Equibles

10-Q

BOISE CASCADE Co (BCC)

10-Q 2021-11-01 For: 2021-09-30
View Original
Added on April 04, 2026

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2021
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                        to

Commission File Number:  001-35805

Boise Cascade Company

(Exact name of registrant as specified in its charter)

Delaware 20-1496201
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)

1111 West Jefferson Street Suite 300

Boise, Idaho 83702-5389

(Address of principal executive offices) (Zip Code)

(208) 384-6161

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, $0.01 par value per share BCC New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes x     No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).      Yes x     No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer x    Accelerated filer o    Non-accelerated filer o    Smaller reporting company ☐

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange

Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐  No x

There were 39,330,807 shares of the registrant's common stock, $0.01 par value per share, outstanding on October 29, 2021.

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PART I—FINANCIAL INFORMATION
Item 1. Financial Statements 1
Condensed Notes to Unaudited Quarterly Consolidated Financial Statements 8
1. Nature of Operations and Consolidation 8
2. Summary of Significant Accounting Policies 8
3. Income Taxes 12
4. Net Income Per Common Share 12
5. Curtailment of Manufacturing Facility 13
6. Debt 13
7. Leases 15
8. Retirement and Benefit Plans 17
9. Stock-Based Compensation 17
10. Stockholders' Equity 18
11. Transactions With Related Party 19
12. Segment Information 20
13. Commitments, Legal Proceedings and Contingencies, and Guarantees 21
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 22
Understanding Our Financial Information 22
Executive Overview 22
Factors That Affect Our Operating Results and Trends 23
Our Operating Results 25
Industry Mergers and Acquisitions 29
Liquidity and Capital Resources 30
Contractual Obligations 31
Off-Balance-Sheet Activities 31
Guarantees 32
Seasonal Influences 32
Employees 32
Disclosures of Financial Market Risks 32
Environmental 32
Critical Accounting Estimates 32
New and Recently Adopted Accounting Standards 33
Item 3. Quantitative and Qualitative Disclosures About Market Risk 33
Item 4. Controls and Procedures 33
PART II—OTHER INFORMATION
Item 1. Legal Proceedings 34
Item 1A. Risk Factors 34
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 34
Item 3. Defaults Upon Senior Securities 34
Item 4. Mine Safety Disclosures 35
Item 5. Other Information 35
Item 6. Exhibits 36
Signatures 37

ii

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PART I—FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS

Boise Cascade Company

Consolidated Statements of Operations

(unaudited)

Three Months Ended<br>September 30 Nine Months Ended<br>September 30
2021 2020 2021 2020
(thousands, except per-share data)
Sales $ 1,879,451 $ 1,589,313 $ 6,143,928 $ 4,002,607
Costs and expenses
Materials, labor, and other operating expenses (excluding depreciation) 1,594,405 1,261,697 4,909,362 3,302,869
Depreciation and amortization 20,299 20,029 60,258 75,260
Selling and distribution expenses 114,466 122,884 366,119 325,913
General and administrative expenses 21,002 26,060 64,252 60,899
Loss on curtailment of facility — — — 1,707
Other (income) expense, net (107) 71 (485) 70
1,750,065 1,430,741 5,399,506 3,766,718
Income from operations 129,386 158,572 744,422 235,889
Foreign currency exchange gain (loss) (353) 265 (52) (199)
Pension expense (excluding service costs) (19) (302) (57) (991)
Interest expense (6,279) (7,002) (18,501) (20,056)
Interest income 63 113 173 958
Change in fair value of interest rate swaps 59 147 1,058 (2,681)
Loss on extinguishment of debt — (13,968) — (13,968)
(6,529) (20,747) (17,379) (36,937)
Income before income taxes 122,857 137,825 727,043 198,952
Income tax provision (31,158) (34,633) (183,632) (49,974)
Net income $ 91,699 $ 103,192 $ 543,411 $ 148,978
Weighted average common shares outstanding:
Basic 39,442 39,315 39,413 39,264
Diluted 39,661 39,526 39,623 39,396
Net income per common share:
Basic $ 2.32 $ 2.62 $ 13.79 $ 3.79
Diluted $ 2.31 $ 2.61 $ 13.71 $ 3.78
Dividends declared per common share $ 0.10 $ 1.70 $ 2.30 $ 1.90

See accompanying condensed notes to unaudited quarterly consolidated financial statements.

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Boise Cascade Company

Consolidated Statements of Comprehensive Income

(unaudited)

Three Months Ended<br>September 30 Nine Months Ended<br>September 30
2021 2020 2021 2020
(thousands)
Net income $ 91,699 $ 103,192 $ 543,411 $ 148,978
Other comprehensive income (loss), net of tax
Defined benefit pension plans
Amortization of actuarial (gain) loss, net of tax of $(2) , $51, $(4), and $153, respectively (3) 151 (10) 452
Effect of settlements, net of tax of $—, $—, $—, and $22, respectively — — — 64
Other comprehensive income (loss), net of tax (3) 151 (10) 516
Comprehensive income $ 91,696 $ 103,343 $ 543,401 $ 149,494

See accompanying condensed notes to unaudited quarterly consolidated financial statements.

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Boise Cascade Company

Consolidated Balance Sheets

(unaudited)

September 30,<br>2021 December 31,<br>2020
(thousands)
ASSETS
Current
Cash and cash equivalents $ 786,886 $ 405,382
Receivables
Trade, less allowances of $3,393 and $1,111 473,727 375,865
Related parties 180 201
Other 17,016 15,067
Inventories 644,370 503,480
Prepaid expenses and other 15,812 8,860
Total current assets 1,937,991 1,308,855
Property and equipment, net 459,254 461,456
Operating lease right-of-use assets 64,678 62,447
Finance lease right-of-use assets 27,549 29,523
Timber deposits 9,333 11,761
Goodwill 60,382 60,382
Intangible assets, net 15,657 16,574
Deferred income taxes 6,969 7,460
Other assets 6,552 7,260
Total assets $ 2,588,365 $ 1,965,718

See accompanying condensed notes to unaudited quarterly consolidated financial statements.

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Boise Cascade Company

Consolidated Balance Sheets (continued)

(unaudited)

September 30,<br>2021 December 31,<br>2020
(thousands, except per-share data)
LIABILITIES AND STOCKHOLDERS' EQUITY
Current
Accounts payable
Trade $ 412,097 $ 307,653
Related parties 1,184 1,199
Accrued liabilities
Compensation and benefits 118,926 118,400
Income taxes payable 109 8,101
Interest payable 5,004 8,477
Other 162,975 80,172
Total current liabilities 700,295 524,002
Debt
Long-term debt 444,419 443,792
Other
Compensation and benefits 28,600 25,951
Operating lease liabilities, net of current portion 57,468 56,001
Finance lease liabilities, net of current portion 30,263 31,607
Deferred income taxes 5,720 18,263
Other long-term liabilities 15,995 15,303
138,046 147,125
Commitments and contingent liabilities
Stockholders' equity
Preferred stock, $0.01 par value per share; 50,000 shares authorized, no shares issued and outstanding — —
Common stock, $0.01 par value per share; 300,000 shares authorized, 44,698 and 44,568 shares issued, respectively 447 446
Treasury stock, 5,367 shares at cost (138,909) (138,909)
Additional paid-in capital 541,022 538,006
Accumulated other comprehensive loss (1,088) (1,078)
Retained earnings 904,133 452,334
Total stockholders' equity 1,305,605 850,799
Total liabilities and stockholders' equity $ 2,588,365 $ 1,965,718

See accompanying condensed notes to unaudited quarterly consolidated financial statements.

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Boise Cascade Company

Consolidated Statements of Cash Flows

(unaudited)

Nine Months Ended<br>September 30
2021 2020
(thousands)
Cash provided by (used for) operations
Net income $ 543,411 $ 148,978
Items in net income not using (providing) cash
Depreciation and amortization, including deferred financing costs and other 61,559 76,784
Stock-based compensation 5,684 5,839
Pension expense 57 1,492
Deferred income taxes (12,017) (2,460)
Change in fair value of interest rate swaps (1,058) 2,681
Loss on curtailment of facility (excluding severance) — 1,476
Other 928 205
Loss on extinguishment of debt — 13,968
Decrease (increase) in working capital
Receivables (99,881) (205,995)
Inventories (142,171) 42,904
Prepaid expenses and other (7,007) (9,641)
Accounts payable and accrued liabilities 186,090 213,935
Pension contributions (229) (12,659)
Income taxes payable (7,927) 17,121
Other (348) (857)
Net cash provided by operations 527,091 293,771
Cash provided by (used for) investment
Expenditures for property and equipment (51,460) (46,994)
Proceeds from sales of assets and other 636 563
Net cash used for investment (50,824) (46,431)
Cash provided by (used for) financing
Borrowings of long-term debt, including revolving credit facility 28,000 400,000
Payments of long-term debt, including revolving credit facility (28,000) (405,774)
Payments of deferred financing costs — (6,222)
Dividends paid on common stock (90,969) (12,553)
Tax withholding payments on stock-based awards (2,729) (3,309)
Other (1,065) (784)
Net cash used for financing (94,763) (28,642)
Net increase in cash and cash equivalents 381,504 218,698
Balance at beginning of the period 405,382 285,237
Balance at end of the period $ 786,886 $ 503,935

See accompanying condensed notes to unaudited quarterly consolidated financial statements.

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Boise Cascade Company

Consolidated Statements of Stockholders' Equity

(unaudited)

Treasury Stock Additional Paid-In Capital Accumulated Other Comprehensive Loss Retained Earnings Total
Amount Shares Amount
Balance at December 31, 2020 $ 446 5,367 $ (138,909) $ 538,006 $ (1,078) $ 452,334 $ 850,799
Net income 149,156 149,156
Other comprehensive loss (4) (4)
Common stock issued 1 1
Stock-based compensation 2,092 2,092
Common stock dividends (0.10 per share) (4,116) (4,116)
Tax withholding payments on stock-based awards (2,729) (2,729)
Proceeds from exercise of stock options 63 63
Other (1) (1)
Balance at March 31, 2021 $ 447 5,367 $ (138,909) $ 537,431 $ (1,082) $ 597,374 $ 995,261
Net income 302,556 302,556
Other comprehensive loss (3) (3)
Stock-based compensation 1,411 1,411
Common stock dividends (2.10 per share) (83,514) (83,514)
Other (1) (1)
Balance at June 30, 2021 $ 447 5,367 $ (138,909) $ 538,841 $ (1,085) $ 816,416 $ 1,215,710
Net income 91,699 91,699
Other comprehensive loss (3) (3)
Stock-based compensation 2,181 2,181
Common stock dividends (0.10 per share) (3,982) (3,982)
Balance at September 30, 2021 $ 447 5,367 $ (138,909) $ 541,022 $ (1,088) $ 904,133 $ 1,305,605

All values are in US Dollars.

See accompanying condensed notes to unaudited quarterly consolidated financial statements.

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Boise Cascade Company

Consolidated Statements of Stockholders' Equity (continued)

(unaudited)

Treasury Stock Additional Paid-In Capital Accumulated Other Comprehensive Loss Retained Earnings Total
Amount Shares Amount
Balance at December 31, 2019 $ 444 5,367 $ (138,909) $ 533,345 $ (50,248) $ 356,698 $ 701,330
Net income 12,200 12,200
Other comprehensive income 215 215
Common stock issued 2 2
Stock-based compensation 1,674 1,674
Common stock dividends (0.10 per share) (3,866) (3,866)
Tax withholding payments on stock-based awards (3,309) (3,309)
Proceeds from exercise of stock options 27 27
Other (2) (2)
Balance at March 31, 2020 $ 446 5,367 $ (138,909) $ 531,735 $ (50,033) $ 365,032 $ 708,271
Net income 33,586 33,586
Other comprehensive income 150 150
Stock-based compensation 1,671 1,671
Common stock dividends (0.10 per share) (3,970) (3,970)
Balance at June 30, 2020 $ 446 5,367 $ (138,909) $ 533,406 $ (49,883) $ 394,648 $ 739,708
Net income 103,192 103,192
Other comprehensive income 151 151
Common stock issued — —
Stock-based compensation 2,494 2,494
Common stock dividends (1.70 per share) (67,534) (67,534)
Proceeds from exercise of stock options 125 125
Balance at September 30, 2020 $ 446 5,367 $ (138,909) $ 536,025 $ (49,732) $ 430,306 $ 778,136

All values are in US Dollars.

See accompanying condensed notes to unaudited quarterly consolidated financial statements.

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Condensed Notes to Unaudited Quarterly Consolidated Financial Statements

1.    Nature of Operations and Consolidation

Nature of Operations

Boise Cascade Company is a building products company headquartered in Boise, Idaho. As used in this Form 10-Q, the terms "Boise Cascade," "we," and "our" refer to Boise Cascade Company and its consolidated subsidiaries. We are one of the largest producers of engineered wood products (EWP) and plywood in North America and a leading United States wholesale distributor of building products.

We operate our business using two reportable segments: (1) Wood Products, which primarily manufactures EWP and plywood, and (2) Building Materials Distribution (BMD), which is a wholesale distributor of building materials. For more information, see Note 12, Segment Information.

Consolidation

The accompanying quarterly consolidated financial statements have not been audited by an independent registered public accounting firm but, in the opinion of management, include all adjustments necessary to present fairly the financial position, results of operations, cash flows, and stockholders' equity for the interim periods presented. Except as disclosed within these condensed notes to unaudited quarterly consolidated financial statements, the adjustments made were of a normal, recurring nature. Certain information and footnote disclosures normally included in our annual consolidated financial statements have been condensed or omitted. The quarterly consolidated financial statements include the accounts of Boise Cascade and its subsidiaries after elimination of intercompany balances and transactions. Quarterly results are not necessarily indicative of results that may be expected for the full year. These condensed notes to unaudited quarterly consolidated financial statements should be read in conjunction with our 2020 Form 10-K and the other reports we file with the Securities and Exchange Commission.

2.    Summary of Significant Accounting Policies

Accounting Policies

The complete summary of significant accounting policies is included in Note 2, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements in "Item 8. Financial Statements and Supplementary Data" in our 2020 Form 10-K.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP) requires management to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Such estimates include the valuation of accounts receivable, inventories, goodwill, intangible assets, and other long-lived assets; legal contingencies; guarantee obligations; indemnifications; assumptions used in retirement, medical, and workers' compensation benefits; assumptions used in the determination of right-of-use (ROU) assets and related lease liabilities; stock-based compensation; fair value measurements; income taxes; and vendor and customer rebates, among others. These estimates and assumptions are based on management's best estimates and judgment. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. We adjust such estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in these estimates resulting from continuing changes in the economic environment will be reflected in the consolidated financial statements in future periods.

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Revenue Recognition

Revenues are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. For revenue disaggregated by major product line for each reportable segment, see Note 12, Segment Information.

Fees for shipping and handling charged to customers for sales transactions are included in "Sales" in our Consolidated Statements of Operations. When control over products has transferred to the customer, we have elected to recognize costs related to shipping and handling as fulfillment costs. For our Wood Products segment, costs related to shipping and handling are included in "Materials, labor, and other operating expenses (excluding depreciation)" in our Consolidated Statements of Operations. In our Wood Products segment, we view our shipping and handling costs as a cost of the manufacturing process and the movement of product to our end customers. For our BMD segment, costs related to shipping and handling of $48.3 million and $49.2 million, for the three months ended September 30, 2021 and 2020, respectively, and $144.5 million and $134.1 million for the nine months ended September 30, 2021 and 2020, respectively, are included in "Selling and distribution expenses" in our Consolidated Statements of Operations. In our BMD segment, our activities relate to the purchase and resale of finished product, and excluding shipping and handling costs from “Materials, labor, and other operating expenses (excluding depreciation)” provides us a clearer view of our operating performance and the effectiveness of our sales and purchasing functions.

Customer Rebates and Allowances

Rebates are provided to our customers and our customers' customers based on the volume of their purchases, among other factors such as customer loyalty, conversion, and commitment, as well as temporary protection from price increases. We provide the rebates to increase the sell-through of our products. Rebates are generally estimated based on the expected amount to be paid and recorded as a decrease in "Sales." At September 30, 2021, and December 31, 2020, we had $131.5 million and $56.3 million, respectively, of rebates payable to our customers recorded in "Accrued liabilities, Other" on our Consolidated Balance Sheets. We adjust our estimate of revenue at the earlier of when the probability of rebates paid changes or when the amounts become fixed. There have not been significant changes to our estimates of rebates, although it is reasonably possible that a change in the estimate may occur.

Vendor Rebates and Allowances

We receive rebates and allowances from our vendors under a number of different programs, including vendor marketing programs. At September 30, 2021, and December 31, 2020, we had $12.3 million and $9.9 million, respectively, of vendor rebates and allowances recorded in "Receivables, Other" on our Consolidated Balance Sheets. Rebates and allowances received from our vendors are recognized as a reduction of "Materials, labor, and other operating expenses (excluding depreciation)" when the product is sold, unless the rebates and allowances are linked to a specific incremental cost to sell a vendor's product. Amounts received from vendors that are linked to specific selling and distribution expenses are recognized as a reduction of "Selling and distribution expenses" in the period the expense is incurred.

Leases

We primarily lease land, building, and equipment under operating and finance leases. We determine if an arrangement is a lease at inception and assess lease classification as either operating or finance at lease inception or upon modification. Substantially all of our leases with initial terms greater than one year are for real estate, including distribution centers, corporate headquarters, land, and other office space. Substantially all of these lease agreements have fixed payment terms based on the passage of time and are recorded in our BMD segment. Many of our leases include fixed escalation clauses, renewal options and/or termination options that are factored into our determination of lease term and lease payments when appropriate. Renewal options generally range from one to ten years with fixed payment terms similar to those in the original lease agreements. Some lease agreements provide us with the option to purchase the leased property at market value. Our lease agreements do not contain any residual value guarantees.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the estimated present value of fixed lease payments over the lease term. The current portion of our operating and finance lease liabilities are recorded in "Accrued liabilities, Other" on our Consolidated Balance Sheets.

We use our estimated incremental borrowing rate, which is derived from information available at the lease commencement date, in determining the present value of lease payments. In determining our incremental borrowing rates, we

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give consideration to publicly available interest rates for instruments with similar characteristics, including credit rating, term, and collateralization.

For purposes of determining straight-line rent expense, the lease term is calculated from the date we first take possession of the facility, including any periods of free rent and any renewal option periods we are reasonably certain of exercising. Variable lease expense generally includes reimbursement of actual costs for common area maintenance, property taxes, and insurance on leased real estate and are recorded as incurred. Most of our operating lease expense is recorded in "Selling and distribution expenses" in our Consolidated Statements of Operations. In addition, we do not separate lease and non-lease components for all of our leases.

Our short-term leases primarily include equipment rentals with lease terms on a month-to-month basis, which provide for our seasonal needs and flexibility in the use of equipment. Our short-term leases also include certain real estate for which either party has the right to cancel upon providing notice of 30 to 90 days. We do not recognize ROU assets or lease liabilities for short-term leases.

Inventories

Inventories included the following (work in process is not material):

September 30,<br>2021 December 31,<br>2020
(thousands)
Finished goods and work in process $ 556,123 $ 431,663
Logs 50,344 35,622
Other raw materials and supplies 37,903 36,195
$ 644,370 $ 503,480

Property and Equipment

Property and equipment consisted of the following asset classes:

September 30,<br>2021 December 31,<br>2020
(thousands)
Land $ 47,099 $ 47,099
Buildings 154,984 151,718
Improvements 65,570 64,178
Mobile equipment, information technology, and office furniture 185,053 178,271
Machinery and equipment 721,713 687,768
Construction in progress 35,334 40,606
1,209,753 1,169,640
Less accumulated depreciation (750,499) (708,184)
$ 459,254 $ 461,456

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Fair Value

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy under GAAP gives the highest priority to quoted market prices (Level 1) and the lowest priority to unobservable inputs (Level 3). In general, and where applicable, we use quoted prices in active markets for identical assets or liabilities to determine fair value (Level 1). If quoted prices in active markets for identical assets or liabilities are not available to determine fair value, we use quoted prices for similar assets and liabilities or inputs that are observable either directly or indirectly (Level 2). If quoted prices for identical or similar assets are not available or are unobservable, we may use internally developed valuation models, whose inputs include bid prices, and third-party valuations utilizing underlying asset assumptions (Level 3).

Financial Instruments

Our financial instruments are cash and cash equivalents, accounts receivable, accounts payable, long-term debt, and interest rate swaps. Our cash is recorded at cost, which approximates fair value, and our cash equivalents are money market funds. As of September 30, 2021, and December 31, 2020, we held $710.7 million and $371.8 million, respectively, in money market funds that are measured at fair value on a recurring basis using Level 1 inputs. The recorded values of accounts receivable and accounts payable approximate fair values based on their short-term nature. At September 30, 2021, and December 31, 2020, the book value of our fixed-rate debt for each period was $400.0 million, and the fair value was estimated to be $428.0 million and $432.0 million, respectively. The difference between the book value and the fair value is derived from the difference between the period-end market interest rate and the stated rate of our fixed-rate, long-term debt. We estimated the fair value of our fixed-rate debt using quoted market prices of our debt in inactive markets (Level 2 inputs). The interest rate on our variable-rate debt is based on market conditions such as the London Interbank Offered Rate (LIBOR) or a base rate. Because the interest rate on the variable-rate debt is based on current market conditions, we believe that the estimated fair value of the outstanding balance on our variable-rate debt approximates book value. As discussed below, we also have interest rate swaps to mitigate our variable interest rate exposure, the fair value of which is measured based on Level 2 inputs.

Interest Rate Risk and Interest Rate Swaps

We are exposed to interest rate risk arising from fluctuations in variable-rate LIBOR on our term loan and when we have loan amounts outstanding on our Revolving Credit Facility. At September 30, 2021, we had $50.0 million of variable-rate debt outstanding based on one-month LIBOR. Our objective is to limit the variability of interest payments on our debt. To meet this objective, we enter into receive-variable, pay-fixed interest rate swaps to change the variable-rate cash flow exposure to fixed-rate cash flows. In accordance with our risk management strategy, we actively monitor our interest rate exposure and use derivative instruments from time to time to manage the related risk. We do not speculate using derivative instruments.

At September 30, 2021, we had two interest rate swap agreements. Under the interest rate swaps, we receive one-month LIBOR-based variable interest rate payments and make fixed interest rate payments, thereby fixing the interest rate on $50.0 million of variable rate debt exposure. Payments on one interest rate swap, entered into in 2016, with a notional principal amount of $50.0 million are due on a monthly basis at an annual fixed rate of 1.007%, and this swap expires in February 2022 (Initial Swap). During second quarter 2020, we entered into another forward interest rate swap agreement which commences on the expiration date of the Initial Swap. Payments on this interest rate swap with a notional principal amount of $50.0 million will be due on a monthly basis at an annual fixed rate of 0.39%, and this swap expires in June 2025.

The interest rate swap agreements were not designated as cash flow hedges, and as a result, all changes in the fair value are recognized in "Change in fair value of interest rate swaps" in our Consolidated Statements of Operations rather than through other comprehensive income. At September 30, 2021, we recorded a long-term asset of $0.7 million in "Other assets" on our Consolidated Balance Sheets, and we also recorded a long-term liability of $0.2 million in "Other long-term liabilities" on our Consolidated Balance Sheets, representing the fair value of the interest rate swap agreements. At December 31, 2020, we recorded a long-term liability of $0.6 million in "Other long-term liabilities" on our Consolidated Balance Sheets, representing the fair value of the interest rate swap agreements. The swaps were valued based on observable inputs for similar assets and liabilities and other observable inputs for interest rates and yield curves (Level 2 inputs).

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Concentration of Credit Risk

We are exposed to credit risk related to customer accounts receivable. In order to manage credit risk, we consider customer concentrations and current economic trends and monitor the creditworthiness of significant customers based on ongoing credit evaluations. At September 30, 2021, receivables from two customers accounted for approximately 19% and 12% of total receivables. At December 31, 2020, receivables from these two customers accounted for approximately 13% and 12% of total receivables. No other customer accounted for 10% or more of total receivables.

New and Recently Adopted Accounting Standards

In March 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope, which refines the scope of Topic 848 and clarifies some of its guidance as it related to recent rate reform activities. Our current contracts that reference LIBOR include certain debt instruments and interest rate swaps. The amendments are effective for eligible contract modifications subsequent to March 12, 2020, and through December 31, 2022. The adoption of these standards did not and are not expected to have a material effect on our financial statements, but we will assess any eligible contract modifications in the future.

There were no other accounting standards recently issued that had or are expected to have a material impact on our consolidated financial statements and associated disclosures.

3.    Income Taxes

For the three and nine months ended September 30, 2021, we recorded $31.2 million and $183.6 million, respectively, of income tax expense and had an effective rate of 25.4% and 25.3%, respectively. For the three and nine months ended September 30, 2020, we recorded $34.6 million and $50.0 million, respectively, of income tax expense and had an effective rate of 25.1% in both periods. For all periods, the primary reason for the difference between the federal statutory income tax rate of 21% and the effective tax rate was the effect of state taxes.

During the nine months ended September 30, 2021 and 2020, cash paid for taxes, net of refunds received, were $203.5 million and $35.3 million, respectively.

4.    Net Income Per Common Share

Basic net income per common share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Weighted average common shares outstanding for the basic net income per common share calculation includes certain vested restricted stock units (RSUs) and performance stock units (PSUs) as there are no conditions under which those shares will not be issued. Diluted net income per common share is computed by dividing net income by the combination of the weighted average number of common shares outstanding during the period and other potentially dilutive weighted average common shares. Other potentially dilutive weighted average common shares include the dilutive effect of stock options, RSUs, and PSUs for each period using the treasury stock method. Under the treasury stock method, the exercise price of a share and the amount of compensation expense, if any, for future service that has not yet been recognized are assumed to be used to repurchase shares in the current period.

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The following table sets forth the computation of basic and diluted net income per common share:

Three Months Ended<br>September 30 Nine Months Ended<br>September 30
2021 2020 2021 2020
(thousands, except per-share data)
Net income $ 91,699 $ 103,192 $ 543,411 $ 148,978
Weighted average common shares outstanding during the period (for basic calculation) 39,442 39,315 39,413 39,264
Dilutive effect of other potential common shares 219 211 210 132
Weighted average common shares and potential common shares (for diluted calculation) 39,661 39,526 39,623 39,396
Net income per common share - Basic $ 2.32 $ 2.62 $ 13.79 $ 3.79
Net income per common share - Diluted $ 2.31 $ 2.61 $ 13.71 $ 3.78

The computation of the dilutive effect of other potential common shares excludes stock awards representing no shares of common stock in both the three months ended September 30, 2021 and 2020, and 0.1 million and 0.2 million shares of common stock, respectively, in the nine months ended September 30, 2021 and 2020. Under the treasury stock method, the inclusion of these stock awards would have been antidilutive.

5.    Curtailment of Manufacturing Facility

On February 20, 2020, we decided to permanently curtail I-joist production at our Roxboro, North Carolina facility by March 31, 2020. As a result of the curtailment, we recorded $15.0 million of accelerated depreciation during first quarter 2020 to fully depreciate the curtailed I-joist assets. In addition, we recorded $1.7 million of various closure-related costs in "Loss on curtailment of facility" in our Consolidated Statements of Operations.

6.    Debt

Long-term debt consisted of the following:

September 30,<br>2021 December 31,<br>2020
(thousands)
Asset-based revolving credit facility due 2025 $ — $ —
Asset-based credit facility term loan due 2025 50,000 50,000
4.875% senior notes due 2030 400,000 400,000
Deferred financing costs (5,581) (6,208)
Long-term debt $ 444,419 $ 443,792

Asset-Based Credit Facility

On May 15, 2015, Boise Cascade and its principal operating subsidiaries, Boise Cascade Wood Products, L.L.C., and Boise Cascade Building Materials Distribution, L.L.C., as borrowers, and Boise Cascade Wood Products Holdings Corp., as guarantor, entered into an Amended and Restated Credit Agreement, as amended, (Amended Agreement) with Wells Fargo Capital Finance, LLC, as administrative agent, and the banks named therein as lenders. The Amended Agreement includes a $350 million senior secured asset-based revolving credit facility (Revolving Credit Facility) and a $50.0 million term loan (ABL Term Loan) maturing on March 13, 2025. Interest on borrowings under our Revolving Credit Facility and ABL Term Loan are payable monthly. Borrowings under the Amended Agreement are constrained by a borrowing base formula dependent upon levels of eligible receivables and inventory reduced by outstanding borrowings and letters of credit (Availability).

The Amended Agreement is secured by a first-priority security interest in substantially all of our assets, except for property and equipment. The proceeds of borrowings under the agreement are available for working capital and other general corporate purposes.

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The Amended Agreement contains customary nonfinancial covenants, including a negative pledge covenant and restrictions on new indebtedness, investments, distributions to equity holders, asset sales, and affiliate transactions, the scope of which are dependent on the Availability existing from time to time. The Amended Agreement also contains a requirement that we meet a 1:1 fixed-charge coverage ratio (FCCR), applicable only if Availability falls below 10% of the aggregate revolving lending commitments (or $35 million). Availability exceeded the minimum threshold amounts required for testing of the FCCR at all times since entering into the Amended Agreement, and Availability at September 30, 2021, was $345.3 million.

The Amended Agreement permits us to pay dividends only if at the time of payment (i) no default has occurred or is continuing (or would result from such payment) under the Amended Agreement, and (ii) pro forma Excess Availability (as defined in the Amended Agreement) is equal to or exceeds 25% of the aggregate Revolver Commitments (as defined in the Amended Agreement) or (iii) (x) pro forma Excess Availability is equal to or exceeds 15% of the aggregate Revolver Commitment and (y) our fixed-charge coverage ratio is greater than or equal to 1:1 on a pro forma basis.

Revolving Credit Facility

Interest rates under the Revolving Credit Facility are based, at our election, on either LIBOR or a base rate, as defined in the Amended Agreement, plus a spread over the index elected that ranges from 1.25% to 1.50% for loans based on LIBOR and from 0.25% to 0.50% for loans based on the base rate. The spread is determined on the basis of a pricing grid that results in a higher spread as average quarterly Availability declines. Letters of credit are subject to a fronting fee payable to the issuing bank and a fee payable to the lenders equal to the LIBOR margin rate. In addition, we are required to pay an unused commitment fee at a rate of 0.25% per annum of the average unused portion of the lending commitments.

At both September 30, 2021, and December 31, 2020, we had no borrowings outstanding under the Revolving Credit Facility and $4.7 million and $4.8 million, respectively, of letters of credit outstanding. These letters of credit and borrowings, if any, reduce Availability under the Revolving Credit Facility by an equivalent amount. During the nine months ended September 30, 2021, the minimum and maximum borrowings under the Revolving Credit Facility were zero and $28.0 million, respectively, and the average interest rate on borrowings was approximately 1.37%.

ABL Term Loan

The ABL Term Loan was provided by institutions within the Farm Credit system. Borrowings under the ABL Term Loan may be repaid from time to time at the discretion of the borrowers without premium or penalty. However, any principal amount of ABL Term Loan repaid may not be subsequently re-borrowed.

Interest rates under the ABL Term Loan are based, at our election, on either LIBOR or a base rate, as defined in the Amended Agreement, plus a spread over the index elected that ranges from 1.75% to 2.00% for LIBOR rate loans and from 0.75% to 1.00% for base rate loans, both dependent on the amount of Average Excess Availability (as defined in the Amended Agreement). During the nine months ended September 30, 2021, the average interest rate on the ABL Term Loan was approximately 1.85%.

We have received and expect to continue receiving patronage credits under the ABL Term Loan. Patronage credits are distributions of profits from banks in the Farm Credit system, which are cooperatives that are required to distribute profits to their members. Patronage distributions, which are generally made in cash, are received in the year after they are earned. Patronage credits are recorded as a reduction to interest expense in the year earned. After giving effect to expected patronage distributions, the effective average net interest rate on the ABL Term Loan was approximately 0.9% during the nine months ended September 30, 2021.

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2030 Notes

On July 27, 2020, we issued $400 million of 4.875% senior notes due July 1, 2030 (2030 Notes) through a private placement that was exempt from the registration requirements of the Securities Act. Interest on our 2030 Notes is payable semiannually in arrears on January 1 and July 1. The 2030 Notes are guaranteed by each of our existing and future direct or indirect domestic subsidiaries that is a guarantor under our Amended Agreement.

The 2030 Notes are senior unsecured obligations and rank equally with all of the existing and future senior indebtedness of Boise Cascade Company and of the guarantors, senior to all of their existing and future subordinated indebtedness, effectively subordinated to all of their present and future senior secured indebtedness (including all borrowings with respect to our Amended Agreement to the extent of the value of the assets securing such indebtedness), and structurally subordinated to the indebtedness of any subsidiaries that do not guarantee the 2030 Notes.

The terms of the indenture governing the 2030 Notes, among other things, limit the ability of Boise Cascade and our restricted subsidiaries to: incur additional debt; declare or pay dividends; redeem stock or make other distributions to stockholders; make investments; create liens on assets; consolidate, merge or transfer substantially all of their assets; enter into transactions with affiliates; and sell or transfer certain assets. The indenture governing the 2030 Notes permits us to pay dividends only if at the time of payment (i) no default has occurred or is continuing (or would result from such payment) under the indenture, and (ii) our consolidated leverage ratio is no greater than 3.5:1, or (iii) the dividend, together with other dividends since the issue date, would not exceed our "builder" basket under the indenture. In addition, the indenture includes certain specific baskets for the payment of dividends.

The indenture governing the 2030 Notes provides for customary events of default and remedies.

Interest Rate Swaps

For information on interest rate swaps, see Interest Rate Risk and Interest Rate Swaps of Note 2, Summary of Significant Accounting Policies.

Cash Paid for Interest

For the nine months ended September 30, 2021 and 2020, cash payments for interest were $20.4 million and $21.2 million, respectively.

7.    Leases

Lease Costs

The components of lease expense were as follows:

Three Months Ended<br>September 30 Nine Months Ended<br>September 30
2021 2020 2021 2020
(thousands)
Operating lease cost $ 3,474 $ 3,313 $ 10,199 $ 10,020
Finance lease cost
Amortization of right-of-use assets 598 603 1,803 1,602
Interest on lease liabilities 592 615 1,775 1,659
Variable lease cost 927 754 2,651 2,215
Short-term lease cost 1,391 899 3,646 2,969
Sublease income (113) (31) (176) (108)
Total lease cost $ 6,869 $ 6,153 $ 19,898 $ 18,357

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Other Information

Supplemental cash flow information related to leases was as follows:

Nine Months Ended<br>September 30
2021 2020
(thousands)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases $ 10,080 $ 9,744
Operating cash flows from finance leases 1,768 1,659
Financing cash flows from finance leases 1,127 936
Right-of-use assets obtained in exchange for lease obligations
Operating leases 9,532 6,628
Finance leases — 9,871

Other information related to leases was as follows:

September 30, 2021 December 31, 2020
Weighted-average remaining lease term (years)
Operating leases 7 8
Finance leases 15 15
Weighted-average discount rate
Operating leases 5.9 % 6.4 %
Finance leases 7.7 % 7.7 %

As of September 30, 2021, our minimum lease payment requirements for noncancelable operating and finance leases are as follows:

Operating Leases Finance Leases
(thousands)
Remainder of 2021 $ 3,550 $ 982
2022 14,250 3,879
2023 14,010 3,919
2024 12,593 3,916
2025 10,472 3,601
Thereafter 30,723 37,801
Total future minimum lease payments 85,598 54,098
Less: interest (17,463) (22,236)
Total lease obligations 68,135 31,862
Less: current obligations (10,667) (1,599)
Long-term lease obligations $ 57,468 $ 30,263

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8.    Retirement and Benefit Plans

The following table presents the pension benefit costs:

Three Months Ended<br>September 30 Nine Months Ended<br>September 30
2021 2020 2021 2020
(thousands)
Service cost $ — $ 167 $ — $ 501
Interest cost 24 1,474 71 4,420
Expected return on plan assets — (1,374) — (4,120)
Amortization of actuarial (gain) loss (5) 202 (14) 605
Plan settlement loss — — — 86
Net periodic benefit expense $ 19 $ 469 $ 57 $ 1,492

Service cost is recorded in the same income statement line items as other employee compensation costs arising from services rendered, and the other components of net periodic benefit expense are recorded in "Pension expense (excluding service costs)" in our Consolidated Statements of Operations.

During the nine months ended September 30, 2021, we paid $0.2 million in cash to the nonqualified pension plan participants. For the remainder of 2021, we expect to make approximately $0.1 million in cash payments to our nonqualified pension plan participants.

9.    Stock-Based Compensation

In first quarter 2021 and 2020, we granted two types of stock-based awards under our incentive plan: performance stock units (PSUs) and restricted stock units (RSUs).

PSU and RSU Awards

During the nine months ended September 30, 2021, we granted 73,265 PSUs to our officers and other employees, subject to performance and service conditions. For the officers, the number of shares actually awarded will range from 0% and 200% of the target amount, depending upon Boise Cascade's 2021 return on invested capital (ROIC), as approved by our Compensation Committee in accordance with the related grant agreement. For the other employees, the number of shares actually awarded will range from 0% to 200% of the target amount, depending upon Boise Cascade’s 2021 EBITDA, defined as income before interest (interest expense and interest income), income taxes, and depreciation and amortization, determined in accordance with the related grant agreement. Because the ROIC and EBITDA components contain a performance condition, we record compensation expense over the requisite service period based on the most probable number of shares expected to vest.

During the nine months ended September 30, 2020, we granted 94,850 PSUs to our officers and other employees, subject to performance and service conditions. During the 2020 performance period, officers and other employees both earned 200% of the target based on Boise Cascade’s 2020 ROIC and EBITDA, determined by our Compensation Committee in accordance with the related grant agreement.

The PSUs granted to officers generally vest in a single installment three years from the date of grant, while the PSUs granted to other employees vest in three equal tranches each year after the grant date.

During the nine months ended September 30, 2021 and 2020, we granted an aggregate of 101,059 and 125,716 RSUs, respectively, to our officers, other employees, and nonemployee directors with only service conditions. The RSUs granted to officers and other employees vest in three equal tranches each year after the grant date. The RSUs granted to nonemployee directors vest over a one year period.

We based the fair value of PSU and RSU awards on the closing market price of our common stock on the grant date. During the nine months ended September 30, 2021 and 2020, the total fair value of PSUs and RSUs vested was $9.2 million and $11.1 million, respectively.

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The following summarizes the activity of our PSUs and RSUs awarded under our incentive plan for the nine months ended September 30, 2021:

PSUs RSUs
Number of shares Weighted Average Grant-Date Fair Value Number of shares Weighted Average Grant-Date Fair Value
Outstanding, December 31, 2020 196,340 $ 35.34 212,766 $ 34.24
Granted 73,265 52.45 101,059 52.95
Performance condition adjustment (a) 94,850 36.45 — —
Vested (68,223) 38.70 (106,200) 35.64
Forfeited (50,022) 37.43 (46,325) 34.07
Outstanding, September 30, 2021 246,210 $ 39.50 161,300 $ 45.08

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(a)    Represents additional PSUs granted during the nine months ended September 30, 2021, related to the 2020 performance condition adjustment described above.

Compensation Expense

We record compensation expense over the awards' vesting period and account for share-based award forfeitures as they occur, rather than making estimates of future forfeitures. Any shares not vested are forfeited. We recognize stock awards with only service conditions on a straight-line basis over the requisite service period. Most of our share-based compensation expense was recorded in "General and administrative expenses" in our Consolidated Statements of Operations. Total stock-based compensation recognized from PSUs and RSUs, net of forfeitures, was as follows:

Three Months Ended<br>September 30 Nine Months Ended<br>September 30
2021 2020 2021 2020
(thousands)
PSUs $ 1,190 $ 1,503 $ 3,024 $ 2,804
RSUs 991 991 2,660 3,035
Total $ 2,181 $ 2,494 $ 5,684 $ 5,839

The related tax benefit for the nine months ended September 30, 2021 and 2020, was $1.4 million and $1.5 million respectively. As of September 30, 2021, total unrecognized compensation expense related to nonvested share-based compensation arrangements was $12.7 million. This expense is expected to be recognized over a weighted-average period of 1.9 years.

10.    Stockholders' Equity

Dividends

On November 14, 2017, we announced that our board of directors approved a dividend policy to pay quarterly cash dividends to holders of our common stock. For more information regarding our dividend declarations and payments made during each of the nine months ended September 30, 2021 and 2020, see "Common stock dividends" on our Consolidated Statements of Stockholders' Equity.

On October 28, 2021, our board of directors declared a quarterly dividend of $0.12 per share on our common stock, as well as a supplemental dividend of $3.00 per share on our common stock, both payable on December 15, 2021, to stockholders of record on December 1, 2021. For a description of the restrictions in our asset-based credit facility and the indenture governing our senior notes on our ability to pay dividends, see Note 6, Debt.

Future dividend declarations, including amount per share, record date and payment date, will be made at the discretion of our board of directors and will depend upon, among other things, legal capital requirements and surplus, our future

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operations and earnings, general financial condition, contractual obligations, restrictions imposed by our asset-based credit facility and the indenture governing our senior notes, applicable laws, and other factors that our board of directors may deem relevant.

Accumulated Other Comprehensive Loss

The following table details the changes in accumulated other comprehensive loss for the three and nine months ended September 30, 2021 and 2020:

Three Months Ended<br>September 30 Nine Months Ended<br>September 30
2021 2020 2021 2020
(thousands)
Beginning balance, net of taxes $ (1,085) $ (49,883) $ (1,078) $ (50,248)
Amortization of actuarial (gain) loss, before taxes (a) (5) 202 (14) 605
Effect of settlements, before taxes (a) — — — 86
Income taxes 2 (51) 4 (175)
Ending balance, net of taxes $ (1,088) $ (49,732) $ (1,088) $ (49,732)

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(a)    Represents amounts reclassified from accumulated other comprehensive loss. These amounts are included in the computation of net periodic pension cost. For additional information, see Note 8, Retirement and Benefit Plans.

11.    Transactions With Related Party

Louisiana Timber Procurement Company, L.L.C. (LTP) is an unconsolidated variable-interest entity that is 50% owned by us and 50% owned by Packaging Corporation of America (PCA). LTP procures sawtimber, pulpwood, residual chips, and other residual wood fiber to meet the wood and fiber requirements of us and PCA in Louisiana. We are not the primary beneficiary of LTP as we do not have power to direct the activities that most significantly affect the economic performance of LTP. Accordingly, we do not consolidate LTP's results in our financial statements.

Sales

Related-party sales to LTP from our Wood Products segment in our Consolidated Statements of Operations were $3.6 million and $2.8 million, respectively, during the three months ended September 30, 2021 and 2020, and $10.2 million and $9.5 million, respectively, during the nine months ended September 30, 2021 and 2020. These sales are recorded in "Sales" in our Consolidated Statements of Operations.

Costs and Expenses

Related-party wood fiber purchases from LTP were $22.3 million and $15.6 million, respectively, during the three months ended September 30, 2021 and 2020, and $63.3 million and $52.0 million, respectively, during the nine months ended September 30, 2021 and 2020. These costs are recorded in "Materials, labor, and other operating expenses (excluding depreciation)" in our Consolidated Statements of Operations.

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12.    Segment Information

We operate our business using two reportable segments: Wood Products and BMD. Unallocated corporate costs are presented as reconciling items to arrive at operating income. There are no differences in our basis of measurement of segment profit or loss from those disclosed in Note 17, Segment Information, of the Notes to Consolidated Financial Statements in "Item 8. Financial Statements and Supplementary Data" in our 2020 Form 10-K.

Wood Products and BMD segment sales to external customers, including related parties, by product line are as follows:

Three Months Ended<br>September 30 Nine Months Ended<br>September 30
2021 2020 2021 2020
(millions)
Wood Products (a)
LVL (b) $ (5.1) $ 4.3 $ 4.6 $ 15.6
I-joists (b) (9.3) 3.3 (1.4) 10.4
Other engineered wood products (b) 9.6 5.6 32.8 17.2
Plywood and veneer 119.2 105.1 443.2 234.2
Lumber 21.3 13.3 65.9 37.9
Byproducts 17.7 16.1 54.3 52.5
Other 4.9 3.9 15.8 12.9
158.3 151.6 615.3 380.7
Building Materials Distribution
Commodity 770.9 718.9 2,985.3 1,649.1
General line 580.8 483.0 1,620.2 1,328.5
Engineered wood products 369.5 235.8 923.1 644.3
1,721.1 1,437.7 5,528.6 3,621.9
$ 1,879.5 $ 1,589.3 $ 6,143.9 $ 4,002.6

___________________________________

(a)    Amounts represent sales to external customers. Sales are calculated after intersegment sales eliminations to our BMD segment.

(b)    Sales of EWP to external customers are net of the cost of all EWP rebates and sales allowances provided at various stages of the supply chain (including distributors, retail lumberyards, and professional builders). For the nine months ended September 30, 2021 and 2020, approximately 78% and 80%, respectively, of Wood Products' EWP sales volumes were to our BMD segment.

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An analysis of our operations by segment is as follows:

Three Months Ended<br>September 30 Nine Months Ended<br>September 30
2021 2020 2021 2020
(thousands)
Net sales by segment
Wood Products $ 497,316 $ 363,674 $ 1,524,220 $ 965,240
Building Materials Distribution 1,721,244 1,437,683 5,528,765 3,621,940
Intersegment eliminations (a) (339,109) (212,044) (909,057) (584,573)
Total net sales $ 1,879,451 $ 1,589,313 $ 6,143,928 $ 4,002,607
Segment operating income
Wood Products (b) $ 122,056 $ 66,035 $ 432,869 $ 86,872
Building Materials Distribution 16,565 107,901 343,122 180,413
Total segment operating income 138,621 173,936 775,991 267,285
Unallocated corporate costs (9,235) (15,364) (31,569) (31,396)
Income from operations $ 129,386 $ 158,572 $ 744,422 $ 235,889

___________________________________

(a)    Primarily represents intersegment sales from our Wood Products segment to our BMD segment.

(b)    Wood Products segment operating income for the nine months ended September 30, 2020, included $15.0 million of accelerated depreciation and $1.7 million of other closure-related costs due to the permanent curtailment of I-joist production at our Roxboro, North Carolina facility. For more information, see Note 5, Curtailment of Manufacturing Facility.

13.    Commitments, Legal Proceedings and Contingencies, and Guarantees

Commitments

We are a party to a number of long-term log supply agreements that are discussed in Note 18, Commitments, Legal Proceedings and Contingencies, and Guarantees, of the Notes to Consolidated Financial Statements in "Item 8. Financial Statements and Supplementary Data" in our 2020 Form 10-K. In addition, we have purchase obligations for goods and services, capital expenditures, and raw materials entered into in the normal course of business. As of September 30, 2021, there have been no material changes to the above commitments disclosed in the 2020 Form 10-K.

Legal Proceedings and Contingencies

We are a party to legal proceedings that arise in the ordinary course of our business, including commercial liability claims, premises claims, environmental claims, and employment-related claims, among others. As of the date of this filing, we believe it is not reasonably possible that any of the legal actions against us will, individually or in the aggregate, have a material adverse effect on our financial position, results of operations, or cash flows.

Guarantees

We provide guarantees, indemnifications, and assurances to others. Note 18, Commitments, Legal Proceedings and Contingencies, and Guarantees, of the Notes to Consolidated Financial Statements in "Item 8. Financial Statements and Supplementary Data" in our 2020 Form 10-K describes the nature of our guarantees, including the approximate terms of the guarantees, how the guarantees arose, the events or circumstances that would require us to perform under the guarantees, and the maximum potential undiscounted amounts of future payments we could be required to make. As of September 30, 2021, there have been no material changes to the guarantees disclosed in the 2020 Form 10-K.

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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Understanding Our Financial Information

This Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our consolidated financial statements and related notes in "Item 1. Financial Statements" of this Form 10-Q, as well as our 2020 Form 10-K. The following discussion includes statements regarding our expectations with respect to our future performance, liquidity, and capital resources. Such statements, along with any other nonhistorical statements in the discussion, are forward-looking. These forward-looking statements include, without limitation, any statement that may predict, indicate, or imply future results, performance, or achievements and may contain the words "may," "will," "expect," "believe," "should," "plan," "anticipate," and other similar expressions. All of these forward-looking statements are based on estimates and assumptions made by our management that, although believed by us to be reasonable, are inherently uncertain. These forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described in "Item 1A. Risk Factors" in our 2020 Form 10-K, as well as those factors listed in other documents we file with the Securities and Exchange Commission (SEC). We do not assume an obligation to update any forward-looking statement. Our future actual results may differ materially from those contained in or implied by any of the forward-looking statements in this Form 10-Q.

Background

Boise Cascade Company is a building products company headquartered in Boise, Idaho. As used in this Form 10-Q, the terms "Boise Cascade," "we," and "our" refer to Boise Cascade Company and its consolidated subsidiaries. Boise Cascade is a large, vertically-integrated wood products manufacturer and building materials distributor. We have two reportable segments: (i) Wood Products, which primarily manufactures engineered wood products (EWP) and plywood; and (ii) Building Materials Distribution (BMD), which is a wholesale distributor of building materials. Demand for the products we manufacture, as well as the products we purchase and distribute, is closely correlated with new residential construction in the United States (U.S.) To a lesser extent, demand for our products correlates with residential repair-and-remodeling activity and light commercial construction. For more information, see Note 12, Segment Information, of the Condensed Notes to Unaudited Quarterly Consolidated Financial Statements in "Item 1. Financial Statements" of this Form 10-Q.

Executive Overview

We recorded income from operations of $129.4 million during the three months ended September 30, 2021, compared with income from operations of $158.6 million during the three months ended September 30, 2020. In our Wood Products segment, income increased $56.0 million to $122.1 million for the three months ended September 30, 2021, from $66.0 million for the three months ended September 30, 2020, due primarily to higher EWP, plywood, and lumber sales prices, as well as higher EWP sales volumes, offset partially by higher wood fiber costs and lower margins on inventory purchased for resale through certain customer programs. In our BMD segment, income decreased $91.3 million to $16.6 million for the three months ended September 30, 2021, from $107.9 million for the three months ended September 30, 2020, driven primarily by a gross margin decrease of $100.5 million, resulting from a sharp decline in commodity prices during third quarter 2021. The negative impacts from commodity price declines were offset partially by higher sales volumes and gross margin percentages for EWP and general line products, as well as decreased selling and distribution expenses of $7.8 million. These changes are discussed further in "Our Operating Results" below.

We ended third quarter 2021 with $786.9 million of cash and cash equivalents and $345.3 million of undrawn committed bank line availability, for total available liquidity of $1,132.2 million. We had $444.4 million of outstanding debt at September 30, 2021. We generated $381.5 million of cash during the nine months ended September 30, 2021, as cash provided by operations was offset partially by capital spending, dividends paid on our common stock, and tax withholding payments on stock-based awards. A further description of our cash sources and uses for the nine month comparative periods are discussed in "Liquidity and Capital Resources" below.

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After seeing fewer pandemic-related disruptions during second quarter 2021, we experienced short-term disruptions at many locations during the third quarter as COVID-19 variants spread throughout the United States. We continue to conduct business with certain modifications to mill and distribution center housekeeping and cleanliness protocols, employee travel, employee work locations, and virtualization or cancellation of certain sales and marketing events, among other modifications. In addition, we continue to actively monitor evolving developments, including the impact of COVID-19 variants, and may take actions that alter our business operations as may be required by federal, state, or local authorities, or that we determine are in the best interests of our employees, customers, suppliers, communities, and stockholders. Furthermore, we are monitoring the development of government mandates that companies ensure workers are vaccinated or tested regularly for COVID-19. While we educate our associates on the effectiveness of vaccines and strongly encourage vaccination for its long-term health benefits, the new regulation may have the near-term effect of increasing costs, straining company resources, interrupting operations, reducing employee morale, or increasing employee turnover, which could adversely affect our business, results of operations, or financial condition.

Economic uncertainty due to the pandemic continues. However, low mortgage rates, continuation of work-from-home practices by many in the economy, and demographics in the U.S. have created a favorable demand environment for new residential construction, particularly single-family housing starts, which we expect to continue in 2021 and into next year. As of October 2021, the Blue Chip Economic Indicators consensus forecast for 2021 and 2022 single- and multi-family housing starts in the U.S. were 1.59 million and 1.57 million units, respectively, compared with actual housing starts of 1.38 million in 2020, as reported by the U.S. Census Bureau. In addition, the age of the U.S. housing stock and limited home inventory availability will continue to provide a favorable backdrop for repair-and-remodel spending. Although we believe that current U.S. demographics support a higher level of forecasted housing starts, and many national home builders are reporting strong near-term backlogs, labor shortages and supply induced constraints on residential construction activity may continue to extend build times and limit activity. In addition, the pace of residential construction and repair-and-remodeling activity may be affected by the economic impact of the cost of building materials and construction, housing affordability, mortgage interest rates, wage growth, prospective home buyers' access to financing, consumer confidence, as well as other factors.

As a manufacturer of certain commodity products, we have sales and profitability exposure to declines in commodity product prices and rising input costs. Our distribution business purchases and resells a broad mix of commodity products with periods of increasing prices providing the opportunity for higher sales and increased margins, while declining price environments expose us to declines in sales and profitability. Reflected in our operating results, lumber and panel pricing was very volatile during second and third quarters 2021, with rapidly rising prices in April and most of May followed by sharp price declines through the month of August before stabilizing in September. Future commodity product pricing and commodity input costs could be volatile in response to capacity restoration and industry operating rates, the impact of COVID-19 on residential construction, net import and export activity, transportation constraints or disruptions, inventory levels in various distribution channels, and seasonal demand patterns.

Factors That Affect Our Operating Results and Trends

Our results of operations and financial performance are influenced by a variety of factors, including the following:

•the commodity nature of our products and their price movements, which are driven largely by industry capacity and operating rates, industry cycles that affect supply and demand, and net import and export activity;

•general economic conditions, including but not limited to housing starts, repair-and-remodeling activity, light commercial construction, inventory levels of new and existing homes for sale, foreclosure rates, interest rates, unemployment rates, household formation rates, prospective home buyers' access to and cost of financing, and housing affordability, that ultimately affect demand for our products;

•the duration and magnitude of impacts of the COVID-19 pandemic and related variants;

•the highly competitive nature of our industry;

•disruptions to information systems used to process and store customer, employee, and vendor information, as well as the technology that manages our operations and other business processes;

•material disruptions and/or major equipment failure at our manufacturing facilities;

•concentration of our sales among a relatively small group of customers, as well as the financial condition and creditworthiness of our customers;

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•product shortages, loss of key suppliers, and our dependence on third-party suppliers and manufacturers;

•labor disruptions, shortages of skilled and technical labor, or increased labor costs;

•the need to successfully formulate and implement succession plans for key members of our management team;

•the enactment of tax reform legislation;

•impairment of our long-lived assets, goodwill, and/or intangible assets;

•cost and availability of raw materials, including wood fiber and glues and resins;

•cost of compliance with government regulations, in particular environmental regulations;

•our ability to successfully and efficiently complete and integrate acquisitions;

•declines in demand for our products due to competing technologies or materials, as well as changes in building code provisions;

•substantial ongoing capital investment costs, including those associated with acquisitions, and the difficulty in offsetting fixed costs related to those investments;

•the cost and availability of third-party transportation services used to deliver the goods we manufacture and distribute, as well as our raw materials;

•exposure to product liability, product warranty, casualty, construction defect, and other claims;

•our indebtedness, including the possibility that we may not generate sufficient cash flows from operations or that future borrowings may not be available in amounts sufficient to fulfill our debt obligations and fund other liquidity needs;

•restrictive covenants contained in our debt agreements;

•fluctuations in the market for our equity; and

•the other factors described in "Item 1A. Risk Factors" in our 2020 Form 10-K.

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Our Operating Results

The following tables set forth our operating results in dollars and as a percentage of sales for the three and nine months ended September 30, 2021 and 2020:

Three Months Ended<br>September 30 Nine Months Ended<br>September 30
2021 2020 2021 2020
(millions)
Sales $ 1,879.5 $ 1,589.3 $ 6,143.9 $ 4,002.6
Costs and expenses
Materials, labor, and other operating expenses (excluding depreciation) 1,594.4 1,261.7 4,909.4 3,302.9
Depreciation and amortization 20.3 20.0 60.3 75.3
Selling and distribution expenses 114.5 122.9 366.1 325.9
General and administrative expenses 21.0 26.1 64.3 60.9
Loss on curtailment of facility — — — 1.7
Other (income) expense, net (0.1) 0.1 (0.5) 0.1
1,750.1 1,430.7 5,399.5 3,766.7
Income from operations $ 129.4 $ 158.6 $ 744.4 $ 235.9
(percentage of sales)
Sales 100.0 % 100.0 % 100.0 % 100.0 %
Costs and expenses
Materials, labor, and other operating expenses (excluding depreciation) 84.8 % 79.4 % 79.9 % 82.5 %
Depreciation and amortization 1.1 1.3 1.0 1.9
Selling and distribution expenses 6.1 7.7 6.0 8.1
General and administrative expenses 1.1 1.6 1.0 1.5
Loss on curtailment of facility — — — —
Other (income) expense, net — — — —
93.1 % 90.0 % 87.9 % 94.1 %
Income from operations 6.9 % 10.0 % 12.1 % 5.9 %

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Sales Volumes and Prices

Set forth below are historical U.S. housing starts data, segment sales volumes and average net selling prices for the principal products sold by our Wood Products segment, and sales mix and gross margin information for our BMD segment for the three and nine months ended September 30, 2021 and 2020.

Three Months Ended<br>September 30 Nine Months Ended<br>September 30
2021 2020 2021 2020
(thousands)
U.S. Housing Starts (a)
Single-family 294.4 281.3 859.0 713.1
Multi-family 125.9 106.2 354.7 302.4
420.3 387.5 1,213.7 1,015.5
(thousands)
Segment Sales
Wood Products $ 497,316 $ 363,674 $ 1,524,220 $ 965,240
Building Materials Distribution 1,721,244 1,437,683 5,528,765 3,621,940
Intersegment eliminations (339,109) (212,044) (909,057) (584,573)
Total sales $ 1,879,451 $ 1,589,313 $ 6,143,928 $ 4,002,607
Wood Products (millions)
Sales Volumes
Laminated veneer lumber (LVL) (cubic feet) 4.6 4.6 13.7 13.1
I-joists (equivalent lineal feet) 76 63 224 172
Plywood (sq. ft.) (3/8" basis) 314 316 955 948
Wood Products (dollars per unit)
Average Net Selling Prices
Laminated veneer lumber (LVL) (cubic foot) $ 22.30 $ 18.14 $ 20.33 $ 18.33
I-joists (1,000 equivalent lineal feet) 1,575 1,237 1,421 1,257
Plywood (1,000 sq. ft.) (3/8" basis) 561 428 672 328
(percentage of Building Materials Distribution sales)
Building Materials Distribution
Product Line Sales
Commodity 44.8 % 50.0 % 54.0 % 45.5 %
General line 33.7 % 33.6 % 29.3 % 36.7 %
Engineered wood 21.5 % 16.4 % 16.7 % 17.8 %
Gross margin percentage (b) 7.9 % 16.4 % 13.1 % 14.4 %

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(a)    Actual U.S. housing starts data reported by the U.S. Census Bureau.

(b)    We define gross margin as "Sales" less "Materials, labor, and other operating expenses (excluding depreciation)." Substantially all costs included in "Materials, labor, and other operating expenses (excluding depreciation)" for our BMD segment are for inventory purchased for resale. Gross margin percentage is gross margin as a percentage of segment sales.

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Sales

For the three months ended September 30, 2021, total sales increased $290.1 million, or 18%, to $1,879.5 million from $1,589.3 million during the three months ended September 30, 2020. For the nine months ended September 30, 2021, total sales increased by $2,141.3 million, or 53%, to $6,143.9 million from $4,002.6 million for the same period in the prior year. As described below, the increase in sales was driven by the changes in sales prices and volumes for the products we manufacture and distribute with single-family residential construction activity being the key demand driver of our sales. In third quarter 2021, U.S. housing starts increased 8%, with single-family starts up 5% from the same period in 2020. On a year-to-date basis through September 2021, total and single-family housing starts both increased 20% compared with the same period in 2020. Average composite panel prices for the three months ended September 30, 2021 were 29% higher than in the same period in the prior year, as reflected by Random Lengths composite panel pricing. Average composite lumber prices for the three months ended September 30, 2021 were 34% lower than in the same period in the prior year, as reflected by Random Lengths composite lumber pricing. For the nine months ended September 30, 2021, average composite panel and average composite lumber prices were 130% and 76% higher, respectively, compared with the same period in the prior year.

Wood Products.  Sales, including sales to our BMD segment, increased $133.6 million, or 37%, to $497.3 million for the three months ended September 30, 2021, from $363.7 million for the three months ended September 30, 2020. The increase in sales was driven by higher plywood prices of 31%, resulting in increased sales of $41.6 million. Higher sales prices for I-joists and LVL of 27% and 23%, respectively, resulted in increased sales of $25.8 million and $19.4 million, respectively. In addition, sales volumes for I-joists and LVL increased 21% and 2%, respectively, resulting in increased sales of $16.4 million and $1.6 million, respectively. Improved lumber sales prices of 99% contributed $10.4 million to the increase in sales. Plywood volumes were flat compared with the same period in the prior year.

For the nine months ended September 30, 2021, sales, including sales to our BMD segment, increased $559.0 million, or 58%, to $1,524.2 million from $965.2 million for the same period in the prior year. The increase in sales was driven primarily by higher plywood prices of 105%, resulting in increased sales of $328.4 million. Higher sales volumes for I-joists and LVL of 30% and 5%, respectively, resulted in increased sales of $64.7 million and $11.6 million, respectively. In addition, sales prices for I-joists and LVL increased 13% and 11%, respectively, resulting in increased sales of $36.8 million and $27.4 million, respectively. Improved lumber sales prices and plywood sales volumes of 104% and 1%, respectively, contributed $33.1 million and $2.2 million, respectively, to the increase in sales.

Building Materials Distribution.  Sales increased $283.6 million, or 20%, to $1,721.2 million for the three months ended September 30, 2021, from $1,437.7 million for the three months ended September 30, 2020. Compared with the same quarter in the prior year, the overall increase in sales was driven by a sales price increase of 23%, offset partially by a sales volume decrease of 3%. By product line, commodity sales increased 7%, or $52.0 million; general line product sales increased 20%, or $97.9 million; and sales of EWP (substantially all of which are sourced through our Wood Products segment) increased 57%, or $133.7 million.

During the nine months ended September 30, 2021, sales increased $1,906.8 million, or 53%, to $5,528.8 million from $3,621.9 million for the same period in the prior year. Compared with the same period in the prior year, the overall increase in sales was driven by sales price and volume increases of 50% and 3%, respectively. By product line, commodity sales increased 81%, or $1,336.2 million; general line product sales increased 22%, or $291.8 million; and sales of EWP increased 43%, or $278.8 million.

Costs and Expenses

Materials, labor, and other operating expenses (excluding depreciation) increased $332.7 million, or 26%, to $1,594.4 million for the three months ended September 30, 2021, compared with $1,261.7 million during the same period in the prior year. In our Wood Products segment, materials, labor, and other operating expenses increased, due to higher EWP sales volumes, as well as higher per-unit costs of logs and OSB (used in the manufacture of I-joists) of approximately 19% and 13%, compared with third quarter 2020. However, materials, labor, and other operating expenses as a percentage of sales (MLO rate) in our Wood Products segment decreased by 390 basis points, which was primarily due to higher plywood, EWP, and lumber sales prices, resulting in improved leveraging of labor and wood fiber costs. In BMD, materials, labor, and other operating expenses increased, driven by higher purchased materials costs across all product lines. In addition, BMD's MLO rate increased by 850 basis points compared with third quarter 2020. This increase in MLO rate was driven primarily by a sharp decline in commodity prices during the third quarter 2021, offset partially by improved gross margins on our EWP and general line sales. In our BMD Segment, periods of increasing prices provide the opportunity for higher sales and increased margins, while declining price environments generally result in declines in sales and profitability, as we experienced in commodity products during third quarter 2021.

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For the nine months ended September 30, 2021, materials, labor, and other operating expenses (excluding depreciation), increased $1,606.5 million or 49%, to $4,909.4 million, compared with $3,302.9 million in the same period in the prior year. In our Wood Products segment, materials, labor, and other operating expenses increased, due to higher sales volumes, as well as higher per-unit costs of OSB and logs of approximately 27% and 16%, compared with the first nine months of 2020. However, the MLO rate in our Wood Products segment decreased by 1,480 basis points, which was primarily due to higher plywood, EWP, and lumber sales prices, resulting in improved leveraging of labor costs, wood fiber costs, and other manufacturing costs. In BMD, the increase in materials, labor, and other operating expenses was driven by higher purchased materials costs as a result of higher prices and higher sales volumes across all product lines. In addition, BMD's MLO rate increased by 130 basis points compared with the first nine months of 2020. Our MLO rate for the nine months ended September 30, 2021, was negatively impacted by the sharp decline in commodity prices during the third quarter 2021, offset partially by improved gross margin percentages on our EWP and general line sales.

Depreciation and amortization expenses increased $0.3 million, or 1%, to $20.3 million for the three months ended September 30, 2021, compared with $20.0 million during the same period in the prior year. For the nine months ended September 30, 2021, these expenses decreased $15.0 million, or 20%, to $60.3 million, compared with $75.3 million in the same period in the prior year, due primarily to recording accelerated depreciation of $15.0 million in first quarter 2020 to fully depreciate the curtailed I-joist production assets at our Roxboro, North Carolina facility. For additional information, see Note 5, Curtailment of Manufacturing Facility, of the Condensed Notes to Unaudited Quarterly Consolidated Financial Statements in "Item 1. Financial Statements" of this Form 10-Q.

Selling and distribution expenses decreased $8.4 million, or 7%, to $114.5 million for the three months ended September 30, 2021, compared with $122.9 million during the same period in the prior year, due primarily to lower employee-related expenses of $13.0 million, most of which relates to incentive compensation. The decrease in selling and distribution expenses was offset partially by an increase in occupancy expenses, as well increased discretionary expenses, including travel and entertainment and professional fees. For the nine months ended September 30, 2021, selling and distribution expenses increased $40.2 million, or 12%, to $366.1 million, compared with $325.9 million during the same period in 2020, due primarily to higher employee-related expenses, including incentive compensation, of $28.3 million, as well as higher shipping and handling costs and occupancy expenses of $5.3 million and $3.4 million, respectively.

General and administrative expenses decreased $5.1 million, or 19%, to $21.0 million for the three months ended September 30, 2021, compared with $26.1 million for the same period in the prior year, due primarily to lower employee-related expenses of $5.9 million, most of which relates to incentive compensation. The decreases were offset partially by increased discretionary expenses, including travel and entertainment expenses and professional fees. For the nine months ended September 30, 2021, general and administrative expenses increased $3.4 million, or 6%, to $64.3 million, compared with $60.9 million during the same period in 2020. The increase was primarily a result of higher employee-related expenses of $3.0 million.

For the nine months ended September 30, 2020, loss on curtailment of facility was $1.7 million, representing various closure-related costs from the permanent curtailment of I-joist production at our Roxboro, North Carolina facility. For additional information, see Note 5, Curtailment of Manufacturing Facility, of the Condensed Notes to Unaudited Quarterly Consolidated Financial Statements in "Item 1. Financial Statements" of this Form 10-Q.

Income From Operations

Income from operations decreased $29.2 million to $129.4 million for the three months ended September 30, 2021, compared with $158.6 million for the three months ended September 30, 2020. Income from operations increased $508.5 million to $744.4 million for the nine months ended September 30, 2021, compared with $235.9 million for the nine months ended September 30, 2020.

Wood Products.  Segment income increased $56.0 million to $122.1 million for the three months ended September 30, 2021, compared with $66.0 million for the three months ended September 30, 2020. The increase in segment income was due primarily to higher EWP, plywood, and lumber sales prices, as well as higher EWP sales volumes. These increases in segment income were offset partially by higher wood fiber costs and lower margins on inventory purchased for resale through certain customer programs.

For the nine months ended September 30, 2021, segment income increased $346.0 million to $432.9 million from $86.9 million for the nine months ended September 30, 2020. The increase in segment income was due primarily to higher plywood, EWP, and lumber sales prices, as well as higher EWP sales volumes. In addition, first quarter 2020 results included

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accelerated depreciation and amortization expense and loss on curtailment of facility of $15.0 million and $1.7 million, respectively, related to the permanent curtailment of I-joist production at our Roxboro, North Carolina facility. These increases were offset partially by higher wood fiber costs and other manufacturing costs. In addition, selling and distribution expenses and general and administrative expenses increased $1.7 million and $0.7 million, respectively.

Building Materials Distribution.  Segment income decreased $91.3 million to $16.6 million for the three months ended September 30, 2021, from $107.9 million for the three months ended September 30, 2020. The decline in segment income was driven primarily by a gross margin decrease of $100.5 million, or a decline in gross margin percentage of 850 basis points, resulting from a sharp decline in commodity prices during third quarter 2021. The negative impacts from commodity price declines were offset partially by higher sales volumes and gross margin percentages for EWP and general line products, as well as decreased selling and distribution expenses of $7.8 million.

For the nine months ended September 30, 2021, segment income increased $162.7 million to $343.1 million from $180.4 million for the nine months ended September 30, 2020. The increase in segment income was driven by a gross margin increase of $202.7 million, resulting from improved gross margins on EWP, general line, and commodity products compared with the first nine months of 2020. This improvement was offset partially by increased selling and distribution expenses of $38.6 million.

Corporate.  Unallocated corporate expenses decreased $6.1 million to $9.2 million for the three months ended September 30, 2021, from $15.4 million for the same period in the prior year. The decrease was due primarily to lower employee-related expenses of $3.0 million, most of which relates to incentive compensation. In addition, as part of our self-insured risk retention program, corporate absorbed approximately $3.2 million of estimated business interruption losses at Wood Products facilities in third quarter 2020.

For the nine months ended September 30, 2021, unallocated corporate expenses increased $0.2 million to $31.6 million from $31.4 million for the nine months ended September 30, 2020. The increase was due primarily to higher employee-related expenses, offset partially by lower self-insurance losses during the first nine months of 2021.

Other

Change in fair value of interest rate swaps. For information related to our interest rate swaps, see the discussion under "Interest Rate Risk and Interest Rate Swaps" of Note 2, Summary of Significant Accounting Policies, of the Condensed Notes to Unaudited Quarterly Consolidated Financial Statements in "Item 1. Financial Statements" of this Form 10-Q.

Loss on extinguishment of debt. In connection with the issuance of the $400 million of 4.875% senior notes due July 1, 2030 (2030 Notes), we commenced a tender offer to purchase any and all of our $350 million aggregate principal amount of 5.625% senior notes due September 1, 2024 (2024 Notes) then outstanding. On July 27, 2020, we accepted for purchase an aggregate principal amount of $212.5 million of the 2024 Notes that were tendered. On September 1, 2020, we redeemed the remaining $137.5 million in aggregate principal amount of the 2024 Notes outstanding. In connection with these transactions, we recognized a pre-tax loss on the extinguishment of debt of $14.0 million during third quarter 2020. The loss includes $10.8 million in debt extinguishment premium payments and $3.2 million for the write-off of unamortized deferred financing costs. For more information related to our indebtedness, see Note 6, Debt of the Condensed Notes to Unaudited Quarterly Consolidated Financial Statements in "Item 1. Financial Statements" of this Form 10-Q.

Income Tax Provision

For the three and nine months ended September 30, 2021, we recorded $31.2 million and $183.6 million, respectively, of income tax expense and had an effective rate of 25.4% and 25.3%, respectively. For the three and nine months ended September 30, 2020, we recorded $34.6 million and $50.0 million, respectively, of income tax expense and had an effective rate of 25.1% in both periods. For all periods, the primary reason for the difference between the federal statutory income tax rate of 21% and the effective tax rate was the effect of state taxes.

Industry Mergers and Acquisitions

On August 27, 2020, Builders FirstSource, Inc. (BFS) and BMC Stock Holdings (BMC) announced a definitive merger agreement. The merger closed in early January 2021. Prior to the merger, BFS and BMC were both customers of ours. We believe we have a good relationship with the combined company and the transaction has not, and we do not expect it to have, a material impact on our future results of operations. The merger resulted in the combined company accounting for 19% of total receivables as of September 30, 2021.

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Liquidity and Capital Resources

We ended third quarter 2021 with $786.9 million of cash and cash equivalents and $444.4 million of debt. At September 30, 2021, we had $1,132.2 million of available liquidity (cash and cash equivalents and undrawn committed bank line availability). We generated $381.5 million of cash during the nine months ended September 30, 2021, as cash provided by operations was offset partially by capital spending, dividends paid on our common stock, and tax withholding payments on stock-based awards. Further descriptions of our cash sources and uses for the nine month comparative periods are noted below.

We believe that our cash flows from operations, combined with our current cash levels and available borrowing capacity, will be adequate to fund debt service requirements and provide cash, as required, to support our ongoing operations, capital expenditures, lease obligations, working capital, income tax payments, and to pay cash dividends to holders of our common stock over the next 12 months. We expect to fund our seasonal and intra-month working capital requirements in the remainder of 2021 from cash on hand and, if necessary, borrowings under our revolving credit facility.

Sources and Uses of Cash

We generate cash primarily from sales of our products, as well as short-term and long-term borrowings. Our primary uses of cash are for expenses related to the manufacture and distribution of building products, including inventory purchased for resale, wood fiber, labor, energy, and glues and resins. In addition to paying for ongoing operating costs, we use cash to invest in our business, service our debt, pay dividends, repurchase our common stock, and meet our contractual obligations and commercial commitments. Below is a discussion of our sources and uses of cash for operating activities, investing activities, and financing activities.

Nine Months Ended<br>September 30
2021 2020
(thousands)
Net cash provided by operations $ 527,091 $ 293,771
Net cash used for investment (50,824) (46,431)
Net cash used for financing (94,763) (28,642)

Operating Activities

For the nine months ended September 30, 2021, our operating activities generated $527.1 million of cash, compared with $293.8 million of cash generated in the same period in 2020. The $233.3 million increase in cash provided by operations was due primarily to an improvement in income from operations. See "Our Operating Results" in this Management's Discussion and Analysis of Financial Condition and Results of Operations for more information related to factors affecting our operating results. In addition, pension contributions decreased $12.4 million compared to the prior year. These increases in cash were offset partially by an increase in working capital of $63.0 million during the nine months ended September 30, 2021, compared with a $41.2 million decrease for the same period in the prior year. In addition, cash paid for taxes, net of refunds received, increased $168.2 million, compared to the prior year, resulting from the significant improvement in income from operations during the first nine months of 2021.

The increase in working capital during the nine months ended September 30, 2021 was primarily attributable to higher receivables and inventories, offset by an increase in accounts payable and accrued liabilities. The changes in working capital during the nine months ended September 30, 2020 included an increase in receivables, which was more than offset by an increase in accounts payable and accrued liabilities and lower inventories. The increases in receivables in both periods primarily reflect increased sales of approximately 17% and 70%, comparing sales for the months of September 2021 and 2020 with sales for the months of December 2020 and 2019, respectively. Inventories increased during the nine months ended September 30, 2021 primarily due to increased cost of inventory purchased for resale. During the nine months ended September 30, 2020, distribution inventories decreased due to stronger than expected demand and higher inventory turns, while manufacturing inventories decreased due to strong-end product demand, lower log inventory, and reduced production levels in response to periodic short-term disruptions at many locations due to COVID-19 and hurricanes in the Southeastern U.S. The increase in accounts payable and accrued liabilities provided $186.1 million of cash during the nine months ended September 30, 2021, compared with $213.9 million in the same period a year ago. During both periods, seasonally higher purchasing activity and extended terms offered by major vendors to our BMD segment led to the increase in accounts payable. During the nine months ended September 30, 2021, an increase in accrued rebates contributed to the increase in accrued liabilities. During the nine months ended September 30, 2020, accrued liabilities also increased due to higher incentive compensation accruals for 2020.

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Investment Activities

During the nine months ended September 30, 2021 and 2020, we used $51.5 million and $47.0 million, respectively, of cash for purchases of property and equipment, including business improvement and quality/efficiency projects, replacement and expansion projects, and ongoing environmental compliance.

We expect capital expenditures in 2021 to total approximately $90 million to $100 million. We expect our capital spending in 2021 will be for business improvement and quality/efficiency projects, replacement projects, and ongoing environmental compliance. Included in our capital spending range is the completion of a log utilization center project at our Florien plywood and veneer plant, a new door assembly operation in Houston, and expansion of our distribution capabilities in the Nashville market. We expect our capital spending, excluding acquisitions, to be approximately $100-to-$130 million in 2022. These levels of capital expenditures could increase or decrease as a result of a number of factors, including acquisitions, efforts to accelerate organic growth, exercise of lease purchase options, our financial results, future economic conditions, availability of engineering and construction resources, and timing and availability of equipment purchases.

Financing Activities

During the nine months ended September 30, 2021, our financing activities used $94.8 million of cash, including $91.0 million for common stock dividend payments and $2.7 million of tax withholding payments on stock-based awards. During the nine months ended September 30, 2021, we also borrowed $28.0 million under our revolving credit facility, which were subsequently repaid during the same period with cash on hand.

During the nine months ended September 30, 2020, our financing activities used $28.6 million of cash. On July 27, 2020, we issued $400 million of 2030 Notes. With proceeds from the 2030 Notes issuance, we retired our $350 million of 2024 Notes and paid-off our American AgCredit term loan of $45.0 million. In connection with the retirement of the 2024 Notes, we made debt extinguishment premium payments of $10.8 million.

During the nine months ended September 30, 2020, our financing activities also used $12.6 million for common stock dividend payments, $6.2 million for financing costs related to the 2030 Notes, and $3.3 million of tax withholding payments on stock-based awards. During the nine months ended September 30, 2020, we did not borrow under our revolving credit facility.

Future dividend declarations, including amount per share, record date and payment date, will be made at the discretion of our board of directors and will depend upon, among other things, legal capital requirements and surplus, our future operations and earnings, general financial condition, contractual obligations, restrictions imposed by our asset-based credit facility and the indenture governing our senior notes, applicable laws, and other factors that our board of directors may deem relevant.

For more information related to our debt transactions and structure, and our dividend policy, see the discussion in Note 6, Debt, and Note 10, Stockholders' Equity, respectively, of the Condensed Notes to Unaudited Quarterly Consolidated Financial Statements in "Item 1. Financial Statements" of this Form 10-Q.

Contractual Obligations

For information about contractual obligations, see Contractual Obligations in "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2020 Form 10-K. As of September 30, 2021, there have been no material changes in contractual obligations outside the ordinary course of business since December 31, 2020.

Off-Balance-Sheet Activities

At September 30, 2021, and December 31, 2020, we had no material off-balance-sheet arrangements with unconsolidated entities.

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Guarantees

Note 10, Debt, and Note 18, Commitments, Legal Proceedings and Contingencies, and Guarantees, of the Notes to Consolidated Financial Statements in "Item 8. Financial Statements and Supplementary Data" in our 2020 Form 10-K describe the nature of our guarantees, including the approximate terms of the guarantees, how the guarantees arose, the events or circumstances that would require us to perform under the guarantees, and the maximum potential undiscounted amounts of future payments we could be required to make. As of September 30, 2021, there have been no material changes to the guarantees disclosed in our 2020 Form 10-K.

Seasonal Influences

We are exposed to fluctuations in quarterly sales volumes and expenses due to seasonal factors. These seasonal factors are common in the building products industry. Seasonal changes in levels of building activity affect our building products businesses, which are dependent on housing starts, repair-and-remodeling activities, and light commercial construction activities. We typically report lower sales volumes in the first and fourth quarters due to the impact of poor weather on the construction market, and we generally have higher sales volumes in the second and third quarters, reflecting an increase in construction due to more favorable weather conditions. We typically have higher working capital in the first and second quarters in preparation and response to the building season. Seasonally cold weather increases costs, especially energy consumption costs, at most of our manufacturing facilities.

Employees

As of October 17, 2021, we had approximately 6,020 employees. Approximately 23% of these employees work pursuant to collective bargaining agreements. As of October 17, 2021, we had ten collective bargaining agreements. Two agreements covering approximately 750 employees at our Oakdale and Florien plywood plants expired on July 15, 2021, but the terms and conditions of these agreements remain in effect pending negotiation of new agreements. We may not be able to renew these agreements or may renew them on terms that are less favorable to us than the current agreements. If any of these agreements are not renewed or extended upon their termination, we could experience a material labor disruption, strike, or significantly increased labor costs at one or more of our facilities, either in the course of negotiations of a labor agreement or otherwise. Labor disruptions or shortages could prevent us from meeting customer demands or result in increased costs, thereby reducing our sales and profitability.

Disclosures of Financial Market Risks

In the normal course of business, we are exposed to financial risks such as changes in commodity prices, interest rates, and foreign currency exchange rates. As of September 30, 2021, there have been no material changes to financial market risks disclosed in our 2020 Form 10-K.

Environmental

As of September 30, 2021, there have been no material changes to environmental issues disclosed in our 2020 Form 10-K. For additional information, see Environmental in "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2020 Form 10-K.

Critical Accounting Estimates

Critical accounting estimates are those that are most important to the portrayal of our financial condition and results. These estimates require management's most difficult, subjective, or complex judgments, often as a result of the need to estimate matters that are inherently uncertain. We review the development, selection, and disclosure of our critical accounting estimates with the Audit Committee of our board of directors. For information about critical accounting estimates, see Critical Accounting Estimates in "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2020 Form 10-K. At September 30, 2021, there have been no material changes to our critical accounting estimates from those disclosed in our 2020 Form 10-K.

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New and Recently Adopted Accounting Standards

For information related to new and recently adopted accounting standards, see "New and Recently Adopted Accounting Standards" in Note 2, Summary of Significant Accounting Policies, of the Condensed Notes to Unaudited Quarterly Consolidated Financial Statements in "Item 1. Financial Statements" in this Form 10-Q.

ITEM 3.          QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For information relating to quantitative and qualitative disclosures about market risk, see the discussion under "Item 7A. Quantitative and Qualitative Disclosures About Market Risk" and under the headings "Disclosures of Financial Market Risks" and "Financial Instruments" in "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2020 Form 10-K. As of September 30, 2021, there have been no material changes in our exposure to market risk from those disclosed in our 2020 Form 10-K.

ITEM 4.          CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain "disclosure controls and procedures," as defined in Rule 13a-15(e) under the Exchange Act. We have designed these controls and procedures to reasonably assure that information required to be disclosed in our reports filed or submitted under the Exchange Act, such as this Form 10-Q, is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. We have also designed our disclosure controls to provide reasonable assurance that such information is accumulated and communicated to our senior management, including our chief executive officer (CEO) and our chief financial officer (CFO), as appropriate, to allow them to make timely decisions regarding our required disclosures. Based on their evaluation, our CEO and CFO have concluded that as of September 30, 2021, our disclosure controls and procedures were effective in meeting the objectives for which they were designed and were operating at a reasonable assurance level.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the three months ended September 30, 2021, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION

ITEM 1.          LEGAL PROCEEDINGS

We are a party to legal proceedings that arise in the ordinary course of our business, including commercial liability claims, premises claims, environmental claims, and employment-related claims, among others. As of the date of this filing, we believe it is not reasonably possible that any of the legal actions against us will, individually or in the aggregate, have a material adverse effect on our financial position, results of operations, or cash flows.

SEC regulations require us to disclose certain information about proceedings arising under federal, state or local environmental provisions if we reasonably believe that such proceedings may result in monetary sanctions above a stated threshold. Pursuant to the SEC regulations, we use a threshold of $1 million or more for purposes of determining whether disclosure of any such proceedings is required.

ITEM 1A.       RISK FACTORS

This report on Form 10-Q contains forward-looking statements. Statements that are not historical or current facts, including statements about our expectations, anticipated financial results, projected capital expenditures, and future business prospects, are forward-looking statements. You can identify these statements by our use of words such as "may," "will," "expect," "believe," "should," "plan," "anticipate," and other similar expressions. You can find examples of these statements throughout this report, including "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations." We cannot guarantee that our actual results will be consistent with the forward-looking statements we make in this report. You should review carefully the risk factors listed in "Item 1A. Risk Factors" in our 2020 Form 10-K, as well as those factors listed in other documents we file with the Securities and Exchange Commission and the risk factors below. We do not assume an obligation to update any forward-looking statement.

The proposed new regulation concerning mandatory COVID-19 vaccination of employees could have a material adverse impact on our business and results of operations.

On September 9, 2021, new regulation was proposed requiring all employers with at least 100 employees to ensure that their employees are fully vaccinated or require unvaccinated workers to get a negative test at least once a week. The Department of Labor's Occupational Safety and Health Administration is drafting an emergency regulation to carry out this mandate, which is expected to be released in the coming weeks. Uncertainty remains regarding, among other things, whether the vaccine mandate will apply to all employees or only to employees who work at on-site locations, and how compliance will be monitored.

We are unable to predict the impact the new regulation would have on us. While we educate our associates on the effectiveness of vaccines and strongly encourage vaccination for its long-term health benefits, the new regulation may have the near-term effect of increasing costs, straining company resources, interrupting operations, reducing employee morale, or increasing employee turnover, which could adversely affect our business, results of operations, or financial condition.

The enactment of tax reform legislation could adversely impact our financial position and results of operations.

Various levels of government are increasingly focused on tax reform and other legislative actions to increase tax revenue. For example, the current administration has proposed to increase the U.S. corporate income tax rate from 21%. Such proposed changes, as well as regulations and legal decisions interpreting and applying these changes, may have significant impacts on our effective tax rate, cash tax expenses, and net deferred tax attributes in future periods.

ITEM 2.          UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3.          DEFAULTS UPON SENIOR SECURITIES

None.

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ITEM 4.          MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5.          OTHER INFORMATION

None.

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ITEM 6.          EXHIBITS

Filed With the Quarterly Report on Form 10-Q for the Quarter Ended September 30, 2021

Number Description
10.1* Pension Plan Group Annuity Contract, effective August 6, 2020
31.1 CEO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2 CFO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1 CEO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2 CFO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS Inline XBRL Instance Document
101.SCH Inline XBRL Taxonomy Extension Schema Document
101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document
104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Portions of this exhibit marked by brackets have been omitted.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

BOISE CASCADE COMPANY
/s/ Kelly E. Hibbs
Kelly E. Hibbs<br>Senior Vice President, Chief Financial Officer and Treasurer

Date:  November 1, 2021

37

Document

Exhibit 10.1

CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT THAT IS MARKED BY [***] HAS BEEN OMITTED BECAUSE IT (I) IS NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM IF PUBLICLY DISCLOSED.

image_0.jpg

The Prudential Insurance Company of America

Newark, New Jersey

Contract-Holder:<br><br><br><br>Boise Cascade Company for the exclusive benefit of participants and beneficiaries of the Plan Plan:<br><br><br><br>Boise Cascade Company Pension Plan
Employer:<br><br><br><br>Boise Cascade Company
Group Annuity Contract No.:<br><br><br><br>[ *** ] Jurisdiction:<br><br><br><br>Idaho
Effective Date:<br><br><br><br>August 6, 2020 Contribution Amount as of Effective Date:<br><br>[ *** ]<br><br><br><br>Contribution Adjustment Amount:<br><br>[ *** ]<br><br>Total Contribution Amount as of August 6, 2020:<br><br>[ *** ]
Pages Attached: 1-43, Cash and Transferred Assets Exhibit, Tables and Annuity Exhibits
BOISE CASCADE COMPANY for the exclusive benefit of participants and beneficiaries of the Plan THE PRUDENTIAL INSURANCE COMPANY<br><br>OF AMERICA<br><br>751 Broad Street<br><br>Newark, NJ 07102
--- ---
By:    /s/ Kelly Hibbs<br><br>Title: SVP, CFO & Treasurer<br><br><br><br>Date: 7/28/21 /s/ Charles F. Lowrey<br><br>Chief Executive Officer<br><br><br><br>/s/ Margaret M. Foran<br><br>Secretary<br><br><br><br>Attest: /s/ Stephen D. Mayernick<br><br>Date: July 28, 2021

Single-Premium Non-Participating Group Annuity Contract supported by a Separate Account providing for Annuity Payments, subject to the provisions of this Contract. The Annuity Payments hereunder do not vary based on any gains or losses of the assets held in the Separate Account.

GAA-9063[ *** ]     Initially a Buy-In Contract supported by a Commingled Separate Account

TABLE OF CONTENTS

Provision IDefinitions, Separate Account Operation and Termination of Contract 4
1.1Definitions 4
1.2Agreement to Pay Contribution Amount; Deposit into the Separate Account 8
1.3Agreement to Make Annuity Payments; Associated Withdrawals from the Separate Account 9
1.4The Separate Account that Supports this Contract 9
1.5Investments Held in Separate Account; Insulation of Separate Account Assets 10
1.6Insulation of Separate Account Assets 10
1.7Expenses; Establishing Reserves; [ *** ] 10
1.8Process for Making Annuity Payments 11
1.9Persons Entitled to Enforce this Contract 11
1.10Buy-Out Conversion 11
1.11Termination of Contract; Surrender of Contract by Contract-Holder 13
Provision IIPayment of Annuity Payments to Contract-Holder Prior to Buy-Out Conversion 16
2.1General 16
2.2Monthly Payment Process 16
2.3Records Reconciliation Process; Adherence to Code and ERISA 16
2.4Over-reimbursements and Under-reimbursements by Prudential 17
2.5Concerning Beneficiaries 18
2.6Concerning Qualified Domestic Relations Orders 18
Provision IIIPayment Terms and Conditions for Forms of Annuities 20
3.1Covered Lives, Contingent Lives, and Beneficiaries 20
3.2Definitions 20
3.3Annuity Forms 20
3.4Annuity Change Procedure/Conditions 29
3.5Change in Annuity Form 29
3.6Lump Sum Payment Option 31
3.7Earlier Annuity Commencement Date 32
3.8Later Annuity Commencement Date 32
3.9Pre-Retirement Survivor Annuity 34
3.10Small Annuity Payments to Covered Lives 37
3.11No Assignment by Covered Lives and Contingent Lives 37
3.12Proof of Continued Existence for Life Annuities; Escheatment 37
3.13Data Misstatements 38
3.14Concerning Designations 39

GAA-9063-48133    2

3.15Concerning Qualified Domestic Relations Orders 40
3.16Payments to Representatives 40
3.17Certificates 40
3.18Purchase of Additional Annuities after the Data Finalization Date 41
Provision IVGeneral Terms 42
4.1Communications 42
4.2Currency; Payments 42
4.3Reliance on Records; Correction of Errors 42
4.4Contract-Holder; Successor 42
4.5No Implied Waiver 43
4.6Changes 43
4.7Entire Contract - Construction 43
4.8Third Party Beneficiaries 43

TABLES

CASH AND TRANSFERRED ASSETS EXHIBIT

ANNUITY EXHIBITS

GAA-9063[ *** ]    3

Provision IDefinitions, Separate Account Operation and Termination of Contract

1.1    Definitions

In addition to other capitalized terms defined in this Contract, the following capitalized terms shall have the meanings indicated, which definitions shall control in the event a term is also defined in the Annuity Exhibits:

“Age 65 Benefit Amount’’ means the amount so shown for a Disabled Immediate Covered Life on the Annuity Exhibits payable beginning on the first of the month immediately following the Temporary Annuity Expiry Date.

“Aggregate Monthly Payment” means, for each month, the total amount of Annuity Payments payable in respect of all Covered Lives (and, if applicable, Contingent Lives and Beneficiaries) for such month, subject to adjustment as provided in this Contract.

“Amendment Date” means, with respect to an amendment to this Contract, the date specified as such on the Cover Page of this Contract, as amended.

“Annuity Commencement Date” means the date the Annuity Payments commence in respect of a Covered Life and, if applicable, Contingent Life and Beneficiary, which is specified on the Annuity Exhibits.

“Annuity Exhibits” means the Annuity Exhibits attached hereto on the Effective Date, as amended and supplemented pursuant hereto.

“Annuity Payments” means, with respect to each Covered Life (and, if applicable, Contingent Life and Beneficiary), the amount, if any, determined in accordance with Provision II and Provision III of this Contract, as applicable.

“Applicable Interest Rate” means the interest rate assumption set forth under Section 417(e)(3) of the Code as prescribed by the Commissioner of the Internal Revenue Service for the month of November preceding the calendar year containing the Covered Life’s Annuity Commencement Date or such other date provided herein.

“Applicable Mortality Table” means the mortality assumption (without consideration to sex or gender) set forth under Section 417(e)(3)(B) of the Code in effect for the calendar year containing the Covered Life’s Annuity Commencement Date, as prescribed by the Commissioner of the Internal Revenue Service.

“Beneficiary” means a person, other than a Covered Life or a Contingent Life, shown in Prudential’s records as the beneficiary associated with such Covered Life or, after the death of a Covered Life, associated with a Contingent Life. A Beneficiary may receive Annuity Payments under this Contract after the death of a Covered Life or Contingent Life if so provided for under the Annuity Form applicable to the Covered Life. A Representative of a Beneficiary shall have the rights of a Beneficiary hereunder. A Beneficiary is not a party to this Contract and has no rights hereunder, except those expressly conferred on it in Sections 1.9 and 1.10.

“Business Day” means any weekday on which the banks in New York City, New York are open for business. If any payment under this Contract is due and payable on a day which is not a Business Day,

GAA-9063[ *** ]    4

or if any notice or report is required to be given on a day which is not a Business Day, such payment shall be due and payable or such notice or report shall be given on the next succeeding Business Day.

“Buy-Out Conversion” has the meaning assigned in Section 1.10.

“Cash and Transferred Assets Exhibit” means the Cash and Transferred Assets Exhibit (substantially in the form attached hereto), setting forth the Contribution Amount, as well as the amount of cash paid on the Effective Date.

“Cash and Transferred Assets Exhibit Supplement” means, with respect to an Amendment Date, a supplement (substantially in the form attached hereto) to the Cash and Transferred Assets Exhibit, setting forth the Contribution Adjustment Amount paid on such Amendment Date, as well as (i) the amount of cash paid on such Amendment Date.

“Code” means the Internal Revenue Code of 1986, as amended from time to time, or any successor statute.

“Commingled Account” means the Non-Participating Group Annuity Separate Account of Prudential. Such separate account also supports Prudential’s payment obligations under other group annuity contracts issued by Prudential. Each such contract obligates Prudential to make payments to the contract-holder and/or to individual covered lives, contingent lives and beneficiaries in amounts measured by the life-span of such covered lives, by any lump sum amounts due, by the remaining portion of any period certain annuities, and/or by any contract surrender amounts due.

“Contingent Life” means a person listed on the Annuity Exhibits as entitled to a periodic payment following the death of the Covered Life in accordance with a joint and survivor Annuity Form, but does not include any Beneficiary. A Contingent Life is not a party to this Contract and has no rights hereunder, except those expressly conferred on it in Sections 1.9 and 1.10. A Representative of a Contingent Life shall have the rights of a Contingent Life hereunder.

“Contingent Life Amount” means an amount that is specified in the Annuity Exhibits for the Covered Life’s Annuity Form as the “Contingent Life Amount.”

“Contract” means this Group Annuity Contract, including the Composite Table and Cash and Transferred Assets Exhibits and any supplements thereto and the Annuity Exhibits and any supplements to the Annuity Exhibits attached hereto, as amended from time to time.

“Contract-Holder” means the entity named as such on the Cover Page of this Contract, and any successors or permitted assigns.

“Contribution Adjustment Amount” means, with respect to an amendment of this Contract, the amount specified as such on the Cover Page of this Contract, as amended, payable on the applicable Amendment Date specified on the Cover Page.

“Contribution Amount” means the amount specified as such on the Cover Page of this Contract.

“Covered Life” means each Immediate Covered Life or Deferred Covered Life listed on the Annuity Exhibits as entitled to a periodic payment specified in the Annuity Exhibits, but does not include any Contingent Life or any Beneficiary. A Covered Life is not a party to this Contract and has no rights hereunder, except those expressly conferred on it in Sections 1.9 and 1.10. A Representative of a Covered Life shall have the rights of a Covered Life hereunder.

GAA-9063[ *** ]    5

“Covered Life Amount” means an amount that is specified in the Annuity Exhibits for the Covered Life’s Annuity Form as the “Covered Life Amount.”

“Data Finalization Amendment Date” means the Amendment Date, if any, on which the Annuity Exhibits or any supplements thereto are attached to this Contract reflecting the data determined by Prudential and the Contract-Holder as of the Data Finalization Date and, if applicable, the related Contribution Adjustment Amount is paid.

“Data Finalization Date” means [ *** ] or such other date as may be determined by mutual written consent of the Contract-Holder and Prudential.

“Deferred Covered Life” means each person listed on the Annuity Exhibits as entitled to a periodic and/or lump-sum payment specified on the Annuity Exhibits attached hereto who is not receiving payments under the Plan as of the Effective Date of this Contract. A Deferred Covered Life is not a party to this Contract and has no rights hereunder, except those expressly conferred on it in Section 1.9 hereof.

“Disability Commencement Date” means first day of the month on or next following the later of (i) the Effective Date and (ii) the date the applicable Deferred Covered Life has incurred a Separation From Service at time of disability. Disability is defined as being deemed to be totally and permanently disabled under the Federal Social Security Act or in the case of partial disability under sub-plan SAL deemed disabled by his or her doctor.

“Disabled Immediate Covered Life” means each person listed on the Annuity Exhibits as an Immediate Covered Life based on a determination by the Contract-Holder prior to the Effective Date that he or she met the requirements to be considered totally and permanently disabled under the Federal Social Security Act or in the case of partial disability under sub-plan SAL deemed disabled by his or her doctor, and the Plan.

“Effective Date” means the date specified as such on the Cover Page of this Contract.

“Employer” means the employer specified on the Cover Page of this Contract.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended, or any successor statute.

“General Account” means the general account of Prudential.

“Guaranteed Number of Payments” means (i) with respect to an Immediate Covered Life, the number of guaranteed payments shown for the Covered Life on the Annuity Exhibits and (ii) with respect to a Deferred Covered Life, the number of guaranteed payments elected by the Deferred Covered Life in accordance with Section 3.5.

“Immediate Covered Life” means each person listed on the Annuity Exhibits as entitled to a periodic and/or lump-sum payment specified on the Annuity Exhibits whose Annuity Commencement Date is October 1, 2020. An Immediate Covered Life is not a party to this Contract and has no rights hereunder, except those expressly conferred on it in Section 1.9 hereof.

“Initial Death Benefit” means the amount determined in accordance with Section 3.3(a)(viii) with respect to a Life Annuity with Deferred Cash Refund.

GAA-9063[ *** ]    6

[ *** ]

“Market Value” means the fair market value of such assets, as such fair market value is determined by Prudential in accordance with its standard procedures for establishing the market value of its assets.

“Original Retirement Date” means the date an Immediate Covered Life retired under the Plan, as specified on the Annuity Exhibits.

“Plan” means the plan specified on the Cover Page of this Contract.

“Pop Up Amount” means (i) with respect to an Immediate Covered Life, the amount that is specified in the Annuity Exhibits for the Covered Life’s Annuity Form as the “Pop Up Amount” and (ii) with respect to a Deferred Covered Life, the difference between the amount the Deferred Covered Life was receiving under the Joint and Survivor Life Annuity with Pop Up and the amount otherwise payable under the Life with Period Certain Annuity with 60 Guaranteed Number of Payments, as determined on the Deferred Covered Life’s Annuity Commencement Date.

"Primary Insurance Amount” means the estimated amount, determined by the Social Security Administration, that the applicable Deferred Covered Life is expected to receive in his or her own right under Title II of the Federal Social Security Act.

“Prudential” means The Prudential Insurance Company of America, its successors and permitted assigns.

“Prudential’s Office” means the following office of Prudential, unless Prudential provides a notice specifying another address for certain or all communications:

The Prudential Insurance Company of America

30 Scranton Office Park

Scranton, PA 18507-1789

Attention: Group Annuity Operations

“Qualified Domestic Relations Order” means a qualified domestic relations order that meets the requirements of ERISA as applied to employee benefit plan participants in effect from time to time.

“Representative” means , with respect to a Covered Life or Contingent Life or Beneficiary, an individual or entity demonstrating to the reasonable satisfaction of Prudential that such individual or entity is duly appointed (a) as a guardian of such Covered Life or Contingent Life or Beneficiary, (b) as a holder of a power of attorney from such Covered Life or Contingent Life or Beneficiary, (c) as a trustee of such Covered Life or Contingent Life or Beneficiary or (d) as a testamentary executor of such Covered Life’s or Contingent Life’s or Beneficiary’s estate; provided, that a “Representative” does not include an assignee of the rights of such person hereunder in contravention of Provision III.

“Required Beginning Date” means the April 1st of the calendar year following the later of (i) the calendar year in which the Deferred Covered Life attains age 70 ½ or (ii) the calendar year in which the Deferred Covered Life incurs a Separation From Service. However, for a Deferred Covered Life that attains age 70 ½ after 12/31/2019, the Required Beginning Date is the April 1st of the calendar year following the later of the calendar year the Deferred Covered Life attains age 72 or the calendar year in which the Deferred Covered Life incurs a Separation From Service.

GAA-9063[ *** ]    7

“Separate Account” means the Commingled Account. The contracts supported by Commingled Account do not participate in the investment or other experience of the Separate Account.

“Separation From Service” means the employment of a Deferred Covered Life with the Employer is terminated for reasons other than death.

“Spouse” means the person legally married to a Deferred Covered Life (or Disabled Immediate Covered Life) in a marriage recognized as valid in the state in which it was entered into. A Spouse entitled to payments under Covered Life’s Joint and Survivor Life Annuity Form shall have the rights of a Contingent Life hereunder.

“Sub-Plan” means the Sub-Plan specified on the Annuity Exhibits, as described below:

Sub-Plan Description
SAL Salaried Plan
A Pension Plan A-Northwest Wood Products
A 6-88 Pension Plan A-Northwest Wood Products.<br><br>Sub Plan A 6-88 follows provisions for Sub-Plan A in this Contract, except when applying a reduction for an earlier Annuity Commencement Date as noted in the Tables.
C Pension Plan A-Non-Northwest Wood Products
C VT C03 Pension Plan A-Non-Northwest Wood Products.<br><br>Sub-Plan C VT 03 follows the provisions for Sub-Plan C in this Contract, except when applying a reduction for an earlier Annuity Commencement Date as noted in the Tables.
B Pension Plan B

“Tables” means the tables attached hereto.

“Temporary Annuity Expiry Date” means the date the final annuity payment is due under a Temporary Annuity. With respect to Immediate Covered Lives, the Temporary Expiry Date is specified on the Annuity Exhibits. With respect to Deferred Covered Lives, the Temporary Annuity Expiry Date is the first day of the month immediately preceding the Deferred Covered Life’s unchanged Annuity Commencement Date.

“Total Contribution Amount” means, as of any date, the Contribution Amount, as increased or decreased by any Contribution Adjustment Amounts specified on an amended Cover Page of this Contract through the most recent Amendment Date.

“Years of Service” means the Years of Service applicable to Deferred Covered Lives as provided to Prudential by the Contract-Holder. For the purposes of meeting eligibility requirements for benefits hereunder, Years of Service will continue to accrue to Deferred Covered Lives after the Effective Date as provided to Prudential by the Contract-Holder.

1.2    Agreement to Pay Contribution Amount; Deposit into the Separate Account

On the Effective Date, the Contract-Holder transferred to Prudential the Contribution Amount. The Contribution Amount consisted of cash identified in the Cash and Transferred Assets Exhibit.

GAA-9063[ *** ]    8

On the Effective Date, Prudential will allocate the Contribution Amount received on such date to the Separate Account. All assets allocated by Prudential to the Separate Account held by a custodian will be held by Prudential in one or more custody accounts at entities independent of Prudential and each such custody account shall only hold assets allocated to the Separate Account.

On each Amendment Date specified on an amended Cover Page of this Contract, if any, Contract-Holder and Prudential may, by separate amendment to this Contract, agree that (a) the Contribution Adjustment Amount specified on such amended Cover Page shall be paid on such Amendment Date (x) prior to or on the Data Finalization Amendment Date, in cash and (y) following the Data Finalization Amendment Date, in cash; and (b) a Cash and Transferred Assets Exhibit Supplement dated as of such Amendment Date shall be attached to this Contract specifying: (i) such Contribution Adjustment Amount; (ii) the amount of cash being transferred as part of such Contribution Adjustment Amount; and (iii) if such Contribution Adjustment Amount is payable by Prudential, to the extent to which such amount is being paid from the General Account or from the Separate Account. No such amendment shall require the consent of any person other than Contract-Holder and Prudential.

If the Contribution Adjustment Amount that is payable on the Amendment Date is a negative number, then such amount shall be paid by Prudential to the Contract-Holder on such Amendment Date by delivering cash equal to such Contribution Adjustment Amount, as indicated on the applicable Cash and Transferred Assets Exhibit Supplement.

If the Contribution Adjustment Amount that is payable on the Data Finalization Amendment Date or any prior Amendment Date is a positive number, then the Contract-Holder shall pay such amount to Prudential on such Amendment Date by delivering cash equal to such Contribution Adjustment Amount, as indicated on the applicable Cash and Transferred Assets Exhibit Supplement, and Prudential will allocate the Contribution Adjustment Amount received on such date to the Separate Account.

If the Contribution Adjustment Amount that is payable after the Data Finalization Amendment Date is a positive number, then the Contract-Holder shall pay such amount to Prudential on such Amendment Date by delivering cash to Prudential in an amount equal to such Contribution Adjustment Amount, as indicated on the applicable Cash and Transferred Assets Exhibit Supplement, and Prudential will allocate the Contribution Adjustment Amount received on such date to the Separate Account.

For the avoidance of doubt, with respect to any amendment to the Annuity Exhibits increasing any Annuity Payments or adding Annuity Payments in respect of new Covered Lives or Contingent Lives or Beneficiaries under this Contract, Prudential’s obligation to make any such increase or addition with respect to any such Annuity Payment or to add any such new Covered Lives or Contingent Lives or Beneficiaries shall be conditioned on Prudential’s prior receipt of any payment due to Prudential under this Contract with respect to any such amendment.

1.3    Agreement to Make Annuity Payments; Associated Withdrawals from the Separate Account

Subject to receipt of the full Contribution Amount, Prudential agrees to pay Annuity Payments due from and after the Effective Date.

In connection with Annuity Payments owed in each month, Prudential will withdraw from the Separate Account assets with a Market Value equal to the Aggregate Monthly Payment. In the event that the assets in the Separate Account are not sufficient to make such payments when due, Prudential shall use the assets in its General Account to make such payments.

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Upon termination of this Contract pursuant to Section 1.11, none of the Contract-Holder, the Employer or any Covered Life, Contingent Life or Beneficiary shall have any right to receive any further payments from any Separate Account or from the General Account or any other assets of Prudential.

A withdrawal from the Separate Account will be made only on a Business Day.

1.4    The Separate Account that Supports this Contract

During the period starting on the Effective Date, and ending on the date of termination of this Contract, the obligations of Prudential under this Contract will be supported by the Commingled Account.

1.5     Investments Held in Separate Account; Insulation of Separate Account Assets

The Separate Account is intended to be invested primarily in investment-grade fixed income securities, but other investments are permitted. Prudential will invest and reinvest the assets of the Separate Account at the time and in the amounts as Prudential determines in its discretion and in accordance with applicable law. Prudential may, with respect to any assets held in the Separate Account, delegate Prudential's investment management and/or voting rights to other entities, including institutions not affiliated with Prudential.

1.6    Insulation of Separate Account Assets

Prudential owns all the assets in the Separate Account. Pursuant to Section 17B:28-9(c) of the New Jersey Insurance Statutes, none of the assets held in the Commingled Account, to the extent of reserves established in respect of the payment obligations of Prudential under this Contract and under the other group annuity contracts supported by such account, will be chargeable with liabilities arising out of any other business of Prudential.

1.7    Expenses; Establishing Reserves; [ *** ]

Expenses may be charged against the Separate Account. Such expenses shall represent the direct and indirect costs (inclusive of general and administrative expenses) relating to this Contract and the Separate Account and shall be charged against the Separate Account in accordance with statutory accounting principles. Expense payables and withdrawals from the Separate Account will include custody fees applicable to the Separate Account, investment management related expenses, taxes due on the Separate Account earnings and general and administrative expenses allocated to the Separate Account. If Prudential’s General Account pays such expenses or contractual obligations, then a payable owed by the Separate Account shall arise, and Prudential’s General Account shall be later reimbursed by charging the Separate Account.

[ *** ]

[ *** ]

[ *** ]

[ *** ]

A withdrawal from the Separate Account will be made only on a Business Day, and the assets withdrawn will no longer be allocated to the Separate Account.

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1.8    Process for Making Annuity Payments

Prior to the consummation of any Buy-Out Conversion, Prudential shall make Aggregate Monthly Payments owed by it to the Contract-Holder pursuant to Provision II. The Contract-Holder and Prudential may separately agree to other arrangements. After the consummation of a Buy-Out Conversion and after receipt of information reasonably required by Prudential to enable it to make future Annuity Payments directly to Deferred Covered Lives and Annuity Payments directly to Immediate Covered Lives (and, if applicable, Contingent Lives and Beneficiaries) (such as information concerning addresses, bank accounts, income tax withholding, designation of Beneficiaries and Qualified Domestic Relations Orders), Prudential shall make Annuity Payments arising after such date directly to such Deferred and Immediate Covered Lives (and, if applicable Contingent Lives and Beneficiaries) pursuant to Provision III. Notwithstanding any other terms of this Contract (including Section 3.3), no Annuity Payments or other payments will be made directly by Prudential to a Covered Life, Contingent Life or Beneficiary at any time prior to consummation of a Buy-Out Conversion pursuant to Section 1.10.

1.9    Persons Entitled to Enforce this Contract

Prudential, Employer and Contract-Holder agree that prior to consummation of a Buy-Out Conversion, no Covered Life, Contingent Life or Beneficiary has any right whatsoever to enforce any term of this Contract against Prudential or any other party and that no Covered Life, Contingent Life, or Beneficiary is an intended third party beneficiary of or shall otherwise benefit from any term of this Contract. Prior to the consummation of a Buy-Out Conversion, the parties agree that only Prudential, Employer, the Plan and Contract-Holder have any rights or obligations hereunder and that none of Prudential, Contract-Holder, the Employer or the Plan have any obligations hereunder to any Covered Life, Contingent Life, or Beneficiary.

After consummation of a Buy-Out Conversion:

(a)Covered Lives and Contingent Lives. Any Covered Life or Contingent Life shall have the right to enforce any provision of (and each Beneficiary and alternate payee will have the contractual right to enforce its rights to Annuity Payments under) this Contract against Prudential but against no other person or entity, in the capacity of an intended third party beneficiary thereof. The rights of a Covered Life or Contingent Life are not diminished if Contract-Holder ceases to exist and no successor is appointed. Nothing in this Contract, express or implied, will give or be construed to give any legal or equitable right, remedy or claim under this Contract to any other person.

(b)Contract-Holder and the Plan. Contract-Holder shall have the right to enforce any provision of this Contract against Prudential. Neither Contract-Holder nor the Plan shall have any obligation to any Covered Life or Contingent Life with respect to the Annuity Payments under this Contract.

(c)Prudential. Prudential shall have the right to enforce any provision of this Contract against Contract-Holder.

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1.10    Buy-Out Conversion

Subject to the terms of this Section 1.10, and if the Plan is amended to provide for immediate distribution of benefits in the form of an annuity directly to Covered Lives (and, if applicable, Contingent Lives), (a “Buy-Out Plan Amendment”), Contract-Holder has the option to initiate a process by which each Covered Life (and, if applicable, Contingent Life) will have the right to enforce any provision of (and each Beneficiary and alternate payee will have the contractual right to enforce its rights to Annuity Payments determined pursuant to Provision III under) this Contract against Prudential but against no other person or entity (the consummation of such process being a “Buy-Out Conversion”).

On any Business Day prior to receipt by Prudential of a Surrender Notice given pursuant to Section 1.11, the Contract-Holder has the right to deliver an irrevocable written notice (a “Buy-Out Conversion Notice”) to Prudential instructing it to initiate a Buy-Out Conversion. The Buy-Out Conversion Notice shall include a representation from the Contract-Holder and the Employer to Prudential, made as of the date thereof, and as of the date of the Buy-Out Conversion, that (a) the Plan is maintained under and is subject to ERISA, (b) to the Contract-Holder’s and the Employer’s knowledge (after making appropriate inquiry), the Plan is in compliance with ERISA and the Code in all material respects and (c) to the Contract-Holder’s and the Employer’s knowledge (after making appropriate inquiry), no event has occurred that is reasonably likely to result in the Plan losing its status as qualified by the Code for preferential tax treatment under Code §§ 401(a) and 501(a). Such Buy-Out Conversion will be a complete conversion of all then remaining Covered Lives and, if applicable, Contingent Lives and Beneficiaries. Upon delivery of a Buy-Out Conversion Notice, this Contract may no longer be surrendered in accordance with Section 1.11.

Prudential will initiate a Buy-Out Conversion if prior to receipt by Prudential of a Surrender Notice pursuant to Section 1.11, (i) the Plan is terminated, (ii) the Plan is the subject of a judicial decree ordering the termination of the Plan in a proceeding instituted by the Pension Benefit Guaranty Corporation or (iii) the Contract-Holder notifies Prudential that it will cease to exist or cease to perform the duties of the Contract-Holder hereunder and no successor is appointed by the Employer, as Plan sponsor, with such Buy-Out Conversion to be effective as of the later of (x) the date on which the Contract-Holder ceases to exist or perform the obligations of the Contract-Holder under this Contract and (y) the satisfaction of each of the Conversion Conditions. If any of the events described in the immediately preceding sentence occurs, the Contract-Holder shall inform Prudential in writing.

The consummation of a Buy-Out Conversion is conditioned upon:

(a)    receipt of all necessary or appropriate third-party consents and approvals, including regulatory approvals, in connection with the Buy-Out Conversion have been obtained;

(b)    receipt of information concerning Covered Lives, including Deferred Covered Lives (and, if applicable, Contingent Lives and Beneficiaries), as specified in Section 1.8;

(c)    enactment of a Buy-Out Plan Amendment; and

[ *** ]

[ *** ]

Following receipt of a valid and irrevocable Buy-Out Conversion Notice and satisfaction of each of the conditions set forth above (the “Conversion Conditions”), Prudential will initiate a Buy-Out Conversion, the consummation of which shall occur by the [ *** ] day following the later of (i) the date of the Contract-Holder’s Buy-Out Conversion Notice to Prudential and (ii) the date on which each of the Conversion Conditions has been satisfied, unless otherwise mutually agreed upon by the parties.

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Upon consummation of a Buy-Out Conversion following receipt of such consents, approvals, and information, and in accordance with the timing described in this Section 1.10, each Covered Life (and, if applicable, Contingent Life) shall have the rights described in Section 1.9. Prudential shall notify Contract-Holder of such consummation. The Commingled Account will support this Contract after consummation of a Buy-Out Conversion.

[ *** ]

After consummation of the Buy-Out Conversion, Prudential will deliver group annuity certificates as described in Section 3.17. After the consummation of a Buy-Out Conversion and after receipt of information reasonably required by Prudential to enable it to make Annuity Payments now and in the future directly to Covered Lives and Deferred Covered Lives (and, if applicable, Contingent Lives and Beneficiaries) (such as information concerning addresses, bank accounts, income tax withholding, designation of Beneficiaries and Qualified Domestic Relations Orders), Prudential shall make Annuity Payments after such date directly to such Covered Lives (and, if applicable, Contingent Lives and Beneficiaries) pursuant to Provision III.

No Buy-Out Conversion hereunder shall be considered an amendment to this Contract nor shall the Annuity Exhibits be amended in connection therewith.

1.11    Termination of Contract; Surrender of Contract by Contract-Holder

If the Contract-Holder does not elect to surrender this Contract in accordance with this Section, this Contract will terminate on the date when no further amounts are payable by either party hereunder.

Prior to delivery of a Buy-Out Conversion Notice, the Contract-Holder may surrender this Contract by giving written notice (a “Surrender Notice”) to Prudential. The Surrender Notice will be deemed complete upon, and surrender of this Contract is conditioned upon, the provision by the Contract-Holder to Prudential of (1) evidence reasonably satisfactory to Prudential that (i) the Employer, as sponsor of the Plan, has decided to distribute the entire interest under the Plan of each Covered Life (and, if applicable, each Contingent Life and Beneficiary) in the form of an irrevocable commitment from a group of one or more insurers and (ii) a fiduciary of the Plan has determined that (a) there has been a material adverse change in or directly affecting Prudential between the Effective Date and the date of such determination that would cause a Buy-Out Conversion of the Contract to fail to satisfy the ERISA Requirements and (b) as a result of the occurrence and continuing impact of such material adverse change, such fiduciary has identified a group of one or more insurers, which does not include Prudential, from which the Plan will purchase irrevocable commitments with respect to the interest under the Plan of each Covered Life (and, if applicable, each Contingent Life and Beneficiary), provided that the fiduciary has the authority to cause the Plan to make such purchase and (2) a copy of a written notice by the plan administrator of the Plan to each Covered Life (and, if applicable, each Contingent Life and Beneficiary) notifying recipients that the plan administrator intends to terminate the Plan or, alternatively, to distribute to recipients their entire interest under the Plan and, in either case, identifying the insurer or insurers from whom the plan administrator intends to purchase irrevocable commitments.

Each of Prudential, the Contract-Holder and the Employer acknowledge and agree that the payment by Prudential of the Surrender Value (as defined below) following a surrender of the Contract in accordance with this Section 1.11, is intended to represent a fixed contractual obligation of Prudential under which the amounts payable to the Contract-Holder are not affected in any manner by the investment performance of the Separate Account for purposes of 29 C.F.R. §2510.3-101(h)(3).

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[ *** ]

Upon the payment of the Surrender Value, this Contract shall terminate and all rights and obligations of the parties hereunder, including for the avoidance of doubt those of any third party beneficiaries, shall terminate; provided, however, that (i) no such termination shall relieve any party from liability for damages arising out of any breach of this Contract which occurred prior to the termination of this Contract, and (ii) Section 1.1 (Definitions), 2.3(c) (Annual Attestation), Section 2.3(d) (Compliance with Laws and Regulations), Section 2.3(e)(Review of Records), Section 2.4 (Over-reimbursements and Under-reimbursements by Prudential), Section 3.6 (Misstatements), and Provision IV will survive any such termination indefinitely. For the avoidance of doubt, upon the termination of this Contract pursuant to this Section 1.11 none of the Contract-Holder, any Covered Life, any Contingent Life or any other individual or entity will have any right to receive any Aggregate Monthly Payments or Annuity Payments thereafter or any amounts remaining in the Separate Account except for any amounts that may accrue to them by operation of the proviso in the preceding sentence.

[ *** ]

The following additional definitions apply to this Section.

“ERISA Requirements” means all of the applicable requirements of ERISA and applicable guidance promulgated thereunder, including Interpretive Bulletin 95-1.

[ *** ]

[ *** ]

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[ *** ]

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Provision IIPayment of Annuity Payments to Contract-Holder Prior to Buy-Out Conversion

2.1    General

With respect to Annuity Payments arising prior to the consummation of a Buy-Out Conversion, Prudential shall discharge its obligation to make such Annuity Payments by making payments to the Contract-Holder as provided in this Provision II. For the avoidance of doubt, Annuity Payments to be made after the consummation of a Buy-Out Conversion are governed by Provision III.

Prudential’s obligation to pay each of the Aggregate Monthly Payments as set forth in this Contract is subject to the condition precedent that the Contract-Holder has performed all of its then outstanding obligations and satisfied all of its then outstanding requirements under the applicable laws and regulations, all as specified in this Contract.

Prudential’s obligation to pay each of the Aggregate Monthly Payments as set forth in this Contract is subject to the receipt of the relevant information listed in Section 2.3.

2.2    Monthly Payment Process

On the first Business Day of each calendar month which is prior to the consummation of a Buy-Out Conversion and during which an Annuity Payment is due under this Contract, Prudential shall pay to the Contract-Holder an amount equal to the Aggregate Monthly Payment due with respect to such month, calculated using the Annuity Exhibits, as such information is updated on Prudential’s records pursuant to this Contract.

2.3    Records Reconciliation Process; Adherence to Code and ERISA

(a)Records and Data. The Contract-Holder will maintain sufficient records and data to establish that the Annuity Payments being made by Prudential are owed pursuant to this Contract.

(b)Information Exchange. At least five (5) Business Days prior to the close of each calendar month, Contract-Holder will provide to Prudential, in an electronic format acceptable to Prudential:

(A) the amount of the Aggregate Monthly Payment to be paid by Prudential for the upcoming calendar month for any Covered Life, Contingent Life, or Beneficiary; and

(B) a listing of Annuity Payments due to each Covered Life, Contingent Life, or Beneficiary for the upcoming calendar month and the applicable Covered Life, Contingent Life or Beneficiary to whom such Annuity Payment is due;

(C) a listing of the following changes in the status of any Covered Life, Contingent Life or Beneficiary (the “Change in Status Report”) occurring since the immediately preceding Change in Status Report (or a statement in writing that no change has occurred since the last such report):

1.Death of a Covered Life actually reported to the Plan or its administrator;

2.Death of a Contingent Life or Beneficiary actually reported to the Plan or its administrator;

3.Annuity Payments previously due to a Covered Life, Contingent Life, or Beneficiary and not yet paid by Prudential;

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4.Payments previously made by Prudential in respect of a Covered Life, Contingent Life, or Beneficiary that were not owed as Annuity Payments;

5.Adjustment of Annuity Payments in respect of a Covered Life due to a Qualified Domestic Relations Order; and

6.Commencement of Annuity Payments in respect of a Deferred Covered Life. [ *** ]

together with such additional information reasonably requested by Prudential within seven (7) Business Days after receipt of the prior Change in Status Report.

(c)Annual Attestation. Within ninety (90) Business Days after the close of each calendar year, an authorized officer of Contract-Holder will attest that to the best of such officer’s knowledge:

(i)The amount paid by Prudential during the prior calendar year equals the amount of Annuity Payments owed by Prudential for such period under this Contract;

(ii)All current information concerning each Covered Life, Contingent Life and Beneficiary, including any change in status (e.g. deaths), was reported to Prudential on a timely basis during the calendar year;

(iii)The Contract-Holder’s records are in agreement with Prudential’s records provided to the Contract-Holder as specified below;

(iv)The Contract-Holder continues to administer the Plan in substantial compliance with the requirements of the Code and ERISA applicable to plan participants in an employee benefit plan.

Prudential will send its payment records of the Covered Lives, Contingent Lives, and Beneficiaries, and the Annuity Payment amounts, to the Contract-Holder within 30 days after the end of the calendar year.

(d)Compliance with Laws and Regulations. The Contract-Holder will satisfy all of the requirements of applicable laws and regulations (including but not limited to the Code and ERISA) with respect to the Plan’s payments to Covered Lives, Contingent Lives, and Beneficiaries. These requirements include, but are not limited to, the following: processing state inheritance tax waivers or notifications, as necessary; filing and issuing appropriate tax information forms; qualifying domestic relations orders; and withholding, reporting and transmitting federal, state and local income taxes, and paying any interest due by the Plan to Covered Lives, Contingent Lives, or Beneficiaries as a result of late payment. Prudential disclaims any responsibility for the Plan’s compliance with the Code, ERISA or any applicable law or regulation.

(e)Review of Records. Upon reasonable advance notice, Prudential or its auditors or other consultants shall be permitted to periodically review and verify the records maintained by the Plan in connection with Covered Lives, Contingent Lives, and Beneficiaries.

2.4    Over-reimbursements and Under-reimbursements by Prudential

(a)If Prudential determines at any time that the amount of any prior Aggregate Monthly Payment paid by it to the Contract-Holder exceeded the Aggregate Monthly Payment actually due under this Contract, the Contract-Holder shall pay such excess amount to Prudential, provided, however, that the Contract-Holder shall have no obligation to make such additional payment to the extent the overpayment:

(i)is not the result of the Contract-Holder’s failure to fulfill its obligations under Section 2.3(b); and

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(ii)was caused by the inaccurate records kept by Prudential; and

(iii)occurred in respect of a month prior to (x) the last month of a calendar year for which an annual attestation was completed in accordance with Section 2.3(c) and (y) the month two (2) years before such determination, whichever is later.

If the Contract-Holder is obligated to pay such excess amount to Prudential, Prudential may subtract such excess amount from any future payment otherwise due to the Contract-Holder, provided that, on request of Prudential, the Contract-Holder shall pay all or part of such excess to the extent that there is no future payment otherwise due or such excess exceeds the future payment. Prudential will correct its records so that future calculations of the Aggregate Monthly Payment are accurate.

(b)If Prudential determines at any time that the amount of any prior Aggregate Monthly Payment paid by it to the Contract-Holder was less than the Aggregate Monthly Payment actually due under this Contract for such month, Prudential shall pay such additional amount to Contract-Holder; provided, however, that Prudential shall have no obligation to make such additional payment to the extent the underpayment:

(i)was caused by the inaccurate records kept by or on behalf of the Plan or Contract-Holder/Employer, and

(ii)occurred in respect of a month prior to the later of (x) the last month of a calendar year for which an annual attestation was completed in accordance with Section 2.3(c) and (y) the month two (2) years before such determination. Amounts owed by Prudential under this clause (b) shall be reduced by amounts owed to Prudential under clause (a) above. Prudential will correct its records so that future calculations of the Aggregate Monthly Payment are accurate.

(c)The obligation of the parties under this Section 2.4 is not increased or reduced by the ability of the Contract-Holder, Plan or Employer, or any entity acting on behalf of such entity, to recoup any overpayment from the related Covered Life, Contingent Life, or Beneficiary, or by the amount of any interest or other costs incurred by the Contract-Holder, Plan, Employer or such other entity in connection with any under or overpayment to a Covered Life, Contingent Life, or Beneficiary.

2.5    Concerning Beneficiaries

A Covered Life may designate and re-designate a Beneficiary from time to time in such manner specified by the Contract-Holder/Employer and in accordance with the Plan, and the Contract-Holder or the Plan shall be responsible for maintaining such records. In connection with a Buy-Out Conversion, upon request from Prudential, the Contract-Holder will give Prudential a copy of such records.

2.6    Concerning Qualified Domestic Relations Orders

The Contract-Holder will be responsible for qualifying any domestic relations order (as defined in subsection 414(p) of the Code which would result in an adjustment to Annuity Payments otherwise payable in respect of a Covered Life and in respect of an alternate payee. Any such adjustment shall split the Annuity Payments between those payable in respect of the Covered Life and those payable in respect of an alternate payee. Otherwise, the Annuity Payment will continue to be payable as set forth in accordance with this Provision II before the Annuity Payment was adjusted. No adjustment to Annuity Payments otherwise payable in respect of a Covered Life or payments or in respect of an alternate payee that result in payment obligations based on the alternate payee’s lifetime will become payable, unless so approved by Prudential. Any such Annuity Payment adjustment will take effect when entered upon Prudential’s records.

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In connection with the consummation of a Buy-Out Conversion, the Contract-Holder will cooperate with Prudential to provide any reasonably necessary or otherwise requested information in connection with any Qualified Domestic Relations Orders in effect with respect to Covered Lives subject to such Buy-Out Conversion. After consummation of any Buy-Out Conversion, Prudential will determine the qualification of any domestic relations order (as defined in Section 414(p) of the Code) in accordance with Section 3.15 for each applicable Covered Life.

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Provision III Payment Terms and Conditions for Forms of Annuities

3.1    Covered Lives, Contingent Lives, and Beneficiaries

The amount owed by Prudential under this Contract in respect of each Covered Life (and, if applicable, Contingent Life and Beneficiary) will be determined by Prudential in accordance with the terms of this Provision III.

Prudential will apply the terms of this Provision III using the information contained in the Annuity Exhibits with respect to such Covered Life, Contingent Life, and Beneficiary as such information is updated or corrected pursuant to this Contract. Capitalized terms used but not defined in Section 1.1 have the meanings assigned in this Provision III.

3.2    Definitions

The following definitions apply to Section 3.3.

“Annuity Forms” means in respect of a Covered Life, one of the types of annuities having such payment terms as are specified in Section 3.3.

3.3    Annuity Forms

(a)The Annuity Forms are as follows:

(i)    “Life Annuity” means the following for each Covered Life identified in the Annuity Exhibits as receiving a distribution of a “Life” Annuity Form.

Prudential does not owe any payments to anyone under this Annuity Form if the Covered Life has died before the Annuity Commencement Date.

During the Covered Life’s lifetime, Prudential will make monthly payments to the Covered Life equal to the Covered Life Amount. Prudential owes the first monthly payment on the Annuity Commencement Date. Prudential will pay subsequent monthly payments on the first day of each month. Prudential’s last monthly payment to the Covered Life will be on the first day of the month in which the Covered Life dies.

(ii)    “Life with Period Certain Annuity” means the following for each Covered Life identified in the Annuity Exhibits as receiving a distribution of a “Life with Period Certain” Annuity Form.

During the Covered Life’s lifetime, Prudential will make monthly payments to the Covered Life equal to the Covered Life Amount. Prudential owes the first monthly payment on the Annuity Commencement Date. Prudential will pay subsequent monthly payments on the first day of each month. Prudential’s last monthly payment to the Covered Life will be on the first day of the month in which the Covered Life dies.

After the Covered Life dies, Prudential will compare the number of monthly payments Prudential made in respect of the Covered Life on and after the Annuity Commencement Date to the Guaranteed Number of Payments. If the number of monthly payments is less than such guaranteed number, Prudential will pay the Covered Life Amount each month to the designated

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Beneficiary. These payments will stop when the total number of payments in respect of the Covered Life, plus the number of payments to the Beneficiary, equals the Guaranteed Number of Payments.

(iii)    “Joint and Survivor Life Annuity” means the following for each Covered Life identified in the Annuity Exhibits as receiving a distribution of a “Joint and Survivor Life” Annuity Form.

During the Covered Life’s lifetime, Prudential will make monthly payments to the Covered Life equal to the Covered Life Amount. Prudential owes the first monthly payment on the Annuity Commencement Date. Prudential will pay subsequent monthly payments on the first day of each month. Prudential’s last monthly payment to the Covered Life will be on the first day of the month in which the Covered Life dies.

After the Covered Life dies, Prudential may owe additional monthly payments. Prudential will owe additional monthly payments if the Contingent Life is alive when the Covered Life dies. Prudential will pay the first payment on the first day of the month following the Covered Life’s death. Prudential will pay subsequent monthly payments on the first day of each month. Prudential will pay the last payment on the first day of the month in which such Contingent Life dies. The amount of the payments will equal the Contingent Life Amount.

(iv)    “Joint and Survivor Life Annuity with Pop Up” means the following for each Covered Life identified in the Annuity Exhibits as receiving a distribution of a “Joint and Survivor Life Annuity with Pop Up” Annuity Form.

During the Covered Life’s lifetime, Prudential will make monthly payments to the Covered Life equal to the Covered Life Amount. Prudential owes the first monthly payment on the Annuity Commencement Date. Prudential will pay subsequent monthly payments on the first day of each month. Prudential’s last monthly payment to the Covered Life will be on the first day of the month in which the Covered Life dies.

If the Contingent Life dies before the Covered Life and within 60 months following the Immediate Covered Life’s Original Retirement Date (or Deferred Covered Life’s Annuity Commencement Date) , Prudential will make monthly Annuity Payments to the Covered Life equal to the sum of the Covered Life Amount and the Pop Up Amount starting on the first day of the month following the later of (a) the Effective Date and (b) the Contingent Life’s date of death. Prudential will make subsequent payments on the first day of each month. Prudential’s last payment to the Covered Life will be on the first day of the month in which the Covered Life dies.

(v) “Period Certain Annuity” means the following for each Covered Life identified in the Annuity Exhibits as receiving a distribution of a “Period Certain” Annuity Form.

Prudential will make monthly payments to the Covered Life equal to the Covered Life Amount. Prudential owes the first monthly payment on the Annuity Commencement Date. Prudential will pay subsequent monthly payments on the first day of each month. The total number of monthly payments will equal the Guaranteed Number of Payments. Once such Guaranteed Number of Payments has been paid, no further payments are due.

After the Covered Life dies, Prudential will compare the number of monthly payments Prudential made in respect of the Covered Life on and after the Annuity Commencement Date to the Guaranteed Number of Payments. If the number of monthly payments is less than such

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guaranteed number, Prudential will pay the “present value” (as such term is defined in Section 3.14) of the remaining guaranteed payments to the Covered Life’s estate.

(vi)    “Temporary Annuity” means the following for each Covered Life identified in the Annuity Exhibits as receiving a distribution of a “Temporary” Annuity Form.

Prudential does not owe any payments to anyone under this Annuity Form if the Covered Life has died before the Annuity Commencement Date.

During the Covered Life’s lifetime, Prudential will make monthly payments to the Covered Life equal to the Covered Life Amount. Prudential owes the first monthly payment on the Annuity Commencement Date, if the Covered Life is living. Prudential will pay subsequent monthly payments on the first day of each month. Payments will end with the monthly payment payable on the earlier of the Temporary Annuity Expiry Date and the first day of the month in which the Covered Life dies.

(vii) “Temporary with Period Certain Annuity” means the following for each Covered Life identified in the Annuity Exhibits as receiving a distribution of a “Temporary with Period Certain” Annuity Form.

During the Covered Life’s lifetime, Prudential will make monthly payments to the Covered Life equal to the Covered Life Amount. Prudential owes the first monthly payment on the Annuity Commencement Date, if the Covered Life is living. Prudential will pay subsequent monthly payments on the first day of each month. Payments will end with the monthly payment payable on the earlier of the Temporary Annuity Expiry Date and the first day of the month in which the Covered Life dies.

If the Covered Life dies prior to the Temporary Annuity Expiry Date, Prudential will compare the number of monthly payments Prudential made in respect of the Covered Life on and after the Annuity Commencement Date to the Guaranteed Number of Payments. If the number of monthly payments is less than such guaranteed number, Prudential will pay the Covered Life Amount each month to the designated Beneficiary. These payments will stop on the earlier of (i) the date when the total number of payments made in respect of the Covered Life, plus the number of payments to the Beneficiary, equals the Guaranteed Number of Payments and (ii) the Temporary Annuity Expiry Date.

(viii) “Life Annuity with Deferred Cash Refund” means the following for each Deferred Covered Life under Sub-Plan SAL.

Subject to the terms of Section 3.4, a Deferred Covered Life under Sub-Plan SAL who incurs a Separation From Service prior to his or her unchanged Annuity Commencement Date may change the Life Annuity Form specified on the Annuity Exhibits to a Life Annuity with Deferred Cash Refund, provided such change request is received within six (6) months after his or her Separation From Service. If the Deferred Covered Life elects this Annuity Form and does not revoke his or her election prior to commencing Annuity Payments in accordance with the last paragraph of this Section 3.3(a)(viii), the Covered Life will be required to commence Annuity Payments on his or her unchanged Annuity Commencement Date. Such Deferred Covered Life may not elect an Earlier Annuity Commencement Date as described in Section 3.7 or Later Annuity Commencement Date as described in Section 3.8.

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During the Covered Life’s lifetime, Prudential will make monthly payments to the Covered Life equal to the Covered Life Amount multiplied by the appropriate conversion factor determined from the Tables of this Contract. Prudential owes the first monthly payment on the unchanged Annuity Commencement Date. Prudential will pay subsequent monthly payments on the first day of each month.

If the Deferred Covered Life dies on or after his or her unchanged Annuity Commencement Date and did not previously revoke his or her election in accordance with the last paragraph of this Section 3.3(a)(viii), Prudential will compare the total Annuity Payments made to the Covered Life on or after the Annuity Commencement Date to the Initial Death Benefit, as determined from the Tables of this Contract. If such total Annuity Payments are less than the Initial Death Benefit, Prudential will pay the difference in a lump sum payment to the Beneficiary.

If the Deferred Covered Life dies prior to his or her unchanged Annuity Commencement and did not previously revoke his or her election in accordance with the last paragraph of this Section 3.3(a)(viii), Prudential will pay a pre-retirement death benefit equal to the Initial Death Benefit, as determined from the Tables of this Contract. The Initial Death Benefit will apply in lieu of any Pre-Retirement Survivor Annuity described in Section 3.9.

A Deferred Covered Life who elects the Life Annuity with Deferred Cash Refund may revoke his or her election prior to his or her unchanged Annuity Commencement Date by providing written direction on a form acceptable to Prudential, subject to the following conditions:

•After the election is revoked, the remaining terms of Provision III will determine the Deferred Covered Life’s Annuity Form and amount of Annuity Payments.

•The Covered Life Amount shown on the Annuity Exhibits with respect to such Deferred Covered Life will be reduced in accordance with the Tables of this Contract for the period of time that pre-retirement death benefit coverage was in effect, before applying any additional conversion factor for any change in Annuity Form or Annuity Commencement Date.

(b)The following applies to Disabled Immediate Covered Lives (or eligible Deferred Covered Lives) only:

Contract Section 3.3 (b) (i) and the Annuity Exhibits denote Immediate Covered Lives who are disabled as of the Effective Date. Additionally, Section 3.3 (b) (ii) denotes Deferred Covered Lives who may become eligible for a disability benefit after the Effective Date.

Eligibility for disability is as follows:

A Deferred Covered Life will be eligible for a disability benefit if he or she (i) becomes totally and permanently disabled under the Federal Social Security Act (or partially disabled as described below for Sub-Plan SAL) and (ii) meets the specific eligibility conditions for his or her respective Sub-Plan as described below. The disability benefit will commence on the Disability Commencement Date.

If a Covered Life is no longer considered totally and permanently disabled under the Federal Social Security Act (or partially disabled as described below for Sub-Plan SAL), any disability benefits payable under this Contract will end on the first day of the month in which such Covered Life ceases to meet such standards for disability status.

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Sub-Plan Eligibility Condition(s):
A, or B A Deferred Covered Life must have five Years of Service with the Employer and must be actively employed or within three years of his or her Separation From Service at time of disability.
C A Deferred Covered Life must have ten Years of Service with the Employer and must be actively employed at time of disability
SAL (total disability) A Deferred Covered Life must have ten Years of Service with the Employer and must be actively employed at time of disability.
SAL (partial disability) A Deferred Covered Life must be age 55 or older, have ten Years of Service with the Employer and must be actively employed at time of disability. Partial disability is defined as a Deferred Covered Life who is unable to do his or her regular job or any other job the Employer could offer for which the Deferred Covered Life would be qualified by training, education or experience. The Deferred Covered Life must submit evidence including medical reports or a statement of disability from his or her doctor.

(i)Temporary Annuity with Re-election after Temporary Annuity Expiry Date for Disabled Immediate Covered Lives.

•“Temporary Annuity with Re-election” means the following for each Covered Life identified in the Annuity Exhibits as receiving a distribution of a “Temporary Annuity with Re-election” Annuity Form.

During the Covered Life’s lifetime, Prudential will make monthly payments to the Covered Life equal to the Covered Life Amount. Prudential owes the first monthly payment on the Annuity Commencement Date. Prudential will pay subsequent monthly payments on the first day of each month. Payments will end with the monthly payment payable on the earlier of the Temporary Annuity Expiry Date and the first day of the month in which the Covered Life dies, unless a surviving Spouse is entitled to a Pre-Retirement Survivor Annuity in accordance with Section 3.3 (b) (iii).

•“Temporary Joint and Survivor Annuity with Re-election” means the following for each Covered Life identified in the Annuity Exhibits as receiving a distribution of a “Temporary Joint and Survivor with Re-election” Annuity Form.

During the Covered Life’s lifetime, Prudential will make monthly payments to the Covered Life equal to the Covered Life Amount. Prudential owes the first monthly payment on the Annuity Commencement Date. Prudential will pay subsequent monthly payments on the first day of each month. Payments will end on the earlier of (a) the Temporary Annuity Expiry Date and (b) the first day of the month in which the Covered Life dies.

If the Covered Life (a) is married, as defined in Section 3.3 (b) (iii), to the Contingent Life on his or her date of death and (b) dies prior to the first day of the month immediately following the Temporary Annuity Expiry Date, the Contingent Life (Spouse) is entitled to the Pre-Retirement Survivor Annuity determined in Section 3.3 (b) (iii).

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If the Covered Life (a) is not married, as defined in Section 3.3 (b) (iii), to the Contingent Life on his or her date of death and (b) dies prior to the first day of the month immediately following the Temporary Annuity Expiry Date, Prudential will owe additional monthly payments to the Contingent Life equal to the Contingent Life Amount. Prudential will pay the first payment on the first day of the month following the Covered Life’s death. Payments will end on the earlier of (a) the Temporary Annuity Expiry Date and (b) the first day of the month in which the Contingent Life dies. In addition, if such Covered Life is married, as defined in Section 3.3 (b) (iii), to a surviving Spouse on his or her date of death, the surviving Spouse will be entitled to the Pre-Retirement Survivor Annuity as determined in Section 3.3 (b) (iii).

•“Temporary Joint and Survivor Annuity with Pop Up and Re-election” means the following for each Covered Life identified in the Annuity Exhibits as receiving a distribution of a “Temporary Joint and Survivor Annuity with Pop Up and Re-election” Annuity Form.

During the Covered Life’s lifetime, Prudential will make monthly payments to the Covered Life equal to the Covered Life Amount. Prudential will make the first monthly payment on the Annuity Commencement Date. Prudential will pay subsequent monthly payments on the first day of each month. Payments will end on the earlier of (a) the Temporary Annuity Expiry Date and (b) the first day of the month in which the Covered Life dies.

If the Contingent Life dies before the Covered Life and within 60 months following the Immediate Covered Life’s Original Retirement Date, Prudential will make monthly Annuity Payments to the Covered Life equal to the sum of the Covered Life Amount and the Pop Up Amount starting on the first day of the month following the later of (a) the Effective Date and (b) the Contingent Life’s date of death. Prudential will make subsequent payments on the first day of each month. Payments will end on the earlier of (a) the Temporary Annuity Expiry Date and (b) the first day of the month in which the Covered Life dies.

If the Covered Life (a) is married, as defined in Section 3.3 (b) (iii), to the Contingent Life on his or her date of death and (b) dies prior to the first day of the month immediately following the Temporary Annuity Expiry Date, the Contingent Life (Spouse) is entitled to the Pre-Retirement Survivor Annuity determined in Section 3.3 (b) (iii).

If the Covered Life (a) is not married, as defined in Section 3.3 (b) (iii), to the Contingent Life on his or her death and (b) dies prior to the first day of the month immediately following the Temporary Annuity Expiry Date, Prudential will owe additional monthly payments to the Contingent Life equal to the Contingent Life Amount. Prudential will pay the first payment on the first day of the month following the Covered Life’s death. Payments will end on the earlier of (a) the Temporary Annuity Expiry Date and (b) the first day of the month in which the Contingent Life dies. In addition, if such Covered Life is married, as defined in Section 3.3 (b) (iii), to a surviving Spouse on his or her date of death, the surviving Spouse will be entitled to the Pre-Retirement Survivor Annuity as determined in Section 3.3 (b) (iii).

(ii)Temporary Annuity with Re-election after Temporary Annuity Expiry Date for Deferred Covered Lives who become eligible for a disability benefit after the Effective Date.

A Deferred Covered Life who becomes eligible for a disability benefit after the Effective Date will receive payments under one of the following Annuity Forms on the Disability Commencement Date: a Temporary Annuity (Sub-Plan C or SAL only), a Temporary Joint and Survivor Annuity (Sub-Plan C or SAL only), Temporary Joint and Survivor Annuity with Pop

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Up (Sub-Plan A or B only) or a Temporary with Period Certain Annuity (Sub-Plan A or B only).

A disabled Covered Life may select an Annuity Form based on his or her Sub-Plan, as described below, by submitting a request to Prudential. All change requests shall be subject to Prudential’s timely receipt of a valid election in a method acceptable to Prudential containing all the information Prudential deems necessary for the change Any such change will be governed by this Section and will take effect on the Covered Life’s commencement date and thereafter will have the same force and effect as if included on the Annuity Exhibits on the Effective Date.

The disclosure and spousal consent requirements of Section 417 of the Code in effect from time to time will apply to a change in Annuity Form. Any change in Annuity Form will apply to payments payable on and after the Annuity Commencement Date.

•“Temporary Annuity with Re-election” means the following for each Deferred Covered Life who becomes disabled after the Effective Date.

During the Deferred Covered Life’s lifetime, Prudential will make monthly payments to the Deferred Covered Life equal to the Covered Life Amount. Prudential owes the first monthly payment on the Disability Commencement Date. Prudential will pay subsequent monthly payments on the first day of each month. Payments will end with the monthly payment payable on the earlier of the Temporary Annuity Expiry Date and the first day of the month in which the Deferred Covered Life dies, unless a surviving Spouse is entitled to a Pre-Retirement Survivor Annuity in accordance with Section 3.3 (b) (iii).

•“Temporary with Period Certain Annuity and Re-election” means the following for each Deferred Covered Life who becomes disabled after the Effective Date.

During the Deferred Covered Life’s lifetime, Prudential will make monthly payments to the Covered Life equal to the Covered Life Amount. Prudential owes the first monthly payment on the Disability Commencement Date, if the Covered Life is living. Prudential will pay subsequent monthly payments on the first day of each month. Payments will end with the monthly payment payable on the earlier of the Temporary Annuity Expiry Date and the first day of the month in which the Deferred Covered Life dies. If the Deferred Covered Life dies prior to the Temporary Annuity Expiry Date, Prudential will compare the number of monthly payments Prudential made in respect of the Deferred Covered Life on and after the Disability Commencement Date to the Guaranteed Number of Payments (60). If the number of monthly payments is less than such guaranteed number, Prudential will pay the Covered Life Amount each month to the designated Beneficiary. These payments will stop when the total number of payments in respect of the Deferred Covered Life, plus the number of payments to the Beneficiary, equals the Guaranteed Number of Payments provided, however, if such Deferred Covered Life is married, as defined in Section 3.3 (b) (iii), on his or her date of death, the Guaranteed Number of Payments is disregarded and the Spouse, if living, will receive a Pre-Retirement Survivor Annuity in accordance with Section 3.3. (b) (iii).

•“Temporary Joint and Survivor Annuity with Re-election” means the Annuity Form described in Section 3.3 (b) (i), subject to the following with respect to a Deferred Covered Life: (a) the Annuity Form is available with continuation percentages equal to 50%, 75% or 100%, (b) the amount of the Deferred Covered Life’s Annuity Payment after the change will be equal to Covered Life Amount multiplied by the appropriate Joint and Survivor Life Annuity factor determined from the Tables of this Contract, with no reduction for an earlier commencement,

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(c) the Contingent Life will be the Deferred Covered Life’s Spouse on the Disability Commencement Date and (d) the Contingent Life Amount payable to the Spouse after the Deferred Covered Life’s death will be equal to the amount of the Annuity Payment payable to the Deferred Covered Life’s multiplied by the applicable continuation percentage based on the Annuity Form elected. .

•“Temporary Joint and Survivor Annuity with Pop Up and Re-election” means the Annuity Form described in Section 3.3 (b) (i) subject to the following with respect to a Deferred Covered Life: (a) the Annuity Form is available with continuation percentages equal to 50%, 75% or 100%, (b) the amount of the Deferred Covered Life’s Annuity Payment after the change will be equal to Covered Life Amount multiplied by the appropriate Joint and Survivor Life Annuity factor determined from the Tables of this Contract, with no reduction for an earlier commencement, and (c) the Contingent Life Amount payable after the Deferred Covered Life’s death will be equal to the amount of the Annuity Payment payable to the Deferred Covered Life’s multiplied by the applicable continuation percentage based on the Annuity Form elected.

(iii)Pre-Retirement Survivor Annuity for Disabled Immediate Covered Lives (and eligible Deferred Covered Lives)

If a Disabled Immediate Covered Life (or a Deferred Covered Life who becomes eligible for a disability benefit after the Effective Date) dies before the first day of the month immediately following his or her Temporary Annuity Expiry Date and has a surviving Spouse on the Covered Life’s date of death, the Annuity Payment payable to the Spouse beginning on the first of the month following the Covered Life’s date of death will be determined as described in the chart below. The payment terms for these Annuity Forms are described in this Section 3.3(b) (iii). For a Covered Life with a Sub-Plan of SAL or C, he or she must have a surviving Spouse to whom he or she had been married for the one-year period ending on the date of the Covered Life’s death.

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Sub-Plan Annuity Payment Determination
A or B The greater of:<br><br>(1)The Contingent Life Amount (if any) otherwise payable to the Spouse under the Joint and Survivor Annuity Form in effect for the Covered Life or<br><br>(2)The survivor portion of 100% Joint and Survivor Life Annuity, calculated as of the first of the month following the Covered Life’s date of death.
SAL (total disability)<br><br>or SAL (partial disability) The greatest of:<br><br>(1)The Contingent Life Amount otherwise payable to the Spouse under the Joint and Survivor Annuity Form in effect for the Covered Life,<br><br>(2)30% of the Age 65 Benefit Amount shown on the Annuity Exhibits; or<br><br>(3)The survivor portion of 50% Joint and Survivor Life Annuity, calculated as of the first of the month following the Covered Life’s date of death.
C The greater of:<br><br>(1)The Contingent Life Amount (if any) otherwise payable to the Spouse under the Joint and Survivor Annuity Form in effect for the Covered Life, or<br><br>(2)The survivor portion of 50% Joint and Survivor Life Annuity, calculated as of the first of the month following the Covered Life’s date of death.

The amount of the Annuity Payment under a Joint and Survivor Life Annuity described above will be determined in accordance with Section 3.5 (Change in Annuity Form) and Section 3.7 (Earlier Annuity Commencement Date); provided that, with respect to a Disabled Immediate Covered Life, the Age 65 Benefit Amount will be used in the determination of such amount instead of the Covered Life Amount on the Annuity Exhibits.

(iv)Re-election after Temporary Annuity Expiry Date for Disabled Immediate Covered Lives and Deferred Covered Lives who become eligible for a disability benefit after the Effective Date

If the disabled Covered Life is still living on the first day of the month immediately following his or her Temporary Annuity Expiry Date, the Covered Life will be entitled to the Annuity Form described below, based on his or her Sub-Plan :

Sub-Plan Married Covered Lives Unmarried Covered Lives
A or B 50% Joint and Survivor Life Annuity with Pop Up Life with Period Certain Annuity with 60 Guaranteed Number of Payments
C or SAL 50% Joint and Survivor Life Annuity Life Annuity

The amount of the Annuity Payment will be determined as follows:

•If the Covered Life is unmarried, the amount of the Annuity Payment will equal (i) with respect to Disabled Immediate Covered Lives, the Age 65 Benefit Amount shown in the

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Annuity Exhibits and (ii) with respect to Deferred Covered Lives, the Covered Life Amount.

•If the Covered Life is married, the amount of the Annuity Payment will equal the Age 65 Benefit Amount (with respect to Disabled Immediate Covered Lives) or Covered Life Amount (with respect to Deferred Covered Lives) multiplied by the appropriate Joint and Survivor Life Annuity factor determined from the Tables of this Contract.

A disabled Covered Life may select an optional Annuity Form based on his or her Sub-Plan, as described below, by submitting a request to Prudential. All change requests shall be subject to Prudential’s timely receipt of a valid election in a method acceptable to Prudential containing all the information Prudential deems necessary for the change Any such change will be governed by this Section and will take effect on the Covered Life’s commencement date and thereafter will have the same force and effect as if included on the Annuity Exhibits on the Effective Date.

The disclosure and spousal consent requirements of Section 417 of the Code in effect from time to time will apply to a change in Annuity Form. Any change in Annuity Form will apply to payments payable on and after the Annuity Commencement Date.

Sub-Plan Optional Annuity Forms
A or B Life with Period Certain Annuity with Guaranteed Number of Payments equal to 60<br><br><br><br>Joint and Survivor Life Annuity (50%, 75%, 100%) with Pop Up. Pop Up only occurs if the Contingent Life dies before the Covered Life and within 60 months following the Covered Life’s commencement date)
C Life Annuity<br><br><br><br>Life with Period Certain Annuity with Guaranteed Number of Payments equal to 120<br><br><br><br>Joint and Survivor Life Annuity (50%, 75% or 100%); Contingent Life must be the Spouse
SAL Life Annuity<br><br><br><br>Life with Period Certain Annuity with Guaranteed Number of Payments equal to 60 or 120<br><br><br><br>Joint and Survivor Life Annuity (50%, 75% or 100%); Contingent Life must be the Spouse

The Amount of the Covered Life’s Annuity Payment after a change to an optional Annuity Form will equal the Age 65 Benefit Amount (with respect to Disabled Immediate Covered Lives) or Covered Life Amount (with respect to Deferred Covered Lives) multiplied by the appropriate factor determined from the Tables of this Contract. The amount of the Contingent Life’s Annuity Payment under any Joint and Survivor Annuity form will be equal to the amount of the Covered Life’s Annuity Payment multiplied by the applicable continuation percentage.

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3.4    Annuity Change Procedure/Conditions

Subject to the terms of this Provision III, each Deferred Covered Life, if alive on the Annuity Commencement Date, (a) is entitled to receive Annuity Payments in the Annuity Form and Covered Life Amount shown on the Annuity Exhibits and (b) may submit a request to change his or her Annuity Form or Annuity Commencement Date by notifying Prudential. All change requests shall be subject to Prudential’s timely receipt of valid election in a method acceptable to Prudential containing all the information Prudential deems necessary for the change. For changes other than a change made due to a later Annuity Commencement Date and the Life Annuity with Deferred Cash Refund, such requests must be received at Prudential’s Office at least 30 days before the applicable Annuity Commencement Date. Any such change will take effect when entered upon Prudential's records and thereafter will have the same force and effect as if included in the Annuity Exhibits on the Effective Date.

The disclosure and spousal consent requirements of Section 417 of the Code as in effect from time to time will apply to a change in Annuity Form. Any change in Annuity Form will apply to payments payable on and after the Annuity Commencement Date.

With respect to the Life Annuity with Deferred Cash Refund Annuity Form described in Section 3.3(a)(viii), the initial change request must be received within six (6) months after the Deferred Covered Life’s Separation From Service, subject to Prudential’s timely receipt of valid election in a method acceptable to Prudential containing all the information Prudential deems necessary for the change, including, but not limited to, the disclosure and spousal consent requirements of Section 417 of the Code as in effect from time to time. In the event the initial election of the Life Annuity with Deferred Cash Refund does not occur within the 180-day election period prior to the Deferred Covered Life’s unchanged Annuity Commencement Date, the Deferred Covered Life will be required to submit an additional election within the 180-day election period prior to his or her unchanged Annuity Commencement Date in accordance with the disclosure and spousal consent requirements of Section 417 of the Code as in effect from time to time.

3.5    Change in Annuity Form

A Deferred Covered Life who has a Spouse on his or her Annuity Commencement Date will, unless he or she specifically elects otherwise in accordance with Section 3.4, have the Annuity Form specified on the Annuity Exhibits changed to a 50% Joint and Survivor Life Annuity with Pop Up for Sub-Plans A and B or 50% Joint and Survivor Life Annuity for Sub-Plans C and SAL, beginning on the Deferred Covered Life’s Annuity Commencement Date. The amount of the Deferred Covered Life’s Annuity Payment after the change will be equal to the amount of the Annuity Payment otherwise payable multiplied by the appropriate factor determined from the Tables of this Contract. Prudential will make the first monthly payment to the Deferred Covered Life on the Annuity Commencement Date. Prudential will pay subsequent payments to the Deferred Covered Life on the first day of each month. Prudential’s last payment to the Deferred Covered Life will be on the first day of the month in which the Deferred Covered Life dies.

After the death of the Deferred Covered Life, Prudential will make additional monthly payments to the Spouse if the Spouse is alive when the Deferred Covered Life dies. Prudential will make the first monthly payment to the Spouse on the first day of the month following the month in which the Deferred Covered Life dies. Prudential will pay subsequent payments to the Spouse on the first day of each month. Prudential’s last payment to the Spouse will be on the first day of the month in which such Spouse dies. The amount of the Annuity Payment payable to the Spouse after the Deferred Covered Life’s death will be equal to the amount of the Annuity Payment payable to the Deferred Covered Life’s multiplied by 50%.

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For Sub-Plans A and B, if the Spouse dies before the Deferred Covered Life and within 60 months following the Deferred Covered Life’s Annuity Commencement Date, Prudential will increase the Annuity Payments to the Deferred Covered Life by the Pop Up Amount (as determined at the commencement date) starting on the first day of the month following the Contingent Life’s death. Prudential will make subsequent payments on the first day of each month. Prudential’s last payment to the Deferred Covered Life will be on the first day of the month in which the Deferred Covered Life dies.

Subject to the terms of Section 3.4, a Deferred Covered Life may, before his or her Annuity Commencement Date, change the Annuity Form specified on the Annuity Exhibits (Life Annuity with respect to Sub-Plans C and SAL; Life with Period Certain Annuity with 60 Guaranteed Number of Payments with respect to Sub-Plans A and B) to one of the following Annuity Forms. The changed Annuity Form will apply to payments payable on and after the Deferred Covered Life’s Annuity Commencement Date.

Sub-Plan Annuity Form
A or B Joint and Survivor Life Annuity with Pop Up with a continuation percentage to the designated Contingent Life equal to 50%, 75%, or 100%<br><br><br><br>Level Income Life with Period Certain Annuity with Guaranteed Number of Payments equal to 60
C Life with Period Certain Annuity with Guaranteed Number of Payments equal to 120<br><br><br><br>Joint and Survivor Life Annuity with a continuation percentage to the designated Contingent Life equal to 50%, 75%, or 100%; Contingent Life must be the Spouse
SAL Life with Period Certain Annuity with Guaranteed Number of Payments equal to 60 or 120<br><br><br><br>Joint and Survivor Life Annuity with a continuation percentage to the designated Contingent Life equal to 50%, 75%, or 100%; Contingent Life must be the Spouse<br><br><br><br>Level Income Life Annuity<br><br><br><br>Life Annuity with Deferred Cash Refund

The amount of the Deferred Covered Life’s Annuity Payment after the change of Annuity Form will be equal to the amount of Annuity Payment otherwise payable multiplied by the appropriate factor determined from the Tables of this Contract. The amount of Annuity Payment payable to the Contingent Life after the Deferred Covered Life’s death will be equal to the amount of the Annuity Payment payable to the Deferred Covered Life multiplied by the applicable continuation percentage. The payment terms for these Annuity Forms are described in Section 3.3; provided that the Contingent Life will be the person designated by the Deferred Covered Life and the Contingent Life Amount will be equal to the amount payable to the designated Contingent Life as determined in accordance with this Section.

The Level Income options described above will be computed as follows:

On and after his or her Annuity Commencement Date but before attainment of his or her Social Security normal retirement age, the amount of the Annuity Payment payable will be equal to A + (B * C) where:

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A = the Covered Life Amount, with such amount adjusted for an earlier Annuity Commencement Date in accordance with Section 3.7 or later Annuity Commencement Date in accordance with Section 3.8, as applicable, and

B = the estimated Primary Insurance Amount that the Deferred Covered Life would receive upon attainment of the Social Security normal retirement age, and

C = the appropriate factor for a Level Income Annuity determined from the Tables of this Contract.

On and after the Deferred Covered Life’s attainment of the Social Security normal retirement age, the amount of the Annuity Payment payable will be equal to the amount determined in the preceding paragraph minus the estimated Primary Insurance Amount that the Deferred Covered Life would receive upon attainment of the Social Security normal retirement age. Prudential’s last monthly payment to the Deferred Covered Life will be on the first day of the month in which he or she dies.

If the Level Income Life with Period Certain Annuity was in effect, then after the Deferred Covered Life dies, Prudential will compare the number of monthly payments Prudential made in respect of the Deferred Covered Life on and after the Annuity Commencement Date to the Guaranteed Number of Payments (60). If the number of monthly payments made is less than such guaranteed number, Prudential will pay the designated Beneficiary the monthly amount otherwise payable to the Deferred Covered Life, subject to adjustment at the Deferred Covered Life’s Social Security normal retirement age. These payments will stop when the total number of payments made in respect of the Deferred Covered Life, plus the number of payments to the Beneficiary, equals the Guaranteed Number of Payments.

However, if the Annuity Payment payable on and after the Deferred Covered Life’s attainment of the Social Security normal retirement age is a negative number, the Annuity Payment payable will be adjusted so that the Annuity Payment payable before the Deferred Covered Life’s attainment of the Social Security normal retirement age will be equal to A / (1 - C) and the Annuity Payment payable on and after attainment of the Social Security normal retirement age will equal zero ($0.00).

3.6    Lump Sum Payment Option

Subject to the terms of Section 3.4, a Deferred Covered Life may elect to receive a lump sum payment in lieu of and in full settlement for the Annuity Payments which would otherwise be payable under this Contract if the lump sum payment determined is $[ *** ] or less. The lump sum payment will be paid on the Deferred Covered Life’s earlier Annuity Commencement Date, Annuity Commencement Date or later Annuity Commencement Date provided that Prudential has received the Deferred Covered Life’s lump sum election. The amount of the lump sum payment will be determined using the Applicable Interest Rate and Applicable Mortality Table, and the following procedure:

i.Payment before the Deferred Covered Life satisfied the age or service requirements for an earlier Annuity Commencement Date in Section 3.7; multiply the Covered Life Amount by the applicable deferred lump sum factor determined from the Tables of this Contract

ii.Payment on or after the Deferred Covered Life satisfied the age and service requirements for an earlier Annuity Commencement Date in Section 3.7 or at the unchanged Annuity Commencement Date; the greater of (a) the Covered Life Amount, adjusted for early commencement, if applicable, multiplied by the applicable immediate lump sum factor determined from the Tables of this Contract and (b) the Covered Life Amount multiplied by the applicable deferred lump sum factor determined from the Tables of this Contract.

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iii.Payment at a later Annuity Commencement Date; multiply the Covered Life Amount, adjusted for later commencement, by the applicable immediate lump sum factor determined from the Tables of this Contract

The disclosure and spousal consent requirements of Section 417 of the Code in effect from time to time will apply to a lump sum payment.

3.7    Earlier Annuity Commencement Date

Subject to the terms of Section 3.4, a Deferred Covered Life may change his or her Annuity Commencement Date to an earlier date. Separation From Service is not required to commence payment at an earlier Annuity Commencement Date [ *** ]. In order to elect an earlier Annuity Commencement Date, the Deferred Covered Life must be at least 55 years of age and (i) for Sub-Plans A and B, have completed 5 Years of Service, and (ii) for Sub-Plans SAL and C, have completed 10 Years of Service.

If (i) a Deferred Covered Life has not satisfied the age or service requirements in the prior paragraph and (ii) the value of his or her Annuity Payments is $[ *** ] or less as determined in accordance Section 3.6, he or she may still elect to change his or her Annuity Commencement Date to an earlier date, subject to the terms of Section 3.4.

There will be no reduction for an earlier Annuity Commencement Date if the Deferred Covered Life satisfied the following conditions:

•Sub-Plans A and B: the earlier Annuity Commencement Date is on or after attainment of age 62.

•Sub-Plans A and B: (i) there was a plant shutdown, as reasonably determined by the Employer and confirmed in written correspondence to Prudential; and (ii) the Deferred Covered Life was actively employed with the Employer and (iii) completed at least 30 Years of Service at the time of the plant shutdown.

•Sub-Plan SAL: Deferred Covered Life (i) is age 62 or older on the earlier Annuity Commencement Date, (ii) is actively employed with the Employer as of November 30, 2020 and (iii) completed at least 15 Years of Service.

Otherwise, the amount of the Annuity Payment payable on the earlier Annuity Commencement Date will be equal to the Covered Life Amount multiplied by the appropriate factor determined from the Tables of this Contract.

3.8    Later Annuity Commencement Date

A Deferred Covered Life may request to commence payments on his or her unchanged Annuity Commencement Date. Separation From Service is not required to commence Annuity Payments. If Prudential has not timely received the Deferred Covered Life’s request and all information Prudential deems necessary in order to commence Annuity Payments on his or her unchanged Annuity Commencement Date, the Deferred Covered Life’s Annuity Commencement Date will be determined as described in this Section.

If a Deferred Covered Life does not commence Annuity Payments on or before his or her unchanged Annuity Commencement Date and incurs a Separation From Service prior to his or her unchanged Annuity Commencement Date, he or she will have the following options, subject, in each case, to a valid election pursuant to Section 3.4:

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(a)The Deferred Covered Life may change his or her Annuity Commencement Date to a later date. Subject to the last paragraph of this Section, the later Annuity Commencement Date will be the earlier of (i) the first day of any month following Prudential’s receipt of a request from the Deferred Covered Life to commence Annuity Payments and (ii) the Required Beginning Date. The amount of the Deferred Covered Life’s Annuity Payment commencing on the later Annuity Commencement Date will be equal to the Covered Life Amount multiplied by the appropriate factor determined from the Tables of this Contract to reflect an actuarial increase for the deferral period beginning on the unchanged Annuity Commencement Date and ending on his or her later Annuity Commencement Date. Such Deferred Covered Life will not receive any Annuity Payments during the period beginning on the unchanged Annuity Commencement Date and ending on the later Annuity Commencement Date; or

(b)The Deferred Covered Life may request to receive Annuity Payments retroactive to his or her unchanged Annuity Commencement Date. The amount of the Deferred Covered Life’s Annuity Payment will be equal to the Covered Life Amount that would have been payable had payments actually commenced on the unchanged Annuity Commencement Date. The Deferred Covered Life will also receive a make-up payment to reflect any missed payments for the period from the unchanged Annuity Commencement Date to the date of the actual make-up payment, credited with interest from the otherwise applicable payment dates until the date of such make-up payment using an annual interest rate of [ *** ]%.

If a Deferred Covered Life (i) reaches his or her unchanged Annuity Commencement Date after the Effective Date, (ii) does not commence Annuity Payments on or before his or her unchanged Annuity Commencement Date and (iii) continues in employment with the Employer beyond his or her unchanged Annuity Commencement Date, Prudential will notify the Deferred Covered Life in accordance with Department of Labor Regulations Section 2530.203-3(b)(4) that his or her Annuity Payments will be suspended during the Deferred Covered Life’s period of employment with the Employer until his or her later Annuity Commencement Date, and that such Deferred Covered Life will receive Annuity Payments when his or her Annuity Commencement Date is changed to a later date. The Contract-Holder has affirmed that each Deferred Covered Life who reached his or her unchanged Annuity Commencement Date prior to the Effective Date while employed with the Employer received a suspension of benefits notice from the Plan prior to the Effective Date in accordance with Department of Labor Regulations Section 2530.203-3(b)(4). Any such Deferred Covered Life described in this paragraph will have the following options, subject, in each case, to a valid election pursuant to Section 3.4:

(a)The Deferred Covered Life may change his or her Annuity Commencement Date to a later date. Subject to the last paragraph of this Section, the later Annuity Commencement Date will be the earlier of (i) the first day of any month following Prudential’s receipt of a request from the Deferred Covered Life to commence Annuity Payments and (ii) the Required Beginning Date. Such later Annuity Commencement Date may occur before or after the Deferred Covered Life’s Separation From Service. The amount of the Deferred Covered Life’s Annuity Payment commencing on the later Annuity Commencement Date will be equal to the Covered Life Amount multiplied, if applicable, by the appropriate factor determined from the Tables of this Contract; provided that any such actuarial increase will only apply to the extent there is an actual deferral period, as determined based on the period (if any) beginning on the earlier of (i) the first day of the month immediately following the Deferred Covered Life’s Separation From Service (if any) and (ii) April 1 of the calendar year following the Deferred Covered Life’s attainment of age 70 ½ if he or she continued in employment with the Employer beyond such date, and ending on the later Annuity Commencement Date. Such Deferred Covered Life will

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not receive any Annuity Payments during the period beginning on the unchanged Annuity Commencement Date and ending on the later Annuity Commencement Date; or

(b)Following the incurrence of a Separation from Service, the Deferred Covered Life who has not yet commenced Annuity Payments may request to receive Annuity Payments retroactive to a later Annuity Commencement Date that is the first day of the month immediately following the Deferred Covered Life’s Separation From Service. The amount of the Deferred Covered Life’s Annuity Payment will be equal to the Covered Life Amount otherwise payable on the unchanged Annuity Commencement Date; provided, however, if the Deferred Covered Life continues in employment with the Employer beyond the April 1 of the calendar year following the Deferred Covered Life’s attainment of age 70 ½, the amount of the Annuity Payment commencing on his or her later Annuity Commencement Date will include an actuarial increase as described in (a). The Deferred Covered Life will also receive a make-up payment to reflect any missed payments for the period from the later Annuity Commencement Date until the date of the actual make-up payment, credited with interest from the otherwise applicable payment dates until the date of such make-up payment using an annual interest rate of [ *** ]%.

If there is a delay in commencing the Deferred Covered Life’s payments on his or her Required Beginning Date, Prudential will owe Annuity Payments retroactive to his or her Required Beginning Date. The amount of the Deferred Covered Life’s Annuity Payment will be equal to the amount that would have been payable had payments actually commenced on the Required Beginning Date. The Deferred Covered Life will also receive a one-time make-up payment to reflect any missed Annuity Payments for the period from the Required Beginning Date until the date of the actual make-up payment, credited with interest from the intended payment dates until the date of such make-up payment using an annual interest rate equal to [ *** ]%.

In the event a Deferred Covered Life who is subject to a later Annuity Commencement Date dies prior to the determination of a later Annuity Commencement Date, his or her Annuity Payments will be cancelled and nothing will be payable in respect of such Deferred Covered Life unless a Pre-Retirement Survivor Annuity described in Section 3.9 applies.

3.9    Pre-Retirement Survivor Annuity

Except as stated in Section 3.3 (a) (viii) and Section 3.3 (b) (iii), a Pre-Retirement Survivor Annuity as described in this Section may apply if a Deferred Covered Life dies prior to his or her Annuity Commencement Date. If a Deferred Covered Life with a Sub-Plan of A or B dies before his or her Annuity Commencement Date and before incurring a Separation From Service or incurred a Separation From Service after satisfying the age and service requirements for early retirement and has a surviving Spouse on the Deferred Covered Life’s death, or who incurred a Separation From Service prior to death, he or she must have a surviving Spouse to whom he or she had been married for the one-year period ending on the date of the Covered Life’s death, an Annuity Payment will be owed to the Spouse for the remainder of his or her lifetime. For any Deferred Covered Life with a Sub-Plan of SAL or C, or any Deferred Covered Life who incurred a Separation From Service prior to death, he or she must have a surviving Spouse to whom he or she had been married for the one-year period ending on the date of the Covered Life’s death.

Prudential will make Annuity Payments to the surviving Spouse starting on the first day of the month on or next following the date of the Deferred Covered Life’s death, as described in the chart below. The Spouse may request to defer payment to a later date but not later than the Deferred Covered Life’s unchanged Annuity Commencement Date as shown on the Annuity Exhibits. Prudential’s last payment to the Spouse will be on the first day of the month in which the Spouse dies.

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Sub-Plan Annuity Payment Determination
A or B If the Deferred Covered Life is active or eligible for early retirement as of his or her date of Separation From Service and age 55 or older at date of death:<br><br>(1)Multiply the Covered Life Amount by the appropriate early factor determined from the Tables of this Contract.<br><br>(2)Multiply (1) by the appropriate factor determined from the Tables of this Contract for a 100% Joint and Survivor Life Annuity (with Pop Up). The resultant benefit amount is payable to the Spouse.<br><br><br><br>If the Deferred Covered Life is active or eligible for early retirement as of his or her date of Separation From Service and younger than age 55 at date of death:<br><br>(1)Multiply the Covered Life Amount by the appropriate early factor from the Tables of this Contract based on age 55.<br><br>(2)Multiply (1) by the appropriate early factor from the Tables of this Contract based on the Deferred Covered Life’s age on the first of the month following death.<br><br>(3)Multiply (2) by the appropriate factor determined from the Tables of this Contract for a 100% Joint and Survivor Life Annuity (with Pop Up). The resultant benefit amount is payable to the Spouse.<br><br><br><br>If the Deferred Covered Life is (i) not active or (ii) not eligible for early retirement as of his or her date of Separation From Service and age 55 or older at date of death:<br><br>(1)Multiply the Covered Life Amount by the appropriate early factor determined from the Tables of this Contract.<br><br>(2)Multiply (1) by the appropriate factor determined from the Tables of this Contract for a 50% Joint and Survivor Life Annuity (with Pop Up). 50% of the resultant benefit amount is payable to the Spouse.<br><br>If the Deferred Covered Life is (i) not active or (ii) not eligible for early retirement as of his or her date of Separation From Service and younger than age 55 at date of death:<br><br>(1)Multiply the Covered Life Amount by the appropriate early factor determined from the Tables of this Contract, based on age 55.<br><br>(2)Multiply (1) by the appropriate early factor determined from the Tables of this Contract, based on the Deferred Covered Life’s age on the first of the month following death.<br><br>(3)Multiply (2) by the appropriate factor determined from the Tables of this Contract for a 50% Joint and Survivor Life Annuity (with Pop Up). 50% of the resultant benefit amount is payable to the Spouse.

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SAL The Spouse of a Deferred Covered Life that is active at date of death or eligible for early retirement as of his or her date of Separation From Service will receive a monthly amount as of the first of the month following the Deferred Covered Life’s date of death based on the greater of (i) the benefit determined below and (ii) 30% of the Covered Life Amount.<br><br><br><br>If the Deferred Covered Life is active or eligible for early retirement as of his or her date of Separation From Service and age 55 or older at date of death:<br><br>(1)Multiply the Covered Life Amount by the appropriate early factor determined from the Tables of this Contract.<br><br>(2)Multiply (1) by the appropriate factor determined from the Tables of this Contract for a 50% Joint and Survivor Life Annuity. 50% of the resultant benefit amount is payable to the Spouse.<br><br><br><br>If the Deferred Covered Life is active or eligible for early retirement as of his or her date of Separation From Service and younger than age 55 at date of death:<br><br>(1)Multiply the Covered Life Amount by the appropriate early factor determined from the Tables of this Contract, based on age 55.<br><br>(2)Multiply (1) by the appropriate early factor determined from the Tables of this Contract, based on the Deferred Covered Life’s age on the first of the month following death.<br><br>(3)Multiply (2) by the appropriate factor determined from the Tables of this Contract for a 50% Joint and Survivor Life Annuity. 50% of the resultant benefit amount is payable to the Spouse.
SAL The Spouse of a Deferred Covered Life not active at date of death and not eligible for early retirement as of his or her date of Separation of Service will receive a monthly amount as of the first of the month following the Deferred Covered Life’s date of death:<br><br><br><br>If the Deferred Covered Life is (i) not active or (ii) not eligible for early retirement as of his or her date of Separation From Service and age 55 or older at date of death:<br><br>(1)Multiply the Covered Life Amount by the appropriate early factor determined from the Tables of this Contract.<br><br>(2)Multiply (1) by the appropriate factor determined from the Tables of this Contract for a 50% Joint and Survivor Life Annuity. 50% of the resultant benefit amount is payable to the Spouse.<br><br><br><br>If the Deferred Covered Life is not eligible for early retirement as of his or her date of Separation From Service and younger than age 55 at date of death:<br><br>(1)Multiply the Covered Life Amount by the appropriate early factor determined from the Tables of this Contract, based on age 55.<br><br>(2)Multiply (1) by the appropriate early factor determined from the Tables of this Contract, based on the Deferred Covered Life’s age on the first of the month following death.<br><br>Multiply (2) by the appropriate factor determined from the Tables of this Contract for a 50% Joint and Survivor Life Annuity. 50% of the resultant benefit amount is payable to the Spouse.

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C If the Deferred Covered Life is active or eligible for early retirement as of his or her date of Separation From Service and age 55 or older at date of death:<br><br>(1)Multiply the Covered Life Amount by the appropriate early factor determined from the Tables of this Contract.<br><br>(2)Multiply (1) by the appropriate factor determined from the Tables of this Contract for a 50% Joint and Survivor Life Annuity. 50% of the resultant benefit amount is payable to the Spouse.<br><br><br><br>If the Deferred Covered Life is active or eligible for early retirement as of his or her date of Separation From Service and younger than age 55 at date of death:<br><br>(1)Multiply the Covered Life Amount by the appropriate early factor determined from the Tables of this Contract, based on age 55.<br><br>(2)Multiply (1) by the appropriate early factor determined from the Tables of this Contract, based on the Deferred Covered Life’s age on the first of the month following death.<br><br>(3)Multiply (2) by the appropriate factor determined from the Tables of this Contract for a 50% Joint and Survivor Life Annuity. 50% of the resultant benefit amount is payable to the Spouse.<br><br><br><br>If the Deferred Covered Life is not eligible for early retirement as of his or her date of Separation From Service and age 55 or older at date of death:<br><br>(1)Multiply the Covered Life Amount by the appropriate early factor determined from the Tables of this Contract.<br><br>(2)Multiply (1) by the appropriate factor determined from the Tables of this Contract for a 50% Joint and Survivor Life Annuity. 50% of the resultant benefit amount is payable to the Spouse.<br><br><br><br>If the Deferred Covered Life is not eligible for early retirement as of his or her date of Separation From Service and younger than age 55 at date of death:<br><br>(1)Multiply the Covered Life Amount by the appropriate early factor determined from the Tables of this Contract, based on age 55.<br><br>(2)Multiply (1) by the appropriate early factor determined from the Tables of this Contract, based on the Deferred Covered Life’s age on the first of the month following death.<br><br>(3)Multiply (2) by the appropriate factor determined from the Tables of this Contract for a 50% Joint and Survivor Life Annuity. 50% of the resultant benefit amount is payable to the Spouse.

3.10    Small Annuity Payments to Covered Lives

A lump sum payment, in lieu of, and in full settlement for, the Annuity Payments which would otherwise be payable to, or on behalf of, a Deferred Covered Life will be paid if the present value of the Annuity Payments is $[ *** ] or less.

The amount of the lump sum payment will be determined in accordance with the procedures described in Section 3.6 .

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3.11    No Assignment by Covered Lives and Contingent Lives

Neither a Covered Life or Contingent Life nor such person’s Representative may (a) assign, pledge, transfer or otherwise alienate his or her rights under the Contract or their respective Annuity Form or an annuity certificate, or (b) enter into a transaction in which one or more Annuity Payments are anticipated or accelerated. Any attempt to do so shall be null and void at the outset, without any effect whatsoever. Also, to the maximum extent permitted by law, including but not limited to the relevant provisions of the Code, no Annuity Payment is subject to the claims of creditors. For the avoidance of doubt, compliance with the terms of a Qualified Domestic Relations Orders will not be considered to be an impermissible alienation under the Contract.

3.12    Proof of Continued Existence for Life Annuities; Escheatment

As a condition to making any Annuity Payment arising from an Annuity Form dependent upon the continued existence of a Covered Life or Contingent Life, Prudential may require the receipt of evidence satisfactory to it that the Covered Life and/or the Contingent Life is alive and no such payment is owed under this Contract unless and until Prudential receives such evidence.

After consummation of a Buy-Out Conversion, if a Covered Life (or Contingent Life) in respect of whom remaining guaranteed payments are payable at the time of his or her death, dies without validly designating a Beneficiary, or if the Beneficiary is no longer living, Prudential may pay the “present value” (as such term is defined in Section 3.14) thereof in full settlement of its liability for such payments. Such present value may be paid to the estate of the Covered Life (or, Contingent Life, if applicable). After the period of time prescribed by applicable state law, any payments under a Period Certain Annuity or lump sum benefit that have been withheld under the terms of this Section 3.12 may be considered abandoned or escheatable property. In such case, Prudential will follow the laws applicable to the disposition of any remaining period certain payments or remaining lump sum benefit payable. Any payments made to the state under such circumstances will relieve Prudential of all further obligations under this Contract with respect to such Annuity Forms.

3.13    Data Misstatements

(i)[ *** ]

(ii)[ *** ]

(iii)[ *** ]

3.14    Concerning Designations

After the consummation of a Buy-Out Conversion, a Covered Life may designate a Contingent Life or Beneficiary and redesignate a Beneficiary from time to time in such manner specified by Prudential and in accordance with such related Annuity Form. Prudential will furnish an acknowledgment of the acceptance of any such designation or re-designation. Any spousal consent requirements of ERISA as applied to employee benefit plan participants in effect from time to time will apply to such designations. Such designations will not require the consent of any prior Contingent Life or Beneficiary, provided the change complies with the requirements of ERISA as applied to employee benefit plan participants in effect from time to time. If an Annuity Form involving a Contingent Life or Spouse has become effective, the Contingent Life or Spouse may, unless the Covered Life has directed otherwise, change

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the Beneficiary at any time after the death of the Covered Life to the estate of the Contingent Life or Spouse, without the consent of such Beneficiary.

If there is no designated Beneficiary shown in Prudential’s records when an Annuity Payment is payable to a Beneficiary under the terms of this Contract, payment will be made to the Covered Life’s Spouse, if living, otherwise to the Covered Life’s surviving children, if any, otherwise to the estate of the last surviving recipient of the Annuity Payments or a Representative thereof. However, if no executor is named for the estate of the last surviving recipient of the Annuity Payments, Prudential may, at its option, pay such amount which would otherwise be payable to an estate as described in the preceding sentence to any one or jointly to any number of the following surviving relatives of the last surviving recipient of the Annuity Payments who appear to Prudential to be equitably entitled to payment because of expenses incurred in connection with the burial or last illness of such last surviving recipient of the Annuity Payments: children, parents, brothers, or sisters. Any payment described in this paragraph and made by Prudential will, to the extent of such payment, be a valid discharge of its obligation under this Contract.

The parties agree with each other that the acceptability of such designations and re-designations of Beneficiaries will meet the requirements of ERISA as applied to employee benefit plan participants in effect from time to time, and shall keep their records accordingly. Such designations shall be effective when they are accepted by Prudential and the applicable records are updated.

Prudential, in determining the existence, identity, ages, or any other facts relating to any relatives of any Covered Life (or Contingent Life) or any persons designated as Beneficiaries, either as a class or otherwise, may rely solely on any affidavit or other evidence deemed reasonably satisfactory by it. Any payment made by Prudential in reliance thereon will, to the extent of such payment, be a valid discharge of its obligation under this Contract.

Should any remaining Annuity Payments become payable to a Beneficiary under an Annuity Form that provides a Guaranteed Number of Payments, Prudential may pay the present value of such Annuity Payments to the Beneficiary if (i) the monthly amount of the payments payable to the Beneficiary is less than $50 or (ii) the Beneficiary is other than a natural person receiving payments in his or her own right. The present value will be in lieu of and in full settlement for the Annuity Payments which would otherwise be payable under this Contract. The “present value” of Annuity Payments, as of any date of determination, means a lump sum payment equal to the total amount of any remaining Guaranteed Number of Payments.

3.15    Concerning Qualified Domestic Relations Orders

After the consummation of a Buy-Out Conversion, if an Annuity Payment is subject to a domestic relations order (as defined in subsection 414(p) of the Code), the Contract-Holder will cooperate with Prudential to provide any reasonably necessary or otherwise requested information in connection with all Qualified Domestic Relations Orders in effect with respect to Covered Lives. For any domestic relations order not qualified prior to the consummation of a Buy-Out Conversion, Prudential shall make determinations relating to the qualification, interpretation and administration of such domestic relations orders and shall make such determinations in accordance with applicable law, including any applicable requirements of ERISA with respect to employee benefit plan participants in effect from time to time. If there is a benefit payable under the Contract with regard to an alternate payee named under a qualified domestic relations order, any such Annuity Payment adjustment will take effect when entered upon Prudential's records.

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3.16    Payments to Representatives

Prudential may withhold Annuity Payments owed to any Covered Life or Contingent Life or Beneficiary if, in the judgment of Prudential, such person is incapable for any reason of personally receiving and giving a valid receipt for such payment. In such case, Prudential may discharge its obligation to any Covered Life or Contingent Life or Beneficiary by making payments to such person’s Representative. Prudential may pay to the Representative of a Covered Life or Contingent Life or Beneficiary amounts otherwise owed to such Covered Life or Contingent Life or Beneficiary if Prudential receives satisfactory evidence of such Representative’s authority. Any amount paid in accordance with this Section 3.16 will completely discharge the liability of Prudential for the amount paid.

3.17    Certificates

After consummation of a Buy-Out Conversion, upon receipt of applicable regulatory approvals, Prudential will issue each Covered Life (and, if receiving Annuity Payments on the date annuity certificates are issued, a Contingent Life) an annuity certificate. Each such certificate will set forth in substance the payments to which each Covered Life (and, if applicable, a Contingent Life) is entitled under this Contract. Also, Prudential may issue a substitute annuity certificate to correct errors contained in the previously issued certificate, whereupon the previously issued annuity certificate shall be null and void.

Each annuity certificate shall provide that only the Covered Life (and, if applicable, a Contingent Life) has the right to enforce any provisions of (and each Beneficiary and alternate payee will have the contractual right to enforce its rights to Annuity Payments under) this Contract, and that such rights are enforceable by the certificate-holder solely against Prudential and against no other person including the Plan, the Contract-Holder, or any affiliate thereof. Each certificate shall describe the consequences of any misstatements of age or other relevant fact, including Prudential’s rights and obligations relating to such misstatements.

The rights of Covered Lives and Contingent Lives under this Contract are not conditioned upon the issuance of annuity certificates, and any delay in issuing an annuity certificate to such Covered Life or Contingent Life does not delay the date on which the Covered Life or Contingent Life begins to have third-party beneficiary rights under this Contract.

3.18    Purchase of Additional Annuities after the Data Finalization Date

If the Contract-Holder requests Prudential to amend this Contract to add, as a Covered Life, a Plan participant who was omitted from the Annuity Exhibits or an alternate payee, beneficiary or surviving spouse of a Plan participant who was omitted from the Annuity Exhibits, and Prudential agrees to amend this Contract, then Prudential will determine the cost for the additional annuity using Prudential’s then current methods and assumptions applicable to the pricing of group pension annuities on the date of determination. Upon receipt of the additional premium amount from the Contract-Holder, this Contract will be amended for the purchase of the additional annuity and Prudential will issue an annuity certificate to reflect such additional purchase in accordance with Section 3.17. In the event that Prudential does not agree to such amendment or does not timely receive the additional premium amount described in this Section 3.18, Prudential shall have no obligation under Section 3.13, this Section 3.18 or otherwise to add any such individual as a Covered Life under this Contract.

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Provision IVGeneral Terms

4.1    Communications

All communications to Prudential regarding this Contract shall be addressed to Prudential’s Office.

Communications to Contract-Holder and Employer will be addressed as shown in our records, as updated from time to time on Prudential’s records based on notice provided by the Contract-Holder or Employer to Prudential.

All communications to Contract-Holder, Employer or Prudential will be in writing.

4.2    Currency; Payments

All moneys, whether payable to or by Prudential, shall be in lawful money of the United States of America. Dollars and cents refer to lawful currency of the United States of America. Payments owed to Prudential or to Contract-Holder shall be made pursuant to agreed procedures and wire instructions.

4.3    Reliance on Records; Correction of Errors

Contract-Holder will furnish all information which Prudential may reasonably require for the administration of this Contract. If Contract-Holder/Employer cannot furnish any required item of information, Prudential may (but is not required to) ask, after consummation of a Buy-Out Conversion, the relevant Covered Life, Contingent Life or Beneficiary to provide such information. Prudential will not be obligated to make Annuity Payments in any way dependent upon such information unless and until it receives all information necessary to fulfill its obligation.

Prudential will maintain the records necessary for its administration of this Contract. Such records will be prepared using the information furnished to it pursuant to this Contract and will constitute prima facie evidence as to the truth of the information recorded thereon. However, Prudential reserves the right to correct its records to eliminate erroneous information furnished to it and to reflect information it gathers reasonably believed by it to be reliable. Prudential may assume the accuracy of Contract-Holder’s records in connection with Covered Lives, Contingent Lives and Beneficiaries. Any payment made by Prudential in reliance on such records shall be a valid discharge of its obligation under this Contract.

4.4    Contract-Holder; Successor

Prudential will be entitled to rely on any action taken or omitted by or on behalf of Contract-Holder pursuant to the terms of this Contract and shall not be required to obtain consents of any other person or organization with an interest in the Plan, except as provided in Section 1.9. With Prudential’s consent, Contract-Holder may authorize representatives of the Plan, Employer or others to act on its behalf under this Contract. Prudential is entitled to rely on Contract-Holder (or its representative) in connection with the administration of this Contract. Contract-Holder at any time may, with the consent of Prudential, appoint a successor Contract-Holder, provided that if the successor Contract-Holder is a trustee for the Plan, such consent shall not be unreasonably withheld. Any such successor Contract-Holder will have all the rights, duties, and obligations of Contract-Holder. If Contract-Holder notifies Prudential that it will cease to exist or cease to perform the duties of Contract-Holder hereunder and no successor Contract-Holder is appointed, the Contract-Holder will thereafter have no rights or obligations under

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this Contract but this Contract shall nevertheless remain in full force and effect until the date on which there ceases to be any further Annuity Payments payable in accordance with the terms of this Contract.

4.5    No Implied Waiver

Except as expressly provided herein, any party's failure to insist in any one or more instances upon strict performance by any other party of any of the terms of this Contract shall not be construed as a waiver of any continuing or subsequent failure to perform or delay in performance of any term hereof.

4.6    Changes

(a)Mutual Agreement. This Contract may be amended at any time by written agreement between Prudential and Contract-Holder.

(b)Law or Regulation. Prudential may change this Contract as it deems necessary or appropriate to satisfy the requirements of any law enacted by (or of any regulation promulgated by) any legislative or governmental authority, body or agency.

(c)Absence of Contract-Holder. If Contract-Holder notifies Prudential that it will cease to exist, or cease to perform the duties of Contract-Holder hereunder, and no successor to Contract-Holder is appointed, then this Contract can thereafter be changed at any time by Prudential in its discretion, but subject to the rights of each Covered Life, Contingent Life and Beneficiary to receive Annuity Payments (as provided in Section 1.9).

4.7    Entire Contract - Construction

This Contract, together with the exhibits attached hereto, constitutes the entire agreement between the parties with respect to the subject matter of this Contract and supersedes all prior agreements and understandings, both oral and written, between the parties with respect to the subject matter of this Contract.

This Contract will be construed according to the laws of the jurisdiction set forth on the Cover Page without regard to the principles of conflicts of laws thereof except to the extent that those laws have been preempted by the laws of the United States of America.

4.8    Third Party Beneficiaries

Except as expressly set forth in Sections 1.9 and 1.10, this Contract does not and is not intended to confer any rights or remedies upon any person other than the Contract-Holder.

GAA-9063[ *** ]    42

[ *** ]

Tables1

1 See separate document

[ *** ]

CASH AND TRANSFERRED ASSETS EXHIBIT

As of August 6, 2020

Listing and Reconciliation of Assets Transferred and Retained in Respect of Total Contribution Amount and Contribution Adjustment Amounts Owed

The Cash and Transferred Assets Exhibit includes a list of cash and non-cash assets, if applicable, that equal the Total Contribution Amount shown on the Cover Page of this Contract.

Contribution Amount as of Effective Date [ *** ]

Cash Assets: [ *** ]

[ *** ]

ANNUITY EXHIBITS

The Annuity Exhibits list each Covered Life, Contingent Life or other person entitled to payments under this Contract plus information that applies to each such Covered Life, Contingent Life or other person. The Annuity Exhibits are attached to and made a part of this Contract in the form of the data file titled [ *** ] provided by the Contract-Holder to Prudential posted to Milliman secure website at [ *** ] Eastern Standard Time on [ *** ]

[ *** ]

Tables

The following Tables provide the conversion factors or actuarial basis that will be used to determine the factors under this Contract. The following definitions apply to the Tables of this Contract:

“Actuarial Equivalence Basis A” means the factor determined using the following assumptions:

•Mortality table: 1971 Group Annuity Mortality Table (80% male, 20% female) for Covered Lives; 1971 Group Annuity Mortality Table (20% Male, 80% Female) for Contingent Lives

•Interest rate: 8.5%

•Rounding: Round final factor to 5 decimal places

“Actuarial Equivalence Basis B” means the factor determined using the following assumptions:

•Mortality table: “Applicable Mortality Table” as defined in Section 1.1

•Interest rate: “Applicable Interest Rate” as defined in Section 1.1

•Age basis: Use Covered Life’s exact age in years and completed months

•Rounding: Round final factor to 5 decimal places

“Actuarial Equivalence Basis C” means the factor determined using the following assumptions:

•Mortality table: 1944 Railroad Retirement Board (RRB) Railway Disabled Annuitants Unisex Mortality Table for Covered Lives; 1971 Group Annuity Mortality Table (20% Male, 80% Female) for Contingent Lives

•Interest rate: 8.5%

•Age basis: Use age nearest birthday for Covered Life and Contingent Life

•Rounding: Round final factor to 5 decimal places

Table I-A: Earlier Annuity Commencement Date (Sub-Plan A & B)

a)Eligibility: Covered Life (i) is at least 55 years of age, (ii) completed 5 Years of Service and (iii) is not covered under Sub-Plan A 6-88

b)Reduction Factor:

•Rounding: Round final factor to 5 decimal places

•Age basis: Use Covered Life’s exact age in years and completed months

•Reduction formula:

◦No reduction if earlier Annuity Commencement Date is on or after Covered Life’s age 62

◦No reduction if (i) there was a plant shutdown, as reasonably determined by the Employer and confirmed in written correspondence to Prudential and (ii) the Covered Life completed at least 30 Years of Service

◦Otherwise, 5% reduction per year from age 62 with a pro rata reduction for any monthly portion of a year

Table I-B: Earlier Annuity Commencement Date (Sub-Plan A 6-88 & Sub-Plan C)

a)Eligibility:

•Sub-Plan A 6-88: Covered Life (i) is at least 55 years of age and (ii) completed 5 Years of Service

•Sub-Plan C: Covered Life (i) is at least 55 years of age, (ii) completed 10 Years of Service and (iii) is not covered under Sub-Plan C VT C03

b)Reduction Factor:

•Rounding: Round final factor to 5 decimal places

•Age basis: Use Covered Life’s exact age in years and completed months

Commencement Age Factor
65 1.00000
64 0.93330
63 0.86670
62 0.80000
61 0.73330
60 0.66670
59 0.61620
58 0.56560
57 0.52700
56 0.49210
55 0.46050

Table I-C: Earlier Annuity Commencement Date (Sub-Plan C VT C03)

a)Eligibility: Covered Life (i) is at least 55 years of age and (ii) completed 10 Years of Service

b)Reduction Factor:

•Rounding: Round final factor to 5 decimal places

•Age basis: Use Covered Life’s exact age in years and completed months

•Reduction formula: 4% reduction per year with a pro rata reduction for any monthly portion of a year

Table I-D: Earlier Annuity Commencement Date (Sub-Plan SAL)

a)Eligibility: Covered Life (i) is at least 55 years of age and (ii) completed 10 Years of Service

b)Reduction Factor:

•Rounding: Round final factor to 5 decimal places

•Age basis: Use Covered Life’s exact age in years and completed months

•Reduction formula:

◦No reduction if Covered Life (i) is age 62 or older on the earlier Annuity Commencement Date, (ii) is actively employed with the Employer as of November 30, 2020 and (iii) completed at least 15 Years of Service

◦Otherwise, 3% reduction per year from age 65 to 60; 5% reduction per year from age 60 to age 55, with a pro rata reduction for any monthly portion of a year

Table I-E: Earlier Annuity Commencement Date prior to age 55 for Pre-Retirement Survivor Annuity (All Sub-Plans)

a)Applies to Pre-Retirement Survivor Annuity determined in accordance with Section 3.9, where the Covered Life’s death occurred prior to age 55

b)Reduction Factor:

•Age basis: Use Covered Life’s exact age in years and completed months

•Reduction: Age 55 factor from Table I-A, I-B, I-C, or I-D (based on the respective Sub-Plan) further reduced by Actuarial Equivalence Basis A for each month the earlier Annuity Commencement Date precedes age 55

Table I-F: Earlier Annuity Commencement Date (Sub-Plan A & B)

a)Eligibility: (i) Covered Life is not eligible for Table I-A and (ii) the value of his or her Annuity Payments is $[ *** ] or less as determined in accordance with Section 3.6

b)Reduction factor: Actuarial Equivalence Basis B

Table I-G: Earlier Annuity Commencement Date (Sub-Plan C & SAL)

a)Eligibility: (i) Covered Life is not eligible for Table I-B or Table I-C and (ii) the value of his or her Annuity Payments is $[ *** ] or less as determined in accordance with Section 3.6

b)Reduction factor: Actuarial Equivalence Basis B

Table I-H: Later Annuity Commencement Date (Sub-Plan A & B)

•Age basis: Use Covered Life’s exact age in years and completed months

•Increase factor: Actuarial Equivalence Basis A

Table I-I: Later Annuity Commencement Date (Sub-Plan C & SAL)

•Age basis: Use Covered Life’s exact age in years and completed months

•Increase factor: Actuarial Equivalence Basis A

Table II and III: Conversion to Life with Period Certain Annuity (Sub-Plan C & SAL)

•Age basis: Use age nearest birthday for Covered Life

•Conversion factor: Actuarial Equivalence Basis A

Table IV through VI: Conversion to Joint and Survivor Life Annuity (Sub-Plan C & SAL)

•Eligibility: Covered Lives under Sub-Plan C & SAL not eligible for a disability benefit

•Age basis: Use age nearest birthday for Covered Life and Contingent Life

•Conversion factor: Actuarial Equivalence Basis A

Table VII through IX: Conversion to Joint and Survivor Life Annuity with Pop Up (Sub-Plan A & B)

•Eligibility: Covered Lives under Sub-Plan A & B not eligible for a disability benefit

•Age basis: Use age nearest birthday for Covered Life and Contingent Life

•Conversion factor: Actuarial Equivalence Basis A; provided that the conversion factor will reflect an actuarial adjustment for a standard Joint and Survivor Life Annuity with no further reduction for the pop-up feature

Table X and XI: Conversion to Level Income Life Annuity or Level Income Life with Period Certain Annuity

•Conversion factor: Actuarial Equivalence Basis A or Actuarial Equivalence Basis B, whichever produces the greater Annuity Payment, calculated in accordance with Section 3.5

Table XII: Lump Sum Payment Option and Small Annuity Payments

•Conversion factor: Actuarial Equivalence Basis B, calculated in accordance with Section 3.6

Table XIII: Conversion to Life Annuity with Deferred Cash Refund (Sub-Plan SAL)

•Age basis: Use age nearest birthday for Covered Life at his or her Separation from Service (referred to in the tables below as Age at Term (a)) and/or age nearest birthday when coverage is revoked

•Initial Death Benefit calculation: Multiply the Covered Life Amount by Initial Death Benefit Factor (b) from the table shown below

•Annuity Payment calculation:

◦If coverage remains in effect on the unchanged Annuity Commencement Date: Multiply the Covered Life Amount by Conversion Factor (c) from the table shown below

◦If coverage is revoked prior to the Annuity Commencement Date: Multiply the Covered Life Amount by the Cost of Death Benefit Coverage if Revoked (d) from the table shown below, before applying any additional conversion factors for change in Annuity Commencement Date or Annuity Form

Age at<br><br>Term<br><br>(a) Initial Death Benefit Factor<br><br>(b) Conversion Factor<br><br>(c)
38 9.03471 0.96025
39 9.81522 0.95810
40 10.66424 0.95586
41 11.58801 0.95256
42 12.59357 0.94998
43 13.68892 0.94735
44 14.88292 0.94471
45 16.18539 0.94209
46 17.60723 0.93953
47 19.16052 0.93706
48 20.85871 0.93473
49 22.71673 0.93159
50 24.75124 0.92928
51 26.98078 0.92720
52 29.42594 0.92540
53 32.10978 0.92393
54 35.05820 0.92159
55 38.30016 0.92036
56 41.86828 0.91959
57 45.79918 0.91813
58 50.13433 0.91774
59 54.92239 0.91802
60 60.22432 0.91732
61 66.10980 0.91854
62 72.65793 0.91884
63 79.95888 0.91998
64 88.11883 0.92265
65 97.26927 0.92459
Cost of Death Benefit Coverage if Revoked (d)
--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Age When Coverage is Revoked
Age at Term (a) 38 39 40 41 42 43 44 45 46 47 48 49 50 51
38 1.00000 0.99882 0.99765 0.99648 0.99531 0.99411 0.99286 0.99157 0.99022 0.98882 0.98737 0.98588 0.98435 0.98278
39 - 1.00000 0.99873 0.99746 0.99618 0.99488 0.99353 0.99212 0.99066 0.98914 0.98756 0.98594 0.98427 0.98257
40 - - 1.00000 0.99862 0.99724 0.99582 0.99435 0.99282 0.99123 0.98958 0.98787 0.98611 0.98430 0.98245
41 - - - 1.00000 0.99849 0.99695 0.99536 0.99370 0.99197 0.99018 0.98832 0.98640 0.98443 0.98242
42 - - - - 1.00000 0.99832 0.99659 0.99479 0.99291 0.99096 0.98894 0.98686 0.98472 0.98253
43 - - - - - 1.00000 0.99812 0.99615 0.99411 0.99200 0.98980 0.98754 0.98521 0.98284
44 - - - - - - 1.00000 0.99787 0.99565 0.99335 0.99096 0.98850 0.98597 0.98339
45 - - - - - - - 1.00000 0.99759 0.99508 0.99249 0.98981 0.98706 0.98425
46 - - - - - - - - 1.00000 0.99727 0.99445 0.99154 0.98855 0.98549
47 - - - - - - - - - 1.00000 0.99693 0.99376 0.99050 0.98718
48 - - - - - - - - - - 1.00000 0.99655 0.99301 0.98939
49 - - - - - - - - - - - 1.00000 0.99614 0.99220
50 - - - - - - - - - - - - 1.00000 0.99571
51 - - - - - - - - - - - - - 1.00000
52 - - - - - - - - - - - - - -
53 - - - - - - - - - - - - - -
54 - - - - - - - - - - - - - -
55 - - - - - - - - - - - - - -
56 - - - - - - - - - - - - - -
57 - - - - - - - - - - - - - -
58 - - - - - - - - - - - - - -
59 - - - - - - - - - - - - - -
60 - - - - - - - - - - - - - -
61 - - - - - - - - - - - - - -
62 - - - - - - - - - - - - - -
63 - - - - - - - - - - - - - -
64 - - - - - - - - - - - - - -
65 - - - - - - - - - - - - - -
Cost of Death Benefit Coverage if Revoked (d)
--- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
Age When Coverage is Revoked
Age at Term (a) 52 53 54 55 56 57 58 59 60 61 62 63 64 65
38 0.98119 0.97958 0.97796 0.97633 0.97471 0.97309 0.97149 0.96990 0.96830 0.96670 0.96509 0.96348 0.96186 0.96025
39 0.98084 0.97909 0.97733 0.97557 0.97380 0.97205 0.97031 0.96858 0.96684 0.96510 0.96335 0.96160 0.95985 0.95810
40 0.98057 0.97867 0.97676 0.97484 0.97292 0.97101 0.96912 0.96724 0.96536 0.96347 0.96157 0.95966 0.95776 0.95586
41 0.98038 0.97832 0.97624 0.97415 0.97207 0.97000 0.96794 0.96590 0.96385 0.96180 0.95973 0.95766 0.95560 0.95353
42 0.98031 0.97807 0.97581 0.97355 0.97128 0.96903 0.96680 0.96458 0.96235 0.96012 0.95788 0.95563 0.95338 0.95113
43 0.98042 0.97799 0.97553 0.97307 0.97061 0.96816 0.96573 0.96332 0.96090 0.95847 0.95603 0.95359 0.95115 0.94870
44 0.98077 0.97812 0.97545 0.97277 0.97010 0.96743 0.96479 0.96217 0.95954 0.95690 0.95425 0.95159 0.94894 0.94628
45 0.98140 0.97852 0.97561 0.97270 0.96980 0.96690 0.96403 0.96117 0.95832 0.95545 0.95256 0.94967 0.94679 0.94390
46 0.98239 0.97925 0.97610 0.97293 0.96977 0.96662 0.96349 0.96039 0.95728 0.95416 0.95102 0.94788 0.94474 0.94159
47 0.98381 0.98039 0.97695 0.97351 0.97007 0.96664 0.96324 0.95986 0.95648 0.95308 0.94966 0.94624 0.94283 0.93941
48 0.98571 0.98200 0.97826 0.97451 0.97076 0.96703 0.96332 0.95965 0.95597 0.95227 0.94855 0.94483 0.94110 0.93738
49 0.98820 0.98415 0.98008 0.97599 0.97191 0.96785 0.96381 0.95981 0.95580 0.95177 0.94772 0.94367 0.93962 0.93556
50 0.99135 0.98694 0.98250 0.97804 0.97360 0.96917 0.96478 0.96041 0.95604 0.95165 0.94724 0.94282 0.93841 0.93399
51 0.99525 0.99044 0.98560 0.98075 0.97590 0.97107 0.96628 0.96153 0.95677 0.95198 0.94717 0.94235 0.93754 0.93273
52 1.00000 0.99476 0.98948 0.98419 0.97890 0.97364 0.96841 0.96323 0.95803 0.95281 0.94757 0.94232 0.93707 0.93181
53 - 1.00000 0.99424 0.98847 0.98270 0.97695 0.97125 0.96559 0.95993 0.95423 0.94851 0.94278 0.93705 0.93132
54 - - 1.00000 0.99369 0.98740 0.98113 0.97490 0.96872 0.96253 0.95631 0.95007 0.94381 0.93756 0.93130
55 - - - 1.00000 0.99312 0.98627 0.97947 0.97272 0.96596 0.95916 0.95234 0.94550 0.93867 0.93183
56 - - - - 1.00000 0.99251 0.98508 0.97770 0.97031 0.96288 0.95542 0.94795 0.94048 0.93300
57 - - - - - 1.00000 0.99187 0.98380 0.97571 0.96759 0.95942 0.95125 0.94308 0.93491
58 - - - - - - 1.00000 0.99116 0.98231 0.97342 0.96448 0.95554 0.94659 0.93764
59 - - - - - - - 1.00000 0.99030 0.98056 0.97077 0.96097 0.95117 0.94137
60 - - - - - - - - 1.00000 0.98932 0.97858 0.96783 0.95709 0.94634
61 - - - - - - - - - 1.00000 0.98822 0.97642 0.96463 0.95283
62 - - - - - - - - - - 1.00000 0.98703 0.97407 0.96110
63 - - - - - - - - - - - 1.00000 0.98574 0.97146
64 - - - - - - - - - - - - 1.00000 0.98427
65 - - - - - - - - - - - - - 1.00000

Table XIV through XVI: Conversion to Joint and Survivor Life Annuity with Pop Up

(Disability Benefit Under Sub-Plan A & B)

•Eligibility: Subject to Section 3.3(b), Deferred Covered Life under Sub-Plan A or B becomes eligible for disability benefit after the Effective Date

•Conversion factor: Actuarial Equivalence Basis C; provided that the conversion factor will reflect an actuarial adjustment for a standard Joint and Survivor Life Annuity with no further reduction for the pop-up feature

Table XVII through XIX: Conversion to Joint and Survivor Life Annuity

(Disability Benefit Under Sub-Plan C & SAL)

a)Eligibility: Subject to Section 3.3(b), (i) Deferred Covered Life under Sub-Plan C becomes eligible for disability benefit after the Effective Date or (ii) Deferred Covered Life under Sub-Plan SAL becomes eligible for partial disability benefit after the Effective Date

•Conversion factor: Actuarial Equivalence Basis C

b)Eligibility: Subject to Section 3.3(b), Deferred Covered Life under Sub-Plan SAL becomes eligible for total disability benefit after the Effective Date

•Conversion factor provided in the tables below, using age nearest birthday for Covered Life and Contingent Life:

Total Disability Benefit Under Sub-Plan SAL; Conversion to 50% Joint & Survivor Life Annuity
Contingent Life
Age 40 41 42 43 44 45 46 47 48 49 50 51 52
Covered Life 40 0.93642 0.93723 0.93808 0.93896 0.93988 0.94084 0.94183 0.94286 0.94392 0.94502 0.94615 0.94732 0.94851
41 0.93415 0.93498 0.93586 0.93678 0.93773 0.93872 0.93976 0.94082 0.94193 0.94307 0.94425 0.94546 0.94671
42 0.93156 0.93243 0.93334 0.93428 0.93527 0.93630 0.93737 0.93848 0.93963 0.94082 0.94205 0.94332 0.94462
43 0.92862 0.92952 0.93046 0.93144 0.93247 0.93353 0.93465 0.93580 0.93700 0.93824 0.93952 0.94084 0.94220
44 0.92549 0.92641 0.92738 0.92840 0.92946 0.93057 0.93173 0.93293 0.93417 0.93547 0.93680 0.93818 0.93961
45 0.92192 0.92287 0.92388 0.92493 0.92603 0.92718 0.92838 0.92963 0.93093 0.93227 0.93367 0.93511 0.93660
46 0.91785 0.91884 0.91988 0.92097 0.92211 0.92330 0.92455 0.92585 0.92720 0.92860 0.93005 0.93156 0.93312
47 0.91322 0.91424 0.91532 0.91644 0.91763 0.91886 0.92016 0.92150 0.92291 0.92437 0.92589 0.92746 0.92909
48 0.90814 0.90920 0.91031 0.91147 0.91270 0.91398 0.91532 0.91672 0.91818 0.91971 0.92129 0.92293 0.92464
49 0.90255 0.90363 0.90478 0.90598 0.90725 0.90858 0.90997 0.91143 0.91295 0.91453 0.91618 0.91790 0.91968
50 0.89634 0.89746 0.89865 0.89989 0.90120 0.90258 0.90402 0.90553 0.90711 0.90876 0.91048 0.91227 0.91413
51 0.88943 0.89059 0.89181 0.89309 0.89445 0.89587 0.89737 0.89894 0.90058 0.90229 0.90408 0.90595 0.90790
52 0.88188 0.88307 0.88433 0.88566 0.88706 0.88854 0.89009 0.89171 0.89342 0.89520 0.89707 0.89901 0.90105
53 0.87358 0.87481 0.87611 0.87748 0.87893 0.88045 0.88206 0.88374 0.88551 0.88737 0.88931 0.89134 0.89346
54 0.86475 0.86601 0.86735 0.86877 0.87027 0.87185 0.87351 0.87526 0.87710 0.87903 0.88105 0.88316 0.88538
55 0.85543 0.85674 0.85813 0.85959 0.86114 0.86278 0.86450 0.86632 0.86823 0.87024 0.87234 0.87455 0.87686
56 0.84551 0.84686 0.84830 0.84981 0.85142 0.85312 0.85491 0.85679 0.85878 0.86087 0.86306 0.86537 0.86779
57 0.83464 0.83604 0.83752 0.83910 0.84076 0.84252 0.84438 0.84634 0.84841 0.85059 0.85288 0.85529 0.85782
58 0.82244 0.82389 0.82542 0.82706 0.82878 0.83061 0.83255 0.83459 0.83674 0.83902 0.84141 0.84392 0.84657
59 0.80846 0.80997 0.81156 0.81325 0.81505 0.81695 0.81896 0.82108 0.82333 0.82569 0.82819 0.83082 0.83359
60 0.79237 0.79392 0.79558 0.79733 0.79919 0.80117 0.80326 0.80547 0.80781 0.81027 0.81288 0.81563 0.81852
61 0.77372 0.77533 0.77704 0.77886 0.78080 0.78284 0.78502 0.78732 0.78975 0.79232 0.79504 0.79790 0.80093
62 0.75200 0.75366 0.75544 0.75732 0.75933 0.76145 0.76371 0.76610 0.76863 0.77130 0.77414 0.77713 0.78029
63 0.72656 0.72828 0.73012 0.73207 0.73415 0.73635 0.73869 0.74117 0.74380 0.74658 0.74953 0.75265 0.75595
64 0.69664 0.69841 0.70031 0.70233 0.70447 0.70675 0.70918 0.71174 0.71447 0.71736 0.72042 0.72366 0.72710
65 0.66126 0.66309 0.66504 0.66712 0.66934 0.67169 0.67419 0.67685 0.67967 0.68266 0.68583 0.68919 0.69276

GAA-9063-TRUE-UP

Total Disability Benefit Under Sub-Plan SAL; Conversion to 50% Joint & Survivor Life Annuity
Contingent Life
Age 53 54 55 56 57 58 59 60 61 62 63 64 65
Covered Life 40 0.94974 0.95101 0.95230 0.95362 0.95497 0.95634 0.95774 0.95916 0.96059 0.96203 0.96349 0.96496 0.96643
41 0.94799 0.94931 0.95066 0.95204 0.95345 0.95488 0.95634 0.95782 0.95932 0.96083 0.96234 0.96387 0.96540
42 0.94596 0.94734 0.94875 0.95019 0.95167 0.95317 0.95470 0.95624 0.95781 0.95939 0.96098 0.96257 0.96418
43 0.94360 0.94505 0.94652 0.94803 0.94958 0.95116 0.95276 0.95438 0.95602 0.95768 0.95935 0.96102 0.96271
44 0.94107 0.94258 0.94413 0.94572 0.94734 0.94899 0.95067 0.95238 0.95411 0.95585 0.95760 0.95937 0.96113
45 0.93813 0.93972 0.94134 0.94300 0.94471 0.94645 0.94822 0.95002 0.95184 0.95367 0.95552 0.95738 0.95924
46 0.93473 0.93638 0.93809 0.93984 0.94163 0.94346 0.94533 0.94723 0.94915 0.95109 0.95304 0.95501 0.95698
47 0.93078 0.93252 0.93431 0.93615 0.93804 0.93997 0.94194 0.94394 0.94597 0.94802 0.95010 0.95218 0.95427
48 0.92640 0.92823 0.93011 0.93204 0.93403 0.93607 0.93815 0.94026 0.94241 0.94459 0.94679 0.94900 0.95122
49 0.92153 0.92344 0.92542 0.92745 0.92955 0.93169 0.93389 0.93613 0.93841 0.94071 0.94305 0.94540 0.94777
50 0.91607 0.91807 0.92015 0.92229 0.92449 0.92676 0.92908 0.93145 0.93386 0.93631 0.93879 0.94129 0.94382
51 0.90992 0.91202 0.91420 0.91645 0.91877 0.92116 0.92362 0.92613 0.92868 0.93128 0.93392 0.93658 0.93927
52 0.90316 0.90536 0.90765 0.91001 0.91246 0.91498 0.91757 0.92023 0.92294 0.92570 0.92850 0.93134 0.93421
53 0.89567 0.89798 0.90037 0.90286 0.90543 0.90809 0.91083 0.91363 0.91651 0.91944 0.92242 0.92545 0.92851
54 0.88769 0.89010 0.89261 0.89522 0.89793 0.90073 0.90362 0.90660 0.90964 0.91275 0.91593 0.91915 0.92242
55 0.87928 0.88180 0.88444 0.88718 0.89003 0.89299 0.89604 0.89918 0.90241 0.90572 0.90909 0.91253 0.91602
56 0.87032 0.87297 0.87573 0.87862 0.88162 0.88473 0.88796 0.89129 0.89471 0.89823 0.90182 0.90548 0.90921
57 0.86047 0.86325 0.86615 0.86919 0.87235 0.87564 0.87905 0.88258 0.88621 0.88995 0.89378 0.89769 0.90168
58 0.84935 0.85226 0.85532 0.85851 0.86185 0.86532 0.86893 0.87267 0.87653 0.88050 0.88458 0.88876 0.89303
59 0.83650 0.83956 0.84277 0.84613 0.84965 0.85332 0.85714 0.86110 0.86520 0.86943 0.87378 0.87825 0.88282
60 0.82157 0.82478 0.82816 0.83169 0.83540 0.83928 0.84332 0.84751 0.85187 0.85637 0.86101 0.86579 0.87069
61 0.80413 0.80749 0.81103 0.81476 0.81866 0.82275 0.82702 0.83147 0.83609 0.84088 0.84583 0.85094 0.85619
62 0.78363 0.78716 0.79087 0.79478 0.79890 0.80321 0.80772 0.81243 0.81733 0.82242 0.82769 0.83315 0.83877
63 0.75943 0.76312 0.76701 0.77112 0.77544 0.77998 0.78475 0.78972 0.79491 0.80032 0.80592 0.81174 0.81775
64 0.73074 0.73458 0.73865 0.74295 0.74749 0.75226 0.75727 0.76253 0.76801 0.77373 0.77969 0.78588 0.79229
65 0.69654 0.70055 0.70479 0.70928 0.71402 0.71903 0.72429 0.72982 0.73560 0.74164 0.74795 0.75451 0.76133

GAA-9063-TRUE-UP

Total Disability Benefit Under Sub-Plan SAL; Conversion to 75% Joint & Survivor Life Annuity
Contingent Life
Age 40 41 42 43 44 45 46 47 48 49 50 51 52
Covered Life 40 0.87169 0.87307 0.87452 0.87604 0.87763 0.87929 0.88103 0.88284 0.88472 0.88668 0.88872 0.89083 0.89302
41 0.86801 0.86942 0.87090 0.87245 0.87408 0.87578 0.87756 0.87942 0.88136 0.88337 0.88546 0.88763 0.88989
42 0.86385 0.86529 0.86680 0.86839 0.87005 0.87180 0.87362 0.87553 0.87751 0.87958 0.88173 0.88397 0.88629
43 0.85915 0.86062 0.86216 0.86379 0.86549 0.86728 0.86915 0.87110 0.87314 0.87526 0.87747 0.87977 0.88216
44 0.85424 0.85574 0.85732 0.85897 0.86072 0.86254 0.86446 0.86646 0.86855 0.87073 0.87300 0.87537 0.87783
45 0.84870 0.85022 0.85183 0.85352 0.85530 0.85717 0.85913 0.86118 0.86332 0.86556 0.86790 0.87033 0.87286
46 0.84243 0.84398 0.84562 0.84735 0.84916 0.85107 0.85307 0.85517 0.85737 0.85967 0.86206 0.86456 0.86717
47 0.83535 0.83693 0.83859 0.84035 0.84221 0.84415 0.84620 0.84835 0.85059 0.85295 0.85541 0.85797 0.86065
48 0.82772 0.82933 0.83102 0.83282 0.83470 0.83669 0.83878 0.84097 0.84327 0.84568 0.84820 0.85083 0.85358
49 0.81947 0.82110 0.82283 0.82465 0.82657 0.82859 0.83072 0.83296 0.83531 0.83777 0.84035 0.84305 0.84587
50 0.81050 0.81215 0.81390 0.81575 0.81770 0.81976 0.82193 0.82421 0.82661 0.82913 0.83177 0.83453 0.83743
51 0.80068 0.80236 0.80413 0.80601 0.80799 0.81009 0.81229 0.81462 0.81706 0.81963 0.82233 0.82515 0.82812
52 0.79025 0.79195 0.79374 0.79565 0.79766 0.79979 0.80203 0.80439 0.80688 0.80950 0.81226 0.81514 0.81818
53 0.77908 0.78079 0.78261 0.78454 0.78658 0.78874 0.79102 0.79342 0.79596 0.79863 0.80143 0.80438 0.80748
54 0.76770 0.76944 0.77128 0.77323 0.77530 0.77749 0.77981 0.78225 0.78483 0.78755 0.79041 0.79342 0.79659
55 0.75635 0.75810 0.75997 0.76195 0.76406 0.76628 0.76863 0.77112 0.77375 0.77652 0.77944 0.78252 0.78575
56 0.74492 0.74670 0.74860 0.75061 0.75275 0.75501 0.75741 0.75994 0.76262 0.76545 0.76843 0.77158 0.77490
57 0.73299 0.73480 0.73673 0.73878 0.74095 0.74326 0.74570 0.74828 0.75102 0.75391 0.75696 0.76018 0.76358
58 0.72008 0.72192 0.72389 0.72597 0.72818 0.73053 0.73302 0.73566 0.73845 0.74141 0.74453 0.74783 0.75131
59 0.70568 0.70755 0.70954 0.71166 0.71392 0.71631 0.71885 0.72154 0.72439 0.72741 0.73060 0.73397 0.73754
60 0.68946 0.69136 0.69339 0.69555 0.69784 0.70028 0.70286 0.70561 0.70851 0.71159 0.71486 0.71831 0.72196
61 0.67108 0.67301 0.67507 0.67726 0.67959 0.68207 0.68470 0.68749 0.69046 0.69360 0.69693 0.70046 0.70420
62 0.65008 0.65204 0.65413 0.65635 0.65872 0.66123 0.66391 0.66675 0.66977 0.67297 0.67637 0.67997 0.68379
63 0.62594 0.62792 0.63003 0.63229 0.63468 0.63724 0.63995 0.64284 0.64590 0.64916 0.65261 0.65628 0.66018
64 0.59801 0.60000 0.60214 0.60441 0.60684 0.60942 0.61217 0.61509 0.61820 0.62150 0.62501 0.62873 0.63269
65 0.56549 0.56750 0.56964 0.57193 0.57438 0.57698 0.57975 0.58270 0.58584 0.58918 0.59273 0.59650 0.60051

GAA-9063-TRUE-UP

Total Disability Benefit Under Sub-Plan SAL; Conversion to 75% Joint & Survivor Life Annuity
Contingent Life
Age 53 54 55 56 57 58 59 60 61 62 63 64 65
Covered Life 40 0.89529 0.89763 0.90005 0.90255 0.90512 0.90776 0.91046 0.91323 0.91605 0.91891 0.92182 0.92477 0.92775
41 0.89222 0.89464 0.89713 0.89971 0.90236 0.90508 0.90788 0.91073 0.91364 0.91661 0.91961 0.92266 0.92574
42 0.88869 0.89118 0.89376 0.89641 0.89915 0.90197 0.90486 0.90781 0.91082 0.91389 0.91700 0.92016 0.92335
43 0.88464 0.88720 0.88986 0.89261 0.89544 0.89835 0.90134 0.90440 0.90752 0.91070 0.91392 0.91720 0.92051
44 0.88038 0.88303 0.88577 0.88861 0.89153 0.89455 0.89764 0.90081 0.90405 0.90734 0.91069 0.91409 0.91754
45 0.87549 0.87822 0.88105 0.88398 0.88701 0.89013 0.89333 0.89662 0.89998 0.90340 0.90689 0.91042 0.91400
46 0.86988 0.87269 0.87561 0.87864 0.88177 0.88500 0.88832 0.89173 0.89522 0.89878 0.90240 0.90609 0.90982
47 0.86344 0.86634 0.86936 0.87248 0.87572 0.87906 0.88250 0.88604 0.88966 0.89337 0.89714 0.90098 0.90487
48 0.85645 0.85944 0.86255 0.86577 0.86912 0.87258 0.87615 0.87981 0.88358 0.88743 0.89135 0.89536 0.89942
49 0.84882 0.85190 0.85510 0.85843 0.86188 0.86546 0.86915 0.87296 0.87686 0.88087 0.88495 0.88913 0.89337
50 0.84045 0.84361 0.84691 0.85034 0.85390 0.85760 0.86142 0.86537 0.86942 0.87358 0.87783 0.88218 0.88660
51 0.83122 0.83447 0.83785 0.84138 0.84506 0.84888 0.85283 0.85691 0.86111 0.86543 0.86985 0.87438 0.87900
52 0.82136 0.82468 0.82816 0.83179 0.83558 0.83952 0.84360 0.84782 0.85217 0.85665 0.86125 0.86596 0.87077
53 0.81073 0.81414 0.81771 0.82144 0.82534 0.82939 0.83361 0.83797 0.84248 0.84712 0.85189 0.85679 0.86180
54 0.79992 0.80341 0.80707 0.81090 0.81491 0.81909 0.82343 0.82794 0.83260 0.83741 0.84237 0.84745 0.85267
55 0.78916 0.79274 0.79650 0.80044 0.80456 0.80886 0.81335 0.81800 0.82283 0.82781 0.83295 0.83824 0.84367
56 0.77839 0.78206 0.78592 0.78997 0.79422 0.79865 0.80328 0.80810 0.81309 0.81826 0.82360 0.82909 0.83475
57 0.76716 0.77093 0.77490 0.77907 0.78344 0.78802 0.79280 0.79779 0.80296 0.80832 0.81387 0.81959 0.82548
58 0.75498 0.75886 0.76294 0.76723 0.77174 0.77647 0.78141 0.78657 0.79193 0.79750 0.80327 0.80922 0.81537
59 0.74131 0.74529 0.74949 0.75391 0.75855 0.76343 0.76854 0.77388 0.77944 0.78522 0.79122 0.79742 0.80383
60 0.72583 0.72991 0.73422 0.73877 0.74356 0.74860 0.75388 0.75940 0.76516 0.77116 0.77740 0.78386 0.79055
61 0.70816 0.71234 0.71677 0.72145 0.72638 0.73157 0.73702 0.74273 0.74870 0.75493 0.76141 0.76814 0.77512
62 0.68783 0.69212 0.69666 0.70146 0.70653 0.71188 0.71750 0.72340 0.72958 0.73603 0.74276 0.74976 0.75704
63 0.66431 0.66869 0.67334 0.67826 0.68346 0.68896 0.69475 0.70083 0.70721 0.71389 0.72086 0.72814 0.73571
64 0.63690 0.64137 0.64611 0.65114 0.65647 0.66210 0.66805 0.67431 0.68088 0.68778 0.69499 0.70253 0.71039
65 0.60478 0.60932 0.61414 0.61927 0.62470 0.63046 0.63654 0.64296 0.64971 0.65680 0.66423 0.67202 0.68016

GAA-9063-TRUE-UP

Total Disability Benefit Under Sub-Plan SAL; Conversion to 100% Joint & Survivor Life Annuity
Contingent Life
Age 40 41 42 43 44 45 46 47 48 49 50 51 52
Covered Life 40 0.81533 0.81713 0.81902 0.82102 0.82311 0.82530 0.82760 0.83000 0.83251 0.83513 0.83786 0.84070 0.84366
41 0.81062 0.81244 0.81437 0.81639 0.81852 0.82075 0.82309 0.82554 0.82810 0.83078 0.83356 0.83647 0.83950
42 0.80531 0.80717 0.80912 0.81118 0.81334 0.81561 0.81799 0.82049 0.82310 0.82583 0.82867 0.83164 0.83474
43 0.79935 0.80123 0.80321 0.80530 0.80749 0.80980 0.81222 0.81476 0.81742 0.82021 0.82311 0.82614 0.82931
44 0.79318 0.79509 0.79709 0.79921 0.80144 0.80378 0.80625 0.80883 0.81154 0.81438 0.81734 0.82044 0.82367
45 0.78625 0.78817 0.79020 0.79235 0.79461 0.79699 0.79949 0.80212 0.80487 0.80776 0.81078 0.81394 0.81724
46 0.77846 0.78040 0.78245 0.78462 0.78691 0.78932 0.79186 0.79452 0.79732 0.80026 0.80333 0.80655 0.80992
47 0.76971 0.77167 0.77374 0.77593 0.77824 0.78068 0.78325 0.78595 0.78879 0.79177 0.79489 0.79817 0.80160
48 0.76039 0.76236 0.76445 0.76665 0.76899 0.77145 0.77405 0.77678 0.77966 0.78268 0.78585 0.78918 0.79267
49 0.75040 0.75238 0.75449 0.75671 0.75906 0.76155 0.76417 0.76693 0.76984 0.77290 0.77612 0.77949 0.78304
50 0.73966 0.74165 0.74376 0.74600 0.74836 0.75087 0.75351 0.75630 0.75923 0.76233 0.76558 0.76900 0.77260
51 0.72804 0.73003 0.73215 0.73440 0.73678 0.73929 0.74195 0.74476 0.74772 0.75084 0.75413 0.75759 0.76123
52 0.71587 0.71787 0.71999 0.72224 0.72463 0.72715 0.72983 0.73265 0.73563 0.73878 0.74210 0.74559 0.74927
53 0.70303 0.70503 0.70715 0.70941 0.71180 0.71433 0.71702 0.71985 0.72285 0.72602 0.72936 0.73288 0.73659
54 0.69024 0.69224 0.69437 0.69663 0.69903 0.70157 0.70426 0.70711 0.71013 0.71332 0.71668 0.72024 0.72399
55 0.67783 0.67983 0.68197 0.68423 0.68664 0.68920 0.69191 0.69478 0.69781 0.70103 0.70442 0.70801 0.71180
56 0.66571 0.66772 0.66987 0.67215 0.67457 0.67714 0.67987 0.68277 0.68583 0.68907 0.69251 0.69613 0.69997
57 0.65341 0.65543 0.65759 0.65988 0.66232 0.66491 0.66767 0.67059 0.67368 0.67696 0.68043 0.68411 0.68799
58 0.64038 0.64242 0.64459 0.64690 0.64936 0.65198 0.65475 0.65770 0.66083 0.66414 0.66766 0.67138 0.67532
59 0.62607 0.62812 0.63031 0.63263 0.63511 0.63775 0.64055 0.64352 0.64668 0.65003 0.65358 0.65735 0.66134
60 0.61021 0.61227 0.61447 0.61681 0.61930 0.62195 0.62477 0.62777 0.63096 0.63434 0.63793 0.64174 0.64578
61 0.59248 0.59455 0.59675 0.59910 0.60161 0.60428 0.60711 0.61013 0.61334 0.61675 0.62038 0.62422 0.62831
62 0.57250 0.57457 0.57678 0.57914 0.58165 0.58433 0.58718 0.59021 0.59344 0.59687 0.60052 0.60440 0.60852
63 0.54980 0.55187 0.55408 0.55644 0.55896 0.56164 0.56450 0.56754 0.57078 0.57423 0.57789 0.58179 0.58595
64 0.52384 0.52590 0.52810 0.53046 0.53297 0.53565 0.53850 0.54155 0.54479 0.54824 0.55191 0.55582 0.55999
65 0.49394 0.49599 0.49818 0.50052 0.50301 0.50568 0.50852 0.51154 0.51477 0.51821 0.52188 0.52578 0.52994

GAA-9063-TRUE-UP

Total Disability Benefit Under Sub-Plan SAL; Conversion to 100% Joint & Survivor Life Annuity
Contingent Life
Age 53 54 55 56 57 58 59 60 61 62 63 64 65
Covered Life 40 0.84673 0.84993 0.85324 0.85667 0.86021 0.86387 0.86763 0.87150 0.87545 0.87949 0.88361 0.88780 0.89205
41 0.84264 0.84591 0.84931 0.85282 0.85646 0.86022 0.86408 0.86806 0.87212 0.87628 0.88051 0.88483 0.88921
42 0.83796 0.84131 0.84479 0.84840 0.85213 0.85599 0.85996 0.86405 0.86823 0.87251 0.87688 0.88132 0.88584
43 0.83261 0.83604 0.83960 0.84330 0.84713 0.85110 0.85518 0.85939 0.86370 0.86811 0.87261 0.87720 0.88186
44 0.82704 0.83056 0.83421 0.83800 0.84194 0.84601 0.85021 0.85454 0.85898 0.86352 0.86817 0.87290 0.87772
45 0.82069 0.82428 0.82802 0.83191 0.83595 0.84013 0.84445 0.84890 0.85348 0.85817 0.86296 0.86785 0.87284
46 0.81344 0.81711 0.82094 0.82493 0.82907 0.83336 0.83780 0.84238 0.84709 0.85192 0.85687 0.86193 0.86709
47 0.80519 0.80894 0.81285 0.81692 0.82116 0.82557 0.83013 0.83483 0.83968 0.84467 0.84977 0.85500 0.86034
48 0.79632 0.80014 0.80414 0.80830 0.81264 0.81715 0.82183 0.82667 0.83165 0.83679 0.84205 0.84745 0.85297
49 0.78675 0.79064 0.79472 0.79897 0.80340 0.80802 0.81281 0.81777 0.82290 0.82818 0.83360 0.83917 0.84487
50 0.77637 0.78033 0.78447 0.78880 0.79333 0.79805 0.80295 0.80804 0.81329 0.81872 0.82430 0.83005 0.83593
51 0.76505 0.76907 0.77328 0.77769 0.78230 0.78711 0.79212 0.79732 0.80271 0.80828 0.81402 0.81992 0.82599
52 0.75314 0.75721 0.76148 0.76596 0.77065 0.77555 0.78066 0.78598 0.79149 0.79719 0.80309 0.80916 0.81540
53 0.74051 0.74462 0.74895 0.75350 0.75826 0.76325 0.76846 0.77388 0.77951 0.78535 0.79138 0.79762 0.80404
54 0.72794 0.73210 0.73649 0.74110 0.74594 0.75101 0.75631 0.76184 0.76759 0.77356 0.77974 0.78613 0.79273
55 0.71580 0.72002 0.72446 0.72914 0.73406 0.73922 0.74463 0.75027 0.75614 0.76225 0.76858 0.77513 0.78191
56 0.70402 0.70830 0.71282 0.71757 0.72258 0.72784 0.73335 0.73911 0.74512 0.75137 0.75786 0.76459 0.77155
57 0.69211 0.69645 0.70104 0.70588 0.71098 0.71634 0.72197 0.72786 0.73401 0.74041 0.74707 0.75399 0.76115
58 0.67949 0.68391 0.68857 0.69350 0.69870 0.70417 0.70991 0.71594 0.72223 0.72880 0.73564 0.74275 0.75013
59 0.66557 0.67005 0.67480 0.67981 0.68510 0.69068 0.69655 0.70271 0.70915 0.71589 0.72291 0.73022 0.73782
60 0.65007 0.65462 0.65943 0.66453 0.66991 0.67560 0.68159 0.68788 0.69448 0.70138 0.70858 0.71610 0.72392
61 0.63265 0.63725 0.64214 0.64731 0.65279 0.65858 0.66468 0.67111 0.67785 0.68491 0.69230 0.70002 0.70807
62 0.61291 0.61757 0.62251 0.62776 0.63332 0.63920 0.64541 0.65196 0.65884 0.66607 0.67363 0.68155 0.68982
63 0.59036 0.59506 0.60006 0.60536 0.61099 0.61696 0.62327 0.62993 0.63694 0.64431 0.65205 0.66015 0.66864
64 0.56442 0.56915 0.57418 0.57953 0.58521 0.59124 0.59763 0.60439 0.61151 0.61901 0.62689 0.63517 0.64384
65 0.53438 0.53911 0.54416 0.54953 0.55524 0.56131 0.56776 0.57458 0.58178 0.58937 0.59738 0.60579 0.61464

GAA-9063-TRUE-UP

image_1.jpg

The Prudential

Insurance Company

of America

AMENDMENT dated July 28, 2021 ("Amendment")

OF

GROUP ANNUITY CONTRACT NO. [ *** ] (the “Contract”)

WHEREAS:

1.Boise Cascade Company for the exclusive benefit of participants and beneficiaries of the Plan (the “Contract-Holder”) and The Prudential Insurance Company of America ("Prudential") entered into the Contract, effective August 6, 2020.

2.The Contract-Holder and Prudential desire to amend the Contract pursuant to Section 1.2 thereof, effective

July 28, 2021 (the "Amendment Date"), as provided herein.

NOW, THEREFORE, THE PARTIES AGREE AND CONFIRM AS FOLLOWS:

1.    Effective on the Amendment Date: (i) the Cover Page, Table of Contents and Annuity Exhibits, as constituted immediately prior to this Amendment, are hereby replaced by the amended and restated Cover Page, Table of Contents and Annuity Exhibits attached hereto, and (ii) the attached Cash and Transferred Assets Exhibit Supplement dated July 28, 2021 is added to and made part of the Contract.

2.    On the Amendment Date, [ *** ] shall pay the Contribution Adjustment Amount and the Interest Due on Contribution Adjustment Amount as of July 28, 2021 (as defined in the Cash and Transferred Assets Exhibit Supplement) to [ *** ], as provided under the Contract and as described on the amended Cover Page and in the Cash and Transferred Assets Exhibit Supplement dated July 28, 2021, attached hereto.

3.After giving effect to this Amendment, references in the Contract to “Contract” shall mean the Contract as amended by this Amendment, and references to “Cover Page” and “Annuity Exhibits” shall mean the Cover Page and Annuity Exhibits attached hereto.

Except as expressly set forth herein, the terms and conditions of the Contract shall be unaffected by this Amendment and remain in full force and effect. All terms capitalized but not otherwise defined herein, shall have the meanings ascribed to them in the Contract.

BOISE CASCADE COMPANY for the exclusive benefit of participants and beneficiaries of the Plan<br><br><br><br><br><br>By: /s/ Kelly Hibbs<br><br>Title: SVP, CFO & Treasurer<br><br><br><br>Print Name: Kelly Hibbs<br><br><br><br>Date: 7/28/21 THE PRUDENTIAL INSURANCE COMPANY OF AMERICA<br><br><br><br><br><br>By: /s/ Stephen D. Mayernick<br><br>Title: Second Vice President<br><br><br><br>Print Name: Stephen D. Mayernick<br><br><br><br>Date: July 28, 2021

GAA-9063-TRUE-UP

image_0.jpg

The Prudential Insurance Company of America

Newark, New Jersey

Contract-Holder:<br><br><br><br>Boise Cascade Company for the exclusive benefit of participants and beneficiaries of the Plan Plan:<br><br><br><br>Boise Cascade Company Pension Plan
Employer:<br><br><br><br>Boise Cascade Company
Group Annuity Contract No.:<br><br><br><br>[ *** ] Jurisdiction:<br><br><br><br>Idaho
Effective Date:<br><br><br><br>August 6, 2020<br><br><br><br>Amendment Date:<br><br><br><br>July 28, 2021 Contribution Amount as of Effective Date:<br><br>[ *** ]<br><br><br><br>Contribution Adjustment Amount as of July 28, 2021:<br><br>[ *** ]<br><br><br><br>Total Contribution Amount as of July 28, 2021:<br><br>[ *** ]
Pages Attached: 1-43, Cash and Transferred Assets Exhibit, Cash and Transferred Assets Exhibit Supplement, Tables and Annuity Exhibits
BOISE CASCADE COMPANY for the exclusive benefit of participants and beneficiaries of the Plan THE PRUDENTIAL INSURANCE COMPANY<br><br>OF AMERICA<br><br>751 Broad Street<br><br>Newark, NJ 07102
--- ---
By:    /s/ Kelly Hibbs<br><br>Title: SVP, CFO & Treasurer<br><br><br><br>Date: 7/28/21 /s/ Charles F. Lowrey Chief Executive Officer<br><br><br><br>/s/ Margaret M. Foran<br><br>Secretary<br><br><br><br>Attest: /s/ Stephen Mayernick<br><br><br><br>Date: July 28, 2021

Single-Premium Non-Participating Group Annuity Contract supported by a Separate Account providing for Annuity Payments, subject to the provisions of this Contract. The Annuity Payments hereunder do not vary based on any gains or losses of the assets held in the Separate Account.

GAA-9063[ *** ]

TABLE OF CONTENTS

PROVISION I    DEFINITIONS, SEPARATE ACCOUNT OPERATION AND TERMINATION OF CONTRACT    4

1.1    Definitions    4

1.2    Agreement to Pay Contribution Amount; Deposit into the Separate Account    8

1.3    Agreement to Make Annuity Payments; Associated Withdrawals from the Separate Account    9

1.4    The Separate Account that Supports this Contract    9

1.5    Investments Held in Separate Account; Insulation of Separate Account Assets    10

1.6    Insulation of Separate Account Assets    10

1.7    Expenses; Establishing Reserves; [ *** ]    10

1.8    Process for Making Annuity Payments    11

1.9    Persons Entitled to Enforce this Contract    11

1.10    Buy-Out Conversion    11

1.11    Termination of Contract; Surrender of Contract by Contract-Holder    13

PROVISION II    PAYMENT OF ANNUITY PAYMENTS TO CONTRACT-HOLDER PRIOR TO BUY-OUT CONVERSION    16

2.1    General    16

2.2    Monthly Payment Process    16

2.3    Records Reconciliation Process; Adherence to Code and ERISA    16

2.4    Over-reimbursements and Under-reimbursements by Prudential    17

2.5    Concerning Beneficiaries    18

2.6    Concerning Qualified Domestic Relations Orders    18

PROVISION III    PAYMENT TERMS AND CONDITIONS FOR FORMS OF ANNUITIES    20

3.1    Covered Lives, Contingent Lives, and Beneficiaries    20

3.2    Definitions    20

3.3    Annuity Forms    20

3.4    Annuity Change Procedure/Conditions    29

3.5    Change in Annuity Form    29

3.6    Lump Sum Payment Option    31

3.7    Earlier Annuity Commencement Date    32

3.8    Later Annuity Commencement Date    32

3.9    Pre-Retirement Survivor Annuity    34

3.10    Small Annuity Payments to Covered Lives    37

3.11    No Assignment by Covered Lives and Contingent Lives    37

3.12    Proof of Continued Existence for Life Annuities; Escheatment    37

3.13    Data Misstatements    38

3.14    Concerning Designations    39

3.15    Concerning Qualified Domestic Relations Orders    40

3.16    Payments to Representatives    40

3.17    Certificates    40

3.18    Purchase of Additional Annuities after the Data Finalization Date    41

PROVISION IV    GENERAL TERMS    42

4.1    Communications    42

4.2    Currency; Payments    42

4.3    Reliance on Records; Correction of Errors    42

4.4    Contract-Holder; Successor    42

4.5    No Implied Waiver    43

GAA-9063[ *** ]

4.6    Changes    43

4.7    Entire Contract - Construction    43

4.8    Third Party Beneficiaries    43

TABLES

CASH AND TRANSFERRED ASSETS EXHIBIT

CASH AND TRANSFERRED ASSETS EXHIBIT SUPPLEMENT

ANNUITY EXHIBITS

GA-48133

CASH AND TRANSFERRED ASSETS EXHIBIT SUPPLEMENT

As of July 28, 2021

[* * *]

A. Total Contribution Amount, determined as of August 6, 2020: [ *** ]
B. Total Contribution Amount, determined as of July 28, 2021: [ *** ]
C. Payment due from [ *** ] resulting from the difference between the Total Contribution Amount determined as of August 6, 2020 and July 28, 2021 (B-A) (“Contribution Adjustment Amount”): [ *** ]
D. Interest Rate: [ *** ]
E. Interest due from [ *** ] on the Contribution Adjustment Amount, calculated from August 6, 2020 to and excluding July 23, 2021, as agreed to, using stated Interest Rate (D) (“Interest Due on Contribution Adjustment Amount”): [ *** ]
Payments from [ *** ]:<br><br><br><br>(i) Adjustment Amount, as of July 28, 2021 (C):<br><br><br><br><br><br>(ii) Interest Due on Premium Adjustment Amount (E):<br><br><br><br><br><br>(iii) Full Contractual Premium Due on July 28, 2021 ((i)+(ii)):<br><br><br><br><br><br>(iv) Non-Contractual Reconciliation Adjustment (credit):<br><br><br><br><br><br>(v) Interest on Item (iv) (credit):<br><br><br><br><br><br>(vi) Discounted Premium Due (agreed to at 7/22/2021 meeting) on July 28, 2021:<br><br><br><br><br><br>(vii) Portion of Item (vi) considered Principal (Contribution Adjustment Amount for Cover Page of Contract):<br><br><br><br><br><br>(viii) Portion of Item (vi) considered Interest:<br><br><br><br><br><br>(ix) Total Contribution Amount for Cover Page of Contract ((A) + (vii)): [ *** ]<br><br><br><br><br><br>[ *** ]<br><br><br><br><br><br>[ *** ]<br><br><br><br><br><br>[ *** ]<br><br><br><br><br><br>[ *** ]<br><br><br><br><br><br><br><br>[ *** ]<br><br><br><br><br><br><br><br>[ *** ]<br><br><br><br><br><br>[ *** ]<br><br><br><br><br><br><br><br>[ *** ]

ANNUITY EXHIBITS

The Annuity Exhibits list each Covered Life, Contingent Life or other person entitled to receive payments under this Contract plus information that applies to each such Covered Life, Contingent Life or other person. The Annuity Exhibits are attached to and made a part of this Contract in the form of the data file titled “[ *** ] [ *** ]” with SHA256 hash code:

[ *** ]

Such data file was made available by Prudential to the Contract-Holder on [ *** ] via the secure website of Intralinks or its applicable affiliate. The Contract-Holder acknowledges that it has had access to, has downloaded and maintains a copy of, and agrees with, the contents of such data file.

Document

Exhibit 31.1

CEO CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Nathan R. Jorgensen, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Boise Cascade Company;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:  November 1, 2021

/s/ Nathan R. Jorgensen
Nathan R. Jorgensen<br>Chief Executive Officer

Document

Exhibit 31.2

CFO CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Kelly E. Hibbs, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Boise Cascade Company;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:  November 1, 2021

/s/ Kelly E. Hibbs
Kelly E. Hibbs
Chief Financial Officer

Document

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Nathan R. Jorgensen, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.    the accompanying Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 (the "Report") fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

2.    the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Boise Cascade Company at the dates and for the periods indicated in the Report.

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Boise Cascade Company and will be retained by Boise Cascade Company and furnished to the Securities and Exchange Commission or its staff upon request.

The undersigned expressly disclaims any obligation to update the foregoing certification except as required by law.

Date: November 1, 2021

/s/ Nathan R. Jorgensen
Nathan R. Jorgensen<br>Chief Executive Officer

The foregoing certification is being furnished solely pursuant to the requirements of 18 U.S.C. § 1350 and is not being filed as a part of the Report or as a separate disclosure document.

Document

Exhibit 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Kelly E. Hibbs, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

  1. the accompanying Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 (the "Report") fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

  2. the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Boise Cascade Company at the dates and for the periods indicated in the Report.

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Boise Cascade Company and will be retained by Boise Cascade Company and furnished to the Securities and Exchange Commission or its staff upon request.

The undersigned expressly disclaims any obligation to update the foregoing certification except as required by law.

Date: November 1, 2021

/s/ Kelly E. Hibbs
Kelly E. Hibbs
Chief Financial Officer

The foregoing certification is being furnished solely pursuant to the requirements of 18 U.S.C. § 1350 and is not being filed as a part of the Report or as a separate disclosure document.

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