Brooks Employee Handbook

Welcome to Brooks Equipment Company. We prepared this Handbook to give you some basic and important information about Brooks Equipment Company's policies and procedures, and about the benefits and services provided to you as an employee of Brooks Equipment Company. We want you to read it thoroughly as soon as possible, and to ask your supervisor or me any questions that may arise.

This Handbook will remain available for your review at any time during normal work hours. You will receive one copy of the Handbook to keep and one copy will always be in my office. We encourage you to review the Handbook from the to time, and to ask the CFO, your supervisor or me any questions you may have.

This Handbook is a statement of policies and procedures and is not a written contract. In order to retain necessary flexibility, Brooks Equipment Company reserves the right to change or cancel the provisions of this Handbook at any time. Changes to the Handbook will become effective as soon as approved by management and posted on the Company's bulletin board.

As you become more familiar with Brooks Equipment Company, you will see that we provide a pleasant, safe and productive work environment. We need your help to do this. It takes honesty, cooperation, and a positive attitude on the part of all of us. Most of all, it requires two-way communication, an open mind and a willingness to decide our common goals and to work together as a team to achieve them.

This Handbook is the start of that process of communication. We will do our best to keep it alive. With your help, we will do an even better job.

We are glad you have joined our company.

Brooks Equipment Company, Inc.

President

B. EMPLOYEE'S ACKNOWLEDGMENT OF HAVING RECEIVED AND REVIEWED THE EMPLOYEE HANDBOOK

I acknowledge that I have received and reviewed a copy of the Brooks Equipment Employee Policy and Procedure Handbook, (" the Handbook"), adopted and effective as of January 1, 1994.

I understand that it is my responsibility to read and comply with the provisions of the Handbook. I also understand that Brooks Equipment Company reserves the right to change or cancel any of the provisions of the Handbook at any time, without notice, and that changes to the Handbook will become effective as soon as approved by management and posted on the Company's bulletin board.

I further acknowledge that this Handbook is a Statement of policies and procedures and is not a written contract. My employment with Brooks Equipment Company is at will.

IN CONSIDERATION OF MY EMPLOYMENT, I AGREE TO CONFORM TO THE POLICIES OF BROOKS EQUIPMENT COMPANY, AND CONFIRM AND UNDERSTAND THAT MY EMPLOYMENT CAN BE TERMINATED WITH OR WITHOUT NOTICE, AT ANY TIME, AT THE OPTION OF EITHER THE COMPANY OR MYSELF. I UNDERSTAND THAT NO MANAGER OR REPRESENTATIVE OF BROOKS EQUIPMENT COMPANY, OTHER THAN THE PRESIDENT, HAS ANY AUTHORITY TO CHANGE ORALLY ANY PROVISION OF THIS HANDBOOK, OR TO ENTER INTO ANY AGREEMENT FOR ANY SPECIFIED PERIOD OF TIME, OR TO MAKE ANY AGREEMENT CONTRARY TO THE FOREGOING.

I am fully aware that my Supervisor, the CFO, and the President of Brooks Equipment Company are willing to explain any section of the Handbook, which I may wish to discuss, or about which I have a question.

Date:_________________________

Employee Signature

C. ACKNOWLEDGMENT

I acknowledge that the following material was covered with me:

Check

__________________ Employment Application

__________________ Employee's Acknowledgment Form

__________________ W-4 Withholding Form

__________________ Documentation Re: Identity and Authorization to Work

__________________ Payroll Periods

__________________ Hours of Work

__________________ Description of Duties

__________________ Probationary Period

__________________ Employee Classification

__________________ Reporting Personal Changes

__________________ Termination of Employment Policy

__________________ Time Keeping Procedures

__________________ How to Report When Absent or Late

__________________ Absence Policy

__________________ Personal Leave Time

__________________ Equal Employment Opportunity Policy

__________________ Personal Phone Calls and Visits

__________________ Rules of Conduct

__________________ Confidentiality Policy

__________________ Solicitation Policy

__________________ Health, Life, Dental & Disability Benefits

__________________ Tour of Facility and Work Area

__________________ Introduction to Fellow Employees

__________________ Fire and Disaster Plan

I particularly acknowledge as a condition of my initial and continued employment, that I have agreed to safeguard any and all information pertaining to Brooks Equipment Company, its customers, and its management policies and procedures. I will not disclose in any manner such confidential information to any unauthorized users, or to any other party or parties outside Brooks Equipment Company.

II. GENERAL POLICIES AND PROCEDURES

A. EQUAL EMPLOYMENT OPPORTUNITY POLICY

Brooks Equipment Company is any equal opportunity employer, and does not discriminate on the basis of race, color, religion, age, sex, marital status, sexual orientation, national origin, disability, veteran status or any other basis prohibited by federal, state, or local law. This policy covers all aspects of employment relationship, including hiring, training, promotion, transfers, job assignments, compensation, discipline, termination, and application of all of Brooks Equipment Company's policies, procedures and benefits.

B. HARASSMENT POLICY

It is Brooks Equipment Company's goal to maintain a pleasant and productive work environment for its employees. Therefore, all forms of harassment related to an employee's race, color, religion, age, sex, marital status, sexual orientation, national origin, disability or veteran status constitute violations of the Handbook and will be treated as disciplinary matters. In furtherance of this policy, Brooks Equipment Company will not permit the use of racial, religious, age related, sexual or ethnic words or phrases, innuendoes, slurs, or jokes within its facilities. In addition, all forms of verbal and physical harassment based on the above categories are prohibited. As for sexual harassment, unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature are considered instances of sexual harassment when:

* Such behavior has the purpose or effect of unreasonably interfering with an employee's work performance or creates an intimidating, hostile or offensive work environment;

* An employee's submission to or rejection of such conduct is used as the basis of employment decisions which affect the employee; or

* Submission to such conduct is implied or stated to be a term or condition of the employee's continued employment.

It is important to remember that behavior which one individual considers innocent or harmless may be regarded as sexual harassment by another person.

In addition to being a violation of Brooks Equipment Company's policy, sexual harassment is against the law, and Brooks Equipment Company will not tolerate sexual harassment of its employees by anyone, including supervisors, other employees, or individuals conducting business with Brooks Equipment Company. Any employee who violates the harassment policy or our commitment to equal employment opportunity will be subject to immediate disciplinary action, up to and including discharge.

If at any time you feel you have been subjected to verbal or physical harassment, of a sexual nature or otherwise, contact you supervisor immediately so that an investigation can be made and appropriate action taken. If for any reason you do not feel comfortable contacting your supervisor about the matter or feel that contacting your supervisor is inappropriate, contact the President of Brooks Equipment Company and he will initiate an investigation and take appropriate action. The confidentiality of all such inquiries will be respected.

C. PERSONNEL RECORDS

Brooks Equipment Company maintains a personnel file for each employee. This information is an important part of Brooks Equipment Company's personnel and payroll records, and its accuracy is necessary for you to receive your compensation and benefits promptly. Therefore, you are required to immediately advise the Personnel Department in writing of any change in your home address, telephone number, name, banking information, or tax withholding exemption information.

In addition, you are required to advise the Personnel Department of the following events, which may have an impact on insurance coverage for your spouse or dependents:

(a) Divorce or legal separation from your spouse; or

(b) Facts which would affect the coverage of a dependent under the terms of the insurance plan. (For example, a child reaching the maximum age for coverage or child over 19 ceasing to be a full-time student.)

Your personnel file is the property of Brooks Equipment Company and is maintained by the Personnel Department. Access to your file is limited to authorized Brooks Equipment Company personnel or representatives. However, you may inspect its contents if you make advance arrangements with the Personnel Department. Except in cases in which legal orders are presented, your written consent is required for disclosure of information from your file to anyone who is not an authorized Brooks Equipment Company employee, representative or agent.

D. DOCUMENTATION CONCERNING YOUR IDENTITY

The Immigration reform and Control Act of 1986 makes it illegal to hire persons not authorized to work in the United States. This act also requires you to present documents to your supervisor or to the Personnel Department proving your identity and authorization to work.

These requirements will be met if you furnish a driver's license or state-issued identification card which includes a photograph, and a certified birth certificate or original Social Security card. Although these documents should be submitted as soon as possible, they must be supplied by your date of hire. Failure to furnish the documents necessary for compliance with the act could result in termination of your employment.

E. HEALTH AND SAFETY

Immediately report any customer, visitor or employee, on-the-job injury or illness to your supervisor, regardless of how minor it may seem. (Forms for reporting such incidences are contained in your warehouse manual). Also, immediately report to your supervisor prior to returning to work after sustaining any personal or on-the-job injury or illness. A worker who fails to report an injury during the shift in which the injury occurs may be subject to disciplinary action.

Brooks Equipment Company is committed to providing you with a safe and healthful work environment. To achieve this goal, it is essential that you immediately report any unsafe act or condition to your supervisor so that necessary action may be taken. Questions and/or suggestions about safety and health should de directed to your supervisor.

In case of industrial accident or injury, Brooks Equipment Company reserves the right to require the employee to be examined by a doctor selected and paid for by Brooks Equipment Company.

F. INSPECTIONS

Brooks Equipment Company reserves the right to inspect, with or without notice, all persons on Company premises and all packages and articles brought onto or taken from the Company’s premises. Brooks Equipment Company also reserves the right to inspect, with or without notice, all employee desks, lockers and vehicles parked on Company property.

G. EMPLOYEE DEVELOPMENT

At Brooks Equipment Company, all employees are encouraged to assume responsibility and act independently. Requests for additional responsibilities are always welcome and individual initiative will generally be highly regarded by the Company's management. All requests for additional job-related training are also welcome and will be thoroughly considered and reviewed by management.

H. PROBLEM RESOLUTION PROCEDURE

Brooks Equipment Company recognizes that employees may have questions or problems regarding their work, working conditions, policies, procedures or other work-related issues.

In order to actively encourage employees to express their concerns and to seek resolution to their questions, Brooks Equipment Company has established a problem resolution procedure for all employees. Brooks Equipment Company is anxious to have employee problems resolved as quickly as possible and in a considerate manner, FREE FROM ANY REPRISAL OR RECRIMINATION for using the procedure.

The following should be followed as appropriate. The issue should initially be raised verbally by the employee to the person or persons involved. If the issue cannot be resolved, present the complaint to your immediate supervisor. Experience has shown that most, if not all, problems can be resolved through frank open discussion between the employee and the supervisor.

If the issue is not resolved to the employee's satisfaction through these discussions, present your complaint to a different company official. The complaint will be evaluated and investigated, and an attempt made to work out a satisfactory resolution. Management will notify you of their decision within five (5) working days.

If after receiving Brooks Equipment Company's decision, you are still not satisfied, you may present your complaint to the President of the company, who will fully consider all relevant facts and circumstances, and issue a final and binding decision.

I. BULLETINS

Bulletins may be posted from time to time on the bulletin board outside of the break room. Employees are expected to read items posted on the bulletin board and be aware of anything that pertains to them. Failure to read items posted on the bulletin board will not be an excuse for being unaware of matters concerning you, which are posted there.

J. MEETINGS

Attendance at scheduled company meetings will be mandatory, unless prior approval to be excused is obtained.

K. OUTSIDE EMPLOYMENT

Brooks Equipment Company will not object to outside employment as long as it does not interfere with your work at Brooks Equipment Company and does not involve work with a direct competitor or a customer. If you are in doubt as to whether your outside employment falls under the above criteria, please bring it to the attention of the Personnel Department.

L. E-MAIL , COMPUTERS, INTERNET AND VOICE MAIL

Our e-mail, computer, Internet, and voice mail systems are Company property. These systems are in place to facilitate your ability to do your job efficiently and productively. To that end, these systems are solely for business purposes, and any personal use is prohibited. We may intercept, monitor, copy, review, and download any communications or files you create or maintain on these systems. When using the Internet, do not send materials of a sensitive nature or that constitute our "confidential information" unless the information is properly encrypted to prevent interception by third parties.

Your communications and use of our e-mail, computer, Internet, and voice mail systems will be held to the same standard as all other business communications, including compliance with our anti-discrimination and anti-harassment policies. We expect you to use good judgment in your use of our company’s system. Management should be notified of unsolicited or offensive materials received by any employee on any of these systems.

Your consent and compliance with our e-mail, computer, Internet, and voice mail policies is a term and condition of your employment. Failure to abide by these rules or to consent to any interception, monitoring, copying, reviewing, and downloading of any communications or files is grounds for disciplinary action, up to and including termination.

M. PERSONAL TELEPHONE CALLS

Personal calls, both incoming and outgoing, are discouraged. However, the Company recognizes that today when all adult members of a household work, there may occasionally be times when personal calls must be made or received during business hours. Such calls must be held to a minimum and must not interfere with an employee's work. Employees should make a concerted effort to make such calls during their breaks or lunchtime.

Of course, in an emergency, phone calls may be made or received. An emergency is regarded as an illness or severe injury to a member of one's family, changed plans regarding an employee's transportation home from work, extreme weather conditions, etc. Where a long-distance call must be made in an emergency situation, the call must be billed to the caller's home phone number. Under no circumstances should any employee give out our 800 numbers to friends, relatives or acquaintances.

Excessive personal telephone conversations will result in disciplinary action.

N. EMPLOYEE CLASSIFICATION AND DEFINITIONS

Your job is classified on the basis of duties and responsibilities according to the applicable Federal and State laws. At the time of hire, and at the time of any change in your employment status, your classification and eligibility for overtime pay will be discussed. The following employment classifications are used throughout this Handbook and are relevant to determining your eligibility for company provided benefits and overtime pay.

1. Exempt Employees. There are a variety of exempt employees under Federal and State law, but generally, exempt employees are those whose responsibilities are considered to be primarily of an "executive," "administrative," or "professional" nature, or those who are employed as outside salespersons. Exempt employees are not eligible for overtime pay.

2. Non-Exempt Employees. Employees who are not exempt are entitled to overtime pay under the provisions of the applicable Federal and State laws. For these employees, an accurate record of actual hours worked must be maintained.

O. TYPES OF EMPLOYMENT

1. Full-time. Those employees, other than temporary employees, who are regularly scheduled to work at least forty (40) hours each week, and who have completed their ninety (90) day probationary period are considered full-time regular employees ("Full-time").

2. Part-time. Those employees, other than temporary employees, who are regularly scheduled to work less than forty (40) hours a week, and who have completed their ninety (90) day probationary period are considered part-time regular employees ("Part-time"). Part-time employees are not eligible for personal leave time, health, life, dental, and disability insurance coverage, funeral pay, jury duty pay or holiday pay provided by Brooks Equipment Company to full-time regular employees.

3. Temporary. Those employees who are hired with the specific understanding that their employment is of a limited duration are considered temporary employees ("Temporary"). Temporary employees are not eligible for any of the benefits provided by Brooks Equipment Company in this Handbook.

4. Introductory. All employees are considered introductory employees, ("Introductory") for the first ninety (90) days of employment. During the introductory period, both Brooks Equipment Company and the introductory employee have the opportunity to determine whether they are compatible. Brooks Equipment Company reserves the right to terminate any introductory employee with or without cause, and without notice, at any time during the introductory period. Brooks Equipment Company has the sole discretion to extend the introductory period of an employee when it determines that an extension is necessary, or appropriate. An employee receives no company benefits of any kind during the introductory period; however, if the employee becomes a permanent full-time employee of Brooks Equipment Company, all benefits shall accrue from the initial date of employment.

P. COMPANY VEHICLES AND EQUIPMENT

The company from time to time provides its employees with Company vehicles and equipment to use on official Company business. Smoking, eating and drinking is not permitted in company-owned vehicles at any time and the use of such vehicles and equipment for non-business purpose is strictly prohibited.

Q. SMOKING

For the safety and comfort of all employees, smoking is allowed only in designated areas, and is prohibited in all company buildings and vehicles.

R. RADIOS

Radios, if played, should not be a distraction to the work environment. Management has the right to ban the playing of radios at any time.

S. HOUSEKEEPING

All employees are responsible for cleaning up after themselves, and keeping their immediate work areas clean and neat. No messy bulletin boards, calendars, or messages should be attached to walls.

T. TERMINATION OF EMPLOYMENT

Your employment at Brooks Equipment Company can be terminated at will either by you or Brooks Equipment Company.

1. Resignation . A resignation is an employee's voluntary termination of his or her employment. If you choose to resign, Brooks Equipment Company asks that you submit a two-week written notice to your supervisor. However, Brooks Equipment Company reserves the right to require you to leave immediately upon the submission of your notice of resignation. If you resign, you are entitled to payment for unused accrued personal leave time as of the date of your resignation.

2. Dismissal. Dismissal is termination of an employee's at will employment by Brooks Equipment Company. Any employee dismissed by Brooks Equipment Company is entitled to receive payment for all of his or her unused accrued personal leave time as of the effective date of dismissal, unless the dismissal is for cause attributable to the employee, in which case, no payment will be made. (See Section III.C.2 for when personal leave time is earned or accrued.)

3. No Severance Pay Plan. An employee who resigns or is dismissed is not entitled to severance pay. From time to time, in special circumstances, an individual leaving the employment of Brooks Equipment Company may be given a special individual payment of additional compensation at the time of his or her cessation of employment. However, these special individual arrangements shall not be construed to grant any employee a right to severance pay under any circumstances.

4. Letters of Recommendation. Letters of recommendation for departing employees are not a matter of right. Requests for such letters should be made to the Personnel Department. Brooks Equipment Company, in its sole discretion, may or may not respond to such a request.

U. GIFTS

Gifts of any kind received from a vendor, customer, banker, accountant, lawyer, or any other service provider or individual affiliated with Brooks Equipment Co., Inc. with a market value of $50 or more should be reported immediately to the Controller or CFO.

III. EMPLOYEE BENEFITS

A. HEALTH, LIFE, DENTAL AND DISABILITY INSURANCE COVERAGE

As a benefit for eligible employees, Brooks Equipment Company provides Health, Life, Dental and Disability Insurance coverage and a Flexible Benefits Plan under the Company Plan. Information regarding the Company's plan and eligibility requirements is available from the Personnel Department.

B. HOLIDAYS

Brooks Equipment Company will generally observe the following scheduled paid holidays during the year:

New Year's Day

Independence Day

Memorial Day

Labor Day

Thanksgiving Day

Day After Thanksgiving

Christmas Eve Day

Christmas Day

New Year's Eve Day

Because the date on which a holiday falls may vary from year to year, notice outlining specific holiday dates are distributed each year.

In order to receive scheduled holiday pay you must have: (i) been employed full-time by Brooks Equipment Company for at least ninety (90) days prior to the scheduled holiday; and (ii) worked the last workday preceding and the first workday following the scheduled holiday (unless you are on vacation, absent due to a death in the family or have made previous arrangements with your supervisor).

Regular full-time employees who work on a scheduled holiday will receive two (2) times their regular straight time hourly rate for all hours worked. This will be in addition to the eight (8) hours straight time holiday pay eligible employees receive. A paid holiday will be counted as time worked for the purpose of computing overtime for that work week.

Employees who are on Leave of Absence or Layoff are not eligible for holiday pay.

C. PERSONAL LEAVE TIME

1. Eligibility

Personal leave time is granted by an employer to long-term, valued employees. Accordingly, employees will be entitled to the following annual personal leave time after completing the indicated length of employment:

Five (5) working days during the first year of employment

Ten (10) working days after 1 year of continuous employment

Fifteen (15) working days after 2 years of continuous employment

Twenty (20) working days after 5 years of continuous employment

Twenty-five (25) working days after 25 years of continuous employment

Personal leave time is actually earned and accrued on a pro-rata monthly basis. At the beginning of each calendar year, employees will be notified of the personal leave time they will be earning during that year. Personal leave time can be taken at any time during the year; however, should the employee terminate during the year, any personal leave time "deficit" (time taken before it has been earned) will be deducted from the employee’s last paycheck.

2. Scheduling of Personal Leave Time.

Scheduling of personal leave time will be coordinated by an employee's immediate supervisor and in no case will such scheduling interfere with the normal course of business. If conflicts between schedules arise, seniority will generally prevail, so all scheduling of personal leave time should be done as early in the year as possible so as to minimize anyone's disappointment. At a minimum, employees should give their immediate supervisor a one week notice for personal leave time to be granted.

3. Other Paid Absences.

In addition to the leave time enumerated above, the Company generally grants employees one or two floating holidays each year and the afternoon of their birthday off with pay. The additional floating holidays will be posted along with the regular holiday schedule.

Floating holiday pay is actually earned and accrued on a pro-rata monthly basis.

The Company wants to encourage all employees to use their accrued personal leave time throughout the year. Each of us needs time off to spend with family and friends and otherwise enjoy life. For that reason the Company will only pay for ten (10) days of accrued but unused personal leave time remaining at December 31st. This accrued but unused personal leave time will be paid by January 31st of the following year. Any accrued but unused leave time remaining at December 31 in excess of ten (10) days will automatically be forfeited.

Employees who leave the company voluntarily or are terminated (unless for cause) will be paid for accrued but unused personal leave time and floating holiday pay remaining at the date of termination.

D. LEAVES OF ABSENCE

Brooks Equipment Company recognizes that various events or circumstances may require you to request a leave of absence from your job. A leave of absence is an approved authorization for an employee to be away from work for a specified period of time. Normally, a leave of absence should be requested if your absence can reasonably be expected to last longer than seven (7) calendar days.

To be eligible for a leave of absence, you must have been a regular full-time employee for at least one year.

Any leave of absence requires prior approval by your supervisor and the President of Brooks Equipment Company, and approval is at the sole discretion of these individuals, unless mandated by Federal or State statute (see Appendix A). When requesting a leave of absence, you should inform your supervisor of the anticipated length of the leave and your expected date of return. Failure to return to work on that date or to request an extension a reasonable length of time in advance of that date will be considered a resignation without notice.

While you are on an approved leave of absence, you and your eligible dependents will continue to participate in Brook Equipment Company's health, life, death and disability insurance plans, to the extent those plans allow such participation.

Brooks Equipment Company will attempt to hold open the positions of employees who are on approved leaves of absences; however, Brooks Equipment Company reserves the right to fill the position of an employee on leave of absence for any reason and at any time.

If your position must be filled during the time you are on a leave of absence, Brooks Equipment Company will attempt to place you in a position of equal pay and status when you return to work. Such placement, however, cannot be guaranteed and is at Brooks Equipment Company's sole discretion, unless required by Federal or State statute.

Failure to accept any position (regardless of pay and status) offered upon return from an approved leave within seven (7) calendar days of the offer will be considered a voluntary resignation.

1. Military Leave: Brooks Equipment Company will grant a leave of absence without pay during an employee's fulfillment of an obligation as a reservist or member of the National Guard. Such a leave will be granted upon receipt of a copy of your orders.

Brooks Equipment Company does not pay full-time military leave. However, any

employee who volunteers for full-time, active duty in the U.S. Armed Forces will be

granted a leave of absence as required by law.

E. FUNERAL LEAVES

The company will compensate regular full-time employees for time missed from a regularly scheduled workday due to a death in the immediate family. The company will allow the employee two (2) days for the purpose of attending the funeral and making other arrangements as the death may necessitate.

Immediate family is limited to Father, Mother, Brother, Sister, Spouse and Child.

If the employee requires additional time off, he/she may apply for a Leave of Absence without pay, or may use accrued but unused personal leave time available.

F. JURY DUTY

Employees are encouraged to fulfill their civic obligation by serving on juries when subpoenaed. Employees are required to furnish their supervisor with a copy of the jury duty summons and return to work promptly when excused from jury duty. The Company will pay regular full-time employees their straight time rate of pay for jury services, not to exceed three (3) regularly scheduled working days.

G. SOCIAL SECURITY BENEFITS

Both you and Brooks Equipment Company contribute equally to your Social Security benefits, which provide retirement and survivorship income for you and certain members or your family. The base earnings to be considered for Social Security deductions and the percentage to be contributed are set each year by Federal law.

If you have questions regarding Social Security benefits and/or regulations, contact the Social Security Administration in your area.

H. WORKERS’ COMPENSATION

In the event of an occupational injury or disability, Workers’ compensation laws cover you. Brooks Equipment Company is responsible for the cost of this benefit and provides this coverage at no cost to its employees.

You should notify your supervisor immediately if you suffer any injury at work, even if you consider the injury to be minor. Your supervisor will notify the appropriate management personnel of the injury so that a report can be filed. Reports must be flied immediately to be sure that you will receive the appropriate Workers' Compensation benefits.

Should your injury result in medical treatment or time lost from your job, the Workers' Compensation Insurance Carrier will determine the benefits you should receive based upon the applicable Workers' Compensation laws.

I. UNEMPLOYMENT INSURANCE

All Brooks Equipment Company employees are covered under applicable Federal and State unemployment laws. Brooks Equipment Company pays the cost of this coverage.

J. COMPENSATION IN GENERAL

Compensation by any organization, including this Company, is related to a person's contributions to the Company. The more valuable the employee, the more the employee may expect to be paid. Many things are considered in determining the employee's worth to the Company, among which is productivity. However, productivity does not always relate to the "total" hours worked, orders taken, boxes packed, or paperwork processed, but also to the "quality" of the tasks completed.

The President will continually review the Company’s salary structure and will make changes as appropriate for both the employees and the Company.

K. ADVANCES ON PAY

Advances on pay are strictly prohibited.

L. BONUSES

Bonuses may be given from time to time based on such things as productivity, efficiency, profitability and the cash position of Brooks Equipment Company. These bonuses, if any and the timing of it are at the sole discretion of the management of Brooks Equipment Company, and are in no way guaranteed.

M. 401(K) PLAN

The Company has established a 401(K) Plan for the benefit of all eligible employees. Under this plan, employees can elect to defer/contribute a certain portion of their income to investments held by the plan which will subsequently be used help fund their retirement. Under this type of plan, these salary deferrals/contributions and the earnings on the investments made with them are not taxed until the employee takes the money out during his/her retirement years.

In addition to the amount that the employee elects to contribute to the plan, the Company will match 50% the employee’s contribution dollar for dollar up to 3% of the employee’s salary.

Information regarding the Company’s 401(K) plan and the eligibility requirements is available from the Personnel Department.

IV. EMPLOYEE CONDUCT

A. CONFIDENTIALITY

Employees will have access to and will become acquainted with trade secrets, confidential information and property relating to Brooks Equipment Company and its customers. All information obtained in the course of your employment is to be used for conducting Brooks Equipment Company's business only. You are prohibited from discussing or disclosing such trade secrets, confidential information or property, either directly or indirectly, to persons outside Brooks Equipment Company, either during employment, or at any time thereafter, except as required by your supervisor. Information, in any form including but not limited to, documents, tapes, lists, computer printouts, studies, reports, drafts, charts, maps, drawings, programs, equipment, scrap, exemplars, records, flies, and other materials pertinent to Brooks Equipment Company or its customers, may not be removed from the facilities without the advance permission of a supervisor. As a condition of employment, this same level of confidentiality must be maintained regarding information about co-workers, employee relations matters, customers and Brooks Equipment Company's operations. Employees may be required to sign non-disclosure information agreements.

B. RULES OF CONDUCT

At Brooks Equipment Company, we strive to render high-quality service while maintaining a good relationship with our customers. All employees are expected to conduct themselves in a manner which will further this objective. Disregarding or failing to conform to these standards shall warrant disciplinary action, up to and including dismissal. For your guidance, standards of conduct or behavior considered improper by Brooks Equipment Company's management includes, but is not limited to the following:

1. Destruction, damage, theft or unauthorized removal or use of the property or merchandise of Brooks Equipment Company, a customer, visitor or an employee;

2. Inefficient or careless job performance or inability to perform job duties satisfactorily;

3. Failure to promptly report to your supervisor an on-the-job injury or accident involving an employee, customer, or visitor of Brooks Equipment Company, or Brooks Equipment Company's property;

4. Negligence that results in injury to a Brooks Equipment Company employee, a visitor, or customer;

5. Falsification of records in the transaction of business;

6. Unauthorized signing or altering of another employee's time card/sheet or recording the time of another employee (or allowing the same to be done to your time card/sheet);

7. Irregular attendance, including tardiness, unreported or excessive absences from work, abuse of sick leave, abuse of an approved leave of absence, or failure to request and obtain an approved leave of absence or extension of a leave of absence in a timely manner;

8. Insubordination, including refusal or failure to perform assigned work;

9. Selling, possessing or being under the influence of alcohol, marijuana, cocaine, narcotics, amphetamines, hallucinogenic or behavior-modifying drugs or other chemical substances during working hours or while on Brooks Equipment Company's premises, including the parking lot;

10. Sleeping while on the job;

11. Fighting or provoking a fight at Brooks Equipment Company's facilities, or interfering with others in the performance of their jobs;

12. Making malicious, false, or derogatory statements that may damage the integrity or reputation of Brooks Equipment Company, its customers or employees;

13. Misrepresenting or withholding pertinent facts in securing employment;

14. Refusal to follow instructions of supervisory or authorized personnel; being rude or discourteous toward supervisors, fellow employees, customers or visitors; or engaging in any action which endangers the health or safety of others;

15. Improper use of Brooks Equipment Company telephones;

16. Abuse of break times and lunch periods;

17. Possession, display, or use of explosives, firearms, or other dangerous weapons while on duty or while at Brooks Equipment Company facilities;

18. Engaging in any activity which is in conflict with the best interest of Brooks Equipment Company;

19. Leaving the work place without prior authorization;

20. Transacting business other than Brooks Equipment Company’s business during normal working hours;

21. Failure or refusal to follow general policies, rules and procedures of Brooks Equipment Company;

22. Disclosing or discussing confidential matters to outsiders.

The Company has developed the following disciplinary procedure to motivate rather than discourage its employees. These steps are not progressive in nature, but represent alternatives, which may be taken depending upon the circumstances.

Verbal Warning:

Give a verbal warning as a problem develops with an employee.
Document the warning and retain it in the employee’s personnel file for future reference. Forward this information to Personnel for review.

Written Warning:

Give a written warning to an employee if little or no improvement is shown within a reasonable period of time. Include previous discussion and/or warnings.
Place the employee on a final warning status.
Emphasize to the employee that termination will be recommended if no noticeable improvement is shown during the final warning period.
Have the employee read and acknowledge receipt of the warning.
If the employee declines to acknowledge receipt by initialing the warning, the supervisor should note such on the form.
Termination will be recommended if avenues of counseling and training have been utilized and no appreciable improvement has been shown.

Suspension:

From time to time, it may become necessary to suspend an employee with or without pay when after thorough investigation management deems it appropriate.

Termination:

From time to time, although not the preferable course of action, it may become necessary for management to take action involving the immediate termination of an employee.

We acknowledge that it is impossible to define rules for every conceivable situation that might arise. Activities, which are not expressly covered in these rules, will be handled on a case-by-case basis. All employees are expected to act with good common sense and in a completely professional manner.

C. ALCOHOL AND DRUG ABUSE

In order to promote the safety of Brooks Equipment Company employees and insure proper service to our customers, it is our policy that employees shall not be involved with the unlawful use, possession, sale or transfer of drugs or narcotics, and further, that employees shall not possess, consume or be under the influence of alcoholic beverages in the workplace. The specific methods for maintaining a work environment free from the effects of alcohol and drug abuse are outlined below.

1. Policy Implementation

a. Employees are expected to report for work and remain at work in condition to perform assigned duties free from the effects of alcohol or drugs.

b. Any involvement with alcohol or drugs, which adversely affects an employee or the workplace, will not be tolerated.

c. Absences directly or indirectly caused by the use of alcohol or drugs will not be excused.

d. Illegal drugs are drugs defined as illegal under Federal, State or local laws, which include, but are not limited to:

marijuana
heroin
hashish
cocaine
hallucinogens
depressants, stimulants and other behavior-modifying drugs which are not prescribed for current personal treatment by an accredited physician.

e. Employees taking prescription or non-prescription drugs must report this use to appropriate supervisory personnel if such use may affect the employee’s ability to perform assigned duties. Failure to follow this instruction may subject the employee to disciplinary action.

2. Consequences of Alcohol or Drug Abuse

a. Drug Abuse

The use consumption, sale or personal possession (for example, on the person, in a toolbox, desk, locker or vehicle) of illegal drugs while on the job (including rest periods and meal periods) or on Brooks Equipment Company’s property, will result in: (i) immediate discharge; and (ii) possibly, criminal prosecution. Any illegal drugs found will be turned over to the appropriate law enforcement agency.

b. Alcohol Abuse

The use, consumption, sale or personal possession (for example, on the person, in a toolbox, desk or locker or vehicle) of alcohol while on the job (including rest and meal periods) or on Brooks Equipment Company’s property will result in immediate discharge.

c. Where there is no evidence of consumption of alcohol or use of illegal drugs during regular work time, but the employee is perceived to be under the influence of drugs or alcohol, the following will apply:

1. Any employee, in any job, who is perceived to be under the influence of alcohol or drugs, will be immediately removed from service. Management may take further disciplinary action based on medical information, past history, and the relevant factors, such as, performance, record of disciplinary actions, etc.

2. Any employee, who while on Brooks Equipment Company’s property displays evidence of alcohol consumption, (such as, the smell of alcohol on the breath) will be immediately removed from service even if it is not apparent that the employee is under the influence of alcohol. Management may take disciplinary action based on past history and other relevant factors, such as performance, record of disciplinary actions, etc.

3. Special Action

a. In order to protect the interest of Brooks Equipment Company, its employees and the public, Brooks Equipment Company may take reasonable measures to find out if alcohol or illegal drugs are located on or being used or consumed upon Brooks Equipment Company’s property. The measures taken may include, but shall not be limited to, the following:

1. A drug screening procedure may be employed as a routine part of the pre-employment application process for all job applicants who have otherwise been approved for employment, but before hire. If the drug screening procedure indicates the presence of drugs or controlled substances, the applicant will not be considered for employment. Applicants are to be given the drug screen before any offer of employment is made and must have negative results prior to the performance of employment duties.

2. Brooks Equipment Company reserves the right, as a condition of employment and continued employment, to request drug and alcohol screens of individuals or groups of employees, including but not limited to certain positions considered sensitive from a health and safety standpoint. The drug screens shall be administered as deemed necessary by Brooks Equipment Company, including, but not limited to, in circumstances of reasonable suspicion of drug and alcohol use. Employees are expected to abide by this screening policy. Refusal to participate in a drug or alcohol screen will result in immediate removal from service and may result in termination. In cases where a positive screen indicates illegal drug use, the employee will be discharged immediately.

3. Federal, State and/or local authorities may be called upon to assist in investigations concerning drug or alcohol use.

4. Searches of Brooks Equipment Company’s property, facilities, or equipment may be conducted by authorized personnel.

a. Except for searches of Brooks Equipment Company’s property, facilities, or equipment, and routine pre-employment screening, the decision to use the measures described above, or other similar measures, should be approved by the President of Brooks Equipment Company.

D. SOLICITATION OR DISTRIBUTION

In order to protect employees from annoyance, harassment, and interference with their work and to maintain a workplace free of litter, Brooks Equipment Company has adopted the following rules concerning solicitation and distribution of literature:

1. No outsiders shall be allowed to solicit or distribute materials on Brooks Equipment’s premises.

2. Employees shall not engage in solicitation of any kind in public areas or in working areas during working time.

3. Employees shall not distribute literature in working areas at any time.

4. Employees shall not distribute literature in non-working areas or non-public areas during working time.

5. As used in these rules, the term "working time" means the period of time that an employee is supposed to be performing job duties. "Working time" does not include time allotted for break or lunch periods or periods before or after work.

E. ATTENDANCE

Because every job at Brooks Equipment Company is important to our efficient operation, the regular attendance of employees is critical to our success. Absenteeism and tardiness reduce efficiency and unnecessarily burden fellow employees.

Any time it is necessary for you to be absent or late, you must notify your supervisor prior to the beginning of your work schedule so that he or she can make arrangements to keep the work running smoothly in your absence. Whenever your absence is prolonged, you should inform your supervisor of any changes in your circumstances and plans for return to work. Absences, which may reasonably be expected to extend for seven (7) calendar days or more, require you to request a leave of absence. An absence of three (3) or more consecutive days without notifying your supervisor will be considered a voluntary termination of your employment.

Absences from work are either excused or unexcused. An absence is unexcused if either: (i) you do not notify your supervisor of the absence prior to the beginning of your shift; or (ii) your supervisor, in his or her discretion and in accordance with the Handbook, determines that excusing your absence would be inconsistent with Company policy.

Any employee who fails to give such notification will be credited with an unexcused absence. Excessive unexcused absences will result in disciplinary action up to and including suspension and/or termination.

Employees taking time off in excess of the "personal leave time" available to them in any calendar year, will be required to obtain prior approval for the absence from the President of the Company, or in the case of an unscheduled absence, obtain approval after their return to work.

F. INCLEMENT WEATHER POLICY

Because of the nature of the Charlotte operation and the dependence that our branches have on us, the Charlotte office will make all attempts to open and close at normal times regardless of inclement weather conditions.

1. It is the Company’s policy to open for normal office hours, irrespective of the weather conditions. All employees are expected to make all reasonable attempts to report to work at their usual starting time. However, employees are expected to make their own determination as to whether they feel it is safe for them to report to work. If the employee reports to work later than his or her regular starting time, that employee will be paid from the time he or she officially arrives at work.

2. No employee will jeopardize their employment at Brooks by not coming to work when they deem it is unsafe to do so or by leaving work early when they feel it is safer to do so.

3. Any time taken off, including the above, will be charged against an employee’s accumulated personal leave time if the employee has any, or will be taken as time without pay.

G. DRESS CODE / PERSONAL APPEARANCE

We realize that each employee has different tastes in his or her dress and personal appearance. At the same time, however, positive interaction with customers and vendors and workplace safety is essential 100% of the time in order to help achieve our goal of being the best distributor of fire safety equipment in our markets. With that in mind, we have adopted a dress code.

It is the policy of the Company that an employee’s dress and grooming should be appropriate to the work situation and radical departures from conventional dress or personal grooming standards are not permitted regardless of the nature of the job performed. The properly attired employee helps to create a favorable image for the Company.

Office employees should wear what is accepted and typical of a professional business operation. The wearing of suggestive attire, worn-out jeans, shorts for men, shorts other than bermuda-length for women, old or worn-out T-shirts, and other similar items of casual attire do not present a businesslike appearance.

The dress and grooming of warehouse employees is established to meet the requirements of safety and comfort. Loose-fitting or baggy clothing, open-toe or high-heel shoes, and dangling or protruding jewelry should not be worn, as it may create a safety hazard. Additionally, cut-off or ragged jeans, sweat pants, tank tops, worn-out T-shirts, casual footwear and other similar casual attire is prohibited.

Hair, beards, mustaches, and sideburns should be clean and properly trimmed and combed, and ladies should be dressed modestly and in good taste, without being extreme with perfume. Since the Company’s business activities are conducted consistently throughout the week, the code of professional dress is applicable Monday through Friday. We realize that from time to time circumstances may dictate exceptions to the above dress code.

Management reserves the right to send home, without pay, any employee who in our opinion is in violation of this policy.

V. OFFICE HOURS AND PAYROLL MATTERS

A. BASIC WORK WEEK

The business of running our company can sometimes be a 24-hour a day, seven-day-a-week operation. However, the basic work week for all personnel except for those who are otherwise lawfully exempted from the applicable minimum wage and overtime requirements shall be 40 hours, Monday through Friday, beginning at 8:00 a.m. and ending at 5:00 p.m.

B. LUNCH HOUR

All employees shall be entitled to a one-hour lunch period. Normally, the lunch period shall be taken between 11:30 a.m. and 2:00 p.m. Since it is necessary for the office to have personnel present, lunch will be scheduled or planned by management so that continual staffing will be achieved.

C. TIME KEEPING

All employees paid on an hourly basis must: (i) record their time at the beginning of the day; (ii) record their time in and out for lunch; and (iii) record their time out at the end of the day.

D. OVERTIME

All non-exempt employees shall be paid time and one-half (1 and 1/2) for all hours in excess of forty (40) in any work week. This means that overtime is computed on a weekly pay period rather than a daily basis. The employee must have worked in excess of the normal 40-hour week before overtime will be paid for the particular week. Overtime worked during one week may not be exchanged for time off in another week, because each week must be separately considered in computing overtime. Lunch time does not count toward the computation of the 40-hour week.

Regular full-time employees who work on a scheduled holiday will receive two (2) time their regular straight time hourly rate for all hours worked. This will be in addition to the eight (8) hours straight time holiday pay eligible employees receive. A paid holiday will be counted as time worked for the purpose of computing overtime for that work week.

It is emphasized that employees are to work overtime only when requested, and approved in advance by their supervisor. Overtime will be approved only when absolutely necessary. The use of overtime will not be abused.

E. PAYROLL DEDUCTIONS

The amount you actually receive in your weekly paycheck, your net pay, does not represent the full amount of your earnings, your gross pay. The Company is required by law to withhold both Federal and State income taxes from your paycheck. These monies withheld are sent to the respective Federal and State treasuries and you are given credit for it on your income taxes for that year.

The amount of the tax withheld and deducted is determined by the amount of your wages and the number of your dependents. Each year you will receive a W-2 showing your total earnings for the year and the amount of taxes deducted, including Social Security taxes.

VI. TRAVEL AND EXPENSE POLICY

A. GENERAL POLICY

When traveling for business purposes for the Company, certain expenses will be reimbursed by the Company. However, the following procedures must be complied with in order for reimbursement to be authorized.

All travel must be approved in advance by the employee’s supervisor.
All travel arrangements for transportation, lodging and car rentals should be made through the employee designated as the Company’s travel liaison.
Employees should provide their supervisor with a copy of their itinerary before leaving on business travel.
Expenses should be reported on an Expense Report. This report must be approved by the employee’s supervisor prior to submitting to Accounts Payable for payment.
All expenses incurred must be submitted for payment as promptly as possible. Expenses will NOT be reimbursed if more than 30 days have elapsed from the date the expense was incurred to the date the Expense Report was submitted to Accounts Payable.
Once submitted, accounts payable will process expense check reimbursements as part of the normal Friday check run. These checks can be picked up from Accounts Payable on Wednesday following the check run. Expense Reports received after Wednesday will not be processed until the next week’s Friday check run.

B. HOTELS

1) Hotel receipts must accompany each employee’s Expense Report.

2) Only charges for room and all related room taxes are covered. This means that all other charges, including telephone, room service, dry cleaning, movies, etc. will not be reimbursed.

C. MEALS

Employees will receive a standard meal allowance, per diem, for each night they are out of town. The following are the standard per diems:
Breakfast:     $5
Lunch:           $10
Dinner:          $15

No receipts are necessary to receive these reimbursements, other than a copy of the hotel bill indicating the nights spent out-of-town. However, request for reimbursement of the per diems must be submitted on the Expense Report.

On rare occasions, a meal will be paid by Brooks for an employee’s entertainment of business associates while out of town. Such "entertainment meals" must be approved by the employee’s supervisor. (The supervisor’s approval can be indicated by signing the Expense Report which includes the meal expenditure.) Tips on these meals should not exceed 20%. Excess tips will not be reimbursed. Receipts must be submitted with the expense report for these "entertainment meals." In addition, statement of the date, place, and business reason for the "entertainment meal", as well as the names of those present and their business relationships to Brooks must be included on the Expense Reports. If an employee is reimbursed for an "entertainment meal" in this way, the per diem allowance for that particular meal will not be allowed to avoid duplicate payment for meal expenses.

D. ENTERTAINING

1) Employees may engage in the entertainment of business associates on behalf of Brooks only if they have been authorized to do so by their supervisor. Such authorization should define the general circumstances and expense limits of the approved forms of entertainment.

2) Employee entertainment expenses will be paid or reimbursed if they are properly approved by the supervisor, are reasonable, and are directly related to or associated with Brook’s business. Employees who incur entertainment expenses which do not meet these standards will be personally responsible for them.

3) Entertainment expenses should be documented on the Expense Report with receipts attached. The Report should include a detailed itemization of the expenses incurred and a statement of the date, place, and business reason for the entertainment, as well as the names of those present and their business relationships to Brooks.

E. SUNDRY

1) For each night an employee is out of town, a sundry allowance of $6 will be given for incidentals incurred. This will be for expenditures that are not specifically listed as reimbursed expenditures under this policy, and could include items such as telephone, snacks, and tips for bellhops. No receipts are necessary for this reimbursement, however, the sundry allowance must be requested on the Expense Report.

F. PARKING

1) All necessary and reasonable parking expenditures will be reimbursed if appropriate receipts are attached to the Expense Report.

G. TRANSPORTATION

1) Airfare reservations should be scheduled in advance, if possible.

2) Coach class should be booked unless otherwise approved by the employee’s supervisor.

3) Receipts for reimbursement must accompany the Expense Report. If an employee has to pay for the airline fare in advance, an itinerary showing the fare paid can be submitted for reimbursement in advance of the actual flight. However, following the flight, the passenger ticket receipt must be submitted to Accounts Payable.

4) Miles traveled in an employee’s car for Brooks’ business purposes will be reimbursed at the standard IRS mileage reimbursement rate. To be eligible for reimbursement, the trip must be more than 20 miles from the employee’s normal work site. The number of miles driven, as well as the departure and destination cities must be included on the Expense Report.

5) Rental car receipts should accompany the Expense Report for reimbursement. Employees should decline purchasing additional insurance coverage when renting a car, however, Brooks Equipment Co., Inc. should be listed on the rental application. Cars rented must have a fair value of $30,000 or less due to the insurance policy held by Brooks. Employees should re-fuel the car prior to returning to the rental agency if possible to avoid the agency’s re-fueling charge. Receipts for gas purchased for rental cars can also be submitted for reimbursement.

6) Cab fares will be reimbursed if accompanied by a receipt. Tipping on cabs should not exceed 10%. Excess tips will not be reimbursed.

7) Other forms of mass transit (subways, buses, etc.) used for business travel will be reimbursed if appropriate receipts are submitted with the Expense Report.

APPENDIX: A

FAMILY AND MEDICAL LEAVE POLICY

FOR NORTH CAROLINA EMPLOYEES

I. Eligibility

Employees must have been employed for a minimum of 12 months and must have worked at least 1,250 hours in the preceding 12 months immediately before the date when leave would begin to be eligible for family and medical leave.

Only those employees who work at a work-site where 50 or more employees are employed by Brooks Equipment Company within a 75-mile radius are eligible for family and medical leave.

II. Types of Family and Medical Leave covered by the policy

Eligible employees are entitled by law to the following unpaid leaves of absence:

1. Birth/adoption/foster care leave: An employee may take up to the maximum family and medical leave for the birth of the employee’s natural child or the placement of a child with the employee for adoption or foster care. Birth leave may be a combination of parental leave and pregnancy leave. Parental leave is time off work for employees who are physically able to return to work but choose to stay home and care for newborn children. Pregnancy leave is characterized by physical disability because of childbirth or a related medical condition.

2. Family Care Leave: An employee may take up to the maximum family and medical leave to care for a family member suffering from a serious health condition. For these purposes, the term "family member" means an employee’s spouse, parent, or child under the age of 18, as well as any other family member disabled under applicable Federal or State regulations.

3. Medical Leave: An employee may take up to the maximum family and medical leave if he or she suffers a serious health condition, which renders the employee unable to perform his or her duties.

Serious Health Condition: A serious health condition means an illness, injury, impairment, or condition involving any of the following:
- inpatient care in a hospital, nursing home, or hospice; or

- outpatient care that requires continuing treatment or supervision by a health care provider.

- Brooks Equipment Company will consider leave taken for a condition that progresses into a serious health condition as counting toward FMLA leave.

III. Maximum Period for Leave

1. In General: Leave may no exceed 12 weeks in any 12-month period, measured on a rolling basis. The leave entitlement for birth, adoption, or foster care placement extends until one year from the birth or the placement.

2. Intermittent Leave: Intermittent leave or reduced working hour arrangements may be provided for family care leaves or medical leaves when required as part of a medically necessary course of conduct, provided adequate medical certification of such need is obtained. Intermittent leave of reduced working hours for birth, child placement, or other non-health related reasons is at the discretion of Brooks Equipment Company. The Company reserves the right to temporarily transfer an employee to an alternative position with equivalent pay and benefits to accommodate intermittent leaves.

IV. Scheduling and Notice

1. Scheduling: A written leave of absence request must be completed and turned in to your supervisor/manager for all leaves of absence whether paid or unpaid. An employee intending to take leave must give thirty (30) days advance notice to the Company is the leave is foreseeable. If not foreseeable, the employee must provide as much advance notice as possible. In situations involving leave for a medical condition, every reasonable effort to schedule medical treatment so that it does not disrupt company operations must be made before a leave will be considered.

2. Certification: An employee requesting medical leave must provide medical certification indicating that a serious health condition exists and other information as requested within fifteen (15) days after the employee makes the request for leave. The certification needs to include:

a. the date on which the serious health condition commenced;

b. the probable duration of the condition;

c. the appropriate medical facts within the knowledge of the health care

provider regarding the condition, including a diagnosis of the particular

condition involved and a brief description of the prescribed regimen of

treatment;

d. an indication of whether hospitalization is required; and

e. for an employee’s own illness or serious health condition, a statement

that the employee cannot perform the essential functions of his or her job.

If the leave is to care for a child, parent, or spouse, the certification must state that the employee is needed to care for the family member and provide an estimate of the amount of time the employee will be needed to provide care or

The Company is entitled to request a second opinion at our expense. If necessary to resolve any conflict between the original certification and the second opinion, the Company will require the opinion of a third doctor. The Company and the employee will jointly select the third doctor, and the Company will pay for the opinion. The third opinion will be considered final. The Company reserves the right to seek periodic medical re-certification during the employee’s medical leave.

Failure to return to work after the scheduled end of family and medical leave without notifying the Company shall be considered a voluntary resignation of employment. If medical reasons require an extension of leave beyond a scheduled date of return, and if the employee retains accrued but unused family and medical leave, the employee must give the Company as much advance notice as possible of the need for additional leave. The Company may require additional certification to demonstrate the medical need for the additional leave.

V. Use of Personal Leave Days During Family and Medical Leave

1. If the employee has accrued personal leave time, the employee may use paid leave first and take the remainder of the twelve (12) weeks as unpaid leave.

2. An employee taking leave for the birth of a child may use paid leave for physical recovery following childbirth. Pregnancy disability or other leave taken under the Company’s temporary disability plan is considered paid personal leave time for purposes of FMLA substitution.

VI. Benefits During Leave

1. During the period of leave, participants in the group insurance plan will continue to receive coverage on the same basis as employees not on leave. The Company will continue to pay the same portion of the insurance premiums for employees on leave as it pays for active employees.

2. If an employee does not return to work after leave due to personal rather than medical reasons, the Company may seek reimbursement for all health care premiums paid on behalf of the employee during the leave.

3. An employee who does not return to work at the end of leave will receive information about rights to COBRA continuation of medical insurance coverage at the expiration of the family and medical leave (or earlier if the Company learns that the employee does not intend to return to work.)

VII. Rights upon Return to Work

1. Reinstatement: Employees who return to work within the approved family and medical leave period will be returned to their same position or to an equivalent one in accordance with applicable Federal and State laws. The Company reserves the right not to reinstate employees who exceed the maximum family and medical leave or those highly compensated "key employees" defined as exempt from reinstatement rights under Federal law. Key employees are those salaried employees among the highest paid 10% of all Company employees. If reinstatement of a key employee from leave causes substantial and grievous injury to the Company, the Company reserves the right not to reinstate such employee.

This policy is meant to comply with applicable Federal and State laws, and is not intended to provide benefits beyond those required by such leave.