5 Your share of the contribution. The nonelective contribution will be "allocated" or divided among participants eligible to share in the contribution for the Plan Year. Your share of the nonelective contribution is determined by the following fraction: Nonelective Contribution X Your Compensation Total Compensation of All Participants Eligible to Share For example: Suppose the nonelective contribution for the Plan Year is $20,000. Employee A's compensation for the Plan Year is $25,000. The total compensation of all participants eligible to share, including Employee A, is $250,000. Employee A's share will be: $20,000 X $25,000 or $2,000 $250,000 If any related employers (related to the Employer by common ownership) elect to participate in the Plan, the employees of those related employers may become participants. If this occurs, the related employers' nonelective contributions to the Plan will be allocated based on the same method as applies to the Employer. Any nonelective contribution made by a related employer will be allocated only among the employees of the contributing employer who participate in the Plan. How is my service determined for allocation purposes? Hour of Service. You will be credited with your actual Hours of Service for: (a) each hour for which you are directly or indirectly compensated by the Employer for the performance of duties during the Plan Year; (b) each hour for which you are directly or indirectly compensated by the Employer for reasons other than the performance of duties (such as vacation, holidays, sickness, disability, lay-off, military duty, jury duty or leave of absence during the Plan Year) but credit will not exceed 501 hours of service for any single continuous period during which you perform no duties; and (c) each hour for back pay awarded or agreed to by the Employer. You will not be credited for the same Hours of Service both under (a) or (b), as the case may be, and under (c). ARTICLE IV COMPENSATION AND ACCOUNT BALANCE What compensation is used to determine my Plan benefits? All Contributions Definition of compensation. Compensation is defined as your total compensation that is subject to income tax and paid to you by the Employer. If you are a self-employed individual, your compensation will be equal to your earned income. The following describes the adjustments to compensation that apply for the contributions noted above. Adjustments to compensation. The following adjustments to compensation will be made: • elective deferrals to this Plan and to any other plan or arrangement (such as a cafeteria plan) will be included. • compensation paid while not a Participant in the component of the Plan for which compensation is being used will be excluded. • compensation paid after you terminate is generally excluded for Plan purposes. However, the following amounts will be included in compensation even though they are paid after you terminate employment, provided these amounts would otherwise have been considered compensation as described above and provided they are paid within 2 1/2 months after you terminate employment, or if later, the last day of the Plan Year in which you terminate employment: • compensation paid for services performed during your regular working hours, or for services outside your regular working hours (such as overtime or shift differential), or other similar payments that would have been made to you had you continued employment. • compensation paid for unused accrued bona fide sick, vacation or other leave, if such amounts would have been included in compensation if paid prior to your termination of employment and you would have been able to use the leave if employment had continued.