismemberment Insurance The Life Insurance Plan pays limited benefits for suicide. If an AD&D Insurance does not cover losses resulting from: Insured employee commits suicide, the beneficiary will receive • An accident occurring before the effective date of your the full Basic Life benefit. However, for Employee Supplemental coverage; and Dependent Life Insurance, if an Insured commits suicide within two years of the coverage effective date, the insurance • Suicide or intentionally self-inflicted injury; company will refund the amount of premiums paid for coverage • Physical or mental illness; instead of paying the death benefit. If an Insured was previously • Bacterial infection or bacterial poisoning. Exception: Infection covered for Supplemental or Dependent Life Insurance for more from a cut or wound caused by an accident; than two years and elected to increase their coverage, the original Supplemental or Dependent Life coverage amount would be paid • Aviation. Exception: A fare-paying passenger on a scheduled to the beneficiary as a death benefit and premiums paid for the or charter flight operated by a scheduled airline; higher coverage amount would be refunded. • Any armed conflict, whether declared as war or not, involving If a dependent child commits suicide and is survived by other any country or government; dependent children covered under the same certificate, no refund • An accident which occurs while in the military service for any of premiums will be paid. country or government; • An accident which occurs when you commit or attempt to commit a crime; • Use of any drug, narcotic or hallucinogenic agent, unless prescribed by a doctor or taken as directed by a doctor or the manufacturer.

WHEN COVERAGE ENDS (LIFE & AD&D)

Your Employee Life Insurance, Accidental Death and Conversion of Coverage Dismemberment Insurance and Dependent Life Insurance will end If your Signature Select Life Insurance coverage ends for any upon: reason other than nonpayment of premiums, you may convert • Termination of your active employment except as provided for your coverage to an individual policy. You will not be required to employees who became totally disabled before age 60 (see submit medical evidence of good health. To convert coverage, ”Continuation Benefit” on page 5-5) you must apply for the conversion policy and pay the first premium payment within 31 days after your Signature coverage • Your transfer to an ineligible classification of employees Select ends. Family members may also convert their coverage. • Termination of the group policies Converted policies are subject to certain benefits and limits as If you die within 31 days following your termination of active outlined in the conversion brochure, which may be requested from employment or transfer to an ineligible classification of employees, the insurance company. Premiums for converted coverage may be your Employee Life Insurance will be paid to your designated substantially higher than your Signature Select coverage. Your beneficiary as though it was still in effect at the time of your death. Benefits Department will provide additional information in the event that your coverage terminates. This conversion provision also applies to any portion of your life insurance coverage that terminates upon retirement. Accidental Death and Dismemberment Insurance and Business Travel Accident Insurance cannot be converted to individual policies.

LIFE AND ACCIDENT PLANS | 5-8 BUSINESS TRAVEL ACCIDENT INSURANCE

Business Travel Accident Insurance benefits will be paid if you sustain injuries or die as a result of an accident while traveling on Company business. These benefits are payable in addition to any benefits that may be payable under Employee Life Insurance and Accidental Death and Dismemberment Insurance.

Your Business Travel Accident Insurance Coverage Amount

Your Business Travel Accident Insurance coverage equals two times your Annual Insured Earnings up to a maximum coverage amount of $2,000,000.

How Benefits Are Paid The amount of the benefit and to whom it is paid depends on the nature of your loss:

Covered Business Travel Accident Losses Business Travel Accident Benefits

100% of the Business Travel Accident Insurance benefit is Loss of life payable to your designated beneficiary in addition to your Employee Life Insurance and AD&D Insurance benefits.

100% of the Business Travel Accident Insurance benefit is Loss of two or more hands or feet payable to you.

100% of the Business Travel Accident Insurance benefit is Loss of sight of both eyes payable to you.

100% of the Business Travel Accident Insurance benefit is Loss of One Hand or One Foot and Sight in One Eye payable to you.

100% of the Business Travel Accident Insurance benefit is Loss of speech and hearing in both ears payable to you.

100% of the Business Travel Accident Insurance benefit is Quadriplegia payable to you.

75% of the Business Travel Accident Insurance benefit is payable Paraplegia to you.

50% of the Business Travel Accident Insurance benefit is payable Hemiplegia to you.

1% of the Business Travel Accident Insurance benefit is payable at the end of each month you remain comatose to a maximum Coma of 11 months. After 11 months, if you remain comatose, 100% of the Business Travel Accident Insurance benefit is payable to your designated beneficiary beginning in month 12.

50% of the Business Travel Accident Insurance benefit is payable Loss of one hand or foot to you.

50% of the Business Travel Accident Insurance benefit is payable Loss of sight in one eye to you.

50% of the Business Travel Accident Insurance benefit is payable Loss of speech to you.

50% of the Business Travel Accident Insurance benefit is payable Loss of hearing in both ears to you.

25% of the Business Travel Accident Insurance benefit is payable Loss of thumb and index finger of the same hand to you.

Only one amount, the largest to which you are entitled, is paid for all losses resulting from a single accident.

LIFE AND ACCIDENT PLANS | 5-9 Aggregate Benefit Exposure and Disappearance The aggregate of all Business Travel Accident Insurance amounts BTA benefits are paid, subject to conditions and exclusions, if available from all losses arising out of any one accident is limited the covered person suffers a covered loss while traveling on the to $25,000,000, irrespective of the number of employees injured. business of the policyholder and the covered loss results directly If the total of individual losses exceeds this limit, proportionate and independently of all other causes from a covered accident amounts will be paid to (or on behalf of) each individual. that causes the covered person’s unavoidable exposure to the elements following the forced landing, sinking, stranding or Additional Benefits wrecking of a vehicle. Permanent Total Disability Benefit If the covered person disappears and is not found within one year from the date of wrecking, sinking or disappearance of the The full Business Travel Accident Insurance benefit is payable, conveyance in which the covered person was riding in the course subject to conditions and exclusions, when a covered person’s of a trip which would otherwise be covered under this policy, it will total disability results directly and of all other causes, from a be presumed that the covered person’s death resulted directly and covered accident. Total and permanent disability must continue for independently of all other causes from a covered accident. 12 consecutive months. Travel or trip must have been authorized in advance by the Seatbelt and Airbag Benefit policyholder. BTA benefits are paid, subject to conditions and exclusions, when War Risk a covered person’s death results directly and of all other causes, from a covered accident while wearing a seatbelt and operating BTA benefits are paid, subject to all applicable conditions and or riding as a passenger in a private passenger automobile. Death exclusions, if the covered person suffers a covered loss that must occur within 90 days of the covered accident. An additional results, directly and independently of all other causes, from a benefit is provided if the covered person was also positioned in a covered accident that occurs during war or acts of war that occur seat protected by a properly-functioning and properly deployed worldwide except for Afghanistan, Egypt, Iraq, Pakistan, Sudan, Supplemental Restraint System (Airbag). Somalia, Syria and countries where travel is permitted only under licenses granted by the Office of Foreign Assets Control, unless Verification of proper use of the seatbelt at the time of the covered such license is granted. accident and that the Supplemental Restraint System properly inflated upon impact must be a part of an official police report of Relocation Benefit the covered accident or be certified, in writing, by the investigating BTA benefits are paid, subject to all applicable conditions and officer(s) and submitted in the claim. exclusions, if the covered person suffers a covered loss that results, directly and independently of all other causes, from a 10% of the principal sum subject Seatbelt Benefit covered accident that occurs during relocation. This Benefit is to a maximum of $25,000 in effect beginning when the covered person departs from his prior place of residence, or if later, his prior place of employment 5% of the principal sum subject to Airbag Benefit and begins travel to his new place of residence or employment. It a maximum of $10,000 ceases to be in effect when the covered person begins his first full day of employment at his new location or 10 days from the date Default Benefit $1,000 this coverage began.

LIFE AND ACCIDENT PLANS | 5-10 WHAT IS NOT COVERED (BTA) FILING A CLAIM

Business Travel Accident Insurance does not cover losses Contact your Benefits Department to obtain or determine resulting from: what forms and documents are needed to file an Employee or • Normal commuting between the Covered Person’s home and Dependent Life Insurance, AD&D Insurance or Business Travel place of work; Accident Insurance claim. When the necessary information has been obtained, the claim should be submitted to your Benefits • Travel to another location where the Covered Person is Department. expected to be assigned for more than 90 days; For general information on the Program’s procedures regarding • Any activity not authorized or organized, or not reimbursable, by benefit claims and appeals, including timing of benefits and appeal the Policyholder; determinations, the manner in which appeals are conducted, • The Covered Person’s Personal Deviation, unless shown in the and notice of any adverse benefit determinations, see the Claims Schedule of Benefits; Denial and Appeal section in the General and Administrative Information chapter of this SPD. • The Covered Person’s driving any vehicle or Private Passenger Automobile for pay or hire; • Business Travel Coverage is not in effect while the Covered Person is performing job duties: (a) during work hours; and INCOME TAX CONSIDERATIONS (b) in a residence work area, which are specified in a written In accordance with IRS rules, if you elect Employee Life Insurance telecommuting agreement between him and his employer. coverage in excess of $50,000, a portion of the premium cost • Intentionally self-inflicted injury, suicide or any attempt thereat; will be treated as taxable income and will be indicated on your • Commission or attempt to commit a felony or an assault; year-end W-2 Wage and Tax Statement. This does not apply to Accidental Death & Dismemberment Insurance, Dependent Life • Declared or undeclared war or act of war; Insurance or Business Travel Accident Insurance. • Aviation, except as a fare-paying passenger on a scheduled In the event of death, benefits are not currently subject to federal commercial or charter flight operated by a scheduled airline income tax when paid to a designated beneficiary under Employee or as a passenger on an aircraft used by the Air Mobility Life Insurance, Accidental Death and Dismemberment Insurance, Command or its foreign equivalent; Dependent Life Insurance and/or Business Travel Accident • Sickness, disease, bodily or mental infirmity, bacterial or viral Insurance. However, federal and/or state estate (“inheritance”) infection or medical or surgical treatment thereof, including taxes may apply. exposure, whether or not accidental, to viral, bacterial or Tax rules are complex and each individual situation is different. chemical agents except for any bacterial infection resulting from Therefore, you should consult with your tax advisor to determine an accidental external cut or wound or accidental ingestion of the extent to which any coverage and/or benefits may be taxable. contaminated food; • Voluntary ingestion of any narcotic, drug, poison, gas or fumes, unless prescribed or taken under the direction of a physician OTHER IMPORTANT and taken in accordance with the prescribed dosage. Business Travel Accident Insurance is an accident-only policy and INFORMATION does not pay benefits for loss caused by or resulting from illness, disease or bodily infirmity. Important information, such as your rights as a Plan participant and other administrative details, can be found in the General and Administrative Information chapter of this SPD. WHEN COVERAGE ENDS (BTA)

Your BTA Insurance will end on the earliest of: • Termination of your active employment* • The date you are no longer in an eligible class of employees • Termination of the group policy

* Termination does not affect a claim for a Covered Loss due to a Covered Accident that occurs before the termination date. However, in no instance will benefits extend beyond the earliest of: 1. the end of the Benefit Period; and 2. the date benefits equal to any applicable Benefit Limit, as shown in the Schedule of Benefits, have been paid; and 3 the date benefits equal to any applicable Policy Aggregate Maximum, as shown in the Schedule of Benefits, have been paid.

LIFE AND ACCIDENT PLANS | 5-11 CHAPTER 6

Health Care Flexible Spending Account Plan CONTENTS

...... Page

Signature Select Health Care Flexible Spending Account Plan ...... 6-1

• How It Works...... 6-1

Enrollment...... 6-2

• Annual Enrollment ...... 6-2

• Change in Status ...... 6-2

Contributions...... 6-3

• Use It or Lose It...... 6-3

Eligible Expenses...... 6-3

Ineligible Expenses...... 6-4

Filing Claims ...... 6-4

• Orthodontia Claims...... 6-5

• Appealing a Claim ...... 6-5

When Coverage Ends...... 6-6

• Submitting Claims After You Leave the Company ...... 6-6

Tax Advantages/Considerations...... 6-7

Other Important Information...... 6-7

HEALTH CARE FLEXIBLE SPENDING ACCOUNT SIGNATURE SELECT HEALTH CARE FLEXIBLE SPENDING ACCOUNT

The Signature Select Health Care Flexible Spending Account If you are paying for services or items from a healthcare-related (FSA) Plan offers you a tax-effective way to pay for health care merchant or one that has implemented an inventory information expenses that are not covered under the Medical, Dental or Vision approval system, your transaction will be automatically approved Plan (or other insurance plans under which you and your eligible at the point of sale. You should always keep your itemized receipts family members are covered). and Explanation of Benefits (EOB) in the event that you need to provide them to PayFlex or the IRS. With the Health Care FSA, you can use before-tax dollars to pay for certain health care expenses you would normally pay for with If you purchase eligible healthcare items along with non-qualifying after-tax “take home” pay. You do not pay federal, state* or local items, be sure to ask the merchant to ring up eligible items income taxes (if applicable), or Social Security taxes on the money separately so that you can use your PayFlex Card. you use to pay for eligible expenses through the Health Care FSA. Your card can be valid for up to a five-year period. Each year you *Certain states do not exempt FSA contributions from state income tax. enroll, the card will reflect that plan year election amount(s). Your card will also include remaining funds from the prior plan year (if How It Works applicable) to be used during the grace period.

PayFlex® is the Claims Administrator for the Health Care FSA. When Not to Use Your Card You can obtain information about your account and claim status In certain situations, you should not use your PayFlex Card to pay by calling PayFlex or going online to www.healthhub.com. for services: Customer Service: 1-800-284-4885 • For instance, when you see an in-network medical doctor, Monday-Friday, 7:00 am - 7:00 pm (CT) do not use your card to pay at the doctor’s office, unless you only owe a co-pay. Your doctor must first file a claim with Saturday, 9:00 am - 2:00 pm (CT) your insurance carrier. Your insurance carrier will apply your PayFlex provides online account information at deductible, network discounts and/or out-of-pocket maximum www.healthhub.com. This information includes account amounts and will send an Explanation of Benefits to your doctor, balances, detailed claims and reimbursement information as well along with payment. Your doctor will then send you a bill. as access to various forms. Visit PayFlex’s website homepage Once you receive the bill from your doctor, after your insurance and select “Employee Account Login” link. The first time you log company has processed your claim, you can use your PayFlex in, you will need to click “REGISTER” to create your account. Your MasterCard to pay the bill. personal PIN will be sent to you within a few minutes at the e-mail • You should not use the card when visiting an out-of-network address you have specified. Your employee ID# is your Social physician either, as the FSA is only for non-reimbursed Security number and your home zip code should be used. expenses. If the medical plan pays any of the out-of-network You will also need your employer number to register on the claim then you would file for reimbursement only the amount not PayFlex website: paid by the insurance plan. • If you use the card for an ineligible expense or fail to provide Name of company Employer number requested documentation, the card may be deactivated. Berryville Graphics 116152 You will be required to offset with another unclaimed expense or reimburse PayFlex for the amount not eligible for Dynamic Graphic Finishing 129552 reimbursement. Coral Graphics 132754 Pay and Submit for Reimbursement Or you can pay for any eligible out-of-pocket expenses as they Pay with PayFlex Card occur during the year and submit an online or paper claim for PayFlex offers the PayFlex CardTM (a credit/debit card) which those expenses to PayFlex and be reimbursed tax-free from your debits eligible expenses directly from your account when billed by FSA. You do not pay any taxes on the money that goes into the a provider who accepts MasterCard. All you have to do is swipe FSA and you do not pay any taxes on the reimbursements you your card and select “Credit.” However, some merchants may ask receive. you to select “Debit.” This means you will need to enter a personal identification number (PIN) to complete the transaction. To get a PIN, call Card Services at 1-888-999-0121. A PIN can be created at any time. If you order a card for your spouse or dependent, they will use the same PIN you use.

HEALTH CARE FLEXIBLE SPENDING ACCOUNT | 6-1 Use It or Lose It Grace Period If you don’t spend the money in your Health Care FSA, Internal The Company offers a 2-1/2 month extension from the end of Revenue Code regulations require that you forfeit your unused the calendar year (December 31) in which you can incur eligible account balance. In other words, if you do not use it, you will lose expenses for the Health Care FSA. If you have not spent all your it! Therefore, you should conservatively estimate your expected contributions by December 31, a grace period exists to incur expenses that are eligible under the Health Care FSA and carefully expenses through March 15 following the plan year. You have until consider how much (if anything) you may want to contribute. Any April 30 to file a claim reimbursement for any expenses incurred unused balances (participant forfeitures) will be used to cover between Jan. 1 through March 15 of the following plan year; administrative expenses of the FSA Plan. otherwise you will forfeit any remaining balance.

ENROLLMENT

To participate in the Health Care FSA Plan, you must complete online enrollment or an enrollment form, as directed by your Human Resources Department, authorizing the Company to make automatic voluntary payroll deductions for contributions to your account. In accordance with Internal Revenue Service (IRS) regulations, you must re-enroll for each calendar year in which you want to participate.

Annual Enrollment Change in Status

Each year, as part of the annual enrollment process you must Once your Health Care FSA election is made upon initial make a new election for the following plan year if you wish to enrollment or annual enrollment, the election remains in effect until contribute to the Health Care FSA. Therefore, you must decide the end of the applicable calendar year and cannot be changed how much (if anything) you will contribute to your account for the unless you have a qualified change in status, which includes the entire year before the year begins. If you do not re-enroll in the following events: Health Care FSA each year, your participation will expire and no • Change in your legal marital status contributions will be taken from your pay in the following calendar year. You will not be able to re-enroll in the Health Care FSA until • Change in the number of your tax dependents the next annual enrollment period for the following calendar year, • Your dependent satisfies (or ceases to satisfy) eligibility unless you have a qualified change in status. requirements such as reaching the age limit If you join the Company after the annual enrollment period, or • Change in employment for you or your spouse or dependent become benefits-eligible in the middle of the plan year, you that affects eligibility of your benefits have up to 31 days following your date of hire or eligibility date If a change in status occurs, your Health Care FSA deductions to enroll in the Health Care FSA Plan. Only those expenses can be started, suspended, increased or decreased within the incurred after you join the Health Care FSA Plan will be eligible for course of the year, provided such change is consistent with reimbursement. When joining the Health Care FSA Plan mid-year, the related change in status. To make a change in your annual your election amount will apply for the remainder of the current election amount, you must complete the applicable sections of an calendar year. Enrollment/Change form and submit it to the Human Resources Department within 31 days of your change in status. Once processed, your contributions that are deducted from your pay will be adjusted for the remainder of the calendar year.

If You Suspend FSA Deductions If you suspend FSA deductions because of a change of status, you may only submit claims for reimbursement for expenses incurred prior to the date of the change of status.

HEALTH CARE FLEXIBLE SPENDING ACCOUNT | 6-2 CONTRIBUTIONS ELIGIBLE EXPENSES

Under the Health Care FSA Plan, you may make voluntary Your Health Care FSA Plan provides reimbursement for health contributions up to a maximum of $2,500 per year, which are care expenses that are not paid or reimbursed by any medical, deducted from your pay before taxes. If an employee and spouse dental or vision insurance plan. In general, most medical expenses both work and the spouse’s employer also offers a Health Care qualified under Internal Revenue Code Section 213 are eligible for FSA, both you and your spouse can fund a Health Care FSA up payment by the Health Care FSA. However, once these expenses to the $2,500 limit to a maximum of $5,000. The minimum annual are reimbursed through the FSA, a tax deduction for the same amount for you to contribute is $200. Voluntary contributions expenses cannot be taken. to your Health Care FSA are deducted from your pay each pay Eligible expenses include: period in equal amounts throughout the calendar year. • Deductibles, co-payments, coinsurance and expenses in excess of any maximum benefit amount Use It or Lose It • Insulin If you don’t spend the money in your Health Care FSA, Internal • Vision care expenses, such as eye examinations, eyeglasses, Revenue Code regulations require that you forfeit your unused contact lenses and supplies not covered by a medical or vision account balance. In other words, if you do not use it, you will lose plan it! Therefore, you should conservatively estimate your expected • Laser eye surgery expenses that are eligible under the Health Care FSA and carefully consider how much (if anything) you may want to contribute. Any • Hearing exams and hearing aids (not covered under medical unused balances (participant forfeitures) will be used to cover plan) administrative expenses of the FSA Plan. • Braces (orthodontia) not covered by a dental plan However, different rules may apply for employees who serve as • Obesity treatment if required by a physician to treat a medical active-duty reservists in the U.S. Armed forces. Please check with condition your Benefits Department to determine if you fall into this category. • Routine physicals and well-baby care not covered by a medical plan Did You Know? • Acupuncture if required by a physician with a prescription dated You don’t have to participate in a Medical Plan to take advantage within the plan year stating medical necessity of the Health Care FSA. • Certain other unreimbursed health care expenses that qualify for a deduction under the Internal Revenue Code More information regarding eligible expenses for a Health Care FSA is detailed in IRS Publication 502, which can be obtained from the IRS at www.irs.gov/pub/irs-pdf/p502.pdf. Please note, however, that not all expenses listed in Publication 502 may be eligible for reimbursement under the Health Care FSA. Please note that the IRS can make changes at any time and without notice. Visit www.healthhub.com or the most current information about eligible expenses.

When Expenses Are Incurred You may only use your Health Care FSA for eligible expenses incurred during the calendar year during which your contributions are deducted from your pay, or during the grace period (until March 15 of the following year). Expenses are considered incurred on the date services or supplies are provided, not when you are billed or when you pay for them.

HEALTH CARE FLEXIBLE SPENDING ACCOUNT | 6-3 INELIGIBLE EXPENSES FILING CLAIMS

Ineligible expenses include: All Health Care FSA claims must be submitted to PayFlex for • Over-the-counter medicines and drugs (except insulin), unless reimbursement. you have a prescription. • Health care expenses to the extent that they are reimbursed Filing a Claim under a medical, dental or vision insurance plan After you incur an eligible expense, you have the option of • Health insurance premiums submitting a claim online or completing a paper claim form and • Long-term care coverage or expenses mailing or faxing it along with your itemized documentation. • Health care expenses incurred in a different calendar year* • To file a claim online, login to your HealthHub account and select File a Claim on the left navigation bar or visit My • Over-the-counter products that promote general wellness such HealthHub Resources to download a claim form from as weight-loss aids and vitamins; herbal remedies Administrative Forms. • General health expenditures such as fitness programs, health • To print a paper claim form, click on My Resources and then club membership fees and exercise machines not prescribed by select Administrative Forms. a physician for a medical condition

• Non-prescription sunglasses Acceptable Documentation • Teeth bleaching Acceptable documentation consists of one of the following: • Cosmetic surgery that is not medically necessary • An Explanation of Benefits (EOB) is the preferred form of • Any health care expense that you deduct on your income tax documentation, which is provided to you by your insurance return provider. • Childcare or eldercare expenses, whether or not eligible under • An itemized receipt is also acceptable, but it must show the the Dependent Care Flexible Spending Account Plan (described date of purchase or service, amount of purchase or service, in Chapter 7). description of item or service, name of merchant or service provider, and name of patient if a medical claim. Correction Methods • Prescription drug receipt containing the pharmacy name, If your purchase is determined by the Administrator to not qualify patient name, date the prescription was filled, the name of the as a Medical Expense, the Administrator, in its discretion, shall use drug, and dollar amount. one of the following correction methods to make the Plan whole. • Over-the-counter (OTC) items must be clearly described on Until the amount is repaid, the Administrator shall take further the receipt. OTC drugs and medicines (except insulin) require a action to ensure that further violations of the terms of the card prescription from your physician in order to get reimbursed. do not occur, up to and including denial of access to the PayFlex Please note that a cancelled check is not acceptable card. documentation. 1. Repayment of the improper amount by the Participant; 2. Withholding the improper payment from the Participant’s wages Mailing or Faxing Claims or other compensation to the extent consistent with applicable 1. Obtain a claim form. If you choose to submit your Health Care federal or state law; FSA claim via mail or fax, then you can download a claim form 3. Claims substitution or offset of future claims until the amount is from PayFlex’s website at www.healthhub.com. repaid; and 2. Complete the claim form. When submitting claims, be sure 4. If subsections (1) through (3) fail to recover the amount, to attach copies of your itemized documentation such as an consistent with the Employer’s business practices, the Employer Explanation of Benefits to the claim form. For over-the-counter may treat the amount as any other business indebtedness. medications, you must submit an itemized cash register receipt that clearly indicates the store name, item name, date and cost of item purchased. OTC drugs and medicines (except insulin) require a prescription from your physician in order to get reimbursed. 3. Send the claim form. Mail or fax the completed form to: PayFlex Systems USA, Inc. Flex Dept. P.O. Box 3039 Omaha, NE 68103-3039 Fax: (402) 231-4310

* You may only use your Health Care FSA for eligible expenses incurred during the calendar year or during the Grace Period described on page 6-2 in which your voluntary contributions are withheld from your pay. Expenses are considered incurred on the date that services are provided, not when you are billed or when you pay for them.

HEALTH CARE FLEXIBLE SPENDING ACCOUNT | 6-4 Orthodontia Claims Appealing a Claim

The IRS recognizes that orthodontia treatment is different from You should submit all claims for reimbursement during the Plan any other type of healthcare expense. To get reimbursed for Year. For the Health Care FSA, you must submit claims no later orthodontia expenses you are required to submit one of the than 120 days after the end of the Plan Year. Any claims submitted following: after that time will not be considered. • Coupon Payment Option – You can submit an itemized In the case of a claim for medical expenses under the Health statement of your orthodontia expenses as the service is Flexible Spending Account, the following timetable for claims provided. Submit this documentation with a completed claim applies: form for reimbursement. Notification of whether claim is accepted or denied 30 days • Monthly Payment Option (Auto Pay) – You can obtain a Extension due to matters beyond the control of the Plan 15 days contract/payment agreement from the orthodontist with the following information: Insufficient information to process the claim: o Patient name Notification to Participant 15 days o Date the service begins Response by Participant 45 days o Length of service Review of claim denial 60 days o Charges for the initial banding work The Plan Administrator will provide written or electronic notification of any claim denial. The notice will state: o Dollar amount charged each month (a) The specific reason or reasons for the denial; • Submit your agreement with your first claim and PayFlex will automatically reimburse you each month, according to the (b) Reference to the specific Plan provisions on which the denial agreement. This eliminates the need for you to submit a claim was based; form for each visit and allows expenses to be paid monthly/ (c) A description of any additional material or information quarterly for the length of the contract. necessary for the claimant to perfect the claim and an Reminders when using Auto Pay option: explanation of why such material or information is necessary; o The PayFlex Card cannot be used to pay for orthodontia (d) A description of the Plan’s review procedures and the time expenses. limits applicable to such procedures. This will include a statement of your right to bring a civil action under section o The orthodontia agreement and a new claim form must be 502 of ERISA following a denial on review; submitted for each plan year in which orthodontia services are received. (e) A statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies o Reimbursements will be issued on a monthly basis near the of, all documents, records, and other information relevant to due date stated on your orthodontia contract agreement. the claim; and • Total Payment Option – If you paid the full amount when the (f) If the denial was based on an internal rule, guideline, treatment began, PayFlex will reimburse you for the amount not protocol, or other similar criterion, the specific rule, guideline, covered by your dental plan, up to your available FSA balance. protocol, or criterion will be provided free of charge. If this is Simply send a copy of your paid receipt to PayFlex, along with not practical, a statement will be included that such a rule, an itemized statement with the following information: guideline, protocol, or criterion was relied upon in making o Provider name the denial and a copy will be provided free of charge to the claimant upon request. o Patient name When you receive a denial, you will have 180 days following receipt o Date treatment started of the notification in which to appeal the decision. You may submit o Amount of expense written comments, documents, records, and other information o Amount insurance will pay relating to the claim. If you request, you will be provided, free of charge, reasonable access to, and copies of, all documents, Note: A paid receipt must be submitted and no expense records, and other information relevant to the claim. reimbursement will be allowed in future plan years. The period of time within which a denial on review is required to be made will begin at the time an appeal is filed in accordance with the procedures of the Plan. This timing is without regard to whether all the necessary information accompanies the filing. A document, record, or other information shall be considered relevant to a claim if it: (a) was relied upon in making the claim determination; (b) was submitted, considered, or generated in the course of making the claim determination, without regard to whether it was relied upon in making the claim determination; HEALTH CARE FLEXIBLE SPENDING ACCOUNT | 6-5 (c) demonstrated compliance with the administrative processes and safeguards designed to ensure and to verify that claim WHEN COVERAGE ENDS determinations are made in accordance with Plan documents and Plan provisions have been applied consistently with If you leave the Company for any reason, your contributions to the respect to all claimants; or Health Care FSA Plan will automatically stop. If you have a PayFlex Card, it will be deactivated. (d) constituted a statement of policy or guidance with respect to the Plan concerning the denied claim. The review will take into account all comments, documents, Submitting Claims After You records, and other information submitted by the claimant relating Leave the Company to the claim, without regard to whether such information was submitted or considered in the initial claim determination. The You may continue to request reimbursement from your Health review will not afford deference to the initial denial and will be Care FSA for expenses incurred on or before the last day of your conducted by a fiduciary of the Plan who is neither the individual employment. However, all such requests must be made before who made the adverse determination nor a subordinate of that April 30 of the year following the end of the plan year. individual. If you voluntarily end your employment or retire, or the Company terminates your employment during the year and you do not elect Questions? to continue participation in the Health Care FSA via COBRA, you To receive more information about PayFlex and health care FSAs, may continue to submit health care claims for eligible expenses visit www.healthhub.com and click the “Employee Account incurred through the last day your employment at the Company Login” link or call PayFlex at 1-800-284-4885. up to the amount you have elected for the plan year, regardless of your cash balance. Claims will need to be submitted by fax or mail. You will have until April 30 of the following year to submit claims. Any money left in the account after this date will be forfeited. If you die while employed, your beneficiary may elect to continue participation in the Health Care FSA via COBRA. If your beneficiary does not elect to continue participation via COBRA, they may continue to submit health care claims for eligible expenses incurred through the day in which you died, up to the amount you have elected for the plan year, regardless of the cash balance. They will have until April 30 of the following year to submit claims. Any money left in the account after this date will be forfeited.

Continuation of Participation Through COBRA You may elect to continue participation in the Health Care FSA by making post-tax contributions through COBRA for the remainder of the calendar year in which your employment terminates. You can then continue to incur claims past your termination date through the grace period of March 15 of the following year. You have until April 30 of the following year to submit claims for reimbursement. Please see the General and Administrative Information chapter of this SPD for information about your right to continue coverage through COBRA.

HEALTH CARE FLEXIBLE SPENDING ACCOUNT | 6-6 TAX ADVANTAGES/CONSIDERATIONS

Compensation that is normally subject to federal income tax, Social Security tax and state* and local income tax (if applicable) is not taxed if contributed to the Health Care FSA. Reimbursements provided under the Health Care FSA are also tax-free. *Certain states do not exempt FSA contributions from state income tax.

FSA Savings Example This example illustrates the tax savings that can result from participating in the Health Care FSA versus paying for health care expenses after tax.

Participate in the Do not participate in the Health Care FSA Health Care FSA

Annual income $50,000 $50,000

Health Care FSA contributions ($2,000) ($0)

Remaining income $48,000 $50,000

Federal, state and Social Security taxes* ($13,272) ($13,825)

Post-tax health care expenses ($0) ($2,000)

Remaining income $34,728 $34,175

Tax savings $553 $0

*Assumes 15% federal tax, 5% state tax and 7.65% Social Security tax.

Once you are reimbursed for an eligible health care expense, you may not take a corresponding deduction on your income tax return because these expenses have been paid through the Health Care FSA Plan with tax-free dollars.

Social Security Since you do not pay Social Security taxes on your before-tax voluntary Health Care FSA contributions, your future Social Security benefits could be slightly reduced. Although this reduction is usually small, it could occur if your taxable compensation is below the Social Security wage base.

Tax Exemptions Certain states (such as Pennsylvania) do not exempt FSA contributions from state income tax. However, the Federal income tax exemption applies to employees in all states.

OTHER IMPORTANT INFORMATION

Important information, such as the Company’s eligibility requirements, your rights as a Plan participant and other administrative details, can be found in the General and Administrative Information chapter of this SPD.

HEALTH CARE FLEXIBLE SPENDING ACCOUNT | 6-7 CHAPTER 7

Dependent Care Flexible Spending Account Plan CONTENTS

...... Page

Signature Select Dependent Care Flexible Spending Account Plan...... 7-1

How It Works...... 7-1

Enrollment...... 7-2

• Annual Enrollment ...... 7-2

• Change in Status ...... 7-2

Contributions...... 7-2

• Use It or Lose It...... 7-2

Eligible Expenses...... 7-3

Ineligible Expenses...... 7-4

Filing Claims ...... 7-4

• Dependent Child or Adult Day Care ...... 7-4

Tax Advantages/Considerations...... 7-6

When Coverage Ends...... 7-7

• Submitting Claims After You Leave the Company ...... 7-7

Other Important Information...... 7-7

DEPENDENT CARE FLEXIBLE SPENDING ACCOUNT SIGNATURE SELECT DEPENDENT CARE FLEXIBLE SPENDING ACCOUNT

The Signature Select Dependent Care Flexible Spending Account (FSA) Plan offers you a tax-effective means of paying for eligible dependent day care expenses that you incur while you are at work. With the Dependent Care FSA, you can use before-tax dollars to pay for certain dependent care expenses you would normally pay for with after-tax “take home” pay. You do not pay federal, *state or local income taxes (if applicable), or Social Security taxes on the money you use to pay for eligible expenses through the Dependent Care FSA.

*Certain states do not exempt FSA contributions from state income tax.

HOW IT WORKS

PayFlex® is the Claims Administrator for the Dependent Pay and Submit for Reimbursement Care FSA. You can obtain information about your account Or you can pay for any eligible dependent care services as they and claim status by calling PayFlex or going online to occur during the year and submit an online or paper claim for www.healthhub.com. those expenses to PayFlex and be reimbursed tax-free from your Customer Service: 1-800-284-4885 FSA. You do not pay any taxes on the money that goes into the Monday-Friday, 7:00 am - 7:00 pm (CT) FSA and you do not pay any taxes on the reimbursements you Saturday, 9:00 am - 2:00 pm (CT) receive.

PayFlex provides online account information at Use It or Lose It www.healthhub.com. This information includes account balances, detailed claims and reimbursement information as well If you don’t spend the money in your Dependent Care FSA, as access to various forms. Visit PayFlex’s website homepage and Internal Revenue Code regulations require that you forfeit your select “Employee Account Login” link. The first time you log in, you unused account balance. In other words, if you do not use it, you will need to click “REGISTER” to create your account. will lose it! Therefore, you should conservatively estimate your expected expenses that are eligible under the Dependent Care You will also need your employer number to register on the FSA and carefully consider how much (if anything) you may want PayFlex website: to contribute. Any unused balances (participant forfeitures) will be used to cover administrative expenses of the FSA Plan. Name of company Employer number

Berryville Graphics 116152 Grace Period Dynamic Graphic Finishing 129552 The Company offers a 2-1/2 month extension from the end of Coral Graphics 132754 the calendar year (December 31) in which you can incur eligible expenses for the Dependent Care FSA. For example, you will have until March 15 following the plan year to incur eligible FSA Pay with PayFlex Card expenses and until April 30 to submit those eligible expenses PayFlex offers the PayFlex CardTM (a credit/debit card) which for reimbursement. debits eligible expenses directly from your account when billed by a provider who accepts MasterCard. All you have to do is swipe your card and select “Credit.” However, some providers may ask you to select “Debit.” This means you will need to enter a personal identification number (PIN) to complete the transaction. To get a PIN, call Card Services at 1-888-999-0121. A PIN can be created at any time. If you order a card for your spouse, they will use the same PIN you use. Sufficient funds must be available on the card to enable a successful transaction. You should always keep receipts in the event that you need to provide them to PayFlex or the IRS. Your card can be valid for up to a five-year period. Each year you enroll, the card will reflect that plan year election amount(s). Your card will also include remaining funds from the prior plan year (if applicable) to be used during the grace period.

DEPENDENT CARE FLEXIBLE SPENDING ACCOUNT | 7-1 increase in hours of employment; or any other similar change ENROLLMENT which makes the individual become (or cease to be) eligible for a particular employee benefit. To participate in the Dependent Care FSA Plan, you must Dependent Eligibility Requirements: An event that causes complete an online enrollment or an enrollment form, as directed a participant’s dependent to satisfy or cease to satisfy the by your Human Resources Department, authorizing the Company dependent eligibility requirements for a particular benefit, such as to make automatic voluntary payroll deductions for contributions attaining a specified age; or to your account. In accordance with Internal Revenue Service (IRS) regulations, you must re-enroll for each calendar year in which you Change in Residence: A change in the place of residence of want to participate. the participant, the participant’s spouse or the participant’s dependent. Annual Enrollment If a change in status occurs, your Dependent Care FSA deductions can be started, suspended, increased or decreased Each year, as part of your annual enrollment you must make a within the course of the year, provided such change is consistent new election for the total annual amount that you would like to with the related change in status. To make a change in your annual contribute to the Dependent Care FSA for the following calendar election amount, you must complete the applicable sections of an year. Therefore, you must decide how much (if anything) you Enrollment/Change form and submit it to the Human Resources will contribute to your account for the entire year before the year Department within 31 days of your change in status. Once begins. If you do not re-enroll in the Dependent Care FSA each processed, your contributions that are deducted from your pay will year, your participation will expire and no contributions will be be adjusted for the remainder of the calendar year. taken from your pay in the following calendar year. You will not be able to re-enroll in the Dependent Care FSA until the next annual enrollment period for the following calendar year, unless you have a qualified change in status. CONTRIBUTIONS If you join the Company after the annual enrollment period, you Under the Dependent Care FSA Plan, you may make voluntary have up to 31 days following your date of hire or the date you contributions up to $5,000 each calendar year, which are first become eligible to enroll in the Dependent Care FSA Plan. deducted from your pay before taxes. The minimum annual Only those expenses incurred after you join the Dependent Care amount you can contribute is $200. Voluntary contributions to the FSA Plan will be eligible for reimbursement. When joining the Dependent Care FSA are deducted from your pay each pay period Dependent Care FSA Plan mid-year, your election amount will in equal amounts throughout the calendar year. apply for the remainder of the current calendar year. Change in Status Annual Maximum IRS regulations impose a contribution limit of $2,500 for married Once your Dependent Care FSA election is made upon initial employees filing separate income tax returns. This limit includes enrollment or annual enrollment, the election remains in effect until your voluntary Dependent Care FSA contributions plus any the end of the applicable calendar year and cannot be changed Dependent Care FSA contributions that your spouse may make to unless you have a qualified change in status, which includes the a Dependent Care FSA sponsored by his/her company. following events: Legal Marital Status: A change in a participant’s legal marital Discrimination Testing status, including marriage, death of a spouse, divorce, legal Each year, the IRS requires that employers offering a dependent separation or annulment, entering into or terminating a same-sex care account to their employees must run discrimination tests to domestic partnership. ensure that these accounts do not favor the highly compensated Change in Number of Dependents: A change in the participant’s ($120,000 for 2015). If the company fails the discrimination test, number of dependents, including the birth of a child, the adoption highly compensated employees will be notified in writing that their or placement for adoption of a Dependent, or the death of a annual elections will/may be reduced. Dependent. Change in Employment Status: Any change in employment Use It or Lose It status of the participant, the participant’s spouse or the If you have any money left in your Dependent Care FSA at the participant’s dependents that affects benefit eligibility under a end of the calendar year that is not claimed by April 30th of the cafeteria plan (including this Plan) or other employee benefit plan following calendar year, Internal Revenue Code regulations (including component Benefit(s)) of the employer of the participant, require that you forfeit your unused account balance. In other the spouse, or dependents. Such events include any of the words, if you do not use it, you will lose it! Therefore, you should following changes in the employment status of the participant, the conservatively estimate your expected dependent care expenses participant’s spouse or the participant’s dependent: termination and carefully consider how much (if anything) you may want to or commencement of employment; a strike or lockout; a contribute. Any unused balances (participant forfeitures) will be commencement of or return from an unpaid Leave of Absence; a used to cover administrative expenses of the FSA Plan. change in worksite; switching from salaried to hourly-paid, union to non-union, or part-time to full-time; incurring a reduction or

DEPENDENT CARE FLEXIBLE SPENDING ACCOUNT | 7-2 ELIGIBLE EXPENSES

Your Dependent Care FSA Plan provides reimbursement for day • Household services related to the care of an elderly or disabled care expenses that allow you and, if you are married, your spouse adult who lives with you, as long as the service provider is also to work. If you are married, both you and your spouse (unless a responsible for providing personal care to the elderly or disabled full-time student or disabled) must work for day care expenses to adult. be eligible. Please note that the list above has been compiled based on IRS According to the Internal Revenue Service, qualifying individuals guidelines and is subject to change without notice. for eligible expenses are defined as: For detailed guidelines on who qualifies as an eligible dependent • Child dependents under age 13 who live with the you for more or what constitutes an eligible dependent care expense, contact than half the year, or the IRS at www.irs.gov/pub/irs-pdf/p503.pdf or by phone at 1-800-829-3676. You can also request a copy of Publication 503, • Adult disabled dependents or spouses who live with you for Child and Dependent Care Expenses. more than half the year and do not have more than a minimum amount of gross income per year as set by the IRS (including Please note that the IRS can make changes at any time and taxable Social Security benefits). without notice. Visit www.healthhub.com for the most current information and a list of qualified dependent care expenses. Note: There is a requirement that a qualifying individual regularly spend eight hours a day in the employee’s home in determining whether expenses incurred for care outside the home are employment-related expenses. Eligible dependent day care expenses may include charges for: • Au pair expenses for dependent care (does not include travel expenses) • Babysitter inside or outside household • Before & After school or extended day programs (supervised activities after the regular school program) • Custodial childcare or eldercare expenses for qualifying individual • Day camps, if primary reason for being there is the care and well-being of the child and is custodial in nature, and not educational • Daycare centers • FICA (Medicare and Social Security) and FUTA (Federal Unemployment) taxes of daycare provider • Household employee whose services include care of a qualifying person • Late pick-up fees • Looking-for-work-expenses incurred to enable employee to look for work • Nanny expenses • Preschool/Nursery school for pre-kindergarten • Sick-child care center to extent the care is not for medical services • Summer day camps (not overnight camps) • Temporary Absence such as for vacation or minor illness and required to pay provider weekly or monthly and the payment includes the short absence as well as work days • Work-related day care expenses - must allow you to work or look for work. You must be gainfully employed (earning income). This does not include volunteer work that is unpaid or for nominal pay.

DEPENDENT CARE FLEXIBLE SPENDING ACCOUNT | 7-3 INELIGIBLE EXPENSES FILING CLAIMS

Ineligible dependent care expenses include: PayFlex is the Claims administrator for the Dependent Care FSA. • Payment to your dependents, including your spouse All Dependent Care FSA claims must be submitted to PayFlex for reimbursement. • Payments for a non-custodial parent’s day care expenses, • Dependent day care expenses incurred in a different calendar Filing a Claim year* After you incur an eligible expense, you have the option of • Medical, dental and/or vision care expenses whether or not submitting a claim online or completing a paper claim form and otherwise covered under the Company benefits or any other mailing or faxing it along with your itemized documentation. health insurance plan. To file a claim online, login to your HealthHub account and select • Educational/tuition expenses - kindergarten, first grade and File a Claim on the left navigation bar or visit My HealthHub above Resources to download a claim form from Administrative . • Expenses paid to child of participant Forms To print a paper claim form, click on My Resources and then • Field trip expenses select Administrative Forms. • Food, clothing, education or entertainment expenses Acceptable documentation consists of one of the following: • Household services (chauffeur, bartender, gardener) • A completed dependent day care claim form with dates of • Incidental expenses (diaper, activities, etc. charges) service, name of dependent, amount requested and day care • Overnight camp (not even the portion attributed to the daytime provider’s name and signature. The claim form can be used as cost) an itemized statement if your day care provider provides this information and signs the form where indicated. • Payments for care where you are not the custodial parent (in divorce situations) • A completed dependent day care claim form and an itemized statement from your day care provider. The itemized statement • Payments for care while you are off work because you are on a must include the provider’s name, your dependent’s name, as leave of absence well as the specific dates day care services were provided and • Payments for care while you are off work because you are on the cost of care. maternity or other medical leave Please note that a cancelled check is not acceptable • Payments for care while you are off work because you are on documentation. vacation unless required to pay weekly or monthly and the Please note that you are required to report the provider’s name, payment includes the short absence as well as work days address and Tax Identification Number or Social Security Number • Payments for care while you are off work due to illness unless on Form 2441 with your personal income tax return. temporary absence, required to pay weekly or monthly and the payment includes the short absence as well as work days Dependent Child or Adult Day Care • Payment for services not yet provided (advance payments) In order to get reimbursed for dependent child or adult day care • Registration fees/reservation fees/holding fees unless paid expenses, the expenses must be work-related, meaning you in order to obtain care and only if and when that provider is and your spouse, if married, must be employed, actively seeking selected employment or a full-time student. • Transportation expenses unless furnished by the care provider When submitting a claim for dependent day care expenses: to or from a place where care is provided • Complete a claim form and provide an itemized statement from * You may only use your Dependent Care FSA for eligible expenses incurred during the calendar your day care provider. year or during the Grace Period described on page 7-1 in which your voluntary contributions are withheld from your pay. Expenses are considered incurred on the date that services are provided, not when you are billed or when you pay for them. • Your provider’s signature on the claim form may be used as a substitute for an itemized statement. Remember, either the provider’s signature on the claim form OR an itemized Adequate Funds statement is required. PLEASE DO NOT SEND BOTH. You can only be reimbursed for eligible expenses up to the • If submitting the itemized statement instead of having the amount that has already been deducted from your pay (cash provider sign the claim form, the itemized statement must balance) and credited to your account at PayFlex. For example, include the provider’s name, your dependent’s name, as well as if you submit an expense for reimbursement of $500, but you have the specific dates day care services were provided and the cost only contributed $275 year-to-date, then you will be reimbursed of care. for $275 and the remainder of the claim will be reimbursed as • Cancelled checks cannot be accepted as a form of contributions are credited to your account. documentation.

DEPENDENT CARE FLEXIBLE SPENDING ACCOUNT | 7-4 • IRS regulations require you to report the provider’s name, Appealing a Claim address and Tax Identification Number (or Social Security You should submit all reimbursement claims during the Plan Year. Number) on Form 2441 to be filed with your personal income For the Dependent Care Flexible Spending Account, you must tax return. A dependent is considered eligible if they are under submit claims no later than 120 days after the end of the Plan Year. age 13 or otherwise meets the “Qualifying Person Test” as Any claims submitted after that time will not be considered. described in Publication 503. All other general requests should be directed to the Administrator • Remember, you can only get reimbursed for day care services of our Plan. If a dependent care claim under the Plan is denied received, not for services to be provided in the future. in whole or in part, you or your beneficiary will receive written notification. The notification will include the reasons for the denial, Mailing or Faxing Claims with reference to the specific provisions of the Plan on which Obtain a claim form. If you choose to submit your Dependent the denial was based, a description of any additional information Care FSA claim via mail or fax, then you can download a claim needed to process the claim and an explanation of the claims form from PayFlex’s website at www.healthhub.com. review procedure. Within 60 days after denial, you or your beneficiary may submit a written request for reconsideration of the Complete the claim form. When submitting claims, be sure to denial to the Administrator. attach copies of your itemized documentation to the claim form. Any such request should be accompanied by documents or Send the claim form. Mail or fax the completed form to: records in support of your appeal. You or your beneficiary may PayFlex Systems USA, Inc review pertinent documents and submit issues and comments in Flex Dept. writing. The Administrator will review the claim and provide, within P.O. Box 3039 60 days, a written response to the appeal. (This period may be Omaha, NE 68103-3039 extended an additional 60 days under certain circumstances.) Fax: (402) 231-4310 In this response, the Administrator will explain the reason for the decision, with specific reference to the provisions of the Plan on which the decision is based. The Administrator has the exclusive right to interpret the appropriate plan provisions. Decisions of the Did You Know? Administrator are conclusive and binding. If you are also enrolled in the Health Care Flexible Spending Account Plan, your PayFlex Card may be used for eligible Questions? expenses in the Health Care Flexible Spending Account Plan or To receive more information about PayFlex and dependent the Dependent Care Flexible Spending Account Plan. care FSAs, visit www.healthhub.com and click the “Employee Account Login” link or call PayFlex at 1-800-284-4885.

DEPENDENT CARE FLEXIBLE SPENDING ACCOUNT | 7-5 TAX ADVANTAGES/CONSIDERATIONS

Compensation that is normally subject to federal income tax, Social Security tax and state* and local income tax (if applicable) is not taxed if contributed to the Dependent Care FSA. Reimbursements provided under the Dependent Care FSA are also tax-free.

*Certain states do not exempt FSA contributions from state income tax.

Dependent Care FSA Savings Example This example illustrates the tax savings that can result from participating in the Dependent Care FSA versus paying for dependent care expenses after tax. In this example, you have $3,000 in annual dependent care expenses.

Do not participate in the Dependent Participate in the Dependent Care FSA Care FSA

Annual income $50,000 $50,000

Dependent Care FSA contributions ($3,000) ($0)

Remaining income $47,000 $50,000

Federal, state and Social Security taxes* ($12,996) ($13,825)

Post-tax dependent care expenses ($0) ($3,000)

Remaining income $34,004 $33,175

Total savings $829 $0

*Assumes 15% federal tax, 5% state tax and 7.65% Social Security tax.

Dependent Care Tax Credit Social Security Once you are reimbursed for an eligible dependent care expense, Since you do not pay Social Security taxes on your before- you may not take a corresponding deduction on your income tax tax voluntary Dependent Care FSA contributions, your future return because these expenses have been paid through the FSA Social Security benefits could be slightly reduced. Although Plan with tax-free dollars. this reduction is usually small, it could occur if your taxable Use of the Dependent Care FSA will reduce — dollar for dollar compensation is below the Social Security wage base. — the amount you may claim as a child and dependent care tax credit. Tax Exemptions You should consult with a tax advisor concerning your personal tax situation. Changes to the child and dependent care tax credit Certain states (such as Pennsylvania) do not exempt FSA or the Earned Income Tax Credit will affect the calculation of contributions from state income tax. However, the Federal income which program is better for you each year. You may qualify for the tax exemption applies to employees in all states. child care tax credit for some amounts in excess of the $5,000 Dependent Care FSA maximum.

DEPENDENT CARE FLEXIBLE SPENDING ACCOUNT | 7-6 WHEN COVERAGE ENDS

If you leave the Company for any reason, your contributions to the Dependent Care FSA Plan will automatically stop. If you have a PayFlex Card, it will be deactivated, and any outstanding claims will need to be submitted via fax or paper. Submitting Claims After You Leave the Company

You may continue to request reimbursement from your Dependent Care FSA for expenses incurred through the grace period of March 15 of the following year until any cash balance is exhausted. However, all such requests must be made before April 30 of the next year. Any money left in the account after this date will be forfeited.

OTHER IMPORTANT INFORMATION

Important information, such as the Company’s eligibility requirements, your rights as a Plan participant and other administrative details, can be found in the General and Administrative Information chapter of this SPD.

DEPENDENT CARE FLEXIBLE SPENDING ACCOUNT | 7-7 CHAPTER 8

General Information Retirement Income Program

• Bertelsmann Pension Account Plan • Bertelsmann 401(k) Savings Plan CONTENTS

...... Page

Plan Identification – Pension Account Plan...... 8-1

Plan Identification – 401(k) Savings Plan ...... 8-1

Fiduciary Information – Pension Account and 401(k) Savings Plans...... 8-1

Participating Companies...... 8-2

Top-Heavy Rules...... 8-3

Non-Assignability of Benefits...... 8-3

Claims Denial and Appeal...... 8-3

Time to Bring Legal Action...... 8-3

Plan Documents...... 8-3

Changing or Terminating Plans...... 8-3

Employment at Will...... 8-4

Your Rights Under ERISA...... 8-4

RETIREMENT INCOME PROGRAM GENERAL INFORMATION

Plan Identification – Pension Account Plan

Name of Plan: Bertelsmann Pension Account Plan Plan Number: 003 Type of Plan: Defined benefit pension plan Plan Trustee: The Northern Trust Company 50 South La Salle Street Chicago, IL 60603 Plan Funding: Company contributions

Plan Identification – 401(k) Savings Plan

Name of Plan: Bertelsmann 401(k) Savings Plan Plan Number: 004 Type of Plan: Defined contribution pension plan Plan Trustee: Fidelity Management Trust Company 82 Devonshire Street Boston, MA 02109 Plan Funding: Company contributions and Employee contributions

Fiduciary Information - Pension Account Plan and 401(k) Savings Plan

Plan Sponsor: Bertelsmann, Inc. 1745 Broadway New York, NY 10019 (212) 782-1150 Employer Identification Number: 95-2949493 Plan Year: January 1 through December 31 Plan Administrator: Plan Committee, Pension & Savings Plans c/o Corporate Benefits Department Bertelsmann, Inc. 1745 Broadway New York, NY 10019 (212) 782-1150 Type of Administration: Company Administration Agent for Service of Legal Process: Chief Legal Counsel c/o Bertelsmann, Inc. 1745 Broadway New York, NY 10019

Service of legal process may also be made upon the Trustee or Plan Administrator.

RETIREMENT INCOME PROGRAM | 8-1 PARTICIPATING COMPANIES

Participating Companies Pension Plan* 401(k) Plan

Arist Education LLC X

arvato digital services LLC X X

Arvato Entertainment LLC X X

Arvato Systems North America, Inc. X X

Author Solutions LLC ––– X

Author Video Solutions LLC ––– X

Berryville Graphics, Inc.** X X

Bertelsmann, Inc. X X

BMG Rights Management (US) LLC ––– X

Coral Graphic Services, Inc. (Dynamic division only) X X

FremantleMedia Latin America, Inc. X

FremantleMedia North America, Inc. X X

Golden Treasures LLC ––– X

Gruner + Jahr USA Group Inc. X

Penguin Random House LLC ––– X

Prestel Publishing LLC ––– X

Penguin Random House Foundation, Inc. X X

PRH Holdings, Inc. X –––

Price is Right Production, Inc. X X

Random House Children’s Entertainment LLC X X

Random House Studio LLC X X

Relias Learning, LLC X

RTL NY, Inc. ––– X

Smashing Ideas LLC ––– X

Xlibris LLC ––– X

495 Production Holdings LLC X * The Pension Account Plan is frozen with respect to all future eligibility and benefit accruals (see Chapter 10, Bertelsmann Pension Account Plan).

** Participation in the 401(k) Plan is frozen and limited to employees who are first hired at Berryville Graphics, Inc. before January 1, 2014. Berryville Graphics, Inc. adopted the BE Printers 401(k) & Profit Sharing Plan for employees first hired on and after January 1, 2014. Rehired Employees first hired before January 1, 2014 will continue to be eligible under the 401(k) Plan upon rehire at any time.

RETIREMENT INCOME PROGRAM | 8-2 or your authorized representative may submit a written request for TOP-HEAVY RULES reconsideration of the application to the Plan Administrator. Your appeal should include all documents or records in support A “top-heavy” plan means a plan that allocates more than 60% of your claim and state the reasons you believe you are eligible of its benefits to “key employees.” Both “top-heavy” and “key for the benefit you have claimed. You or your authorized employees” are terms defined under the Internal Revenue Code. representative may review pertinent documents and submit issues If the Pension Account Plan or the 401(k) Savings Plan (singularly and comments in writing. The Plan Administrator will review the a “Plan” and collectively the “Plans”) became top heavy, all Plan claim and within 60 days - subject to extension (made in writing members would be informed and benefits could be modified to within the initial 60-day period) in special circumstances for provide special accelerated vesting, special minimum benefits and up to an additional 60 days - will provide a written response to limits on covered compensation. the appeal. If your appeal is denied, the notification will explain the reason for the decision, the specific reference to the Plan provisions on which the decision is based, and a statement NON-ASSIGNABILITY OF BENEFITS that you are entitled to receive, upon written request and free of charge, reasonable access to, and copies of, all documents, Benefits payable under a Plan are payable only to Plan members records and other information relevant to your claim. The Plan or their beneficiaries. No one has the right to commute, pledge, Administrator has the sole discretionary authority and exclusive withdraw, encumber or assign benefits to any other individual(s) or right to interpret the appropriate Plan provisions. Decisions by the organization(s). However, in certain circumstances, a lien against Plan Administrator are conclusive and binding. If you fail to timely Plan assets may be made by federal or state governments. Also, a file a request for reconsideration, you will lose your right to pursue beneficiary may waive his or her rights to benefits under the Plans your claim in court. If your claim for benefits is denied or ignored, pursuant to a Qualified Disclaimer as defined in Section 2518 of in whole or part, you can file suit in a state or federal court. the Internal Revenue Code. Notwithstanding the preceding paragraph, in the event that a valid Qualified Domestic Relations Order (QDRO) is properly served on TIME TO BRING LEGAL ACTION a Plan, benefits will be paid accordingly. A QDRO is an order or a judgment from a state court directing the Plan Administrator to pay You cannot bring an action in court to pursue your claim all or a portion of a member’s Plan benefits to a spouse, former for benefits later than one year from the date of the Plan spouse or dependent. A copy of the QDRO procedures for each Administrator’s decision on your appeal (or, if no decision is Plan is available upon request and without charge from the Plan provided to you within 120 days of the Plan Administrator’s receipt Administrator. of your appeal, no later than 12 months from the 120th day after the Plan Administrator’s receipt of your appeal). CLAIMS DENIAL AND APPEAL PLAN DOCUMENTS If you have a complaint or claim concerning the operation or administration of a Plan, or about your benefits under a Plan, The summaries contained in this booklet describe the key features you or your authorized representative has the right to have the of the Plans as of January 1, 2015, and do not cover all details. complaint reviewed by the Plan Administrator. All complaints and The full terms and conditions of the Plans are provided in the claims for benefits must be submitted in writing within two years, various Plan documents and insurance contracts. The documents beginning (i) in the case of a lump-sum payment, on the date legally govern the operations of the Plans. In the event of a conflict on which the payment was made, (ii) in the case of installment or discrepancy of any kind between the Plan documents and the payments, on the date on which the first in the series of payments descriptions contained in these summaries, the Plan documents was made, or (iii) for all other claims, on the date on which the control. action complained of occurred. You are entitled to receive, upon Copies of all Plan documents, as well as the annual reports of Plan request and free of charge, reasonable access to and copies of all operations filed with the Internal Revenue Service, are available for documents, records and other information relevant to your claim. review during normal business hours at your Human Resources If an application for benefits under a Plan is denied in whole or in Department. part, you or your beneficiary will receive written notification within 90 days, subject to extension (made in writing within the initial 90-day period) in special circumstances for up to an additional 90 days. The notification will include the reasons for the denial CHANGING OR with reference to the specific Plan provisions on which the denial TERMINATING PLANS is based, a description of any additional information needed to process the claim, an explanation why such information is needed, Although the Company expects, and intends, to continue the and an explanation of the claim review procedure including time Plans indefinitely, the Company, by decision of the Board of limits. Within 60 days after receiving a denial, you Directors obtained at an authorized meeting or by written consent of the Board of Directors (or their designee), may change or terminate the Plans at any time. RETIREMENT INCOME PROGRAM | 8-3 The Company’s decision to change or terminate a Plan may be B. Prudent Actions by Plan Fiduciaries due to changes in federal or state laws, the requirements of the In addition to creating rights for Plan members, ERISA imposes Internal Revenue Code or ERISA, or any other reason. A Plan duties upon the people who are responsible for the operation of change may involve transferring Plan assets and liabilities to each Plan. The people who are responsible for the management another plan or dividing the Plan into two or more parts. If the of the Plan, called “fiduciaries” of the Plan, have a duty to act Company does make a change or terminates a Plan, it may decide prudently and in the best interest of you and other Plan members to set up a different plan providing similar or identical benefits. and beneficiaries. If a Plan is terminated, a benefit may be payable to you. The C. Enforce Your Rights amount of your benefit may be paid to you in one or more cash payments or an annuity contract that will pay you a monthly Another one of your rights relates to the claim appeal procedure income. The exact form of payment may be set by law; if there is - i.e., the right to receive written notice if your claim for benefits a choice, the Plan Administrator will decide the type and timing of should, for any reason, be denied in whole or in part, plus the right payment, unless otherwise determined by the Plan Administrator. to have your claim reconsidered. And, of course, the Company will not dismiss you or discriminate against you in any way to prevent you from obtaining benefits from the Plans or exercising your rights EMPLOYMENT AT WILL under ERISA. If your claim for a benefit is denied or ignored, in whole or in part, Participation in a Plan does not create or imply an employment you have a right to know why this was done, to obtain copies of contract between the Company and any Plan member. documents relating to the decision without charge, and to appeal any denial, all within certain time schedules. Under ERISA, there are steps you can take to enforce the above YOUR RIGHTS UNDER ERISA rights. For instance, if you request materials from a Plan and do not receive them within 30 days, you may file suit in a federal court. In such a case, the court may require the Plan Administrator Your benefits as an employee are covered by the Employee to provide the materials and pay you up to $110 a day until you Retirement Income Security Act of 1974, as amended (ERISA) receive the materials, unless the materials were not sent because and, as a member in a Plan, you are entitled to certain rights and of reasons beyond the control of the Plan Administrator. If you protections under ERISA. have a claim for benefits that is denied or ignored, in whole or in part, you may file suit in a state or federal court (subject to the A. Receive Information About Your Plan and Benefits time limit set forth under “Time to Bring Legal Action.” In addition, Although the law does not require a company to provide benefits, if you disagree with a Plan’s decision, or lack thereof, concerning it does set standards for those that do. The Company believes you the qualified status of a domestic relations order or a medical should know as much as possible about your benefits. You are child support order, you may file suit in federal court. If it should entitled to receive copies of Plan documents (including insurance happen that Plan fiduciaries misuse the Plan’s money, or if you contracts and collective bargaining agreements, if applicable) are discriminated against for asserting your rights, you may seek and other Plan information upon written request to your Human assistance from the U.S. Department of Labor, or you may file Resources Department. Under ERISA, a nominal charge can be suit in a federal court. The court will decide who should pay court made for each page of any Plan document that you request. You costs and legal fees. If you are successful the court may order the are also entitled to view the documents and contracts governing person you have sued to pay these costs and fees. If you lose, the the Plan, including a copy of the latest annual report (Form 5500) court may order you to pay these costs and fees, for example, if it filed by the Plan with the U.S. Department of Labor, without finds your claim is frivolous. charge, at the Plan Administrator’s office. The Form 5500 is also available at the Public Disclosure Room of the Employee Benefits D. Assistance with Your Questions Security Administration. If you have any questions about the Plans, you should contact You have a right to receive, without charge, a statement of your Human Resources Department. If you have any questions about accrued and vested benefits under each Plan as follows: this statement or about your rights under ERISA, or if you need • For the 401(k) Savings Plan, you will receive a statement assistance in obtaining documents from the Plan Administrator, showing the value of your account at the end of every calendar you should contact the nearest Area Office of the Employee quarter (March 31, June 30, September 30 and December 31). Benefits Security Administration (EBSA), U.S. Department of Labor, listed in your telephone directory or the Division of • For the Pension Account Plan, you will receive a statement at Technical Assistance and Inquiries, Employee Benefits Security least once every three years if you are employed at the time the Administration, U.S. Department of Labor, 200 Constitution statement is provided and you have a vested benefit under the Avenue, N.W., Washington, DC 20210. You may also obtain certain Plan. You may also request a statement in writing once each publications about your rights and responsibilities under ERISA by year without charge. calling the publications hotline of EBSA. The Plan Administrator is required by law to furnish you with a copy of a summary of the 401(k) Savings Plan’s annual financial report (SAR) each year without charge.

RETIREMENT INCOME PROGRAM | 8-4 CHAPTER 9

The Bertelsmann 401(K) Savings Plan CONTENTS

...... Page

Plan Highlights ...... 9-1

Eligibility...... 9-2

Enrollment...... 9-3

• Automatic Enrollment...... 9-3

• Resolicitation and Re-Enrollment ...... 9-3

• Qualified Default Investment Alternative...... 9-3

• How to Enroll...... 9-4

How the Plan Works...... 9-5

• Pre-Tax Contributions ...... 9-5

• Roth 401(k) Contributions...... 9-5

• Pre-Tax or Roth 401(k) Contributions...... 9-5

• Maximum Contributions...... 9-5

• Annual Increase and Resolicitation Program ...... 9-5

• How Catch-up Contributions Work...... 9-5

• Covered Earnings...... 9-6

• Tax Examples ...... 9-6

Company Contributions ...... 9-8

• Company Matching Contributions...... 9-8

• Company Annual Contributions...... 9-8

• Company Profit Sharing Contributions...... 9-8

Your Choice of Investment Funds...... 9-9

• Short-Term Trading Fees...... 9-10

• How the Fees Work...... 9-10

• What Do These Fees Mean to You...... 9-10

• Selection of Investment Options ...... 9-10

• Responsibility for Investment Decisions...... 9-11

• Financial Engines ...... 9-11

How Your Account Balance Can Grow — Examples...... 9-12

Vesting...... 9-13

• Five-Year Break ...... 9-13

Rollovers from Other Plans ...... 9-14

Plan Payments...... 9-14

• Timing of Plan Payments...... 9-14

• Payment Methods ...... 9-14

• Loans...... 9-15

• Withdrawals Not Due to Hardship ...... 9-15

THE BERTELSMANN 401(K) SAVINGS PLAN • Hardship Withdrawals...... 9-16

• Qualified Reservist Distribution...... 9-16

• Distribution While Performing Service in the Uniformed Service ...... 9-16

• Minimum Required Distributions...... 9-16

• In-Plan Roth Rollovers...... 9-16

• Tax Considerations...... 9-17

• How to Apply for Benefits...... 9-17

Plan Flexibility...... 9-18

Online and Toll-Free Telephone Services ...... 9-18

• NetBenefitsSM (online access)...... 9-18

• Voice Response System...... 9-18

• Participant Service Representative ...... 9-18

Other Important Information...... 9-19

Appendix A – Participating Affiliates...... 9-20

Appendix B – Company Annual Contribution...... 9-21

Appendix C – Company Annual Contribution...... 9-22

Appendix D – Random House Group Profit Sharing Contribution...... 9-23

This Summary Plan Description (SPD) is merely a summary of the terms of the Plan. In the event of a conflict between the actual terms of the Plan and this summary, the terms of the Plan shall control. The Company reserves the right to unilaterally amend, modify or terminate the Plan in its sole discretion at any time for any reason.

THE BERTELSMANN 401(K) SAVINGS PLAN PLAN HIGHLIGHTS

The Bertelsmann 401(k) Savings Plan (the “Plan”) offers you incentives to save and invest for your future. The Plan is maintained under Section 401(k) of the Internal Revenue Code, which offers tax advantages to encourage you to save for retirement. The Plan, which became effective April 1, 1987, is voluntary and is subject to continuing government approval under the Internal Revenue Code. The Random House, Inc. Incentive Investment Plan was merged into the Plan effective December 31, 2009. The Ten Speed Press 401(k) and Profit Sharing Plan was merged into the Plan effective January 13, 2010. The BMG 401(k) Savings Plan was merged into the Plan effective December 31, 2013. A portion of The Pearson Retirement Plan was merged into the Plan effective January 17, 2014. The G + J USA Group, Inc. Retirement Savings Plan was merged into the Plan effective January 16, 2015. The following table summarizes the main features of the Plan as of January 1, 2015:

Highlights of the Plan

Here’s What the Plan Does for You Through These Features

You can invest 1%–75% of your Covered Earnings* each pay Helps you save for the future period through convenient payroll deductions.

The Company matches your contributions** dollar for dollar up to 6% of your Covered Earnings. Company Annual Adds to your investments Contributions and Profit Sharing Contributions may also be made in certain cases.

You can direct your contributions, rollovers and the Company’s contributions into different investment funds. You can also Lets you choose how to invest reallocate your existing account balances into different investment funds.

You pay no federal income taxes on your own pre-tax contributions, the Company’s contributions, or any investment Defers and saves taxes while you invest earnings until this money is paid to you in the future. Roth 401(k) contributions grow tax-free if you meet certain requirements.

You are always 100% “vested” (that is, you have a non- forfeitable right) in the current value (including investment earnings and returns) of your Plan contributions and the Provides rapid vesting Company’s matching contributions. Company Annual Contributions require three years of service to vest. Profit Sharing Contributions vest on a three-year graded vesting schedule.

The full vested value of your Plan account is available when Funds are available when needed most your service ends at retirement, total disability or termination of employment.

While you are employed, you can make cash withdrawals under certain circumstances if you have a financial hardship, or are Allows withdrawals and loans over 59-1/2 years of age. You can borrow from your account for any reason.

* Subject to IRS regulations and restrictions. ** You must have one year of service to be eligible for Company Matching Contributions.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-1 ELIGIBILITY

Unless you are subject to the rules below for certain part-time and Penguin Random House Group (see Appendix D) on January 1, temporary employees, you are eligible to join the Plan as follows: 2014, your past service with Pearson plc or any or its subsidiaries is also counted. If you were employed by Gruner + Jahr USA • You may begin making contributions immediately after you join Group, Inc. on January 1, 2015, your past service with Gruner + the eligible class. Jahr USA Group, Inc. and certain of its affiliates is also counted. • The Company will begin matching your contributions (up to 6% Employment as a leased employee is also treated as employment of Covered Earnings) after the later of the date you complete with the Company if you are later hired as an employee of the one year of eligibility service or the date you join the eligible Company or an affiliate. Employment as a part-time employee class. Generally, you complete one year of eligibility service on or as a temporary employee continues to count as employment the first anniversary of your employment. with the Company if you are subsequently hired as a full-time If you are classified by the Company as a part-time employee who employee. is regularly scheduled to work less than 20 hours per week (1,000 You are in the eligible class if you are employed by the Company hours per year) or as a temporary employee, you are eligible to (or an Active Participating Affiliate listed in Appendix A, attached), make contributions and to receive matching contributions (up to provided that: 6% of Covered Earnings) on the later of the date you complete one • You are not in a class of employees eligible to participate in year of eligibility service or the date you join the eligible class. another defined contribution retirement plan sponsored by You complete one year of eligibility service by working at least a Bertelsmann affiliate company, or in any retirement plan 1,000 hours in the 12 consecutive month period beginning on your established under the laws of a foreign country. date of employment. If you do not meet this requirement in that • You are not a “leased” employee as described under the Internal period, you will complete one year of eligibility service if you work Revenue Code and you are not classified by the Company as an at least 1,000 hours in any plan year. If you are reclassified independent contractor, freelancer or other similar classification (e.g., you increase your hours to at least 20 per week), you will no that is not on the payroll of the Company. longer be subject to these special rules. You may begin making your own contributions immediately, and you will complete • If you are covered by a collective bargaining agreement of any one year of eligibility service without regard to the 1,000-hour kind, it provides for your participation in the Plan. requirement. • You are not a nonresident alien with no income from the Hours of service include hours of actual service for performing Company earned for services performed in the U.S. duties with the Company and hours for which you are paid by the Throughout this summary, the Active Participating Affiliates are Company during any absences, such as vacation (up to 501 hours referred to as “the Company.” for any single absence). Once you become eligible to participate in the Plan, you will In determining hours, all of your service with the Company and remain eligible until the date you retire, die, terminate employment any of its affiliates or subsidiaries that are owned at least 20% or otherwise leave the eligible class. by either the Company or any of its parent companies is treated as employment with the Company. If you were employed by the

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-2 ENROLLMENT

Automatic Enrollment

If you are newly hired or rehired, you will be automatically enrolled in the Plan with a 3% pre-tax deferral rate, unless you elect otherwise, sixty (60) days after you meet the eligibility requirements for the Plan. Once you are automatically enrolled in the Plan, at the beginning of each year, your contribution rate will increase by 1% until you reach 6%. Or you can choose to change your contribution rate on your own. If you were hired in the first half of the year, your first increase date is the following January 1st. If you were hired in the second half of the year, your first automatic increase is delayed to a year from the following January 1st.

Resolicitation and Re-Enrollment

If you elect not to make any contributions to the Plan or if you discontinue your contributions at any time subsequent to your initial enrollment, you will be automatically enrolled in the Plan on your re-enrollment date with a 3% pre-tax deferral rate, unless you elect otherwise within the sixty (60) day notice period prior to your re-enrollment date. If you discontinue your contributions in the first half of the year, your re-enrollment date is the following January 1st. If you discontinue your contributions in the second half of the year, your re-enrollment date is delayed to a year from the following January 1st. Your deferral contributions will be automatically invested in the Pyramis Lifecycle Fund that matches your date of birth according to the chart below, unless you give Fidelity other investment instructions before the end of the 60-day “opt-out” period. For example, if you were born in 1975, your contributions will be invested in Pyramis Lifecycle Fund 2040. This fund is known as a Qualified Default Investment Alternative (QDIA). Information regarding this QDIA, including a description of the investment objectives, risk and return characteristics, and fees and expenses, can be obtained by contacting Fidelity Customer Service as indicated below.

Qualified Default Investment Alternative

Pyramis Index Lifecycle Birth Date Range Retirement Date Range ..will be mapped to Commingled Pool Class V

12/31/1937 & earlier Retired before 2002 Ô Pyramis Income Fund

01/01/1938–12/31/1942 2003–2007 Ô Pyramis 2005 Fund

01/01/1943–12/31/1947 2008–2012 Ô Pyramis 2010 Fund

01/01/1948–12/31/1952 2013–2017 Ô Pyramis 2015 Fund

01/01/1953–12/31/1957 2018–2022 Ô Pyramis 2020 Fund

01/01/1958–12/31/1962 2023–2027 Ô Pyramis 2025 Fund

01/01/1963–12/31/1967 2028–2032 Ô Pyramis 2030 Fund

01/01/1968–12/31/1972 2033–2037 Ô Pyramis 2035 Fund

01/01/1973–12/31/1977 2038–2042 Ô Pyramis 2040 Fund

01/01/1978–12/31/1982 2043–2047 Ô Pyramis 2045 Fund

01/01/1983-12/31/1987 2048-2052 Ô Pyramis 2050 Fund

01/01/1988 & later 2053 and later Ô Pyramis 2055 Fund

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-3 If you do not want to automatically enroll or re-enroll, you How to Enroll must contact Fidelity by phone at 1-866-733-1170 or log on to NetBenefitsSM at www.netbenefits.com and make a new deferral Eligible employees may enroll in the Plan at any time online at election of 0% before the 60-day “opt-out” period expires. You www.netbenefits.com. may also contact Fidelity if you want to begin making contributions Select the New User Registration link and enter your Social before the end of the 60-day “opt-out” period, if you want to Security Number and follow the instructions. You will also need change your deferral percentage or if you want to choose your your date of birth and ZIP Code. You will have the opportunity own investment options within the Plan. to select a unique Customer ID to use in place of your Social Your account will continue to be invested in the QDIA until Security Number. Please note that if you have ever registered and you elect to transfer all or a portion of your account or future established an ID and PIN at any of the following Fidelity sites - contributions to any of the other investment funds available under Fidelity.com, 401k.com, eWorkplace, or NetBenefitsSM - from either the Plan. You can make such an election at any time, by visiting a current or previous employer, you should use the same ID and NetBenefitsSM at www.netbenefits.com or by calling Fidelity at PIN to access NetBenefitsSM. 1-866-733-1170. A description of the available investment funds You can also enroll by contacting Fidelity by phone at also is available on the Fidelity website at www.netbenefits.com. 1-866-733-1170. There are no restrictions, fees or expenses in connection with electing to transfer out of the QDIA. NOTE: You should maintain the security of your 401(k) account just like you would your bank account. Do not share your Beginning in 2014 and annually thereafter, if (i) you are age 45 or password with anyone. older; (ii) you did not opt-out of having your deferral contributions automatically invested in the Pyramis Lifecycle Fund that matches Through Fidelity, you will: your date of birth; (iii) your Plan account is currently 100% • Select the percentage you want to invest in the Plan from your invested in the applicable Pyramis Lifecycle Fund; and (iv) you Covered Earnings; had not previously opted out of the Financial Engines Professional • Choose whether your contributions will be pre-tax or after-tax Management Program (the “Financial Engines Program”), then you Roth contributions; will be automatically be enrolled in the Financial Engines Program. (See Financial Engines on page 9-11 of this chapter.) Every five • Authorize the Company to make regular payroll deductions for years you will be re-solicited if you subsequently opt out of the your Plan contributions; Professional Management Program and re-elect the Pyramis • Choose how you want to invest your money and the Company’s Lifecyle Fund that matches your date of birth. Re-solicitation contributions; and means you automatically will be swept back into the Professional Management Program unless you affirmatively elect another • Designate a beneficiary to receive the value of your Plan account investment option(s). in the event of your death. (If you are married, your spouse must be your beneficiary, unless he or she consents in writing before The Financial Engines Program is a fee-based, discretionary a notary public to your naming another beneficiary.) account management service where Financial Engines Advisors L.L.C., an independent, SEC-registered investment advisor, Your Plan deductions will begin with the first paycheck issued on will provide ongoing monitoring and management of your Plan or after the date Fidelity confirms your enrollment. Generally, you account. The Financial Engines Program serves as a QDIA. You should allow 10 working days for your enrollment or a change in will be automatically enrolled in the Financial Engines Program if your contribution election to be reflected in your paycheck. you meet the above criteria and you do not opt-out in accordance If you transfer from one Bertelsmann affiliated company to another, with the Financial Engines Program terms. More information on you should contact your new Benefits Department regarding your Financial Engines and the Financial Engines Program is available Plan participation. under Financial Engines on page 9-11 of this chapter and the Financial Engines Program Terms and Conditions which is available from Financial Engines. Soon after Fidelity is notified of your eligible status, an enrollment kit will be automatically mailed to your home address. The kit contains a brief summary of the Plan provisions and provides additional information regarding the enrollment process and a description of the various investment options. Also included is a Rollover Acceptance form to be completed if you would like to roll over money into the Plan from another qualified plan or IRA that qualifies for rollover, as described in the “Rollovers from other Plans” section of this chapter. Your rollover contributions will be automatically invested in the Pyramis Lifecycle Fund that matches your date of birth according to the chart above, unless you give Fidelity other investment instructions as provided on the Rollover Acceptance form.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-4 HOW THE PLAN WORKS

When you join the Plan, you elect a percentage — in whole percentages, from 1% to 75% — that you would like deducted from your Covered Earnings and deposited into the Plan after each pay period. You have the option of making your contributions on a pre-tax and/ or after-tax Roth basis, as described below.

Pre-Tax 401(k) Contributions age 50 and older. (You are considered to be age 50 for the entire year you turn age 50, no matter when your birthday occurs during When you make pre-tax contributions, the percentage you the year.) For 2015, the catch-up contribution limit is $6,000. elect to invest is deducted from your Covered Earnings before Future increases to the contribution limits will be determined each federal - and in most locations, state and local - income taxes are year by the IRS (in $500 increments) based upon increases in the withheld. Therefore, your contributions are not taxed until paid Consumer Price Index. out from the Plan in the future, and your current taxable income is reduced. The reduced taxable income will be reflected in your Annual Increase and Resolicitation Program W-2 statement issued after the end of each year. Your salary reduction contributions are, however, subject to Social Security Once you are automatically enrolled or re-enrolled in the Plan, at and Medicare withholding taxes. the beginning of each year, your contribution rate will increase by 1% until you reach 6%. If you are hired in the first half of the year, Roth 401(k) Contributions your first increase date is the following January 1st. If you were hired in the second half of the year, your first automatic increase You also have the option of making Roth contributions, which is delayed to a year from the following January 1st. Or you can are treated as “after-tax”; they are taxable to you before they choose to change your contribution rate on your own. By electing are contributed to the Plan, but not taxable when distributed your own contribution rate, you will opt out of the automatic as long as you receive a “qualified distribution.” (A qualified increase program; however, you may set up a personalized annual distribution is one that is made at least five years after your first increase schedule. Roth contribution is made, and after you are at least 59-1/2 or If you discontinue your contributions in the first half of the year, you are disabled or die.) If you qualify to make traditional pre-tax will be re-enrolled the following January 1st at 3% and your first contributions, you are eligible for a Roth 401(k) contribution. increase date is the following January 1st. If you discontinue your contributions in the second half of the year, your re-enrollment at Pre-Tax or Roth Considerations 3% will be delayed to a year from the following January 1st and your first increase will be the next following January 1st. The potential benefits of pre-tax versus Roth 401(k) contributions depend on your personal financial situation, your existing tax rate How Catch-Up Contributions Work and your anticipated tax rate at the time of your retirement. If you contribute to a Roth, you give up a tax break today in exchange To be eligible for catch-up contributions in 2015, you must be for a tax break in the future. Therefore, a Roth contribution might age 50 or older in 2015. For eligible participants, the maximum benefit you if your tax rate in retirement is higher than during the pre-tax and Roth contributions that can be made in 2015 are years you contribute. (You should note that because Roth 401(k) $24,000 ($18,000 plus a $6,000 catch-up). If you choose to contributions are made after-tax, you may take home less money take advantage of the catch-up contribution in 2015, you must in your paycheck than you would if you contributed to a traditional elect a contribution percentage that will allow you to exceed the pre-tax 401(k).) However, if your tax rate is lower in retirement, IRS annual contribution limit of $18,000 before the end of the then a traditional pre-tax 401(k) might be more beneficial to you year. Any contributions made to the Plan in excess of $18,000, than the Roth contribution option. but less than $24,000, will be deemed, or categorized, as For more information on taxes, please see page 9-6. This catch-up contributions at the end of the year. You must elect summary is for informational purposes and is not intended to be a contribution percentage that will allow you to reach $24,000 tax advice. You should talk with a tax professional about whether before the end of the year if you want to contribute the maximum pre-tax or Roth 401(k) contributions are right for you since the catch-up contribution amount of $6,000. In order to provide the decision will depend on your individual tax situation and other best opportunity for reaching this maximum amount, the Plan circumstances that differ from person to person. More information maximum deferral percentage is 75% of your Covered Earnings. about the Roth 401(k) option is available on www.netbenefits.com. If you are age 50 or older and you do not wish to make catch-up contributions, make sure that your deferral percentage election Maximum Contributions is set low enough that it will not defer more than you intended to save. As always, you should re-evaluate your contribution election The IRS limits the amount that you may invest on a pre-tax or regularly to be sure it is consistent with your retirement planning Roth basis. For 2015, the limit is $18,000. This limit includes the objectives. combined total of your pre-tax and Roth contributions into any The following example illustrates how making catch-up tax-qualified retirement plan. In addition, as described in the next contributions can vary depending on a participant’s individual section, you may make a special “catch-up” contribution if you are situation. THE BERTELSMANN 401(K) SAVINGS PLAN | 9-5 Catch-Up Contribution Example Sam’s annual salary is $50,000. In 2014, Sam was contributing 35% of his salary to the Plan. At the end of 2014, Sam contributed a total of $17,500 to the Plan. In 2015, Sam will reach age 50 and wishes to take advantage of the catch-up election and the additional salary deferral of $6,000. Since the Plan’s maximum deferral percentage is 75%, Sam can increase his deferral rate by 13 percentage points. By increasing his deferral rate to 48%, Sam will have contributed $24,000 by the end of 2014. Please note: The percentage of your catch-up election will depend upon your salary and the time of the year at which you make your election. For example, using the above scenario, if Sam delayed his election change until April 1, 2015, his election would need to be increased by 18 percentage points (in addition to his previous deferral rate of 35%) for a total deferral percentage of 53%. As mentioned earlier, you should re-evaluate your contribution election regularly to be sure it is consistent with your retirement goals.

Covered Earnings

As used throughout this summary, the term “Covered Earnings” includes your base salary or wages and any overtime pay, sales incentives, commissions, bonuses, vacation and holiday pay, and non-insured sick pay reported to you by the Company on IRS Form W-2. Covered Earnings also include any salary reductions you make under this Plan and any pre-tax deductions under the Signature Select Benefits Plan, such as pre-tax deductions for health plan coverage and transportation fringe benefits. Covered Earnings do not include any other Company contributions to or resulting from your benefit plans - including this Plan and plans such as the Medical or Dental Plans, any third-party sick pay or any imputed income as a result of your Group Life Insurance protection. Covered Earnings also do not include severance pay or any amounts deferred under any non-qualified income deferral or bonus arrangement with the Company. However, Covered Compensation does include your regular compensation for services during regular working hours, and compensation for services outside your regular working hours (such as overtime or shift differential), commissions, bonuses or other similar payments that are paid after you terminate employment if (i) the compensation is paid by the later of 2-1/2 months after you terminate employment or December 31 of the year in which you terminate employment, and (ii) those amounts would have been included as “Covered Compensation” if they were paid before you terminated employment. Under IRS regulations, the Plan may recognize a maximum of $265,000 as Covered Earnings for each Plan participant in 2015. This limit is subject to adjustment by the IRS each year (in $5,000 increments) based upon increases in the Consumer Price Index.

Tax Examples

Below is an example that compares the impact on annual take home pay by investing on a pre-tax basis under the Plan versus an investment on an after-tax basis outside the Plan — for example, in a passbook savings account. For purposes of this example, let’s assume that your annual Covered Earnings are $35,000 and you elect to invest 6% through the Plan.

Comparing Pre-Tax Contributions versus After-Tax Contributions

After-Tax Contributions Impact on Earnings Pre-Tax Contribution $35,000 Covered Earnings $35,000 $0 Before-Tax Investment - $2,100 $35,000 Taxable Pay $32,900 -$4,800 Taxes* - $4,500 $30,200 After-Tax Pay $28,400 -$2,100 After-Tax Investment $0 $28,100 Take-Home Pay $28,400

Tax Savings (additional take home pay) $300

PLUS the Company Match, after at least one year of employment + $2,100

Total Saved $2,400

* Calculated using estimated 2013 Federal Income Tax Rates for a single filer

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-6 As the example on the previous page shows, investing on a pre-tax basis through the Plan lowers your taxable income. Therefore, you pay less income tax now. The employee in this example would have $300 more spendable income by investing under the Plan on a pre-tax basis than by investing the same amount on an after-tax basis. The $300 represents current federal income tax savings. And the advantages of pre-tax savings will be even greater in most states and cities that have their own income tax laws. In addition, after completing one year of employment, you will be eligible to receive a dollar-for-dollar Company Matching Contribution up to 6% percent of pay. In the example on the previous page, that is an additional $2,100 for a combined total of $2,400 saved by investing on an after-tax basis. Below is an example that compares the tax savings impact by contributing on a traditional pre-tax basis under the Plan versus contributing on a Roth basis. For purposes of this example, let’s assume that your annual Covered Earnings are $35,000, you elect to invest 6% through the Plan, and you are currently 40 years old and will take a full distribution of your account balance when you are 65 years old.

Comparing Traditional Pre-Tax and Roth Contributions

Traditional Pre-Tax 401(k) Contribution Roth 401(k) Contribution

Covered Earnings $35,000 $35,000

Employee Contribution 6% 6%

Contribution Amount $2,100 $2,100

Taxes Paid $11,515 $12,250

Net Take Home Pay $21,385 $20,650

Estimated Total Account Balance at $7,100 $7,100 Age 65

Taxes at Distribution $2,485 $0

Total Amount of Taxes Paid $2,485 $735

Total Tax Savings $1,750

Assumptions: • Calculated using an estimated Federal Income Tax Rate of 35%. • Current age is 40 with 25 years until retirement. • Assumes investment earnings of 5% per year. • Earnings on the Roth balance are not taxed. • Taxes on the Roth 401(k) contributions were paid up front.

As the above example shows, investing on a pre-tax basis through the Plan lowers your taxable income. Therefore, you pay less income tax now. The employee in this example would have $735 more spendable income by investing under the Plan on a pre-tax basis than by investing the same amount on a Roth basis. The $735 represents current federal income tax savings. However, the employee in this example could save $2,485 in taxes when he takes a distribution at age 65 if he invested on a Roth basis. This is a total tax savings of $1,750. This is because he paid the taxes up front, and earnings on Roth contributions are not taxed. These examples are for illustrative purposes only. You should talk with a tax professional about whether pre-tax or Roth 401(k) contributions are right for you.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-7 COMPANY CONTRIBUTIONS

Company Matching Contributions

Through its matching contributions, the Company helps your Plan account grow even faster — and these investments are not taxed until taken out of the Plan. Company Matching Contributions made on Roth contributions are not taxed at the time made but are taxable when distributed. The Company Matching Contribution rate is: • $1.00 for every $1.00 you contribute up to 6% (pre-tax or Roth) of Covered Earnings

For example... If you earn $35,000 per year and you invest 6% of your Covered Earnings (a total of $2,100 per year) through the Plan, the Company would match your contribution as follows: Your contribution 6% x $35,000 = $2,100 Company Match $2,100 x $1.00 = $2,100 Total amount credited to your account $4,200

As you can see in this example, by contributing $2,100, your account would be credited with a total of $4,200. That’s equivalent to an immediate return of 100% on your investment — before adding any investment earnings! The maximum possible Company Matching Contribution will be $15,900 in 2015, based on a participant contributing at least 6% (the maximum percentage eligible for the Company match) and eligible compensation of at least $265,000 (the maximum annual compensation that the IRS allows to be considered for a qualified plan). The Company Matching Contributions made after your first year of service under this Plan substantially exceed the level needed to qualify as “Safe-Harbor” contributions and so the Plan is not subject to discrimination testing that could reduce your salary deferral and matching contributions.

Company Annual Contributions

Eligible employees of Bertelsmann, Inc. and certain of its affiliates receive an additional Company Annual Contribution. Eligibility for and the amount of the Company Annual Contributions are described in Appendices B and C, attached.

Company Profit Sharing Contributions

Eligible employees of the Penguin Random House Group (See Appendix D) may be entitled to receive an additional Company Profit Sharing Contribution, depending on the financial performance of the Company. Eligibility for and the amount of the Company Profit Sharing Contribution are described in Appendix D, attached.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-8 YOUR CHOICE OF INVESTMENT FUNDS

Choosing the right asset allocation (mix of investment options) is an important step toward achieving your retirement savings goal. You have a choice of using fourteen investment funds to build your own portfolio or using any of 12 Pyramis Lifecycle Funds. Investment earnings are tax-deferred until you receive them. The available investment options are:

Fund Name Ticker Fund Type

Managed Income Portfolio (MIP) II Class 3 NA Managed Income

PIMCO Total Return Institutional Fund PTTRX Bond

Vanguard Total Bond Market Index Fund Institutional Shares VBTIX Bond

American Funds American Balanced (R6) RLBGX Balanced/Hybrid

JP Morgan Trust I Diversified Real Return R5 JRLRX Balanced/Hybrid

American Beacon Large Cap Value Fund Institutional Class AADEX Large Cap Value

Vanguard Institutional Index Fund Institutional Shares VINIX Large Cap Blend

Prudential Jennison Growth Fund Class Z PJFZX Large Cap Growth

Vanguard Extended Market Index Institutional Shares VIEIX Mid Cap Blend

Fidelity Low-Priced Stock Fund – Class K FLPKX Mid Cap Blend

Fidelity Diversified International Fund – Class K FDIKX International Stock

Vanguard Total International Stock Index Fund – Institutional Shares VTSNX Foreign Large Blend

DWS RREEF Real Estate Securities Fund Institutional Class RRRRX Specialty

Pyramis Index Lifecycle 2005 Commingled Pool Class V None Targeted Asset Allocation

Pyramis Index Lifecycle 2010 Commingled Pool Class V None Targeted Asset Allocation

Pyramis Index Lifecycle 2015 Commingled Pool Class V None Targeted Asset Allocation

Pyramis Index Lifecycle 2020 Commingled Pool Class V None Targeted Asset Allocation

Pyramis Index Lifecycle 2025 Commingled Pool Class V None Targeted Asset Allocation

Pyramis Index Lifecycle 2030 Commingled Pool Class V None Targeted Asset Allocation

Pyramis Index Lifecycle 2035 Commingled Pool Class V None Targeted Asset Allocation

Pyramis Index Lifecycle 2040 Commingled Pool Class V None Targeted Asset Allocation

Pyramis Index Lifecycle 2045 Commingled Pool Class V None Targeted Asset Allocation

Pyramis Index Lifecycle 2050 Commingled Pool Class V None Targeted Asset Allocation

Pyramis Index Lifecycle 2055 Commingled Pool Class V None Targeted Asset Allocation

Pyramis Index Lifecycle Income Commingled Pool Class V None Targeted Asset Allocation

PLEASE NOTE: As of January 1, 2015, the following funds charge Short-Term Trading Fees:

• Fidelity Diversified International Fund – Class K: 1% on shares held less than 30 days. • Fidelity Low-Priced Stock Fund – Class K: 1.5% on shares held less than 90 days. • DWS RREEF Real Estate Securities Fund Institutional Class: 2% for shares held less than 15 days.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-9 Short-Term Trading Fees: What Are They? Selection of Investment Options

Some funds assess a short-term trading fee — sometimes called The Plan is designed to be a long-term investment, and you a “redemption fee.” These fees are imposed to discourage “short- should not attempt to time the market or make frequent transfers. term trading”— exchanging in and out of a fund within a short If you make investment changes or transfers because you believe period of time. Short-term trading increases the transaction costs, there will be short-term changes in the markets, your strategy may which can ultimately result in lower investment returns of the fund be frustrated by the timing of the Plan’s administrative process. for all participants who invest in the fund. The fee is assessed by Because the Plan is not designed to allow for day trading, you the fund and offsets the costs of short-term trading. Funds that will not be reimbursed for any investment losses or opportunity experience high levels of exchange activity often implement short- costs resulting from administrative delays in implementing your term trading fees; however, any fund may implement a fee in the investment elections or investing your contributions. future. If you do not have any investment direction set up with Fidelity, your Plan monies will be deposited into the QDIA (please see the How the Fees Work QDIA chart on page 9-3 of this chapter). Other circumstances in which default investment allocations are made to the QDIA The fee is charged only if you place an exchange out of the funds include failure of a participant or beneficiary to provide investment that assess a redemption fee before the stated holding period — directions following (i) the elimination of an investment fund, (ii) a and the fee is charged only on the shares you exchange out. For change in service provider, (iii) a rollover from another plan, or (iv) example, say you have a balance of $2,000 in the DWS RREEF any other failure of a participant to provide investment instructions. Real Estate Securities Fund and the entire balance is less than Additionally, if (i) you are age 45 or older; (ii) you did not opt-out 15 days old. You decide to exchange $1,000 out of that fund into of having your deferral contributions automatically invested in the the Managed Income Portfolio. This exchange of $1,000 will be Pyramis Lifecycle Fund that matches your date of birth; (iii) your subject to the 2% fee ($20). This fee is deducted from the amount Plan account is currently 100% invested in the applicable Pyramis of money that would be transferred into the Managed Income Lifecycle Fund; and (iv) you had not previously opted out of the Portfolio (now $980). Again, this fee is charged by the fund, not by Financial Engines Program, then you will be automatically enrolled the Company or Fidelity. in the Financial Engines Program as your QDIA. When you make changes to your investments, depending upon What Do These Fees Mean to You the nature of those changes, they will normally be implemented on the same business day as long as you request the change prior to • It’s important to note that if you are contributing to any fund that 4:00 p.m. Eastern time on a day that the market is open. However, charges a redemption fee, a portion of your shares held in the the Plan does not guarantee immediate implementation of your fund will be subject to the holding period at any given time. To investment changes or transfers, and it is possible that there will avoid this, you must redirect your contributions to another fund be administrative delays. Your contributions to the Plan will be (that does not assess the fee). deposited in the Plan’s trust fund as soon as it is administratively • When you place an exchange out of a fund that charges a feasible to do so. redemption fee, shares held longer than the stated holding NOTE: As with all investments of this type, there is no assurance period will be applied first to avoid the redemption fee. that the funds will achieve their objectives, so please Moreover, if a fee is assessed, the representative (or system) will carefully read the fund prospectus before investing. tell you approximately how much the fee is and how many days The Company (and Fidelity) will make every effort to you must wait to avoid the fee before placing the exchange. provide you descriptive information to enable you to • The funds that charge redemptions fees are subject to change, make informed investment decisions. You must read the and it is quite likely that more funds will do so in the future. You information carefully and make your investment decision will be informed at the time of your request for a transfer into or based on your particular situation. No representative of out of a fund if a redemption fee currently applies. the Company (or Fidelity) will give you specific investment advice or recommendations. If you would like help with For more detailed information on all of your investment choices, your own retirement planning, visit a local Fidelity Investor please contact Fidelity by phone at 1-866-733-1170 or log on Center. For information on investor centers near you, go to NetBenefitsSM at www.netbenefits.com. You may also find to www.fidelity.com. You should consider consulting the current fund prices for all of the funds except the Managed with a professional investment advisor of your choice in Income Portfolio in most newspapers in the financial section. making your investment decisions. Please note that the You can invest all of your Plan monies in one fund or split your investment funds offered under the Plan may change contributions (and/or the Company Matching Contributions) from time to time. between any of the available funds. You can also transfer all or a portion of the monies in one fund to another fund. Your contribution allocation among funds must be in whole percentages (e.g., 23%; not 23-1/2%).

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-10 Responsibility for Investment Decisions

By providing you with a choice of investment funds which are diversified across the major asset classes, and the flexibility to direct and change your investment allocations, this Plan is covered by Section 404(c) of the Employee Retirement Income Security Act of 1974, as amended (ERISA). As a result, you are solely responsible for investment decisions and results concerning your account and the Plan fiduciaries (identified in the General Information section) are not liable for losses arising from the investment instructions given by you. In other words, the Plan fiduciaries are not responsible for choosing how to invest your account among those various options and for bearing the risk of loss of your decision.

Financial Engines

To assist in your investment decisions, the Plan offers you independent, objective investment advice and management from Financial Engines Advisors L.L.C., a registered investment advisor. For more information call 1-877-401-5762.

Professional Management Online Advice With Professional Management, a team of professionals using If you prefer to actively manage your Plan account, Online Advice proprietary tools analyzes the investments available in the Plan may be right for you. This easy-to-use website offers objective, and selects a personalized mix designed to be appropriate for you. professional advice to help you refine your investment strategy. Financial Engines works with Fidelity to handle all transactions to You can get a personalized forecast showing how much your put an investment strategy into action for you and continues to investments may be worth when you retire, and see a step-by-step manage your account over time to help keep you on track. action plan with specific investment recommendations. You can also fine-tune your strategy by exploring different contributions, As part of Professional Management, you have access to the risk levels, and retirement goals. To get started, log on to Income+ feature. Income+ is a service designed to provide steady Fidelity NetBenefitsSM payouts from your Plan account which can last for life. With at www.netbenefits.com and click Get Income+, Financial Engines manages your Plan account with a Personalized Help from Financial Engines. strategy seeking to generate income in retirement. You may elect Advisory services, including Professional Management and Online to receive monthly payouts from your Plan account and can make Advice, are provided only by Financial Engines Advisors L.L.C., a additional ad-hoc withdrawals as needed. However, any ad-hoc federally registered investment advisor. Financial Engines does not withdrawals will result in a reduction of your regularly scheduled guarantee future results. Advisory services may include a fee. payouts. Additional information on Professional Management, For specific fee information, please refer to the applicable including the Income+ feature, is available in the Financial Engines Financial Engines Terms and Conditions. Program Terms and Conditions which you can request from Financial Engines.

* With optional out-of-plan annuity purchase by age 85.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-11 HOW YOUR ACCOUNT BALANCE CAN GROW

Examples The chart below shows the projected total Plan account balance (including the Company Matching Contributions* but no other Company contributions) for an employee who earns $25,000 per year over a period of 10, 20, 30 and 40 years. For these examples, we are assuming investment earnings of 5% per year and a constant employee investment rate of 3%, 4%, 5%, 6% and 10% of pay.

Employee 3% of pay 4% of pay 5% of pay 6% of pay 10% of pay Invests ($750/yr) ($1,000/yr) ($1,250/yr) ($1,500/yr) ($2,500/yr)

10 years $18,900 $25,200 $31,400 $ 37,70 0 $50,300

20 years $49,600 $66,100 $82,700 $99,200 $132,300

30 years $99,700 $132,900 $166,100 $199,300 $265,800

40 years $181,200 $241,600 $302,000 $362,400 $483,200

Any salary increases over the employee’s working career would, of course, increase the amounts shown above. Actual investment earnings may be higher or lower than 5%.

* You must have one year of service to be eligible for Company Matching Contributions.

Your Account Statement Unless you log on to NetBenefitsSM and elect otherwise, quarterly account statements will be automatically mailed to your home. The first time you log on to NetBenefitsSM, your options will be changed so that your default method of receiving statements will be online. If you prefer, you can change your options at any time so that quarterly statements continue to be mailed to your home. In any case, an annual statement will be mailed to your home. You can view and print an account statement anytime online at www.netbenefits.com. This statement shows the current value of your Plan investments and the Company matching and other contribution investments. The statement also reports the amount that has been deposited into your Plan account (by you and the Company) since the last statement and the investment return for the period from each investment fund. You can use this statement to track the value of your investments in the Plan. In addition, you can track the value of your account 24 hours a day, 7 days a week through Fidelity’s toll-free telephone and online services. You can also track the price per share of each of the investment funds (except the Managed Income Portfolio) in major newspapers.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-12 VESTING

“Vesting” means that you have a non-forfeitable right to your Plan account. You are immediately 100% vested in pre-tax and Roth 401(k) contributions, Company Matching Contributions, rollover deposits, and investment earnings on the foregoing types of contributions. You become 100% vested in any Company Annual Contributions described in Appendices B and C, and any earnings on such contributions, after three years of vesting service. You become vested in any Profit Sharing Contributions described in Appendix D, and any earnings on such contributions, in accordance with the following schedule:

Number of Years of Vesting Service Percentage of Account Vested Less than 1 full year 0% 1 full year 33% 2 full years 67% 3 or more full years 100%

If applicable, your BMG Plan Profit Sharing Account and BMG • The date you take a distribution of your entire vested interest in Frozen Matched Account transferred from the BMG 401(k) Savings your account; and Plan will vest under a five-year graded vesting schedule, which • The date you incur a Five-Year Break (described below). provides for 20% vesting after each year of vesting service and full vesting after five years of vesting service. Any amounts forfeited due to a distribution prior to a Five-Year Break will be restored if you return to employment before incurring Regardless of service, you will become fully vested in the a Five-Year Break. foregoing amounts upon your death or total disability during employment. You will also become fully vested if you reach your normal retirement date while employed by the Company. Five-Year Break Your normal retirement date is your 65th birthday if you were participating in the Random House, Inc. Incentive Investment A Five-Year Break is a break in service lasting at least five years. Plan on December 31, 2009, in the BMG 401(k) Savings Plan A break in service is the period beginning on the earliest of the on December 31, 2013, or in The Pearson Retirement Plan on following dates and ending on your return to work: December 31, 2013. Otherwise, your normal retirement date is the • The date you terminate employment for any reason; later of (i) your 65th birthday, or (ii) the earlier of (A) the date you • The second anniversary of a parental leave, which is a leave of complete three years of vesting service or (B) the fifth anniversary absence because of pregnancy, childbirth, or adoption, or to of the date you commenced participation in the Plan. Your normal take care of a child immediately following birth or adoption; retirement date under this rule will be your 65th birthday unless you are hired after your 62nd birthday, in which case it will be the • The latest date on which you may return from protected military date you complete three years of vesting service. leave; and You earn one year of vesting service for 12 months of employment • The first anniversary of an absence for any reason other than with the Company or any of its affiliates or subsidiaries that are those described above. owned at least 20% by the either the Company or any of its parent Your prior years of vesting service will be restored upon re- companies (including those that have not adopted the Plan). If employment if any of the following conditions apply: you were employed by the Penguin Random House Group (see Appendix D) on January 1, 2014, your past service with Pearson • If you terminate employment after acquiring any vested interest plc or any or its subsidiaries is also counted. Employment as a in employer contributions; leased employee is also treated as employment with the Company • You made pre-tax or Roth 401(k) contributions prior to your if you are later hired as an employee of the Company or an affiliate. termination; or Employment as a part-time employee or as a temporary employee • You return to work before a Five-Year Break. continues to count as employment with the Company if you are subsequently hired as a full-time employee. If any of the above conditions applies, your prior years of vesting service will be restored upon re-employment. For example, For this purpose, any absence or employment gap that lasts fewer assume you made pre-tax 401(k) contributions for two years, than 12 months is treated as continuous employment. Any other quit, and were reemployed six years later. Because the second nonconsecutive periods of employment are aggregated, except as condition applies, your prior years of vesting service would described below following a Five-Year Break. be restored. In that case, you would fully vest in Profit Sharing If you terminate employment before completing three years of Contributions or Company Annual Contributions, if any, made vesting service, your nonvested Company Annual Contribution or to your account after earning one additional year of vesting Profit Sharing Contribution account balance, if any, will be forfeited service. Moreover, your prior years of vesting service would count upon the earlier of: in applying the contribution allocation schedules set forth in Appendix B or C, if applicable.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-13 ROLLOVERS FROM OTHER PLANS

You may roll over eligible distributions from other qualified retirement plans, such as 401(k) plans, defined benefit plans, 403(a) retirement plans 403(b) annuity contracts, certain governmental 457(b) plans or IRAs to this Plan. Your rollover may include any after-tax balance distributed from such plan or contract, and may include any “Roth” 401(k) balance, but not a Roth IRA balance. You can even roll over a qualified distribution from a defined benefit pension plan maintained by a Bertelsmann affiliated company after you retire. The rollover must occur within 60 days of the distribution from the other qualified plan and the administrator of that plan must provide documentation of the other plan’s tax qualified status. Note that the taxable portion of any distribution that is not rolled over directly (as described in the next paragraph) is subject to mandatory 20% Federal income tax withholding. Alternatively, you can avoid the 20% Federal income tax withholding by electing that a direct rollover be made from such plan or contract without receiving a distribution. You can obtain information regarding how to rollover qualified money into the Plan by contacting Fidelity online or by phone. A rollover form is also included in the enrollment guide that is mailed to your home when Fidelity is first notified that you are an eligible employee. Or, your Benefits Department can provide you with the necessary forms and additional information. You will always be 100% vested in your Rollover Account. Your Rollover Account will be subject to the Plan’s rules for loans, withdrawals and distributions explained in the following sections.

PLAN PAYMENTS

Timing of Plan Payments married as a result of a common law marriage. For purposes of the preceding sentence, your “spouse” will include: Your Plan account can be paid to you upon retirement, attainment • the person with whom you have contracted in a same-sex civil of age 59-1/2 (while still employed), total disability (defined as union recognized under applicable state or local law and such eligibility for disability benefits under a long-term disability plan union is evidenced in public record; or maintained by the Company or satisfying the requirements for • the person with whom you have entered into a same-sex disability benefits under the Social Security Act or, if you were a domestic partnership recognized under applicable state or participant in the G + J USA Group, Inc. Retirement Savings Plan local law and such domestic partnership is evidenced in public on December 31, 2014, you are determined to be disabled by record. a physician chosen by the Plan Administrator), or termination of employment with the Company and all affiliates of the Company. If you live in a state that recognizes same-sex marriage, then Under limited circumstances, some portions of your Plan account an individual described in (i) or (ii) above will only continue to be may also be available for payment to you as a taxable withdrawal treated as your spouse for 12 months after the date on which the while you are still employed by the Company. In addition, you may law governing same-sex marriage in your state of residence was borrow from your Plan account as described in the Loans section. changed or, if earlier, the date on which such person becomes your actual spouse (as determined for Federal income tax In the event of your death, the value of your Plan account will purposes pursuant to the state or foreign law under which your become payable to your beneficiary. If you are married, your marriage has been legally recognized). spouse is automatically your beneficiary. However, you may designate someone else as your beneficiary with your spouse’s written, notarized consent. If you are unmarried, you may name Payment Methods any person as your beneficiary. When the value of your Plan account becomes payable upon Your beneficiary designation, if provided in writing, will be effective termination of employment with the Company and all affiliates only if made on the appropriate forms and filed in the manner of the Company, you (or your beneficiary) will have a choice of directed by your Benefits Department. You can request a form by payment methods as explained below. The value of your Plan phone or from your Benefits Department. You can also designate account includes your pre-tax contributions, your Roth 401(k) a beneficiary online atwww.netbenefits.com . If you have not contributions, the Company Matching Contributions, the vested designated a beneficiary, or if your beneficiary fails to survive amount of any other Company contributions, your “Rollover” you and you have not named a contingent beneficiary, the Plan contributions, any vested investment gains (or losses), and any will deem your surviving spouse to be your beneficiary if you are other monies that you have invested in the Plan. married. If you are not married, the Plan will deem your estate to be your beneficiary. If the value is more than $1,000 For this purpose, your “spouse” means the person (regardless of his or her sex) to whom you are married, as determined for Federal If the total value of your Plan account is more than $1,000, you (or income tax purposes pursuant to the state or foreign law under your beneficiary) will have the following choices on how to receive which your marriage has been legally recognized at the date of the the money: determination, but does not include any person to whom you are 1. A single payment (“lump sum”)

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-14 2. Annual installments over a period of up to your life expectancy If you apply for a loan, you will be given complete information or the joint life expectancy of you and your spouse about the interest rate that applies — before the loan transaction is completed. Inquiries regarding loan amounts, loan applications 3. Partial distributions, in any amount and at any time and with and loan prepayments are handled directly with Fidelity via a such frequency as you elect from time to time toll-free number at 1-866-733-1170 or logging on to NetBenefitsSM 4. Roll over of funds to another qualified plan, IRA, 403(b) annuity at www.netbenefits.com. There is a $50.00 non-refundable contract or certain governmental 457(b) plans loan application fee. This fee will be deducted directly from your 5. Deferred payment individual plan account. If you choose to defer payment, the money will remain in the Plan The loan interest rate will be equal to the current prime lending and will be invested as you direct. rate (as published in the Wall Street Journal on the last business day of the quarter prior to the quarter in which you take the If you do not choose a payment method, the payment of your Plan loan) plus 1%. The interest rate is fixed for the term of the loan. account balance will automatically be deferred until you reach age Loan repayment will be handled via convenient automatic payroll 70-1/2 (in accordance with Minimum Required Distributions Rules) deduction. All repayments will be credited in accordance with your or die — whichever comes first. If you choose to receive your Plan investment elections then in effect. You can prepay a loan in full at account balance prior to age 70-1/2, payment will be made as any time. Partial loan prepayments are also permitted. If you make soon as possible after Fidelity receives the request. a partial prepayment of a loan, your payroll based loan payments Please note that an annual account maintenance fee may be will continue in the same amount, but your loan will be fully paid deducted from the account of terminated participants on a sooner than originally scheduled. quarterly basis. Currently, this maintenance fee is covered by Upon termination of employment, you or your beneficiary may offsets and/or payments which may be attributable to the annual repay any outstanding loan balance. You may also elect to operating expenses of one or more of the Plan’s designated continue making loan payments via direct coupon. You must leave investment options. However, the Company at any time, without your money in the Plan in order to continue loan payments. If loan prior notice, may deduct this fee directly from the account of payments are not made as scheduled, your loan is defaulted, and terminated participants. your outstanding loan balance becomes a taxable distribution and is reported as such to the IRS. If the value is $1,000 or less If you are on an approved leave of absence (other than for qualified If the total value of your Plan account is $1,000 or less, the Plan military leave described below), your loan payments will be will pay the amount in a single payment as soon as possible after suspended for the duration of your absence up to one year, and the end of the quarter following your termination of employment then will be re-amortized when you return to work. The original with the Company. You may elect, within this timeframe, to have loan ending date may be extended but not beyond the maximum the balance of your account paid to you as an immediate lump term allowed. sum subject to tax withholding, or paid as a direct rollover to an IRA, another qualified plan, 403(a) retirement plan, 403(b) annuity If you have defaulted on a previous loan from the Plan, you cannot contract or certain governmental 457(b) plans. take out a new loan until you repay the defaulted loan (with accrued interest).

Loans Military Leave Rules

You can borrow money from your Plan account (other than any Loan repayments will be suspended while you are on a qualified balance in your Company Annual Contribution Account). The military leave. When you return from your leave, your loan term will minimum amount you may borrow at one time is $1,000. The be extended by the time you were on leave. maximum amount that you may borrow at one time is the lesser of Interest on any loans will continue to accrue while you are on a (a) 50% of the vested value of your Plan account, or (b) $50,000, qualified military leave. The interest rate charged on any loan while reduced by your highest outstanding loan balance over the you are on military leave will be the lesser of the rate in effect preceding 12 months. While Company Annual Contributions (and at the time you took the loan or 6% and will be effective for the the earnings on those contributions) cannot be used as a source duration of your leave. Upon your return to work, the interest rate for a loan these amounts are used to determine the maximum will revert to the original rate that was in effect prior to your leave. amount of a loan available from other accounts in the Plan. You may have a maximum of two outstanding loans at a time. If Withdrawals Not Due to Hardship you want to initiate a new loan, but you already have two loans outstanding, you would need to repay one or more loans to get a While you continue your employment with the Company, you may new loan. Upon final receipt of payment, there is a fifteen (15) day make an in-service withdrawal from the Plan once per calendar delay before a new loan can be initiated. year, as follows: All loans must be repaid, with interest, within five years — unless • after you reach age 59-1/2 (excluding any amounts attributable to you use the money to purchase your primary residence, in which Company Annual Contributions described in Appendix B or C), case a repayment period up to 10 years may be elected. • from your Rollover Account and your non-Roth After-Tax Account, if applicable.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-15 Notwithstanding the above, if you were a participant in the BMG There is no specified minimum or maximum hardship withdrawal 401(k) Savings Plan on December 31, 2013 or the G + J Group, amount; however, the withdrawal amount cannot exceed the Inc. Retirement Savings Plan on December 31, 2014, you are amount that is needed to meet the financial hardship plus any eligible to receive an unlimited number of non-hardship in-service penalty or income tax withholding that may be applicable. withdrawals under the Plan during a calendar year. You must exhaust your loan eligibility before you can apply for a Also notwithstanding the above, if you were a participant in hardship withdrawal. To receive a financial hardship withdrawal, The Pearson Retirement Plan on December 31, 2013, you are you must apply in writing to the Plan Administrator, who will eligible to receive an unlimited number of non-hardship in-service evaluate your request, require supporting documentation and withdrawals under the Plan during a calendar year with respect determine whether you qualify for a withdrawal. You must certify to the portion of your accounts under the Plan attributable to your that your hardship cannot be satisfied through any other sources accounts under The Pearson Retirement Plan as of December 31, reasonably available to you. 2013. Also note that the withdrawals of amounts that are available Please note that there is a $20 processing fee deducted for all solely because you incur a financial hardship are not eligible for non-hardship in-service withdrawals. “rollover” into another qualified plan, IRA, 403(b) annuity contract or governmental 457(b) plan. Hardship Withdrawals Qualified Reservist Distribution While you continue your employment with the Company, you may make an in-service withdrawal from the Plan in the event of a If you are ordered or called to active duty (because you are a financial hardship (as defined below) once per calendar, limited to: member of a reserve component) for a period of more than 179 • your Rollover Account and your non-Roth After-Tax Account , if days or for an indefinite period, at any time during the period applicable; beginning on the date of the order or call and ending at the close of your period of active duty, you can elect a distribution of all or • vested amounts attributable to Profit Sharing Contributions any portion of your account attributable to pre-tax contributions described in Appendix D; and Roth 401(k) contributions. You cannot repay such a • vested amounts attributable to Company Matching distribution to the Plan. Contributions made prior to January 1, 2002 (January 1, 1999 with respect to transfers from the Random House, Inc. Incentive Distributions While Performing Service in the Investment Plan); and • your pre-tax or Roth 401(k) contributions, excluding earnings Uniformed Service thereon after 1988. If you are performing service in the uniformed services while Company Matching Contributions made after January 1, on active duty for a period of more than 30 days, you will have 2002 (January 1, 1999 with respect to matching contributions the option of requesting a distribution from the Plan of all or any transferred from the Random House, Inc. Incentive Investment portion of your account attributable to pre-tax contributions and Plan) are considered to be “safe-harbor” contributions, and are Roth 401(k) contributions. If you take such a distribution, you not available for withdrawal due to hardship. In addition, Company will be suspended from making pre-tax contributions, catch-up Annual Contributions described in Appendices B and C are not contributions and Roth 401(k) contributions for a period of six eligible for hardship withdrawal. You may withdraw your own months following the date of the distribution. You cannot repay contributions, but not any earnings on those contributions after such a distribution to the Plan. December 31, 1988. A “financial hardship” means an immediate and substantial need Minimum Required Distributions that cannot be met from other sources and that arises from any one of the following: Any benefit payable to an active Participant (other than a 5% • medical expenses for you, your spouse, or dependents (to the owner) who attains age seventy and one-half (70-1/2) will begin no extent that such expenses are not reimbursable under any later than April 1st following the later of the calendar year in which employer-sponsored health plan); the Participant (i) attains 70-1/2, or (ii) terminates service with the Company and its affiliates. • post-secondary school (e.g., college) tuition payments and related educational fees over the next 12 months for you, your Please note that there is a $25 processing fee deducted for all spouse or your dependents; Minimum Required Distributions. • purchase of a principal residence for you; • to prevent eviction from or foreclosure on the mortgage for your In-Plan Roth Rollovers principal residence; If you are eligible to receive an in-service non-hardship withdrawal • payments for burial or funeral expenses for your parent, spouse, under the Plan (as described above) or to receive payment of your children, or dependents; or vested Plan account following your retirement or termination of • expenses for the repair of damage to your principal residence employment, you can elect an In-Plan Roth rollover with respect to that would qualify for the casualty deduction. any amounts in your Plan account:

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-16 • That are attributable to non-Roth contributions; The 10% additional income tax also will not apply and federal income tax will be deferred with respect to your distribution if • That you could receive as an in-service non-hardship withdrawal you “rollover” the taxable portion of your Plan account to another or as a distribution after you retired or terminated employment; company’s tax-qualified plan, Individual Retirement Account (IRA), and a 403(a) plan, 403(b) annuity contract or certain governmental • That, if withdrawn or paid to you, would be eligible to be rolled 457(b) plans within 60 days of your Plan distribution. Most over to an eligible employer plan or an IRA. distributions made on or after January 1, 1993 are subject to 20% This means that hardship withdrawals, loans and Minimum Federal Income Tax withholding unless directly rolled over into Required Distributions are not eligible for In-Plan Roth rollovers. another employer’s qualified plan, IRA, 403(a) plan, 403(b) annuity or 457(b) plan. Following an In-Plan Roth rollover, the amounts that you rolled over will be held in an In-Plan Roth Rollover Account under the Federal tax law currently permits other exceptions to the 10% Plan. You will be able to elect withdrawals and distributions of any additional income tax. Keep in mind, however, the tax law changes amounts (including earnings) in this In-Plan Roth Rollover Account from time to time. Before you decide how to receive your Plan to the same extent as you could have elected with respect to distribution or whether to make a withdrawal, you should consult those amounts prior to the In-Plan Roth rollover. with a tax advisor of your own choosing. You will have to pay taxes on any amounts you rolled over in an In order for a Roth distribution to be entirely non-taxable, it must In-Plan Roth rollover in the year in which you make the In-Plan be a “qualified distribution.” A qualified distribution is one that is Roth rollover. made at least five years after the first Roth contribution is made, and is after you are at least 59-1/2 or are disabled or die. If the Roth distribution is not a qualified distribution, only the portion Tax Considerations of the distribution attributable to your own contributions (rather than earnings on such contributions) is non-taxable. The portion The following summarizes some basic tax considerations of the distribution attributable to earnings is taxable and may also concerning Plan distributions. It is for informational purposes be subject to the 10% additional income tax. If your entire Roth only and is not intended as tax advice. It is also not intended to IRA account is not distributed, the distribution will be allocated be a complete discussion of all applicable tax consequences. between both contributions and earning on a prorated basis. Therefore, you should consult your own tax advisor before making any elections under the Plan. Armed Forces When deciding whether and how much to invest under the Plan, Different rules may apply to withdrawals by employees who serve you should be aware of several considerations. As mentioned, the as active-duty reservists in the U.S. Armed forces. Please check Plan offers certain tax advantages because it is intended to be a with Fidelity at 1-866-733-1170 to determine if you fall into this long-term retirement savings program. category. Plan payments (other than loans and certain Roth 401(k) account distributions) are recognized as income for federal income tax purposes in the year received. The Internal Revenue Service also How to Apply for Benefits imposes an additional penalty tax of 10% — above the ordinary income tax otherwise payable — on the value of most withdrawals To receive a Plan payment, you or your beneficiary must contact or Plan payments received before age 59-1/2. Fidelity by phone at 1-866-733-1170 or log on to NetBenefitsSM Exceptions to this 10% additional tax rule include payments at www.netbenefits.com. In some cases, you will be asked to following termination of employment after reaching age 55 provide additional information and data, such as a copy of your or resulting from total disability or death. The 10% tax is also birth certificate or other proof of age. waived if you make a financial hardship withdrawal to pay for deductible medical expenses or to pay someone else under a Qualified Domestic Relations Order (as defined in the General and Administrative Information chapter of this SPD) in the event of divorce.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-17 PLAN FLEXIBILITY

The Plan allows you to manage your investments to suit your needs. You may make any of these changes 24 hours a day, 7 days a week by calling Fidelity at 1-866-733-1170 or logging on to NetBenefitsSM at www.netbenefits.com. • Change the percentage of your Covered Earnings that you contribute — you can increase or decrease the percentage of your Covered Earnings that you contribute at any time. The change will become effective with the first paycheck issued after notification is received by the Payroll Department from Fidelity. • Change the type of your contributions — you can change the type of contributions you are making to the Plan on a prospective basis from pre-tax contributions to Roth contributions or from Roth contributions to pre-tax contributions. You cannot change any contributions already made to the Plan. • Stop contributing to the Plan — you can discontinue your Plan contributions at any time. Your payroll deductions will stop as of the first paycheck issued after notification of your change is received by the Payroll Department from Fidelity. You can resume contributions at any time as of the first paycheck issued after notification is received by the Payroll Department from Fidelity. • Change your future investment allocation — you can change the investment mix for your future Plan contributions as of any business day. Changing your future contributions will not affect the assets already invested in your account. • Change your current investment mix — you can exchange between or among the funds offered by the Plan at any time. Transaction requests received before the close of the New York Stock Exchange, typically 4:00 p.m. Eastern Time, on any business day will be processed that day. Transaction requests received after the NYSE closes or on holidays or weekends will be processed on the following business day.

ONLINE AND TOLL-FREE TELEPHONE SERVICES

The Plan offers three ways to access information about your account and/or to make certain changes to your account: • NetBenefitsSM (online access) • Voice Response System (VRS) • Participant Service Representative

1. NetBenefits SM (online access) at 2. Voice Response System (VRS) www.netbenefits.com 1-866-733-1170

NetBenefitsSM features: An automated phone service is available 24 hours a day. You can use any touch-tone phone to enroll in the Plan, change your • Interactive retirement planning tools and learning resources and contribution percentage, stop or start your payroll contributions, or calculators (retirement savings; take home pay; financial); change the investment fund(s) in which your future contributions • View updated account information; are to be deposited. You may also transfer your current account • View amount available for a loan, and initiate a new loan; balances between the various investment funds available under the Plan. The VRS also enables you to: • View Plan and fund information (including performance and research) on each investment option; • Check your account balance and current investment information; • Access online educational workshops; • Review your account history; • View and update your email address; • Review the investment objective, performance, and current • View and update beneficiary information; price of your investment funds; and • View and update banking and tax withholding information if you • Model or request a loan or distribution from your account (if will be receiving distributions; and available). • Initiate a withdrawal or distribution, if eligible.

3. Participant Service Representative 1-866-733-1170

• Speak to a Participant Service Representative from 8:30 a.m. to 12:00 midnight Eastern Time on any business day that the New York Stock Exchange is open for business. THE BERTELSMANN 401(K) SAVINGS PLAN | 9-18 OTHER IMPORTANT INFORMATION

ERISA Rights Additional information about your rights under the Plan can be found in the General Information – Retirement Income Program chapter.

Loss of Benefits Although you are immediately 100% vested in all your contributions and Company Matching Contributions made to your account, benefits may be lost due to adverse investment experience, the operation of limitations presently or hereafter imposed under the applicable laws, the imposition on such benefits of income, penalty or excise taxes, and the application of a “qualified domestic relations order” (as defined in the General and Administrative Information chapter). In addition, Company Annual and Profit Sharing Contributions may be forfeited if you terminate employment before they are fully vested under the rules described in Appendices B, C and D.

Effect on Other Benefits By investing in the Plan on a pre-tax basis, you are reducing your taxable income, which in turn reduces your current federal income taxes. The decrease in your taxable income has no effect on your pay-related Company benefits. For example, your life insurance, disability coverage and pension benefit will be based on your pay before any of your contributions are deducted. Your Social Security taxes and benefits will also not be affected.

Non-Discrimination Testing The IRS requires that a tax-advantaged savings plan meet a complex test to assure a fair level of participation in the plan by employees at all compensation levels. However, because of the level of Company Matching Contributions, immediate vesting and other beneficial features, the Plan is intended to qualify for a “safe harbor” exemption from the IRS testing requirements for all contributions made after the first year of service. If, for any reason, the Plan did not qualify for this exemption, it could be necessary to adjust and/or refund the pre-tax and Roth investments made by higher-paid employees downward to a level considered fair under the law. If such an adjustment becomes necessary, all affected employees would be notified accordingly.

Federal Pension Benefit Insurance As a matter of law, the Plan is not eligible for insurance coverage with the Pension Benefit Guaranty Corporation (PBGC). Accordingly, benefits under the Plan are not guaranteed by the PBGC.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-19 APPENDIX A

Participating Affiliates

Bertelsmann Group Active Participating Affiliates Arist Education LLC arvato digital services LLC Arvato Entertainment LLC Arvato Systems North America, Inc. Berryville Graphics, Inc.* Bertelsmann, Inc. BMG Rights Management (US) LLC Coral Graphic Services, Inc. (Dynamic division only) FremantleMedia Latin America, Inc. FremantleMedia North America, Inc. Gruner + Jahr USA Group, Inc. Prestle Publishing LLC Price Is Right Productions, Inc. Relias Learning LLC RTL NY, Inc. 495 Production Holdings LLC

Penguin Random House Group Active Participating Affiliates Penguin Random House Foundation, Inc. Penguin Random House LLC Random House Children’s Entertainment LLC Random House Studio LLC Smashing Ideas LLC Golden Treasures LLC Author Solutions LLC Author Solutions Video LLC Xlibris LLC

You are not in the eligible class (as described on page 9-2) if you are not a current employee of an entity listed above. However, you may be a participant if you have a Plan account due to your employment (now or in the past) with a former participating company (inactive, dissolved, merged or sold) that previously participated in the Plan (as reflected in Chapter 8 of this SPD). * Participation in the 401(k) Plan is frozen and limited to employees who are first hired at Berryville Graphics, Inc. before January 1, 2014. Berryville Graphics, Inc. adopted the BE Printers 401(k) & Profit Sharing Plan for employees first hired on and after January 1, 2014. Rehired Employees first hired before January 1, 2014 will continue to be eligible under the 401(k) Plan upon rehire at any time.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-20 APPENDIX B

Company Annual Contribution

Bertelsmann, Inc. Arvato Systems North America, Inc. FremantleMedia Latin America, Inc. FremantleMedia North America, Inc. Price Is Right Productions, Inc. RTL NY, Inc.

Company Annual Contribution Eligible employees of Bertelsmann, Inc. and the participating affiliates listed above receive an additional annual Company contribution to their 401(k) account. In order to be eligible to share in the allocation for this contribution, you must still be an active employee (or on an approved leave of absence) on December 31st of the year for which the contribution is made, unless you left employment due to your death, disability, retirement or involuntary termination on account of layoff, job elimination or reduction in force. Effective for plan years beginning on and after January 1, 2015, no Company Annual Contributions will be made on behalf of otherwise eligible employees of Bertelsmann, Inc. or Arvato Systems North America, Inc. who are highly compensated employees for the plan year for which the contribution would be made. An employee is a highly compensated employee for a plan year (and will not receive the Company Annual Contribution for the plan year) if the employee’s compensation earned in the plan year preceding the year in which the contribution is to be made exceeded a limit set by the IRS each year. For 2015, an employee is considered to be a highly compensated employee if the employee earned more than $115,000 in 2014. Based on IRS cost of living indexing, an employee will be a highly compensated employee for 2016 if the employee earned more than $120,000 in 2015.

How the Company Annual Contribution is calculated Subject to the preceding paragraph, each year that you meet the above allocation eligibility requirements, the Company will add a contribution to your account. The amount is equal to a percentage of your Covered Earnings for the year, and it is based on your age and years of service as of December 31st of each year. Years of service are determined in the same manner as vesting service (see page 9-13). For example, assume you are age 36 on December 31, 2014 and have worked at the Company for seven years. As the table below shows, the Company will contribute 1.3% of your Covered Earnings to the Plan. So, if you earn $45,000 a year, the Company will contribute $585 to your account — and that is in addition to the Company Matching Contributions!

Less than 10 years of Between 10 and 19 years of More than 20 years of Age as of December 31 service service service

Under 30 1.0% of Covered Earnings 1.0% of Covered Earnings --

Between 30 and 39 1.3% of Covered Earnings 1.3% of Covered Earnings 1.3% of Covered Earnings

Between 40 and 49 1.7% of Covered Earnings 2.0% of Covered Earnings 2.3% of Covered Earnings

Between 50 and 59 2.0% of Covered Earnings 2.3% of Covered Earnings 2.7% of Covered Earnings

60 and Over 2.3% of Covered Earnings 2.7% of Covered Earnings 3.0% of Covered Earnings

The contribution for each year is expected to be made during the first quarter of the immediately following year but in no event will be made later than the due date for the Company’s Federal income tax return. The Company makes the contribution to your Company Annual Contribution Account automatically. You do not need to make contributions from your own pay to receive the additional Company contribution. If you do not already have an account in the Plan or if you do not have any investment direction set up with Fidelity, the Company Annual Contributions will be automatically invested in the Pyramis Lifecycle Fund that matches your expected retirement date according to the chart on page 9-3, unless you give Fidelity other investment instructions.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-21 APPENDIX C

Company Annual Contribution

Berryville Graphics, Inc. Dynamic Graphic Finishing, Inc.

Company Annual Contribution These Company Annual Contributions were discontinued for all plan years beginning on and after January 1, 2015. This means that no employees will receive any Company Annual Contributions under this Appendix C for 2015 or any subsequent year. Eligible employees of the participating affiliates listed above receive an additional annual Company contribution to their 401(k) account. In order to be eligible to share in the allocation for this contribution, you must still be an active employee (or on an approved leave of absence) on December 31st of the year for which the contribution is made, unless you left employment due to your death, disability, retirement or involuntary termination on account of layoff, job elimination or reduction in force.

How the Company Annual Contribution is calculated Each year that you meet the above allocation eligibility requirements, the Company will add a contribution to your account. The amount is equal to a percentage of your Covered Earnings, and it is based on your years of vesting service (see page 9-13) as of December 31st of each year. For example, assume as of December 31, 2014 you have worked at the Company for seven years. As the table below shows, the Company will contribute 1.0% of your Covered Earnings to the Plan. So, if you earn $45,000 a year, the Company will contribute $450 to your account — and that is in addition to the Company Matching Contributions!

Years of Vesting Service Contribution (% of Covered Earnings)

Less than 10 1.0% of Covered Earnings

Between 10 and 14 years 1.5% of Covered Earnings

Between 15 and 19 years 2.0% of Covered Earnings

Between 20 and 24 years 2.5% of Covered Earnings

25 years or more 3.0% of Covered Earnings

The contribution for each year will be made during the first quarter of the immediately following year. The Company makes the contribution to your Company Annual Contribution Account automatically. You do not need to make contributions from your own pay to receive the additional Company contribution. If you do not already have an account in the Plan or if you do not have any investment direction set up with Fidelity, the Company Annual Contributions will be automatically invested in the Pyramis Lifecycle Fund that matches your expected retirement date according to the chart on page 9-3, unless you give Fidelity other investment instructions.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-22 APPENDIX D

Penguin Random House Group Profit Sharing Contribution

Penguin Random House LLC Random House Children’s Entertainment LLC Random House Studio LLC Smashing Ideas LLC Golden Treasures LLC Author Solutions LLC Author Video Solutions LLC Xlibris LLC

Eligible employees of the participating affiliates listed above (referred to in this Appendix D as the “Penguin Random House Group”) may receive a Profit Sharing Contribution under the Plan. See Appendix A for members of the Penguin Random House Group.

Eligible Employees You will be eligible to share in the Profit Sharing Contribution for any plan year if: • You are eligible to make pre-tax or Roth 401(k) contributions to the Plan; • You meet the annual allocation criteria set forth below; and • You satisfy one of the following service requirements: º You were hired or rehired on or before the January 1 (or the first business day) of the plan year for which the Profit Sharing Contribution is made; º You were rehired and earned a year of service* on or before the July 1 of the plan year for which the Profit Sharing Contribution is made; or º You were rehired at any time during the plan year for which the Profit Sharing Contribution is made, but you had previously become eligible for Profit Sharing Contributions at the time of your earlier termination. * For part-time and temporary employees, a year of service is satisfied if you worked at least 1,000 hours during the 12-month period following your date of hire or rehire (as applicable) or within any plan year thereafter. For all other employees, a year of service is earned in the same manner as vesting service (see page 9-13).

Annual Allocation Criteria You are eligible to share in a Profit Sharing Contribution, if any, for a plan year only if: • You worked at least 1,000 hours during the plan year; and • You are an eligible employee of the Penguin Random House Group on the last day of the plan year. The “last day” requirement is waived in the case of death, disability or approved leave of absence.

THE BERTELSMANN 401(K) SAVINGS PLAN | 9-23 CHAPTER 10

The Bertelsmann Pension Account Plans CONTENTS

...... Page

Plan Highlights ...... 10-1

Eligibility...... 10-2

Cost...... 10-2

How Your Benefit is Calculated at Retirement...... 10-2

Your Pension Account Balance ...... 10-3

• Credits to Your Pension Account Balance Prior to Your Freeze Date...... 10-3

• Covered Earnings...... 10-3

• Your Initial Pension Account Balance...... 10-3

Social Security Retirement Benefits...... 10-4

Normal Retirement...... 10-4

Early Retirement ...... 10-4

Deferred Retirement...... 10-4

Normal Payment Methods...... 10-5

• For Unmarried Employees...... 10-5

• For Married Employees ...... 10-5

Optional Payment Methods...... 10-6

• Life Annuity Option for Married Employees...... 10-6

• Joint and Survivor (J&S) Annuity Option...... 10-6

• Guaranteed Period Options...... 10-7

• Lump-Sum Payment ...... 10-7

• If You Return to Employment...... 10-8

Vesting...... 10-8

• Severance Date and Period of Severance ...... 10-8

• Benefit Amount...... 10-9

• Forfeiture of Benefits ...... 10-9

• Lump-Sum “Cash-Out” of Small Benefits...... 10-9

• Re-employment...... 10-10

Pre-Retirement Spouse’s Benefit...... 10-10

How to Apply for Benefits...... 10-10

Tax Considerations ...... 10-10

Limitations on Benefits ...... 10-11

PBGC Insurance...... 10-11

PENSION CONTENTS

...... Page

Pension Plan Termination ...... 10-12

Other Important Information...... 10-12

Appendix A – Participating Affiliates...... 10-13

Appendix B – Bertelsmann Pension Account Plan Accruals ...... 10-14

Appendix C – Random House, Inc. Pension Account Plan Accruals ...... 10-17

Appendix D – BMG Pension Account Plan Accruals...... 10-19

Appendix E – Provisions Regarding Former Golden Books Plan Participants...... 10-22

This Summary Plan Description (SPD) is merely a summary of the terms of the Plan. In the event of a conflict between the actual terms of the Plan and this summary, the terms of the Plan shall control. The Company reserves the right to unilaterally amend, modify or terminate the Plan in its sole discretion at any time for any reason.

PENSION PLAN HIGHLIGHTS

Eligible employees of the Participating Companies listed in Appendix A participate in the Bertelsmann Pension Account Plan (the “Plan”). The Plan offers you the security of guaranteed monthly income during retirement. If you are eligible, you automatically become a Plan member - and the Company pays the full cost of your Plan membership. Your Plan benefits are in addition to Social Security retirement benefits, your payment(s) from the 401(k) Savings Plan and any benefits to which you may be entitled under the Employee Retirement Plan of Doubleday & Company Inc. (which was terminated as of December 31, 1986). The Plan was established effective January 1, 1987 and was substantially modified as of January 1, 1993. The Plan was amended and restated effective as of December 31, 2009, and effective December 31, 2009, the Random House, Inc. Pension Account Plan was merged into the Plan. The Plan was most recently amended and restated effective as of January 1, 2014. The Plan is a “frozen plan”. This means that the amount of your benefit earned under the Plan is frozen as of the “Freeze Date” applicable to your Participating Company and will not increase after the Freeze Date even if you continue working for a Participating Company. If you do continue to work for a Participating Company or any other company that is a Bertelsmann affiliate (determined on the basis of at least 20% ownership), however, your continued service will still count toward the vesting of your benefit under the Plan and for eligibility for Early Retirement benefits from the Plan. The “Freeze Date” applicable to each Participating Company is listed in Appendix A. The following table summarizes the main features of the Plan as of January 1, 2015:

Here’s What the Plan Does for You Through These Features

Provides you with guaranteed retirement income Your annual pension benefit is based on your Pension Account balance at retirement.

Costs you nothing The Company pays the entire cost of the Plan.

Gives you a choice of retirement dates You can retire on or after your normal retirement date (age 65) or you can retire with a reduced benefit as early as age 55 (with five or more years of service).

Lets you choose your form of payment You can choose a lifetime monthly benefit or a lump-sum payment (depending on the actuarial value of the lump sum and your age at termination) at retirement (provided you obtain your spouse’s written consent if you are married). Alternatively, you may choose a reduced lifetime benefit for yourself and a survivor income benefit to a beneficiary after your death (if you are married, a survivor benefit is normally payable to your spouse).

Provides benefits even if you leave before retirement After completing five years of service with the Company, you have a non-forfeitable right to a benefit from the Plan, which can be paid to you when you reach age 55 (even if your employment has terminated). This right is called “vesting.”

Can provide your spouse with income in the event of your death After you complete five years of service, your spouse (if married before retirement at least one year) will receive benefits from the Plan if you die before retirement.

PENSION | 10-1 ELIGIBILITY COST

No new employees will join the Plan after the Freeze Date The Company pays the entire cost of the Plan. (see Appendix A) applicable to each Participating Company. As a regular, full-time employee of a Participating Company (see Appendix A) or as a part-time employee of a Participating HOW YOUR BENEFIT IS Company scheduled to work at least 20 hours per week (1,000 hours per year) hired prior to the Freeze Date applicable to the CALCULATED AT RETIREMENT Participating Company, you were eligible to participate in the Plan upon hire or at the end of any applicable employment probationary No additional benefits will accrue in the Plan after the Freeze period (if it ended prior to the Freeze Date) imposed by the Date (see Appendix A) applicable to each Participating Company, as set forth in its employee handbook, provided that: Company. • You were not in a class of employees eligible to participate As a Plan member, you have a Pension Account balance that in another defined benefit plan sponsored by a Bertelsmann is credited by the Company based on your Covered Earnings affiliate company, or any other retirement plan established under while employed. The amount of benefit accrual credited by the the laws of a foreign country. Company each year prior to your Freeze Date was based on your Covered Earnings while employed. This plan design is known • You were not a “leased” employee as described under the as a career average pension plan. The cumulative amount of Internal Revenue Code and you were not classified by the this benefit accrual is tracked by a number called your Pension Company as an independent contractor, freelancer or other Account balance. There are no further benefit accruals credited by similar classification that is not on the payroll of the Company. the Company to your Pension Account after your Freeze Date. • If you were covered by a collective bargaining agreement of any If you retire at age 65, you will receive an annual benefit equal kind, it provides for your membership in this Plan. to 1/10 of your Pension Account balance at retirement. Annual • You were not a nonresident alien with no income from the benefits are paid in monthly installments or, if you terminate Company earned for services performed in the U.S. employment at age 55 or later (with a minimum of 5 years of If you were hired as a part-time employee, temporary employee or service,) you may elect to receive a lump sum or other optional on-call employee scheduled to work less than 20 hours per week benefit form (provided you obtain your spouse’s written consent if (1,000 hours per year), you became a Plan member as of the first you are married). payroll period following the completion of 1,000 hours of service Reduced benefits can be elected upon retirement as early as age in your first 12 consecutive months of employment. If you did not 55 (with a minimum of 5 years of service) and/or survivor benefit meet the 1,000-hour requirement in this period, you became a coverage can be provided, subject to a reduction in your lifetime Plan member as of the first payroll period following the completion monthly benefit. of at least 1,000 hours in any plan year (January 1 – December 31). Once you became a Plan member, you received benefit credits retroactively back to the beginning of the 1,000-hour computation period. For determining Plan eligibility, you earned an hour of service for every hour in which you were directly or indirectly paid, or entitled to payment, by the Company for the performance of duties. Hours were credited for the month in which the duties were performed. Hours were also credited for periods in which no duties were performed due to vacation, holidays or leaves of absence due to disability, layoff, jury duty or military service, but not to exceed 501 hours. However, any hours that were awarded for back pay were allocated to the month or months that were involved in the back- pay award.

PENSION | 10-2 YOUR PENSION ACCOUNT BALANCE

PLEASE NOTE: No additional benefits will accrue in the Plan deferred compensation or bonus arrangement with the Company after the Freeze Date (see Appendix A) applicable to each are not included in Covered Earnings. Participating Company. The Internal Revenue Code limits the amount of Covered On January 1, 2006, your accrued benefit under the Plan was Earnings that may be used for calculating Plan benefits. The IRS converted due to new IRS rules. Before January 1, 2006, the adjusts this limit each year based upon increases in the Consumer Plan’s benefit formula stated that you would receive a 25% Price Index. The IRS maximum Covered Earnings for the 5-year increase in your monthly pension payments when you turn age period through 2008 were as follows: 75 and every ten years thereafter. New IRS rules prohibit such increases. To make up for this loss of future increases, you will Year Maximum Covered Earnings receive a higher payment amount when you retire. Your accrued 2008 $230,000 annual benefit as of December 31, 2005 was converted to an 2007 $225,000 increased actuarially equivalent benefit amount (multiplied by 2006 $220,000 1.1234 if you had not yet elected retirement benefits), payable in the same form at the same time but without any automatic 2005 $210,000 payment increase in the future. Your Pension Account balance as 2004 $205,000 of January 1, 2006 includes this actuarial conversion.

Credits to Your Pension Account Balance Prior Your Initial Pension Account Balance to Your Freeze Date Bertelsmann Pension Account Plan If you were actively employed by the Company or a Participating If you were a Plan member in the Bertelsmann Pension Company and were a member of the Plan on December 31, 1992, Account Plan on December 31, 2009, beginning January you had an initial Pension Account balance on January 1, 1993 1, 1993 (or upon your subsequent eligibility for the Plan), the based on your accrued benefit determined under the Plan as in Company credited your Pension Account balance with an amount effect on that date. Please see Appendix B for a description of the equal to 5% of your Covered Earnings until your retirement, calculation of your initial Pension Account balance as determined termination of employment, or your Freeze Date (see Appendix A), under the Plan and how the Plan works. whichever was earlier.

If you were a Plan member in the Random House, Inc. Former Random House, Inc. Pension Account Plan Pension Account Plan on December 31, 2009, beginning July If you were actively employed by Random House, Inc. or a 1, 1998 (or upon your subsequent eligibility for the Plan), Random Participating Company under the Random House, Inc. Pension House credited your Pension Account balance with an amount Account Plan and were a member of the Random House, Inc. equal to 6% of your Covered Earnings until your retirement, Pension Account Plan on June 30, 1998, you had an initial termination of employment, or your Freeze Date (see Appendix A), Pension Account balance on July 1, 1998 based on your accrued whichever was earlier. benefit determined under the Plan as in effect on that date. Please see Appendix C for a description of the calculation of your initial Covered Earnings Pension Account balance as determined under the Random House, Inc. Pension Account Plan and how the Plan works. As used throughout this Summary, the term “Covered Earnings” includes your base salary or wages paid while you were a Plan Note Regarding Former Golden Books Plan Participants: The benefits of former employees of Golden Books Family member and any overtime pay, shift differential, sales incentives, Entertainment, Inc. and its affiliates include benefits they accrued, commissions, bonuses, vacation or holiday pay and non-insured if any, under the terms of the Golden Books Retirement Plan for sick pay, prior to your contributions, if any, to the Bertelsmann Hourly Employees. Certain provisions relating to these benefits or Random House 401(k) Plan or the Signature Select Benefits and their payment, in particular Early Retirement, which continue Plan, such as pre-tax deductions for health plan coverage and to be determined under the terms of the Golden Books Plan, are transportation fringe benefits. explained in Appendix E. Covered Earnings do not include any other Company contributions to or resulting from your benefit plans - including this Plan and plans such as the Medical or Dental Plans or any imputed income as a result of your Group Life Insurance protection. Earnings also do not include any otherwise eligible earnings payments that are not paid as of, or within two weeks (i.e., within a normal payroll cycle) after, termination provided such amounts would have been payable to you in the ordinary course of your employment. Severance payments paid to you following your termination of employment or deferrals under any non-qualified

PENSION | 10-3 SOCIAL SECURITY EARLY RETIREMENT

RETIREMENT BENEFITS If you are at least age 55 and you have completed at least five Years of Service, you may elect Early Retirement as of the first Benefits from the Plan are paid entirely in addition to Social day of any month between your 55th and 65th birthdays. If you Security retirement benefits. retire early (before age 65), you may elect to begin receiving your Social Security provides retirement benefits to you and your pension benefits as of your early retirement date, your normal eligible spouse based on earnings covered under the Social retirement date (age 65) or the first day of any month in between. Security law. Full Social Security retirement benefits (based on If you retire early and elect to start receiving benefits before your your Social Security covered earnings) start at your Social Security normal retirement date (age 65), your benefit will be lower because normal retirement age. Your spouse is eligible for an additional you will receive benefits for a longer period of time. To determine 50% of your benefit - or a benefit based on his or her own Social your annual early retirement benefit under the Plan, divide your Security covered earnings, if greater - when he or she reaches Pension Account balance as of your early retirement date by the Social Security normal retirement age. Please note that Social number of years* between: Security’s normal retirement age for individuals born after 1937 (a) the date as of which your pension benefits commence gradually increases from 65 to 67. Ultimately, for employees born after 1959, full Social Security benefits will not become payable and until age 67. However, reduced benefits are available before (b) the first day of the month following your 75th birthday normal retirement age (as early as age 62). * Fractions of whole years are prorated by months. Your actual Social Security entitlement will depend upon your salary history throughout your working career, any gaps in Social For example, if you retired at age 62 and began receiving benefits Security coverage, your age at retirement, your spouse’s age and immediately, your annual benefit for each of the 13 years from employment history, and other relevant factors. ages 62 to 75 would be equal to your Pension Account balance as of your early retirement date (age 62) divided by 13. Please remember that Social Security benefits are not paid automatically. You must apply for them. To get more information If you retired at age 55 and began receiving benefits immediately, about the Social Security law and your personal status under it, your annual benefit for each of the 20 years from ages 55 to 75 contact your local Social Security office or visit Social Security’s would be equal to your Pension Account balance as of your early website at www.ssa.gov. retirement date (age 55) divided by 20. This is equivalent to a 50% reduction for early retirement at age 55. See Appendix E for special Early Retirement provisions for former NORMAL RETIREMENT Golden Books Plan Participants.

Under the Plan, your Normal Retirement Date is your 65th birthday. This is when you qualify for the full benefit that you have DEFERRED RETIREMENT accrued (earned) under the Plan, subject to adjustment based upon the payment date and method that you elect. If you keep working for the Company after your normal retirement date (age 65) and before your Freeze Date, you continued to receive credits to your Pension Account balance until you actually retired or your Freeze Date, whichever occurred first. Your Plan benefit payments will start as of the first day of the month after your actual retirement date (or sooner if required by IRS regulations). If your employment has already terminated, you may also elect to begin receiving your pension benefits as of a date following your Normal Retirement Date and prior to the April 1st following the year in which you attain age 70-1/2, subject to adjustment to reflect the delayed payment. Your deferred retirement benefit is equal to 1/10 of your Pension Account balance as of your Deferred Retirement Date or your Freeze Date, whichever occurred first. For any period after your normal retirement date when you are not receiving your retirement benefits because you continue to work after your normal retirement date, you will experience what the U.S. Department of Labor considers a “suspension of benefits.” If this applies to you, the Company will provide you with a written notice explaining the suspension of benefits and the Plan provisions it is based on.

PENSION | 10-4 NORMAL PAYMENT METHODS

The Plan provides flexibility by offering several different methods under which you can receive your Plan benefits. However, unless you elect an optional form of payment, you will be paid under the Plan’s normal form of payment, based on your marital status when you retire.

For Unmarried Employees

The Plan’s normal form of payment for an unmarried employee is a Life Annuity. Under this payment method, your benefit is payable for your lifetime. However, no benefits are payable after your death.

For Married Employees

If you retire and are married when Plan benefits begin, the normal form of payment is the Qualified Joint and Survivor Annuity. Under this payment method, your monthly pension is reduced so that, after your death, 50% of your reduced Plan benefit is continued to your surviving spouse - for the rest of his or her life. • The reduction in your benefit is based on the difference between your age and the age of your spouse. For example, if you and your spouse are within 5 years of the same age, your retirement benefit would be reduced by 4%. So, if your annual benefit payable at 65 was $10,000, you would receive $9,600 per year under the Qualified Joint and Survivor Annuity. Then, in the event of your death, your surviving spouse would receive $4,800 per year (50% of $9,600) for the rest of his or her life. • The reduction in your benefit would be different if your spouse is more than five years older or younger than you (as shown in the chart on the next page). For example, if your spouse is 6 years younger than you, your retirement benefit would be reduced by 4.3%. Or if your spouse is 6 years older than you, your retirement benefit would be reduced by 3.7%. Further information on these and the Plan’s other factors that apply to you is available through your Benefits Department. • If your spouse were to die before your Plan payments began, this payment form would be automatically canceled and you would receive your Plan benefit in the Life Annuity form (described above) - unless you remarried or elected another form of payment before retirement. If your spouse were to die after you have begun receiving Plan benefits, you would continue to receive your reduced benefit for the rest of your life and no further benefits would be paid to anyone after your death. For this purpose, your “spouse” means the person to whom you are married at the time of your benefits commence, as determined for Federal income tax purposes pursuant to the state or foreign law under which your marriage was legally recognized at the date of determination, but does not include any person to whom you are married as a result of a common law marriage.

PENSION | 10-5 OPTIONAL PAYMENT METHODS

The Plan permits you to elect an optional form of payment at retirement, instead of the normal payment method. You may elect a payment option by filing the appropriate forms with your Benefits Department within the required filing period, before you begin receiving Plan benefits. However, if you are married, you will need your spouse’s written consent, witnessed by a notary public or the Plan Administrator, in order to elect an optional method of payment (described below) other than the 50%, 75%, or 100% Joint and Survivor Annuity with your spouse as your beneficiary. For this purpose, your “spouse” means the person to whom you are married at the time of your benefits commence, as determined for Federal income tax purposes pursuant to the state or foreign law under which your marriage was legally recognized at the date of determination, but does not include any person to whom you are married as a result of a common law marriage. You may, at any time within the 90-day period before benefits begin, revoke your election to receive an optional form of payment

Life Annuity Option for Married Employees

This option for married employees is the same as the Life Annuity, which is the normal form of payment for unmarried employees. Under this payment method, you receive unreduced monthly benefits for life, but no benefits are paid to your spouse - or to anyone else - after your death. Spousal consent is required.

Joint and Survivor (J&S) Annuity Option

This option is similar to the Qualified Joint and Survivor Annuity, which is the normal form of payment for married employees. However, under this option, you may (with your spouse’s consent if you are married) name anyone as your beneficiary to receive Plan benefits after your death. And you may choose 50%, 75% or 100% of your reduced monthly benefit to become payable to your beneficiary - for his or her lifetime - after your death. Of course, an unmarried employee may also elect the Joint and Survivor Annuity with any individual named as beneficiary. The amount by which your Plan benefit is reduced depends on the percentage you elect to have continued after your death; the greater the percentage you choose, the greater the reduction of your lifetime benefit. In addition, your monthly Plan benefit is adjusted to reflect the ages of you and your beneficiary as shown in the chart below. To determine your reduced annual benefit under the 50%, 75%, or 100% Joint and Survivor Annuity Options, multiply your annual benefit as of your pension benefit commencement date by the applicable factor shown in the chart below.

If Your Beneficiary is: 50% J&S: 75% J&S: 100% J&S: 9 years younger .948 .884 .816 8 years younger .951 .888 .822 7 years younger .954 .892 .828 6 years younger .957 .896 .834 0 – 5 years younger .960 .900 .840 0 – 5 years older .960 .900 .840 6 years older .963 .904 .846 7 years older .966 .908 .852 8 years older .969 .912 .858 9 years older .972 .916 .864

If your spouse (or other designated beneficiary) is 10 or more years older or younger than you, please contact your Benefits Department to determine the appropriate reduction. If you elect an option that provides payments to a person who is much younger than you (other than your spouse), the value of the lifetime pension payable to you must equal more than 50% of the total value of the benefits payable (as determined by the Plan actuary).

PENSION | 10-6 Guaranteed Period Options

Under this option, you receive reduced retirement income for life, with payments guaranteed, in any event, for 5, 10 or 15 years, as you choose. If you were to die before the guarantee period is over, your reduced benefits would continue to be paid to your designated beneficiary for the remainder of the guarantee period. You may (with your spouse’s consent if you are married) elect anyone you wish as your beneficiary, and you may change your beneficiary designation at any time before Plan payments begin, although a designation will only be effective if received prior to your death. If your beneficiary should die after you do and during the guarantee period, the value of any remaining benefits will be paid to a contingent beneficiary designated by you. If you did not designate a contingent beneficiary, the beneficiary will be your surviving spouse or, in the case of no surviving spouse, your estate. To determine your reduced annual benefit under the 5-year, 10-year or 15-year Guaranteed Period Option, multiply your annual benefit as of your pension benefit commencement date by the applicable factor shown in the chart below.

Your Age as of Your Last 5-Year Guaranteed Period 10-Year Guaranteed Period 15-Year Guaranteed Period Birthday Preceding the Option Option Option Start of Pension Payments

55 .992 .972 .940

56 .991 .969 .930

57 .990 .966 .920

58 .989 .963 .910

59 .988 .959 .900

60 .987 .954 .890

61 .986 .949 .880

62 .984 .943 .870

63 .982 .937 .860

64 .980 .929 .850

65 .977 .921 .840

Contact your Benefits Department for the applicable factors after age 65.

Lump-Sum Payment*

Under this option, you would receive a one-time payment of your Plan accrued benefit as of your retirement date. This payment would be the actuarial equivalent of your Pension Account balance based on your age at the time of retirement and the actuarial interest and mortality factors in effect as of the January 1st preceding the date on which your lump-sum payment is calculated. This means that the actual lump-sum amount that you receive may be significantly more or less than the dollar amount credited to your Pension Account balance at retirement.

* See the section Lump-Sum "Cash-Out" of Small Benefits and Benefits under Vesting for more information. To determine the lump-sum present value of your Pension Account balance at retirement, multiply your Pension Account balance by the factor that corresponds to your age as of your retirement date. Factors are prorated by months between whole years of age:

Age Factor Age Factor Age Factor 55 0.79010 59 0.97107 63 1.21025 56 0.83261 60 1.02122 64 1.27508 57 0.87690 61 1.08357 65 1.34102 58 0.92301 62 1.14654

PENSION | 10-7 These factors apply only to payments that are made during 2015. New factors are determined as of each January 1st. Please contact your Benefits Department for details. If you elect this form of payment, you (and/or your beneficiary) will not be eligible to receive any future benefits from the Plan. This form of payment will be automatically applied if the lump-sum present value of your Pension Account balance at retirement is $1,000 or less.

If You Return to Employment

If you return to employment after you start receiving your Plan benefits, if you elected to receive your Plan benefits as a monthly annuity, your monthly payments will continue during your period of re-employment. If you elected a lump-sum payment when you retired, the lump sum represented full and final payment under the Plan and there would be no further benefits due you.

VESTING

You become fully vested in your Plan benefits when you complete Severance Date and Period of Severance fiveYears of Service (or reach age 65, if sooner). Your Severance Date is the earlier of (i) the date on which you quit, “Vesting” refers to your non-forfeitable right to Plan benefits if you retire, are discharged or die, or (ii) the first anniversary that you terminate employment or die before retirement. are absent from employment with the Company (with or without Your “vesting” status also determines your eligibility for normal pay) for any reason other than quit, retirement, discharge or death retirement, early retirement and the pre-retirement surviving (such as, vacation, holiday, sickness, disability, layoff or leave of spouse’s benefit. absence). Years of Service for vesting purposes generally means all your If your Severance Date is due to any of the reasons in clause (i) service with the Company, plus any service you may have with above and if you return to work and complete an hour of service any other company that is a Bertelsmann affiliate (determined on within 12 months after your Severance Date, your Period of the basis of at least 20% ownership). (Years of Service generally Severance will be included in your Years of Service. Your Period also include continuous full-time service with any current affiliate of Severance is the period beginning on your Severance Date and company prior to its acquisition by Bertelsmann.) ending on the date you are once again credited with an hour of Effective January 1, 2006, Years of Service generally means service. your period of employment, commencing on your date of hire and A special rule applies if you take a parental leave due to ending on your Severance Date.1 pregnancy, the birth or adoption of a child, or childcare Notwithstanding the foregoing, if you were not fully vested in your immediately following birth or adoption. Plan benefits on July 1, 2013 and you were employed by Penguin There is also a separate rule for members who are absent due Random House LLC or one of its subsidiaries on July 1, 2013 (or, if to military service. For more information on your protected rights later, on your delayed employee transfer date), you became 100% under USERRA, you should contact your Benefits Department. vested in your Plan benefits on July 1, 2013 (or, if later, on your delayed employee transfer date). Note: Although benefit accruals are frozen under the Plan, years of service will continue to accrue for vesting purposes.

1 The manner of calculating service for vesting purposes was changed from an “hours of service” method to an “elapsed time” method, effective as of January 1, 2006. In addition, effective as of January 1, 2006, the “hours of service” method of calculation was simplified for purposes of determining Years of Service for regular full-time employees and part-time employees scheduled to work less than 20 hours per week prior to the effective date of the change. The change from hours of service to elapsed time resulted in a transition period for your employment anniversary year that included January 1, 2006 to ensure you did not lose any Years of Service as a result of the change. Please contact your Benefits Department for your Years of Service for periods prior to the change including the transition period. If your employment terminated prior to January 1, 2006, your Years of Service are calculated under the old “hours of service” method, which required you to complete 1,000 hours of service during the year to receive credit for a Year of Service. If your employment terminates on or after January 1, 2006, your Years of Service prior to January 1, 2006 will be calculated under the old “hours of service” method as simplified and your Years of Vesting Service after January 1, 2006 will be calculated using the “elapsed time” method described above. This change does not affect the method for counting hours of service for eligibility purposes under “Eligibility” above.

PENSION | 10-8 Benefit Amount Forfeiture of Benefits

If you terminate employment after you are vested, your annual If your employment terminates before you have completed five benefit will be equal to 1/10 of your Pension Account balance as Years of Service and you are not otherwise fully vested, you will of your termination of employment, commencing as of the first forfeit all benefits under the Plan. day of the month after your 65th birthday. You may elect to begin receiving your pension benefits as of a date following your Normal Retirement Date and prior to the April 1st following the year in Lump-Sum “Cash-Out” of Small Benefits which you attain age 70-1/2 (on which date your pension benefits If the actuarial present value of your vested benefit when you will automatically begin), subject to adjustment to reflect the terminate employment or on any subsequent annual valuation date delayed payment. is less than $1,000 ($5,000 in the case of a surviving spouse), the If you terminate employment before age 55 with a vested benefit, Plan Administrator will automatically pay the value to you (or your generally you may elect to receive reduced benefits starting on surviving spouse) in a lump sum. the first day of any month between ages 55 and 65. The amount If the actuarial present value of your vested benefit when you of the reduction will depend on how many months before age 65 terminate employment or on any subsequent annual valuation you elect to begin receiving benefits (as described in the Early date is greater than $1,000 but not more than $5,000, the Plan Retirement section) in the form of an annuity option. Administrator will pay the value to you in a lump sum only if you Effective for distributions after 2006, if the actuarial present value elect to receive an immediate lump sum. Spousal consent is not (determined as of your commencement date) of your benefit required to make this election. payable at age 65 exceeds $5,000, but does not exceed $10,000, If a lump-sum “cash-out” payment of small benefits as described you may commence payment before you attain age 55 in the under this section is made, neither you nor your spouse will be following payment forms: entitled to any additional benefits from the Plan based on your • An immediate lump-sum payment equal to the present value service before your termination. amount; or The actuarial lump-sum present value of your benefit upon • An actuarially equivalent annuity, as follows: termination of employment is determined by multiplying your − if you are unmarried, in a Single Life Annuity; or Pension Account balance as of your termination of employment by a factor that corresponds to your age as of your termination of − if you are married, in a 50% or 75% Joint and Survivor Annuity employment. Factors will decrease if interest rates get higher. with your spouse as beneficiary. The “cash-out” factors change each January 1st. Sample factors The election of a lump sum greater than $5,000 requires spousal for terminations occurring in 2015 are shown below. consent. Under the current Plan terms, if the present value amount of your benefit later exceeds $10,000, the lump sum payment Age at Age at option and early commencement right will no longer be available. Termination Lump-Sum Termination Lump-Sum You may choose another available annuity form if you wait until of Factor of Factor you attain age 55. Employment Employment Notwithstanding the foregoing, if you were employed by Penguin 25 0.16426 40 0.34156 Random House LLC or one of its subsidiaries on July 1, 2013 (or, 30 0.20950 45 0.43668 if later, on your delayed employee transfer date) and you either (i) 35 0.26737 50 0.59890 had reached age 55 by July 1, 2013 (or, if later, by your delayed employee transfer date) and had not completed five or more For example, assume that an employee terminates employment Years of Service on that date or (ii) remain employed by Penguin at age 35 in 2014 and his Pension Account balance as of his Random House LLC or one of its subsidiaries until you reach age termination date is $15,000. The actuarial lump sum present value 55, then you will be eligible to elect a lump sum payment of your of this employee’s benefit would be determined as follows: benefits regardless of the amount of the present value of your $ 15,000 - Pension Account balance at termination benefits. x 0.26737 - Lump-sum factor at age 35 Also notwithstanding the foregoing, if you were involuntarily terminated from employment with arvato digital services LLC $4,010.55 - Actuarial lump sum present value or Arvato Entertainment LLC for reasons other than cause (as Since the actuarial present value of the benefit is $5,000 or less, determined in the sole discretion of your Human Resources the employee in this example could elect to receive a single Department) after December 31, 2013; then you will be eligible lump-sum “cash-out” payment of $4,010.55 upon termination of to elect a lump-sum payment of your benefits regardless of the employment at age 35, rather than an annual benefit of $1,500 per amount of the present value of your benefits. year starting at age 65 (1/10 x $15,000). Since the actuarial value In any event, the election of a lump sum greater than $5,000 of the benefit is not more than $5,000, the employee (if he were will require spousal consent if you are married at the time of the married) does not need to obtain his spouse’s written consent. payment. If the employee in this example were age 45 upon termination of employment (rather than age 35), the actuarial benefit would be greater than $5,000 ($15,000 x 0.43668 = $6,550.20). Since the

PENSION | 10-9 actuarial value of the benefit is less than $10,000, the employee in such union is evidenced in public record, or (ii) the person with this example could elect to receive a single lump-sum “cash-out” whom you have entered into a same-sex domestic partnership payment of $6,550.20 upon termination of employment at age 45, recognized under applicable state or local law and such domestic rather than an annual benefit of $1,500 per year starting at age 65 partnership is evidenced in public record. However, if you live in (1/10 x $15,000); provided that, if he were married, he obtains his a state that recognizes same-sex marriage, then an individual spouse’s written consent to the lump-sum “cash-out” payment. described in clause (i) or (ii) of the preceding sentence will only be treated as your spouse for 12 months after the date on which the In the event the actuarial equivalent of the employee’s accrued law governing same-sex marriages in your state of residence was benefit would be greater than $10,000 and the employee changed to allow same-sex marriages (unless you become legally terminated prior to age 55, he could not receive a “cash-out” married to that individual within that 12 month period). payment upon termination of employment and, instead, would be entitled (if unmarried) to receive an annual benefit of 1/10 of his If you die after age 55 with a vested benefit and before pension Pension Account balance under a single Life Annuity commencing payments begin, your surviving spouse will receive the 50% at age 65. Of course, he could still choose to receive a reduced survivor benefit your spouse would have received under the annual benefit starting as early as age 55 and/or may elect a Qualified Joint and Survivor Annuity method of payment if you had form of payment other than the Life Annuity (but not a lump-sum retired on the day before your death. Payment will begin as of the payment). first day of the month following the date of your death. If you die before age 55 with a vested benefit, your surviving Re-employment spouse will receive a reduced survivor benefit calculated as if you had retired on the day before your death. Benefit payments will If you are vested when your employment terminates and you incur begin on the first day of the month following the date you would a one-year Period of Severance, and you subsequently become have reached age 55. re-employed, your Years of Service for vesting purposes before you left will be reinstated when you return to work provided you complete a Year of Service following your re-employment. HOW TO APPLY FOR BENEFITS If you are not vested when your employment terminates and you incur a one-year Period of Severance, the Years of Service for As you approach your normal retirement date (age 65), your vesting purposes you had earned before your Period of Severance Benefits Department will provide you with the necessary will be reinstated when you return if the length of your Period information and instructions for receiving benefits and electing of Severance is less than five years or your number of Years of payment options. If you would like to consider early retirement, Service before the break - whichever is greater. you must apply to your Benefits Department at least three months In any case, you will not earn Years of Service for vesting purposes before you would like your benefits from the Plan to commence. during your Period of Severance. Plan membership will resume In case of your death before retirement, your Benefits Department when you return to work. will provide information about any Plan benefits that might be payable upon notification of your death from your spouse. PRE-RETIREMENT SPOUSE’S BENEFIT TAX CONSIDERATIONS The following summarizes some basic tax considerations The Plan automatically provides benefits for your spouse if you die concerning distributions from the Plan. It is for informational with vested rights before your pension payments start. To qualify purposes only and is not intended as tax advice. It is also not for the pre-retirement spouse’s benefit, you and your spouse must intended to be a complete discussion of all applicable tax have been married for at least one year before your death (or the consequences. Therefore, you should consult your own tax individual must have been treated as your “spouse” as described advisor before making any elections under the Plan. in the following paragraph during the one-year period ending on your date of death). These benefits will cease when your spouse Pension benefits are generally taxable as ordinary income for dies. No benefits will be paid under this section if your surviving federal income tax purposes. Many states also tax pension spouse dies before commencing receipt of benefits or if you benefits. However, different rules apply to lump-sum payments divorce your spouse before you die. and annuity payments. For purposes of providing the spousal death benefit, “spouse” Lump-Sum Payments. If you receive a lump-sum payment, the means the person to whom you are married (as determined for taxable amount may be subject to special tax treatment and may Federal income tax purposes pursuant to the state or foreign law be eligible to be rolled over to an Individual Retirement Account under which your marriage was legally recognized at the date of (IRA) or another tax-qualified employer plan. determination) at the time of your death, but does not include any Lump-sum payments are recognized as income for federal income person to whom you are married as a result of a common law tax purposes in the year received. The Internal Revenue Service marriage. For purposes of the preceding sentence, “spouse” will also imposes an additional penalty tax of 10% — above the include (i) the person with whom you have contracted in a same- ordinary income tax otherwise payable — on the value of most sex civil union recognized under applicable state or local law and lump-sum payments received before age 59-1/2. Exceptions to

PENSION | 10-10 this 10% additional tax rule include lump-sum payments following termination of employment after reaching age 55 or resulting from PBGC INSURANCE total disability or death. The Pension Benefit Guaranty Corporation (PBGC), a federal The 10% additional income tax also will not apply and federal insurance agency, insures your pension benefits under the Plan. income tax will be deferred with respect to your lump-sum If the Plan terminates (ends) without enough money to pay all payment if you “rollover” your lump sum distribution to an IRA, benefits, the PBGC will step in to pay pension benefits. Most another company’s tax qualified plan, a 403(b) annuity contract people receive all of the pension benefits they would have received or certain governmental 457(b) plans within 60 days of your lump under their plan, but some people may lose certain benefits, such sum distribution. as subsidized early retirement benefits. Lump-sum payments are subject to 20% federal income tax The PBGC guarantee generally covers: (1) normal and early withholding unless directly rolled over into another employer’s retirement benefits; (2) disability benefits if you become disabled qualified plan, IRA, 403(b) annuity or 457(b) plan. before the plan terminates; and (3) certain benefits for your Federal tax law currently permits other exceptions to the 10% survivors. additional income tax. Keep in mind, however, the tax law changes The PBGC guarantee generally does not cover: (1) benefits greater from time to time. Your tax advisor can provide more information. than the maximum guaranteed amount set by law for the year in Annuity Payments. Like lump-sum payments, annuity payments which the plan terminates; (2) some or all of benefit increases and are recognized as income for federal income tax purposes in the new benefits based on plan provisions that have been in place for year received. Federal income taxes will be withheld from your fewer than five years at the time the plan terminates; (3) benefits payments unless you request otherwise in writing. The amount that are not vested because you have not worked long enough withheld will depend on your filing status and the number of for the company; (4) benefits for which you have not met all of exemptions you claim. Depending on your state of residence, state the requirements at the time the plan terminates; (5) certain early and local taxes also may apply. retirement payments (such as supplemental benefits that stop If no income taxes are withheld from your annuity payments, or if when you become eligible for Social Security) that result in an the amount withheld is not sufficient to cover the taxes due, you early retirement monthly benefit greater than your monthly benefit may be required to file estimated taxes and you may be subject to at the plan’s normal retirement age; and (6) non-pension benefits, an IRS penalty for insufficient withholding. such as health insurance, life insurance, certain death benefits, vacation pay, and severance pay. Even if certain of your benefits are not guaranteed, you still may Armed Forces receive some of those benefits from the PBGC depending on how Different rules may apply to withdrawals by employees who serve much money your plan has and on how much the PBGC collects as active-duty reservists in the U.S. Armed forces. Please from employers. check with the Plan Administrator to determine if you fall into this For more information about the PBGC and the benefits it category. guarantees, ask the Plan Administrator or contact the PBGC’s Technical Assistance Division, 1200 K Street N.W., Suite 930, Washington, D.C. 20005-4026 or call 1-800-400-7242. TTY/TDD LIMITATIONS ON BENEFITS users may call the federal relay service toll-free at 1-800-877- 8339 and ask to be connected to 1-800-400-7242. Additional Under IRS regulations, certain maximum benefit limitations are information about the PBGC’s pension insurance program imposed. is available through the PBGC’s website on the Internet at www.pbgc.gov. Among the government’s rules limiting pension plan benefits is Section 415(b) of the Internal Revenue Code, which requires that the employer-provided annual benefit for an employee cannot exceed a stipulated dollar amount ($210,000 per year in 2015, subject to adjustment based upon the retiree’s age and the method of payment). The IRS may increase this limit each year based upon increases in the Consumer Price Index. Any Plan member to whom this limit applied prior to the applicable Freeze Date would have been notified accordingly.

PENSION | 10-11 PENSION PLAN TERMINATION OTHER IMPORTANT

If the Plan is terminated, you will have a vested, or non-forfeitable, INFORMATION right to the accrued benefit you have earned. The amount of your benefit, if any, will depend on Plan assets, the terms of the Plan Important information, such as how to file and appeal a claim, your and the benefit guarantee of the PBGC. Plan assets will be shared rights as a Plan member and other administrative details can be among Plan members and their beneficiaries according to ERISA found in the General and Administrative Information chapter of this in the following order: SPD. 1. Certain annuities that members have been receiving or could Loss or Reduction of Benefits have been receiving for three years prior to Plan termination The following situations may result in a loss or reduction of 2. Other vested benefits guaranteed by the PBGC benefits under the Plan: 3. Other vested benefits • If you leave the Company and all affiliates before you become 4. Remaining Plan benefits vested in the Plan, you will not be eligible for any benefits. If Plan assets are sufficient, you will receive your full accrued • If your spouse or same-sex domestic partner dies before you do benefit. After all benefit obligations are provided for and legal and after you start to receive payments in the form of a joint and requirements have been met, any remaining Plan assets will revert survivor annuity, the amount of your payments will not increase. to the Company. • If you are single and die after benefit payments have commenced, benefits may continue after your death only under the 5, 10 and 15 year guaranteed payment options. • If you die before benefit payments have commenced and you are single, you have been married less than one year, or your same sex domestic partner has been treated as your spouse under the Plan for less than one year at the time of your death, no benefits are payable to your survivors. • If the present value of your benefit is $1,000 or less when you leave the Company and all affiliates, it will be paid to you in a single lump sum and you will not receive any other benefits from the Plan. • An adjustment in benefits may be made if an error occurs when calculating your benefit or your age has been misstated.

PENSION | 10-12 APPENDIX A

Participating Affiliates

Bertelsmann Group Participating Affiliates*

Participating Affiliated Company Adoption Date Accrual Freeze Date

December 31, 2003 for former Arvato arvato digital services LLC January 1, 2008 Services, Inc. Members

March 31, 2007 for former Sonopress Arvato Entertainment LLC January 1, 2013 LLC Members.

Berryville Graphics, Inc. January 1, 1987 December 31, 2006

March 31, 2007 with respect to former Coral Graphic Services, Inc. January 1, 2014 Dynamic Graphic Finishing, Inc.** (Dynamic division only) Members.

December 31, 2008 with respect PRH Holdings, Inc. July 1, 2013 to former Random House, Inc. (and subsidiaries) Members.

* For the benefit formula for the Bertelsmann Group, see Appendix B.

** Dynamic Graphic Finishing, Inc. became inactive effective December 31, 2014 when it was merged into Coral Graphic Services, Inc.

Companies that Adopted the Random House, Inc. Pension Account Plan***

Participating Affiliated Company Adoption Date Accrual Freeze Date

Arvato Systems North America, Inc. October 20, 2003 December 31, 2003

Bertelsmann, Inc. January 1, 1987 December 31, 2003

FremantleMedia North America, Inc. January 1, 2003 December 31, 2003

Price Is Right Productions, Inc. January 1, 2003 December 31, 2003

Random House, Inc.**** July 1, 1998 December 31, 2008

Random House Children’s Entertainment November 1, 2007 December 31, 2008 LLC

Random House Studio LLC April 28, 2005 December 31, 2008

*** For the benefit formula for the former Random House, Inc. Pension Account Plan, see Appendix C

**** Random House, Inc. became inactive effective June 30, 2013 when it was merged into Random House LLC, which was spun off to Penguin Random House LLC as of July 1, 2013

PENSION | 10-13 APPENDIX B

Bertelsmann Pension Account Plan Accruals

Your Initial Pension Account Balance as of January 1, 1993 If you were actively employed by the Company or another participating company in the Plan as of December 31, 1992, you had a beginning Pension Account balance as of January 1, 1993, which consisted of: (A) An amount equal to ten (10) times your Accrued Annual Benefit under the Plan as of December 31, 1992 (based on the Plan “formula” in effect until that date -- see below) plus (B) An additional credit from the Company equal to 5% of your total Covered Earnings during the five-year period preceding January 1, 1993 (i.e., January 1, 1988 through December 31, 1992).

Your Accrued Annual Benefit as of December 31, 1992 Your Accrued Annual Benefit as of December 31, 1992 was equal to:

1.1% (.011) x your Final Average Compensation up to your Social Security Covered Compensation Years of Benefit Service up to 30 X + 1.67% (.0167) x your Final Average Compensation above your Social Security Covered Compensation

For purposes of the above calculation, the following definitions apply: Years of Benefit Service are your full (and partial) years of service with the Company counted from January 1, 1987 (or, from the date on which your Company became a Participating Company, if later) through December 31, 1992. A full Year of Benefit Service was credited for each 12-month period during which you worked at least 1,000 hours. If you worked less than 1,000 hours in a given 12-month period, you received credit for one-twelfth (1/12) of a Year of Benefit Service for each month during which you worked at least 150 hours. Final Average Compensation means your average Covered Earnings for the highest 60 consecutive calendar months out of the last 120 calendar months through December 31, 1992. Social Security Covered Compensation means your average earnings that are subject to Social Security tax. Social Security Covered Compensation varies with the year you were born as shown on page 10-16.

PENSION | 10-14 The following example illustrates how the Plan works. Former BMG Pension Account Plan participants, please note: If you were a member in the BMG Pension Account Plan as an employee of Arvato Services, Inc. (in the Duncan, S.C. location) and your benefit was transferred to the Plan on December 30, 2004, please see Appendix D for an illustration of how your benefit was calculated in the BMG Pension Account Plan.

For this example, we will assume that you participated in the Plan from January 1, 1987 through December 31, 1992 and that your Accrued Annual Benefit as of December 31, 1992 was $2,000 per year payable at age 65. Therefore, 10 times the value of your Accrued Annual Benefit under the Plan as of December 31, 1992 was $2,000 x 10 = $20,000

We will also assume that your total Covered Earnings from January 1, 1988 through December 31, 1992 were $150,000 (an average of $30,000 per year for five years). Therefore, you received an additional credit from the Company equal to: $150,000 x 5% = $7,500

So, in this example, your beginning Pension Account balance as of January 1, 1993 was $20,000 + $7,500 = $27,500

Now, let’s assume that you continue working for 13 more years after January 1, 1993 and, during that time, your total Covered Earnings are $481,000 (an average of $37,000 per year for 13 years). Therefore, the Company would have credited the following additional amount to your Pension Account balance during those 13 years: $481,000 x 5% = $24,050

As of January 1, 2006, but before the conversion described $27,50 0 (your beginning balance as of 1/1/93) below, your total Pension Account balance would then be +$24,050 (credited from 1/1/1993 to 12/31/05)

$51,550

On January 1, 2006, your benefit was converted to replace the automatic increase provision. The Pension Account balance for members who had not yet retired was multiplied by the actuarial factor of 1.1234. Your Pension Account balance as of January 1, 2006, including this actuarial conversion, becomes: $51,550 X 1.1234 = $57,911

Now, let’s assume that you continue working for one more year after January 1, 2006 and, during that time, your total Covered Earnings are $45,000. Therefore, the Company would credit the following additional amount to your Pension Account balance during that year. $45,000 X 5% = $2,250

At retirement on January 1, 2007, your total Pension Account $ 57,911 (your balance as of 1/1/06) balance would then be: + $ 2,250 (credited from 1/1/06 to 12/31/07)

$60,161

For each year of retirement, you would receive an annual benefit 1/10 of $60,161 = $6,016.10 payable at age 65 as a Life Annuity equal to: (payable in monthly installments of $501.34)

PENSION | 10-15 Social Security Covered Social Security Covered Year of Birth Year of Birth Compensation Compensation

1923 $15,600 1942 $44,400

1924 $16,800 1943 $45,600

1925 $18,600 1944 $ 47,4 0 0

1926 $19,800 1945 $48,600

1927 $21,000 1946 $49,000

1928 $22,800 1947 $50,400

1929 $24,000 1948 $51,600

1930 $25,800 1949 $52,800

1931 $27,000 1950 $53,400

1932 $28,800 1951 $54,000

1933 $30,000 1952 $54,600

1934 $31,800 1953 $55,200

1935 $33,000 1954 $55,800

1936 $34,800 1955 $56,400

1937 $36,000 1956 $57,000

1938 $39,000 1957 $57,000

1939 $40,200 1958 $ 57,6 0 0

1940 $42,000 1959 or after $ 57,6 0 0

1941 $43,200

Notes: 1. If you were a participant in the Doubleday & Company, Inc. Retirement Plan prior to 1987, or the Time Warner/Book-of-the-Month Club Retirement Plan prior to January 1, 2001, your benefit under that plan will be paid in addition to your benefit under the Bertelsmann Pension Account Plan. 2. “Company” in these examples is referring to the applicable Participating Company. 3. Benefit accruals under the Plan are frozen as of the applicable Freeze Date.

PENSION | 10-16 APPENDIX C

Random House, Inc. Pension Account Plan Accruals

Your Pension Account Balance as of July 1, 1998 If you were actively employed by Random House, Inc. or another participating company in the Random House, Inc. Pension Account Plan as of June 30, 1998, you had a beginning Pension Account balance as of July 1, 1998, which consisted of: (A) An amount from the Company equal to 5% of your total Covered Earnings during the period July 1, 1994 through June 30, 1998 plus (B) If you were actively employed by Random House, Inc., or another participating company in the Random House, Inc. Pension Account Plan as of June 30, 1994, you had a beginning Pension Account balance as of July 1, 1994, which consisted of: (a) An amount equal to ten (10) times your Accrued Annual Benefit under the Plan as of June 30, 1994 (based on the Plan “formula” in effect until that date — see below) plus (b) An additional credit from the Company equal to 5% of your total Covered Earnings during the five-year period preceding July 1, 1994 (i.e., July 1, 1989 through June 30, 1994).

Your Accrued Benefit as of June 30, 1994 Your Accrued Annual Benefit as of June 30, 1994 was equal to:

1.0% (.01) x your Final Average Compensation up to $7,800 Years of Benefit Service up to 25 X + 1.5% (.015) x your Final Average Compensation above $7,800

plus

0.5% (.005) x your Final Average Compensation up to $7,800 Years of Benefit Service over 25 X + (max 20 years) 0.75% (.0075) x your Final Average Compensation above $7,800

Years of Service are your full (and partial) years of service with the Company counted from December 31, 1959 onward (or, from the date on which your Company became a Participating Company, if later) through June 30, 1994. A full Year of Service was credited for each 12-month period during which you worked at least 1,000 hours. If you worked less than 1,000 hours in a given 12-month period, you received credit for one-twelfth (1/12) of a Year of Service for each month during which you worked at least 150 hours. For purposes of the above calculation, the following definitions apply: Final Average Compensation means your average Covered Earnings for the highest 60 consecutive calendar months out of the last 120 calendar months prior to July 1, 1994.

PENSION | 10-17 The following example illustrates how the Random House, Inc. Pension Account Plan worked.

For this example, we will assume that you participated in the Plan from January 1, 1987 through June 30, 1994 and that your accrued retirement benefit as of June 30, 1994 was $2,000 per year payable at age 65. Therefore, the value of your accrued benefit under the Plan as of June 30, 1994 was $2,000 x 10 = $20,000 We will also assume that your total Covered Earnings from July 1, 1989 through June 30, 1994 were $150,000 (an average of $30,000 per year for five years). Therefore, you received an additional credit from the Company equal to $150,000 x 5% = $7,500 So, in this example, your beginning Pension Account balance as of July 1, 1994 was $20,000 + $7,500 = $27,500 Let’s further assume that your total Covered Earnings from July 1, 1994 through June 30, 1998 were $130,000 (an average of $32,500 per year for four years). Therefore, for the period July 1, 1994 through June 30, 1998, the Company credited you with $130,000 x 5% = $6,500 So, in this example, your Pension Account balance as of July 1, 1998 was $27,500 + $6,500 = $34,000 Now, let’s assume that you continue working for 7-1/2 more years after July 1, 1998. During that time, your total Covered Earnings are $262,500 (an average of $35,000 per year for 7-1/2 years). Therefore, the Company would have credited the following additional amount to your Pension Account during those 7-1/2 years $262,500 x 6% = $15,750

As of January 1, 2006, but before the conversion described $27,50 0 (your beginning balance as of 7/1/94) below, your total Pension Account balance would then be: + $6,500 (credited at 5% from 7/1/94-6/30/98)

$15,750 (credited at 6% from 7/1/98 to 12/31/05)

$49,750 On January 1, 2006, your benefit was converted to replace the automatic increase provision. The Pension Account balance for members who had not yet retired was multiplied by the actuarial factor of 1.1234. Your Pension Account balance as of January 1, 2006, including this actuarial conversion, becomes: $49,750X 1.1234 = $55,889 Now, let’s assume that you continue working for two more years after January 1, 2006 and, during that time, your total Covered Earnings are $80,000 (an average of $40,000 per year for two years). Therefore, the Company would credit the following additional amount to your Pension Account during that year. $80,000 X 6% = $4,800

At retirement on January 1, 2009, your total Pension Account $55,889 (your balance as of 1/1/06) balance would then be: + $4,800 (credited from 1/1/06 to 12/31/07)

$60,689

For each year of retirement, you would receive an annual benefit 1/10 of $60,689 = $6,068.90 payable at age 65 as a Life Annuity equal to: (payable in monthly installments of $505.74)

Notes: 1. If you were a participant in the Doubleday & Company, Inc. Retirement Plan prior to 1987, or the Advance Publications Retirement Plan prior to July 1, 1998, your benefit under that plan will be paid in addition to your benefit under the Random House, Inc. Pension Account Plan. 2. The benefits of former employees of Golden Books Family Entertainment, Inc. and its affiliates include benefits they accrued under the terms of the Golden Books Retirement Plan for Hourly Employees. Their benefit accruals in the Golden Books plan were frozen on March 31, 2002 and were subsequently transferred to the Random House, Inc. Pension Account Plan after the Golden Books Plan merged into the Plan on December 31, 2002. Certain provisions relating to these benefits and their payment which continue to be determined under the terms of the Golden Books Plan provisions are explained in the Appendix E. 3. “Company” in these examples is referring to the applicable Participating Company. 4. Benefit accruals under the Plan are frozen as of the applicable Freeze Date.

PENSION | 10-18 APPENDIX D

BMG Pension Account Plan Accruals

The frozen benefits of some Arvato Services, Inc. participants (Duncan, S.C. location) include benefits they accrued under the terms of the BMG Pension Account Plan while they were employees of BMG. Assets and liabilities attributable to BMG Music Publishing NA, Inc. and Zomba Enterprises, Inc. Members were spun off and transferred to the Plan effective December 30, 2004. The terms of the BMG Pension Plan accruals are explained below.

Your Frozen Pension Account Balance Earned under the BMG Pension Account Plan Your accruals in the BMG Pension Account Plan were frozen as of December 31, 2003. Starting July 1, 1998 (or upon your subsequent eligibility for the Plan), the Company credited your Pension Account balance with an amount equal to 6% of your Covered Earnings until your retirement or termination of employment, or December 31, 2003 if earlier. Note: As of December 31, 2003, the Plan will calculate your benefit using your years of service and compensation on that date. The benefit amount will not grow after December 31, 2003. If you have not reached the required five-year vesting threshold, your service will continue to count toward meeting the vesting requirement.

Your Pension Account Balance as of July 1, 1998 If you were actively employed by the Company prior to July 1, 1998, your Pension Account balance as of that date consisted of: (A) An amount equal to 5% of your total Covered Earnings during the period January 1, 1994 through June 30, 1998 plus (B) If you were actively employed by the Company from January 1, 1994 through December 31, 1996, an additional amount equal to 1.25% (.0125) of your total Covered Earnings from January 1, 1994 until December 31, 1996. plus (C) If you were actively employed by the Company as of December 31, 1993, you had a beginning Pension Account balance as of January 1, 1994, which consisted of: (a) An amount equal to ten (10) times your Accrued Annual Benefit under the Plan as of December 31, 1993 (based on the Plan “formula” in effect until that date --see below) plus (b) An additional credit from the Company equal to 15% of your total Covered Earnings during the five-year period preceding January 1, 1994 (i.e., January 1, 1989 through December 31, 1993).

Your Accrued Annual Benefit as of December 31, 1993 If you were an active employee of the Company on December 31, 1993, your Accrued Annual Benefit under the Plan as of that date was converted into a Pension Account balance by multiplying it by ten (10).

Your Accrued Annual Benefit as of December 31, 1993 was equal to: 1.10% (.011) x your Highest Average Earnings up to your Social Security Covered Compensation plus 1.67% (.0167) x your Highest Average Earnings above your Social Security Covered Compensation times Your years of Benefit Service (to a maximum of 30)

Highest Average Earnings means your average Covered Earnings for the highest five consecutive calendar years out of the last ten calendar years before 1994. Social Security Covered Compensation means your average earnings that are subject to Social Security tax. Social Security Covered Compensation varies with the year you were born as shown in the table below.

PENSION | 10-19 Social Security Covered Social Security Covered Year of Birth Year of Birth Compensation Compensation

1923 $15,600 1942 $44,400

1924 $16,800 1943 $45,600

1925 $18,600 1944 $ 47,4 0 0

1926 $19,800 1945 $48,600

1927 $21,000 1946 $49,000

1928 $22,800 1947 $50,400

1929 $24,000 1948 $51,600

1930 $25,800 1949 $52,800

1931 $27,000 1950 $53,400

1932 $28,800 1951 $54,000

1933 $30,000 1952 $54,600

1934 $31,800 1953 $55,200

1935 $33,000 1954 $55,800

1936 $34,800 1955 $56,400

1937 $36,000 1956 $57,000

1938 $39,000 1957 $57,000

1939 $40,200 1958 $ 57,6 0 0

1940 $42,000 1959 $ 57,6 0 0

1941 $43,200 or after $ 57,6 0 0

Your years of Benefit Service are your full (and partial) years of service with the Company counted from December 16, 1986 (or, from the date on which your Company became a Participating Company, if later) through December 31, 1993. A full year of Benefit Service was credited for each 12-month period during which you worked at least 1,000 hours. If you worked less than 1,000 hours in a given 12-month period, you received credit for one-twelfth (1/12) of a year of Benefit Service for each month during which you worked at least 150 hours.

PENSION | 10-20 An Example — How the Plan Works

The following example illustrates how the Plan works.

For this example, we will assume that you participated in the Plan from January 1, 1987 through December 31, 1993 and that your accrued retirement benefit as of December 31, 1993 was $2,000 per year payable at age 65. Therefore, 10 times the value of your accrued annual benefit under the Plan as of December 31, 1993 was: $2,000 x 10 = $20,000

We will also assume that your total Covered Earnings from January 1, 1989 through December 31, 1993 were $150,000 (an average of $30,000 per year for five years). Therefore, you received an additional credit from the Company equal to: $150,000 x 15% = $22,500

So, in this example, your beginning Pension Account balance as of January 1, 1994 was: $20,000 + $22,500 = $42,500

Let’s further assume that your total Covered Earnings from January 1, 1994 through December 31, 1996 were $96,000 (an average of $32,000 per year for three years). Therefore, for the period January 1, 1994 through December 31, 1996, the Company credited you with: $96,000 x 1.25% = $1,200

Let’s further assume that your total Covered Earnings from January 1, 1994 through June 30, 1998 were $162,000 (an average of $36,000 per year for four and a half years). Therefore, for the period January 1, 1994 through June 30, 1998, the Company credited you with 5% of those earnings: $162,000 x 5% = $8,100

So, in this example, your Pension Account balance as of July 1, 1998 was: $42,500

+ $1,200

+ $8,100

$51,800

Now, let’s assume that you continue working for five and half more years after July 1, 1998 until December 31, 2003, when new accruals to the Plan were frozen, and, during that time, your total Covered Earnings are $231,000 (an average of $42,000 per year for 5-1/2 years). Therefore, the Company would have credited the following additional amount (at 6% of covered earnings) to your Pension Account balance during those 5-1/2 years: $231,000 x 6% = $13,860

Your January 1, 2004 Pension Account balance would then be: $51,800

+ $13,860

$65,660

On December 30, 2004, your frozen accrued benefit was transferred from the BMG Pension Account Plan to the Bertelsmann Pension Account Plan: $65,660

You continue working for two more years, until January 1, 2006. You do not accrue any more benefits in the Plan since benefit accruals were frozen as of December 31, 2003. You will, however, continue to accrue service for vesting purposes for continued eligible service with the Company. On January 1, 2006, your benefit was converted to replace the automatic increase provision. The Pension Account balance for participants who had not yet retired was multiplied by the actuarial factor of 1.1234. Your Pension Account balance as of January 1, 2006, including this actuarial conversion becomes: $65,660 x 1.1234 = $73,762

If you continue working till retirement at age 65, your Pension Account balance remains the same, since no new accruals are being credited to your account. Your 1/10 of $73,762 = $7,376 benefit at normal retirement payable at age 65 as a Life Annuity would then be: (payable in monthly installments of $614.67)

Notes: If you were a participant in the Arista Records, Inc. Pension Plan on June 30, 1988, your Accrued Benefit as of December 31, 1993 is determined by adding your June 30, 1988 Arista Pension benefit to the benefit earned under the BMG Pension Account Plan from July 1, 1988 through December 31, 1993.

PENSION | 10-21 APPENDIX E

Provisions Regarding Former Golden Books Plan Participants

If you are a former employee of Golden Books Family Entertainment, Inc. and its affiliates, your benefits under the Plan include the benefits you accrued, if any, under the terms of the Golden Books Retirement Plan for Hourly Employees (the “Golden Books Plan”). Your benefit accruals in the Golden Books Plan were frozen on March 31, 2002 and your accrued benefit as of that date was subsequently transferred to the Random House, Inc. Pension Account Plan after the Golden Books Plan merged into the Plan on December 31, 2002. You can receive the portion of your benefit that you earned under the Golden Books Plan without an early retirement reduction if you are at least age 62 (instead of age 65). If you elect early retirement between the age of 55 and 62, your benefit will continue to be reduced as it was under the Golden Books Plan by 5% for each year benefits commence prior to 62. These provisions only apply to the portion of your benefit that you earned under the Golden Books Plan. The portion of your benefit you earned as a participant in the Plan will be determined in accordance with the terms of the Plan, without regard to this Appendix E.

PENSION | 10-22 CHAPTER 11

Severance Plan CONTENTS

...... Page

Key Terms to Know...... 11-1

Introduction...... 11-4

Eligibility and Participation...... 11-4

Covered Terminations...... 11-4

Severance Plan Benefits...... 11-5

What Is Not Covered ...... 11-7

When Coverage Ends...... 11-7

Other Important Information...... 11-8

Appendix A – Participating Companies...... 11-12

SEVERANCE PLAN KEY TERMS TO KNOW

Here are a few important terms that are used in this Plan. Knowing what these terms mean in the context of this Plan will help you better understand how the Plan works.

Adjusted Service Date Adjusted Service Date means the Hire Date with respect to any participating company adjusted to include any period of continuous employment with any other company in the Bertelsmann group or any parent, subsidiary or other affiliate (as determined by the Committee) of the Company immediately prior to the Hire Date, provided that there is no more than a one-week break in employment prior to the Hire Date. In the event an Eligible Employee separates from employment for any reason and subsequently is rehired, the employee’s original Hire Date shall be disregarded, the date of re-employment will become the Hire Date.

COBRA COBRA refers to a law known as the Consolidated Omnibus Budget Reconciliation Act of 1985 (Pub. L. 99-272, 100 Stat. 82), which provides certain eligible former Employees and their eligible dependents with the right to temporary continuation of their health coverage, at group rates plus an administrative charge of 2%.

Committee For the purposes of Plan Administration, unless otherwise provided at the sole discretion of the Plan Sponsor, the Committee is typically comprised of the Vice President of Finance/Chief Financial Officer and the Director and Manager of Human Resources of each of the Companies, to the extent such positions exist. Disability A Disability is a physical or mental condition causing an Employee’s inability to substantially perform the essential functions of his or her job with the Company, despite, if applicable, the provision of such reasonable accommodations as may be required by law, including a condition entitling an Employee to benefits under any disability income policy or program of the Company.

Eligible Employee An Eligible Employee is an Employee who may participate in the Severance Plan according to the Eligibility and Participation section of this Plan.

Employee An Employee is an individual who is reported on the regular payroll of the Company as a common law employee. For purposes of the Plan, a Leased Employee, a Temporary Employee, an intern, or an individual who is designated by the Company as an Independent Contractor or who otherwise is paid by the Company other than through its internal corporate payroll system will not be considered an Employee.

Hire Date Hire Date means the date on which employment with the Company or a predecessor company commenced.

Independent Contractor An Independent Contractor is an individual (including, but not limited to, a consultant) who is engaged directly by the Company to perform services for the Company other than as a common law employee and who is paid by the Company, either of its parents, a joint venture partner of any of the foregoing, or any affiliate or subsidiary of the Company, other than through its internal corporate payroll system.

Leased Employee A Leased Employee is an individual performing services for the Company for whom the direct payor of compensation with respect to the performance of services for the Company is any outside entity, including but not limited to a payroll service, professional employer organization or temporary employment agency, rather than the Company’s internal corporate payroll system.

Part-Time Employee A Part-Time Employee is an individual classified as regularly scheduled to work less than 30 scheduled hours per week.

Participant A Participant is an Employee who has met and continues to meet the eligibility and participation requirements according to this Plan.

SEVERANCE PLAN | 11-1 Severance Benefit A Severance Benefit is pay and benefits payable in accordance with the Severance Plan Benefits section of this Plan.

Severance Payment A Severance Payment is the monetary component of a Severance Benefit.

Temporary Employee A Temporary Employee is an individual whose period of employment with the Company is for a seasonal or other limited period of time or who is otherwise designated as a temporary employee by the Company.

Weekly Base Compensation For exempt employees, a Participant’s Weekly Base Compensation is the annual base salary divided by 52. For non-exempt employees, a Participant’s Weekly Base Compensation is the regularly hourly rate of pay multiplied by the Participant’s regular assigned hours of work during a workweek, up to a maximum of 40 hours. Weekly Base Compensation does not include compensation attributable to overtime pay, bonus, commissions, shift differentials, reimbursements, or other allowances or contributions to any other employee benefit plan. It is determined immediately preceding the Participant’s termination date.

Without Cause Without Cause means permanent termination from the Company, as determined in the sole discretion of the Committee, as a result of: • Lack of work; • Reduction in force; • Discontinuance of a department or operation; • Organizational realignment; • Position elimination; • Sale of the Company or of a business, branch, division, operation or subsidiary of the Company or the sale of all or substantially all of the assets thereof, in either event in which the Employee is not offered comparable employment with the purchaser; • Outsourcing of services to a service provider or vendor in which the Employee is not offered employment (whether comparable or otherwise) with such service provider or vendor; • Location, facility or plant closing; or • An Employee’s demonstrated insufficient aptitude for continued employment by the Company, not attributable to any willful cause or lack of effort. For avoidance of doubt: Without Cause shall not include an Employee’s termination of employment with the Company, as determined in the sole discretion of the Committee, in connection with his or her: 1. Failure to perform faithfully and diligently his or her duties for the Company; 2. Unsatisfactory or poor work performance, attributable to willful cause or lack of effort; 3. Neglect of duty; 4. Violation of Company rules or policies, including its Code of Conduct, Time Off and Leave Policies and any employee handbook that may be adopted by the Company; 5. Tardiness or absenteeism; 6. Intimidating, threatening or violent conduct, including fighting; 7. Reporting for work while under the influence of alcohol, or drugs not taken under the direction of a licensed physician; 8. Sale or use of alcohol or drugs on Company premises, with the exception of alcohol consumption associated with a Company sanctioned event at which alcohol is served; 9. Engaging in harassing or inappropriate conduct; 10. Conviction of or plea of guilty or no contest to (or accepting deferred adjudication of) a felony or any other crime that, in the judgment of the Committee, renders the Employee unsuitable for employment with the Company; 11. Causing the Company to commit a violation of any federal, state or local law or regulation; 12. Misconduct, including without limitation dishonesty, insubordination, misappropriation of confidential information, engaging in a conflict of interest, breach of a confidentiality agreement, theft, breach of a duty of loyalty to the Company, or failure to comply with applicable laws or governmental regulations with respect to the Company, the operations of any affiliate of the Company, or the Employee’s own actions;

SEVERANCE PLAN | 11-2 13. Other conduct contrary to the interests of the Company; 14. Failure to return from an approved leave of absence; or 15. Lay-off that is expected to be short term.

Year of Service A Year of Service is a 12 consecutive-month period, beginning on the Hire Date or, for transferred Eligible Employees, Adjusted Service Date, as reflected in each Company’s Human Resources records, and each subsequent anniversary of such Hire Date or Adjusted Ser- vice Date.

SEVERANCE PLAN | 11-3 • Part-Time Employee (Employee working less than 30 hours per INTRODUCTION week) • Leased Employee Berryville Graphics, Inc. and Coral Graphic Services, Inc., including its Dynamic Graphic Finishing division, which are • Employee subject to a collective bargaining agreement part of BE Printers America, a division of Bertelsmann, Inc., • Individual designated by the Company as an independent strive to maintain stable employment however, under certain contractor or consultant, regardless of whether such individual circumstances, employment terminations may occur. The purpose is subsequently re-characterized as having been an Employee of this Severance Plan (the “Plan”) is to provide financial support during the period he or she was performing services for the and continuation of certain benefits, for a pre-determined time, to Company. In the event that an Independent Contractor is eligible employees of those BE Printers America companies listed subsequently hired or re-characterized as a regular, full time as participating companies on Appendix A, hereto (collectively, the Employee, any severance calculation will be based on the “Company”). date of such rehire or re-characterization from Independent The Plan constitutes an amendment and restatement, effective Contractor to full-time Employee, and no period during which May 1, 2015, of the Berryville Graphics – Severance Plan, originally the individual was characterized by the Company as an effective December 1, 1987, and supersedes the original plan in Independent Contractor shall be taken into account in the its entirety with respect to Eligible Employees who are terminated calculation of severance from employment on or after May 1, 2015. The terms of the original • Intern, or plan will continue to apply to employees of Berryville Graphics, Inc. whose employment is terminated prior to May 1, 2015. The Plan, • Employee who at the time of termination of employment enters as amended and restated, is effective May 1, 2015 supersedes into or has entered into a written employment agreement and replaces any prior workforce reduction, job elimination, or (whether or not it provides for severance benefits) or separate severance policies, programs or practices that may have been severance agreement, plan or arrangement with the Company, applicable to employees of the Company, its parent companies, either of its parents, a joint venture partner of any of the or any predecessor of the Company or its parent companies. The foregoing, or any affiliate or subsidiary of the Company, or any Plan is intended to be an employee welfare benefit plan as defined Employee who is eligible for severance or termination pay or in the Employee Retirement Income Security Act of 1974, as benefits pursuant to any agreement, including an employment amended (“ERISA”). agreement, with the Company, either of its parents, a joint venture partner of either, or any affiliate or subsidiary of the This document contains the official text of the Plan and also Company unless (i) such agreement specifically provides that serves as the SPD. Benefits under the Plan are determined by the the Employee will be eligible to receive benefits under this terms of this Plan document. Plan or under any predecessor plan of one of the Company’s The Plan Sponsor reserves the right, whether in an individual case parents or (ii) otherwise determined by the Company in its sole or more generally, to amend, suspend, or terminate the Plan at any discretion. time, with or without advance notice. Any such amendment may Plan participation is automatic for any eligible Employee; no cause the cessation and discontinuance of severance benefits enrollment is necessary. to any person under the Plan except for participants who have executed and not rescinded a waiver and release. Participation in this Plan is provided to eligible employees COVERED TERMINATIONS and does not constitute a guarantee of employment, requires continued employment and eligibility and is subject to the terms If a Participant’s employment is involuntarily terminated by the and conditions of the plan document. Company Without Cause, the Participant will be entitled to a After you have read this information, please contact your local Severance Benefit, provided that: Human Resources Representative if you have any questions. • Participant remains employed as an Eligible Employee until the termination date determined by the Company in its sole discretion, and ELIGIBILITY AND • Within the time period specified, Participant signs an Agreement PARTICIPATION and General Release provided by the Company that includes, without limitation: An Employee who has satisfactorily completed the orientation o An effective general release of all claims or liabilities of any period, if any, is eligible to participate in the Plan if he or she is an kind against the Company, its parents, joint venture partners exempt or non-exempt salaried or hourly Employee of one of the of the Company and its parents, subsidiary and affiliated participating companies listed in Appendix A, each of which is companies and each of their respective directors, officers, included in the definition of Company under this Plan: employees and shareholders, and, as applicable and to the extent permitted by law, An individual who falls into any one or more of the following categories is not eligible to participate in the Plan: o Provisions relating to, among other things, confidentiality, cooperation, non-disparagement, return of company • Temporary Employee property, non-solicitation and eligibility for re-employment.

SEVERANCE PLAN | 11-4 SEVERANCE PLAN BENEFITS

If a Participant is entitled to a Severance Benefit, the amount will be based upon length of actual service according to Participant’s Hire Date or Adjusted Service Date, using the following guidelines:

Service* Severance Benefit Less than 6 months None 6 months to 2 years 2 weeks 3 to 10 years 1 week per year of service More than 10 years Additional 2 weeks More than 15 years Additional 2 weeks More than 20 years Additional 2 weeks More than 25 years Additional 2 weeks More than 30 years Additional 2 weeks More than 35 years Additional 2 weeks More than 40 years Additional 2 weeks More than 45 years Additional 2 weeks More than 50 years Additional 2 weeks * Partial years are not prorated.

Example For 20 years of service, the severance benefit would be 14 weeks. 10 = 1 week per year of service for the first 10 years + 2 = additional 2 weeks for exceeding 10 years + 2 = additional 2 weeks for exceeding 15 years 14 weeks total

Payment of Benefit After expiration of the Severance Benefit Period, the Participant A Participant may elect either one of the following options with will be responsible for paying the full monthly premium, including regard to payment of the Severance Benefit, provided that such the 2% administrative charge, for the remainder of any coverage election is made on the form provided by Human Resources and period available under COBRA. Premiums during the Severance such election is received by Human Resources prior to the date Benefit Period will be based on applicable active employee rates in the Participant signs the Agreement and General Release required effect at the applicable time. under “Covered Terminations” above: A Participant who elects a one-time, lump-sum payment as the • One time, lump-sum payment; or payment option may elect COBRA continuation coverage in • Salary continuation accordance with applicable law at the full COBRA rate without A Participant who elects salary continuation as the payment reduction by the company subsidy, as follows: The Participant option may elect COBRA continuation coverage in accordance will pay the full monthly COBRA premium rate, including the 2% with applicable law at a reduced (company-subsidized) rate administrative charge, for the entire period of COBRA continuation during the period of time the Severance Benefit is paid (the coverage. “Severance Benefit Period), as follows: The Company will pay a portion of the COBRA premium equal to the Company share of Maximum Base and Supplementary Benefit the applicable premium for active employee coverage and the In no instance will the total of the Severance Benefit exceed two Participant will pay the Participant share of the applicable active (2) times the lesser of (i) the Participant’s annual compensation employee rate plus the applicable COBRA administrative charge for the preceding calendar year, or (ii) the tax-qualified plan of 2%. The applicable premium will be based on the coverage compensation limit (2 x $265,000, or $530,000, for 2015). The tier (e.g., Employee only, Employee + spouse, etc.) the Participant payment of all cash Severance Benefits must be completed no was enrolled in at the time of termination of employment. The later than December 31 of the second calendar year following the premium subsidy will apply to any covered dependents (e.g., year of the Participant’s termination. Each payment of the cash spouse or child) for whom COBRA coverage is elected based on Severance Payments made through salary continuation is treated the Participant’s termination even if the Participant waives COBRA as a separate payment for purposes of the short term deferral coverage for himself or herself. exemption under Section 409A of the Internal Revenue Code. SEVERANCE PLAN | 11-5 Additional Benefits Death Benefits The Company may, in its sole discretion, pay an additional cash If a Participant who has elected to receive the Severance Benefit severance amount to any one or more Participants. This additional as salary continuation dies before the last of such payments has severance will be payable as a lump-sum payment, and is not been made, the unpaid portion of such Severance Benefit, if any eligible for salary continuation or benefits subsidy. A Participant’s (not including any company-subsidized COBRA continuation right to any additional amount of severance under this Plan coverage), will be paid in a lump sum to the beneficiary (or shall be determined in accordance with the terms of any written beneficiaries) designated by the Participant on a form provided document which specifies the amount and time of such additional by Human Resources. Unsubsidized COBRA coverage will be lump-sum payment and is addressed to the Eligible Employee available in accordance with applicable law to any dependents from the Vice President of Finance/Chief Financial Officer, or the receiving medical coverage on the date of the Participant’s death, President and Chief Executive Officer of each of the Companies, at their own expense. to the extent such positions exist. No other Employee of the Company is authorized to grant additional severance pay. Re-employment by the Company In the event a Participant who is receiving or has received a Reduction, Offset or Termination of Benefits Severance Benefit becomes re-employed or engaged (including Unless the Committee, in its sole discretion, provides otherwise in as a Leased Employee, Independent Contractor, Part-Time writing, in the event that the Company provides paid leave to an Employee, or Temporary Employee) during the Severance Benefit Employee instead of advance notice of his or her termination of period (whether paid as salary continuation or in a single sum) employment in accordance with the requirements of the Worker by the Company, either of its parents, a joint venture partner of Adjustment and Retraining Notification Act (or other similar federal any of the foregoing, or any affiliate or subsidiary of the Company or state statute), then the amount of such Employee’s Severance or of any successor company, he or she will forfeit the right to Benefit will be reduced (but not below zero) by the amount of pay receive any further Severance Benefits effective as of the date received by the Employee during the period of paid leave. Any the re-employment (or rendering of services) commences. If the such leave will be counted in determining the Employee’s Years of Severance Payment was paid in a single sum, then as a condition Service. of re-employment (or payment for rendering of services as set forth above), the Participant shall reimburse the Company for the The Company reserves the right to offset any Severance Benefit amount of Severance Payments previously paid that exceeds the by any advance or other monies an Employee owes to the Weekly Base Compensation multiplied by the number of weeks Company to the extent allowed by applicable law. between the Participant’s Termination Date and the date of re- In the event a Participant discloses to any unauthorized person employment or engagement. A former Employee is required to information relating to the business of the Company which is notify a Human Resources Generalist of the Company immediately confidential or breaches any contract or employment agreement upon accepting any offer of employment or engagement with or violates any legal obligation to the Company, or if the (including but not limited to employment as a Leased Employee, Company acting in good faith determines that it has a claim Independent Contractor, Part-Time Employee, or Temporary against a Participant that relates back directly or indirectly to his Employee), or any other offer of payment in connection with the employment with the Company, the Committee shall have the rendering of services from the Company, either of its parents, right to suspend payment to or for the benefit of the Participant any joint venture partner of any of the foregoing, or any affiliate under the Plan and/or to offset the benefit otherwise payable to or subsidiary of the Company or from any successor to the the Participant under the Plan and /or to require the repayment to Company. the Company (i.e., to claw back) any benefits already paid to the extent deemed necessary to satisfy any debt or other amount that the Committee, acting in good faith, determines is owed by the Participant to the Company to the extent allowed by applicable law.

Payment of Severance Benefit A Participant may elect between receiving the total of the Severance Benefit as a one-time, lump-sum payment or as salary continuation payable in accordance with the Company’s regular payroll practices, less applicable federal, state and local taxes and other required deductions, provided that such election is made on the form provided by Human Resources and such election is received by Human Resources prior to the date the Participant signs the Agreement and General Release required under “Covered Terminations” above.

SEVERANCE PLAN | 11-6 WHAT IS NOT COVERED

Except as may be provided in any written employment agreement between any Employee and the Company, an Employee will not be entitled to any Severance Benefits under this Plan if: • He or she voluntarily resigns, retires, or otherwise terminates employment with the Company; • His or her separation from services is due to death or Disability; • His or her employment is terminated by the Company for any reason other than Without Cause; • He or she is not an Eligible Employee at the time of separation from service; • He or she is not working because operations have been limited, interrupted or suspended due to a strike, work stoppage or slowdown, lockout, civil disturbance or other circumstance beyond the Company’s control; • He or she (i) is offered and accepts employment (whether comparable or otherwise) or (ii) is offered but does not accept comparable employment, in either case with the purchaser, in connection with the sale or transfer of the Company or of a business, branch, division, operation or subsidiary or the sale of all or substantially all of the assets thereof; • He or she (i) is offered and accepts employment (whether comparable or otherwise) or (ii) is offered but does not accept comparable employment, in either case with the Company, any of the Company’s parents, with a joint venture partner of the Company or any of its parents, or with any affiliate or subsidiary of the Company (including in connection with a transaction described in the previous bullet where he or she does not accept employment or is not offered comparable employment with the purchaser); or • He or she fails to timely sign and return the Agreement and General Release or, if applicable, revokes the Release within the time period specified therein.

WHEN COVERAGE ENDS

Coverage under the Plan ends on the earlier of the date when: • The Employee no longer meets the Plan’s eligibility and participation requirements, including as a result of the Company’s amendment of the Plan or a change in the Employee’s employment status, or • BE Printers America through the Plan Sponsor discontinues the Plan or the Company that employs the Employee discontinues participation in the Plan.

SEVERANCE PLAN | 11-7 OTHER IMPORTANT INFORMATION

This section provides important administrative information concerning the Plan.

Name of Plan: BE Printers America Severance Pay Plan (f/k/a Berryville Graphics – Severance Plan)

Plan Number: 510

Type of Plan: The Plan is an employee welfare benefit plan.

Plan Sponsor: Berryville Graphics, Inc. c/o Human Resources Department 25 Jack Enders Blvd. Berryville, VA 22611

Plan Administrator Severance Plan Committee c/o Berryville Graphics, Inc. Human Resources Department 25 Jack Enders Blvd. Berryville, VA 22611

Employer Identification Number: Berryville Graphics, Inc. –13-3634870

Plan Year: December 1 through November 30

Agent For Service of Legal Process: Chief Legal Counsel c/o Bertelsmann, Inc. 1745 Broadway, 20th Floor New York, NY 10019 Service of legal process may also be made upon the Plan Administrator.

Plan Funding: Benefits under the Plan are paid from the general assets of the Company. No assets of the Company will be segregated from other assets for purposes of the Plan. Benefits under the Plan are unsecured.

Plan Administration The Committee shall be the Plan “Administrator” within the be conclusive and final, subject to review or correction only to meaning of section 3(16) of ERISA and shall have the overall the extent that such a decision, determination or construction responsibility for the operation of the Plan. Any member of is shown by clear and convincing evidence to be arbitrary and the Committee may resign at any time by giving notice to the capricious. Company. Any resignation shall take effect on the date of receipt The Committee may delegate some or all of its authority under the of such notice or at any later date specified in the notice. No Plan to any person or persons provided that any such delegation member of the Committee shall receive any compensation for is in writing. his or her services as a member of the Committee. A majority of the members of the Committee shall constitute a quorum for the Claims Procedure transaction of business. All resolutions or other actions taken by the Committee shall require the written approval or affirmative vote If the Plan Administrator determines that a Participant is entitled of a majority of the members of the Committee. to a Severance Benefit, the Company will provide the Severance Benefit to the Participant in accordance with this Plan and the The Committee shall have all discretionary powers necessary to Participant will not have to file a claim. If the Participant disagrees carry out its duties and the provisions of the Plan, including but with the Committee’s determination of eligibility for a Severance not limited to, the absolute discretionary authority to interpret or Benefit or the amount of the Severance Benefit, the Participant construe the Plan, to resolve ambiguities, to make determination may file a written claim for benefits with the Committee. of questions of eligibility, participation and benefits and all other related or incidental matters. The Committee’s decisions will

SEVERANCE PLAN | 11-8 The Participant must file a claim for a Severance Benefit no later Amendment and Termination of the Plan than one year after the date Participant’s employment with the The Plan Sponsor reserves the right to amend, modify or Company terminates. Any claim not made within that time period discontinue all or any part of the Plan for any reason at any time is waived. The Participant must exhaust the claim procedures and without prior notice and any such action shall apply to existing described in this section prior to pursuing any other remedy. as well as future Employees. The Committee will review the Participant’s claim pursuant to its discretionary authority to administer and interpret the Plan and to Employment Rights determine eligibility for Severance Benefits. The Committee will Nothing in the Plan shall be deemed to give any person any right notify the Participant in writing of its decision within 90 days of to remain in the employ of the Company or to affect the right of the receiving the Participant’s claim. If special circumstances require Company to terminate the employment of any person at any time, an extension of time (not to exceed an additional 90 days) for with or Without Cause. processing any claim, the Committee will so notify the Participant in writing prior to the expiration of the initial 90-day period. Severability If a claim for Severance Benefits is denied (in whole or part), the If any provision of the Plan is held invalid or unenforceable, its written notice of denial will state the reason for the denial, the invalidity or unenforceability will not affect any other provisions of pertinent Plan provision(s) upon which the denial is based, any the Plan, and the Plan will be construed and enforced as if such additional information that may be needed (including the reason provision had not been included in this document. such additional information is needed) and the steps that may be taken to obtain further review of the Participant’s claim. Taxes The Participant or Participant’s authorized representative may review all documents related to any denial of benefits. If the To the extent required by law, the Company will withhold taxes Participant disagrees with the Committee’s decision, Participant from any Severance Benefit payable hereunder. The Company has 60 days from the receipt of the original denial to appeal. The makes no representations concerning the tax treatment under appeal should be in writing and sent to: federal, state or local laws about any Severance Benefit paid under the Plan. The Participant should consult with his or her own Severance Plan Committee accountant or tax advisor in this regard. c/o Berryville Graphics, Inc. Human Resources Department No Assignment; Binding Effect 25 Jack Enders Blvd. Berryville, VA 22611 No Participant or his or her estate has the right to alienate, assign, commute or otherwise encumber any benefit under this Plan for No later than 60 days after receiving the appeal, the Committee any purpose whatsoever and, except to the extent prohibited will notify the Participant in writing of its final decision on the claim. by applicable law, any attempt to do so will be disregarded If special circumstances require an extension, the Participant will completely as null and void. The provisions of this Plan are binding be so notified in writing. The written notice will state the reason for on each Participant and former Participant, as well as such the Committee’s final decision and the pertinent Plan provision(s) individuals’ respective estates and the Company. upon which it is based.

No action at law or in equity may be brought in court on a claim Governing Law for benefits under this Plan after the later of one year from the date To the extent not preempted by ERISA or other federal law, the of the decision on review (or if no decision is furnished within 120 Plan will be construed and enforced in accordance with the laws days of receipt of the request for review, one year after the 120th of the State of New York. day after receipt of the request for review). Failure to file suit within this time period shall extinguish any right to benefits under the Plan.

SEVERANCE PLAN | 11-9 Statement of ERISA Rights Participants in the Plan are entitled to certain rights and protections under ERISA. ERISA provides that all Plan Participants shall be entitled to: • Examine without charge, at the Committee’s office and at other specified locations, such as work sites, all documents governing the Plan. If the Plan is required to file an annual report (Form 5500 series), the Participant can obtain a copy of the latest annual report from the Plan Administrator or at the Public Disclosure Room of the Employee Benefits Security Administration. • Obtain copies of all Plan documents and other information governing the operation of the Plan upon written request to the Committee. The Committee may make a reasonable charge for copies.

In addition to creating rights for Plan participants, ERISA The court will decide who should pay court costs and legal fees. If imposes certain duties upon the people who are responsible the Participant is successful, the court may order the person the for the operation of employee benefit plans. The people who Participant has sued to pay the costs and fees. If the Participant operate the Plan, called “fiduciaries” of the Plan, have a duty to loses, the court may order the Participant to pay these costs and do so prudently and in the interest of all Plan participants and fees, for example, if it finds the claim frivolous. beneficiaries. No one, including the Participant’s employer, may If you are the Participant and you have any questions about the terminate any Participant’s employment or otherwise discriminate Plan, you should contact the Committee. If you have any questions against the Participant in any way to prevent the Participant from about this statement or about your rights under ERISA, you should obtaining a benefit or exercising any of Participant’s rights under contact the nearest office of the Employee Benefits Security ERISA. Administration, U.S. Department of Labor, listed in your telephone If a Participant’s claim for a benefit is denied in whole or in part, directory, or you may write to the Division of Technical Assistance the Participant must receive a written explanation of the reason and Inquiries, Employee Benefits Security Administration, U.S. for the denial. The Participant has the right to have the Committee Department of Labor, 200 Constitution Avenue, N.W., Washington, review and reconsider the claim. Under ERISA, there are steps DC 20210. the Participant can take to enforce these rights. For instance, if a Participant requests materials from the Committee and does not receive them within 30 days, the Participant may file suit in a federal court. In such a case, the court may require the Committee to provide the materials and pay the Participant up to $110 a day until the Participant receives the materials, unless the materials were not sent because of reasons beyond the control of the Committee. If the Participant has a claim for benefits denied or ignored, in whole or in part, the Participant may file suit in a state or federal court. If it should happen that the Plan fiduciaries misuse the Plan’s money, or if the Participant is discriminated against for asserting Participant’s rights, the Participant may seek assistance from the U.S. Department of Labor, or may file suit in a federal court.

SEVERANCE PLAN | 11-10 Internal Revenue Code Section 409A Compliance with Section 409A. This Plan is intended to meet acceleration of payment by the Company under Section 409A, the exemption for severance benefits plans, short-term deferrals, payment of such non-exempt amounts shall be accumulated reimbursement arrangements and in-kind benefits and the and the Participant’s right to receive payment or distribution of COBRA exemption. Accordingly, the Plan shall be interpreted and such accumulated amounts will be delayed (without the payment administered in a manner so that any amount payable or benefit of interest) until the earlier of the Participant’s death or the first provided hereunder shall be paid or provided in a manner and at day of the seventh month following the Participant’s “separation such time and in such form that is either exempt from or compliant from service”. For purposes of this Plan, the term “specified with the applicable requirements of Section 409A of the Internal employee” has the meaning given such term in Section 409A, Revenue Code of 1986, as amended, and applicable guidance provided, however, that the Company’s “specified employees” and regulations issued thereunder (“Section 409A”). Nevertheless, and its application of the six-month delay rule shall be determined the tax treatment of the benefits provided under the Plan are not in accordance with rules adopted by the Company, which shall warranted or guaranteed. Neither the Company nor any of its be applied consistently with respect to all nonqualified deferred directors, officers, employees or advisors shall be held liable for compensation arrangements of the Company and all members of any taxes, interest, penalties or other monetary amounts owed by its controlled group, including this Plan. the Participant as a result of the application of Section 409A. Treatment of Installment Payments. Each payment of Payments Upon Termination of Employment. Notwithstanding Severance Benefits, without limitation, each installment payment anything in this Plan to the contrary, to the extent that any and each payment or reimbursement of premiums for continued amount or benefit that would constitute non-exempt “deferred Medical, Dental or Life Insurance coverage, shall be considered a compensation” for purposes of Section 409A would otherwise be separate payment. payable or distributable hereunder by reason of the Participant’s Timing of Reimbursements and In-Kind Benefits. If the termination of employment, such amount or benefit will not be Participant is entitled to be paid or reimbursed for any taxable payable or distributable to the Participant by reason of such expenses and such payments or reimbursements are includible circumstance unless (i) the circumstances giving rise to such in the Participant’s federal gross taxable income, the amount of termination of employment meet any description or definition of such expenses reimbursable in any one calendar year shall not “separation from service” in Section 409A (without giving effect to affect the amount reimbursable in any other calendar year, and any elective provisions that may be available under such definition), the reimbursement of an eligible expense must be made no later or (ii) the payment or distribution of such amount or benefit would than December 31 of the year after the year in which the expense be exempt from the application of Section 409A by reason of was incurred. No right of Executive to reimbursement of expenses the short-term deferral exemption or otherwise. This provision shall be subject to liquidation or exchange for another benefit. Any does not prohibit the vesting of any amount upon a termination payment or reimbursement of expenses shall be for expenses of employment, however defined. If this provision prevents the incurred during the Participant’s lifetime (or during a shorter period payment or distribution of any amount or benefit, such payment of time specified in this Plan). or distribution shall be made on the date, if any, on which an event occurs that constitutes a Section 409A-compliant “separation Timing of Release of Claims. Except for payments that are from service.” exempt from Section 409A, whenever a payment or benefit is conditioned on the Participant’s execution and non-revocation Delay of Payment to Specified Employees. If any amount of a release of claims, such release must be executed and all that would constitute non-exempt “deferred compensation” revocation periods shall have expired within 60 days after the for purposes of Section 409A would otherwise be payable date of termination; failing which such payment or benefit shall be or distributable under this Plan by reason of the Participant’s forfeited. Subject to the Delay of Payment to Specified Employees “separation from service” at a time (i) when any shares of stock of described above, such payment or benefit (including any the Company or any member of its controlled group are traded on installment payments) that would have otherwise been payable an “established securities market,” and (ii) during a period in which during such 60-day period shall be accumulated and paid on the the Participant is treated as a “specified employee” (as such terms 60th day after the date of termination provided such release has are defined in Section 409A), then, subject to any permissible been executed and such revocation periods shall have expired.

SEVERANCE PLAN | 11-11 APPENDIX A

PARTICIPATING COMPANIES

Plan Sponsor • Berryville Graphics, Inc.

Other Participating Companies • Coral Graphic Services, Inc. (including its Dynamic Graphic Finishing division)

SEVERANCE PLAN | 11-12