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Centennial School District

DEPENDENT CARE ASSISTANCE PLAN

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TABLE OF CONTENTS

ARTICLE I - INTRODUCTION

1.1 / Adoption of the Plan
1.2 / Effective Dates
1.3 / Purpose
ARTICLE II - DEFINITIONS

ARTICLE III - PARTICIPATION

3.1 / Eligibility
3.2 / Commencement of Participation
3.3 / Term of Participation
3.4 / Treatment of Rehired Employees
3.5 / Change in Participant Election

ARTICLE IV – CONTRIBUTIONS AND BENEFITS

4.1 / Funding
4.2 / Benefits
4.3 / Amounts Paid in Error
4.4 / Nondiscrimination
4.5 / Maximum Benefits
4.6 / Forfeiture (Use-it-or-lose-it-Rule)

ARTICLE V - PLAN ADMINISTRATION

5.1 / Employer's Duties
5.2 / Information to be Provided to Employer
5.3 / Interpreting Plan Terms
5.4 / Misstatements
5.5 / Review Procedures
5.6 / Rules to Apply Uniformly

ARTICLE VI - GENERAL PROVISIONS

6.1 / Amendment and Termination
6.2 / Nonassignability
6.3 / Not an Employment Contract
6.4 / Participant Litigation
6.5 / Addresses
6.6 / Required Information
6.7 / Severability
6.8 / Applicable Law

DEPENDENT CARE ASSISTANCE PLAN

ARTICLE I

INTRODUCTION

1.1 Adoption of the Plan. This Dependent Care Assistance Plan has been adopted and executed by the Employer.

1.2 Effective Dates. The provisions of this Plan are effective on July 1, 2011. The Employer’s Dependent Care Plan was originally effective July 1, 1999.

1.3. Purpose. The purpose of the Plan is to provide reimbursement for certain Dependent Care Expenses of Participants not otherwise covered by insurance or by the Employer. The Employer intends that the Plan qualifies as a dependent care assistance plan under Section 129(d) of the Code, and that the benefits provided under the Plan be eligible for exclusion from Participants' income under Section 129 of the Code.

ARTICLE II

DEFINITIONS

As used in this Plan document, the following terms will have the following meanings:

2.1 "Change in Status" A Change In Status is an event that allows a Participant to change their contribution election during the Plan Year, and outside of the scheduled open enrollment period. The Employer has elected to allow all of the Change in Status reasons published by the IRS for this type of Plan.

2.2 "Code" the Internal Revenue Code of 1986, as amended.

2.3 "Compensation" all the earned income, salary, wages and other earnings paid by the Employer to a Participant during a Plan Year, including any amounts contributed by the Employer pursuant to a salary reduction agreement which are not includable in gross income under Sections 125, 129, 402(a)(8), 402(h), 403(b) or 457(b) of the Code.

2.4 "Dependent" an individual who is a dependent within the meaning of Section 152(a) of the Code of a Participant in the Plan.

2.5 "Dependent Care Expenses" expenses incurred by a Participant for the care of a Qualified Person or for related household services which would be considered employment-related expenses under Section 21(b)(2) of the Code.

2.6 "Eligible Employee" an Employee, as defined below, who is eligible to participate in the Employer's health care program, limited to employees who regularly work at least 40 hours per week, and not including Employees who are Non-Resident Aliens (within the meaning of section 7701(b)(1)(B) of the Code deriving no earned income (within the meaning of section 911(d)(2) of the Code) from the Employer which constitutes income from sources within the United States (within the meaning of section 861(a)(3) of the Code).

2.7 "Employee" a person who is currently or hereafter employed by the Employer, or by any other employer aggregated under sections 414(b), (c), (m), (n) or (o) of the Code and the regulations there under, including a Leased Employee subject to section 414(n) of the Code. Individuals who are not contemporaneously classified as Employees of the Employer for purposes of the Employer's payroll system (including, without limitation, individuals employed by temporary help firms, technical help firms, staffing firms, employee leasing firms, professional employer organizations or other staffing firms whether or not deemed to be "common law" Employees or "Leased Employees" within the meaning of section 414(n) (o) of the Code) are not considered to be Eligible Employees of the Employer and will not be eligible to participate in the Plan. In the event any such individuals are reclassified as Employees for any purpose, including without limitation, common law or statutory employees, by any action of any third party, including, without limitation, any government agency, or as a result of any private lawsuit, action, or administrative proceeding, such individuals will notwithstanding such reclassification, remain ineligible for participation hereunder. Notwithstanding foregoing, the exclusive means for individuals who are not contemporaneously classified as an Employee of the Employer on the Employer's payroll system to become eligible to participate in this Plan is through an amendment to this Plan, duly executed by the Employer, which specifically renders such individuals eligible for participation hereunder.

The Employer will have full and complete discretion to determine eligibility for participation and benefits under this Plan, including, without limitation, the determination of those individuals who are deemed Employees of the Employer (or any controlled group member). The Employer's decision will be final, binding and conclusive on all parties having or claiming a benefit under this Plan. This Plan is to be construed to exclude all individuals who are not considered Employees for purposes of the Employer's payroll system, and the Employer is authorized to do so, despite the fact that its decision may result in the loss of the Plan's tax qualification.

2.8 "Employer"Centennial School District or any of its affiliates, successors or assignors which adopt the Plan.

2.9 "Participant" any Employee who has met the eligibility requirements of this Plan and has elected to participate in the Plan.

2.10 "Plan Year" means the 12-consecutive month period, July 1st through June 30th.

2.11 Qualifying Person: All child and Dependent Care Expenses must be for the care of one or more Qualifying Persons. A Qualifying Person is:

(a) A child whom is claimed as the Participant’s Dependent and who was under the age of 13 when the care was provided:

(b) A Participant’s Spouse who was physically or mentally not able to care for himself or herself and lived with the Participant for more than half of the year;

(c) A person who was physically or mentally not able to care for himself or herself and lived with the Participant for more than half of the year, and either:

(1) Was the Participant’s Dependent:

(2) Would have been the Participant’s Dependent except that:

i) He or she received gross income equal to or in excess of the exemption amount for dependents under Internal Revenue Code § 151(d):

ii) He or she filed a joint return;

iii) The Participant, or the Participant’s spouse if filing jointly, could be claimed as a Dependent on someone else’s federal tax return.

Child of divorced or separated parents: Even if a Participant cannot claim a child as a Dependent, he or she is treated as a Qualifying Person if:

(a) The child was under the age of 13 or was physically or mentally not able to care for himself or herself;

(b) The Participant was the child’s custodial parent (the parent with whom the child lived for the greater part of the calendar year), and

(c) The non-custodial parent is entitled to claim the child as a Dependent under the special rules for a child of divorced or separated parents.

If this applies, the non-custodial parent cannot treat the child as a Qualifying Person.

"Salary Reduction Agreement" the agreement authorizing the Employer to reduce the Employee's Compensation while a Participant for purposes of obtaining Dependent Care Reimbursement Benefits under this Plan.

2.12 "Spouse" means an individual who is legally married to a Participant but will not include an individual separated from a Participant or under a decree of legal separation.

ARTICLE III

PARTICIPATION

3.1 Eligibility.Each Eligible Employee is eligible to participate in the Plan on their date of hire, or the date on which the Employee otherwise becomes eligible to participate as defined in this Plan Document or by applicable law, so long as the Employee is employed by the Employer on the day they are enrolled. The Employee’s election must be delivered to the Employer within 30 days of the date of hire.

3.2 Commencement of Participation. An Eligible Employee is required to execute a Salary Reduction Agreement setting forth the amount of pretax funds to be made available to the Eligible Employee for the immediately following Plan Year or remaining portion of the Plan Year. The Participant must, before the end of the first Plan Year of participation and, before the end of each subsequent Plan Year, provide the Employer with a newly executed Salary Reduction Agreement. Each new agreement will specify the amount to be made available to the Participant for the immediately following Plan Year or remaining portion of the Plan Year covered by the agreement. Should a Participant fail to execute a valid Salary Reduction Agreement for any Plan Year before the start of the Plan Year, the Participant will be ineligible to participate in the Plan for that Plan Year.

3.3 Term of Participation.Each Participant will be enrolled in the Plan for the entire Plan Year or the portion of the Plan Year remaining after enrollment, or until the earlier of:

(a) the Participant dies, resigns or terminates employment with the Employer;

(b) the Participant fails to make required contributions under the Plan;

(c) the Participant ceases to be an eligible Employee;

(d) the Plan terminates; or,

(e) the Participant revokes their election under a Change In Status.

3.4 Treatment of Rehired Employees.A Participant whose employment terminates and is subsequently re-employed within 30 days of their separation of service and within the same Plan Year will immediately rejoin the Plan with the same Benefit elections. Should the Participant return within 30 days of their separation of service during the following Plan Year, the Participant will be allowed to change elections through the Open Enrollment process.

A Participant whose employment terminates and who is subsequently re-employed with more than 30 days separation of service will need to re-satisfy Plan eligibility requirements to rejoin the Plan. Any unused reimbursement Benefits Accounts balance prior to the initial separation of service date will be forfeited.

3.5 Change in Participant Election. No Participant will be allowed to alter or discontinue their annual election during a Plan Year except when due to and consistent with a Change in Status. Change In Status requests must be made within 30 days of the Change In Status event and must be consistent with the actual Change In Status event. Upon the occurrence of a Change in Status, the Participant will file a new Salary Reduction Agreement, which will serve to revoke the Participant's previous Salary Reduction Agreement. The new Salary Reduction Agreement, if determined by the Employer to be timely submitted and consistent with the Status Change, will be effective prospectively and apply only to those Benefits accruing to the Participant after the effective date of the new Salary Reduction Agreement. The Employer will determine if the new Salary Reduction Agreement has been timely submitted consistent with the nature of the Change in Status.

ARTICLE IV

CONTRIBUTIONS AND BENEFITS

4.1 Funding. Contributions to the Plan are made and limited in accordance with the Participant’s annual election as stated on the Participant’s Salary Reduction Agreement. Contributions to the Plan will be accounted for as the Employer deems appropriate. The Participant’s annual election is limited to the lesser of $5,000 (or $2500 in the case of a married Participant that is filing a tax return separately) the Participant’s annual salary, or the Spouse’s annual salary.

4.2 Benefits. Benefits are only provided for the reimbursement of Dependent Care Expenses for a Qualified Person that are incurred during the Plan Year and during the period in which the Employee was a Participant. Benefits are limited to the amount that has actually been withheld from the Participant’s Compensation on the date the claim is processed.

Reimbursement will only be made under the Plan on the basis of Dependent Care Expenses incurred for the care of a Qualified Person, as presented to the Employer on a written form specified by the Employer. It will be the duty of the Employer to construe what are and what are not Dependent Care Expenses subject to reimbursement from a Participant's dependent care reimbursement benefits account. If the Employer determines that an expense is a Dependent Care Expense subject to reimbursement, the Employer will reimburse the Participant for the Dependent Care Expense within a reasonable time. To make the determination that a Dependent Care Expense subject to reimbursement has been incurred, the Employer may require proper evidence of any or all of the following:

(a) the name of the Qualified Person for whom the expenses have been incurred;

(b) the nature of the services incurred;

(c) the date the services were incurred;

(d) the amount of the requested reimbursement; and,

(e) that the expenses have not been otherwise paid through a program offered by the Employer or any other employer, or reimbursed from any other source.

The Employer will be the sole arbiter of what constitutes a Dependent Care Expense subject to reimbursement under the Plan.

In the event of the death of the Participant prior to the payment of any claims, payment will be made in the following priority:

(a)Executor of the Estate of the deceased Participant,

(b)Spouse of decedent.

4.3 Amounts Paid in Error. Upon any benefit payment made in error, the Employer will inform the Participant that they are required to repay the amount that has been paid to or on the behalf of a Participant in error. This includes and is not limited to amounts over the Participant’s annual election, amounts for services that are determined not to be Dependent Care Expense, or when a Participant does not provide adequate documentation to substantiate a claim upon request. The Employer may take reasonable steps to recoup such an amount including reducing the amount of future benefit reimbursements by the amount paid in error.

4.4 Nondiscrimination. The Plan is intended to not discriminate in favor of highly compensated individuals as to eligibility to participate, contributions and benefits in accordance with applicable provisions of the Code. The Employer may take such actions as excluding certain highly compensated employees from participation in the Plan if, in the Employer's judgment, such actions serve to assure that the Plan does not violate applicable nondiscrimination rules.

4.5 Maximum Benefits. Notwithstanding any other provisions of this Plan, no Participant will receive Dependent Care Reimbursement Benefits in excess of their maximum annual election defined and limited in Section 4.1 above. No Participant will be reimbursed in an amount that exceeds their year-to-date contributions as of the date the claim is processed.

4.6 Forfeiture (Use-it-or-lose-it-Rule). A Participant forfeits the amount of their annual election that is in excess of the amount of claims reimbursed for Dependent Care Expenses rendered during any Plan Year. A Participant who is covered on the last day of any Plan Year can submit eligible claims up to the last day of the fourth month following the end of the Plan Year. A Participant who terminates coverage prior to the last day of any Plan Year has 120 days from the date of termination to submit eligible claims.

Upon such forfeiture, the Participant's accrual will be reduced to zero. Forfeited funds can be retained by the Employer, or at the discretion of the Employer, forfeitures of benefits under the Plan can be reallocated to Participants in any reasonable manner that has no relation to prior claims history. Forfeitures of benefits may also be applied towards the cost of administering the Plan. Forfeitures of benefits will become the sole property of the Employer.

ARTICLE V

PLAN ADMINISTRATION

5.1 Employer's Duties. In addition to any rights, duties or powers specified throughout the Plan, the Employer will have the following rights, duties and powers:

(a) to interpret the Plan, to determine the amount, manner and time for payment of any benefits under the Plan, and to construe or remedy any ambiguities, inconsistencies or omissions under the Plan;

(b) to adopt and apply any rules or procedures to insure the orderly and efficient administration of the Plan;

(c) to determine the rights of any Participant, Spouse, Dependent or beneficiary to benefits under the Plan;

(d) to develop appellate and review procedures for any Participant, Spouse, Dependent or beneficiary denied benefits under the Plan;

(e) to provide the Employer with such tax or other information it may require in connection with the Plan; and,

(f) to employ any agents, attorneys, accountants or other parties (who may also be employed by the Employer) and to allocate or delegate to them such powers or duties as is necessary to assist in the proper and efficient administration of the Plan, provided that such allocation or delegation and the acceptance thereof is in writing.

5.2 Information to be Provided to the Employer. The Employer, or any of its agents, will collect employment records of any employee eligible to participate under the Plan. Such records will include, but will not be limited to, any information regarding period of employment, leaves of absence, salary history, termination of employment, or any other information the Employer may need for the proper administration of the Plan. Any Participant or Dependent or any other person entitled to benefits under the Plan will furnish to the Employer his correct post office address, his date of birth, the names, correct addresses and dates of birth of any beneficiaries, with proper proof thereof, or any other data the Employer might reasonably request to insure the proper and efficient administration of the Plan.

5.3 Interpreting Plan Terms. Any interpretation of any provision of this Plan made in good faith by the Employer as to the terms of this Plan is final and will be binding upon the parties.

5.4 Misstatements. Any misstatement or other mistake of fact will be corrected as soon as reasonably possible upon notification to the Employer and any adjustment or correction attributable to such misstatement or mistake of fact will be made by the Employer as he considers equitable and practicable.

5.5 Review Procedures.In cases where the Employer or a Third Party Administrator denies a benefit under this Plan for any reason, the Employer or Third Party Administrator will provide written documentation of the reasons for their action. The written denial will be provided to the Employee within 30 days of the date of the decision. The written denial will refer to any Plan or section of the Code relied upon in making the decision.