1.01 If this Roth IRA is not designated as a Roth Conversion IRA, then, except in the case of a rollover contribution described in section 408A(e), the Custodian will accept only cash contributions and only up to a maximum amount of $2,000 for any tax year of the Depositor.

1.02 If this Roth IRA is designated as a Roth Conversion IRA, no contributions other than IRA Conversion Contributions may be made during the same tax year will be accepted.


2.01 The $2,000 limit described in Article I is gradually reduced to $0 between certain levels of adjusted gross income (AGI). For a single Depositor, the $2,000 annual contribution is phased out between AGI of $95,000 and $110,000; for a married Depositor who files jointly, between AGI of $150,000 and $160,000; and for a married Depositor who files separately, between $0 $10,000. In the case of a conversion, the Custodian will not accept IRA Conversion Contributions in a tax year if the Depositor's AGI for that tax year exceeds $100,000 or if the Depositor is married and files a separate return. Adjusted gross income is defined in section 408A(c)(3) and does not include IRA Conversion Contributions.


3.01 The Depositor's interest in the balance in the custodial in non forfeitable.


4.01 No part of the custodial funds may be invested in life insurance contracts, nor may the assets of the custodial account be commingled with other property except in a common trust fund or common investment fund (within the meaning of section 408(a)(5)).

4.02 No part of the custodial funds may be invested in collectibles (within the meaning of section 408(m)) except as otherwise permitted by section 408(m)(3), which provides an exception for certain gold, silver, and platinum coins, coins issued under the laws of any state, and certain bullion.


5.01 If the depositor dies before his or her entire interest is distributed to him or her and the Depositor's surviving spouse is not the sole beneficiary, the entire remaining interest will, at the election of the Depositor or, if the Depositor has not so elected, at the election of the beneficiary or beneficiaries, either:

1. Be distributed by December 31 of the year containing the fifth anniversary of the Depositor's death, or



2. Be distributed over the life expectancy of the designated beneficiary starting no later than December 31 of the year following the year of the Depositor's death.

If the Depositor's spouse is the sole beneficiary on the Depositor's date of death, such spouse will then be treated as the Depositor.

5.02 In the case of distribution method 5.01(b) above, to determine the minimum annual payment for each year, divide the Depositor's entire interest in the trust as of the close of business on December 31 of the preceding year by the life expectancy of the designated beneficiary using the attained age of the designated beneficiary as of the beneficiary's birthday in the year distributions are required to commence and subtract 1 for each subsequent year.

5.02 If the Depositor's spouse is the sole beneficiary on the Depositor's date of death, such spouse will then be treated as the Depositor.


6.01 The Depositor agrees to provide the Custodian with information necessary for the Custodian to prepare any reports required under sections 408(i) and 408A(d)(3)(E), and Regulations section 1.408-5 and 1.408-6, and under guidance published by the Internal Revenue Service.

6.02 The Custodian agrees to submit reports to the Internal Revenue Service and the Depositor as prescribed by the Internal Revenue Service.


7.01 Notwithstanding any other articles which may be added or incorporated, the provisions of Articles I through IV and this sentence will be controlling. Any additional articles that are not consistent with section 408A, the related regulations, and other published guidance will be invalid.


8.01 This agreement will be amended from time to time to comply with the provisions of the Code, related regulations, and other published guidance. Other amendments may be made with the consent of the persons whose signatures appear on the Roth IRA Adoption Agreement.


9.01 Applicable Law: This Custodial Agreement shall be governed by the laws of the state where the Trust resides.

9.02 Annual Accounting: The Custodian shall, at least annually, provide the Depositor or Beneficiary (in the case of a death) with an accounting of such Depositor's account. Such accounting shall be deemed to be accepted by the Depositor, if the Depositor or Beneficiary does not object in writing within 60 days after the mailing of such account statement.

9.03 Amendment: The Depositor irrevocably delegates to the Custodian the right and power to amend this Custodial Agreement. Except as hereafter provided, the Custodian will give the Depositor 30 days prior written notice of any amendment. In case of a retroactive amendment required by law, the Custodian will provide written notice to the Depositor of the amendment within 30 days after the amendment is made, or if later, by the time that notice of the amendment is required to be given under regulation or other guidance provided by the IRS. The Depositor shall be deemed to have consented to any such amendment unless the Depositor notifies the Custodian to the contrary within 30 days after notice to the Depositor and requests a distribution or transfer of the balance in the account.

9.04 Resignation and Removal of Custodian:

1. The Custodian may resign at any time by giving at least 30 days notice to the Depositor. The Custodian may resign and appoint a successor trustee or custodian to serve under this agreement or under another governing instrument selected by the successor trustee or custodian by giving the Depositor written notice at least 30 days prior to the effective date of such resignation and appointment, which notice shall also include a copy of such other governing instrument, if applicable, and the related disclosure statement.
   
   The Depositor shall then have 30 days from the date of such notice to either request a complete distribution of the account balance or designate a different successor trustee or custodian. If the Depositor does not request distribution of the account or designate a different successor within such 30 days, the Depositor shall be deemed to have consented to the appointment of the successor trustee or custodian and the terms of any new governing instrument, and neither the Depositor nor the successor shall be required to execute any written document to complete the transfer of the account to the successor trustee or custodian. The successor trustee or custodian may rely on any information, including beneficiary designations, previously provided by the Depositor.



2. The Depositor may at any time remove the Custodian and replace the Custodian with a successor trustee or custodian of the Depositor's choice by giving 30 days written notice to the Custodian. In such event, the Custodian shall then deliver the assets of the account as directed by the Depositor. However, the Custodian may retain a portion of the assets of the Roth IRA as a reserve for payment of any anticipated remaining fees and expenses, and shall pay over any remainder of this reserve to the successor trustee or custodian upon satisfaction of such fees and expenses.

9.05 Custodian's Fees and Expenses:

1. The Depositor agrees to pay te Custodian any and all fees specified in the Custodian's current published fee schedule for establishing and maintaining this Roth IRA, including but not limited to any fees for distributions from, transfers from, and terminations of this Roth IRA. The Custodian may change its fee schedule at any time by giving the Depositor 30 days prior written notice.



2. The Depositor agrees to pay any expenses incurred by the Custodian in the performance of its duties in connection with the account. Such expenses include, but are not limited to, administrative expenses, such as legal and accounting fees, and any taxes of any kind whatsoever that may be levied or assessed with respect to such account.



3. All such fees, taxes, and other administrative expenses charged to the account shall be collected either from the assets in the account or from any contributions to or distributions from such account if not paid by the Depositor, but the Depositor shall be responsible for any deficiency.



4. In the event that for any reason the Custodian is not certain as to who is entitled to receive all or part of the Custodial Funds, the Custodian reserves the right to withhold any payment form the Custodial Account, to request a court ruling to determine the disposition of the custodial assets, ant to charge the Custodial Account for any expenses incurred in obtaining such legal determination.

9.06 Withdrawal Requests: All requests for withdrawal shall be in writing on the form provided by the Custodian. Such written notice must also contain the reason for the withdrawal and the method of distribution being requested.

9.07 Responsibilities: Depositor agrees that all information and instructions given to the Custodian by the Depositor is complete and accurate and that the Custodian shall not be responsible for any incomplete or inaccurate information provided by the Depositor or Depositor's beneficiary(ies). Depositor agrees to be responsible for all tax consequences arising from contributions to and distributions from this Custodial Account and acknowledges that no tax advice has been provided by the Custodian.

9.08 Designation of Beneficiary: Except as may be required by State law, in the event of the Depositor's death, the balance in the account shall be paid to the beneficiary or beneficiaries designated by the Depositor on a beneficiary designation acceptable to and filed with the Custodian. The Depositor may change the Depositor's beneficiary or beneficiaries at any time by filing a new beneficiary designation with the Custodian. If no beneficiary designation is in effect, if none of the named beneficiaries survive the Depositor, or if the Custodian cannot locate any of the named beneficiaries after reasonable search, any balance in the account will be payable to the Depositor's estate.



10.01 Investment of Contributions: At the direction of the Depositor (or at the direction of the beneficiary upon the Depositor's death) the Custodian shall invest all contributions to the account and earnings thereon in investments acceptable to the Custodian, which may include marketable securities traded on a recognized exchange or "over the counter" excluding any securities issued by the Custodian), covered call options, certificates of deposit, and other investments to which the Custodian consents, in such amounts as are specifically selected and specified by Depositor in orders to the Custodian in such form as may be acceptable to the Custodian, without any duty to diversify and without regard to whether such property is authorized by the laws of any jurisdiction as a custodial investment. The Custodian shall be responsible for the execution of such orders and for maintaining adequate records thereof. However, if any such orders are not received as required, or, if received, are unclear in the opinion of the Custodian, all or a portion of the contribution may be held uninvested without liability for loss of income or appreciation, and without liability for interest pending receipt of such orders or clarification, ot the contribution may be returned. The Custodian may, but need not, establish programs under which cash deposits in excess of a minimum set by it will be periodically and automatically invested in interest-bearing investment funds. THe Custodian shall have no duty other than to follow the written investment directions of the Depositor, and shall be under no duty to question said instructions and shall not be liable for any investment losses sustained by Depositor.

10.02 Registration: All assets of the account shall be registered in the name of the Custodian or of a suitable nominee. The same nominee may be used with respect to assets of other investors whether or not held under agreements similar to this one or in any capacity whatsoever. However, each Depositor's account shall be separate and distinct; a separate account therefore shall be maintained by the Custodian, and the assets thereof shall be held by the Custodian in individual or bulk segregation either in the Custodian's vaults or in depositories approved by the Securities and Exchange Commission under the Securities Exchange Act of 1934.

10.03 Investment Advisor: The Depositor may appoint an Investment Advisor, qualified under Section 3(38) of the Employee Retirement Income Security Act of 1974, to direct the investment of his Roth IRA. The Depositor shall notify the Custodian in writing of any such appointment by providing the Custodian a copy of the instruments appointing the Investment Advisor and evidencing the Investment Advisor's acceptance of such appointment, an acknowledgment by the Investment Advisor that it is a fiduciary of the account, and a certificate evidencing the the Investment Advisor's current registration under the Investment Advisor's Act of 1940. The Custodian shall comply with any investment directions furnished to it by the Investment Advisor, unless and until it receives written notification from the Depositor that the Investment Advisor's appointment has been terminated. The Custodian shall have no duty other than to follow the written investment directions of such Investment Advisor and shall be under no duty to question said instructions, and the Custodian shall not be liable for any investment losses sustained by the Depositor.

10.04 No Investment Advice: The Custodian does not assume any responsibility for rendering advice with respect to the investment and reinvestment of Depositor's account and shall not be liable for any loss which results from Depositor's exercise of control over his account. The Custodian and Depositor may specifically agree in writing that the Custodian shall render such advice, but the Depositor shall still have and exercise exclusive responsibility for control over the investment of the assets of his account, and the Custodian shall not have any duty to question his investment directives.

10.05 Prohibited Transactions: Notwithstanding anything contained herein to the contrary, the Custodian shall not lend any part of the corpus or income of the account to; pay any compensation for personal services rendered to the account to; make any part of its services available on a preferential basis to; acquire for the account any property, other than cash, from; or sell any property to, any Depositor, any member of a Depositor's family, or a corporation controlled by any Depositor through the ownership, directly or indirectly, or 50% or more of the total combined voting power of all classes of stock entitled to vote, or of 50 percent or more of the total value or shares of all classes of stock of such corporation.

10.06 Unrelated Business Income Tax: If the Depositor directs investment of the account in any investment which results in unrelated business taxable income, it shall be the responsibility of the Depositor to so advise the Custodian and to provide the Custodian with all information necessary to prepare and file any required returns or reports for the account. As the Custodian may deem necessary, and at the Depositor's expense, the Custodian may request a taxpayer identification number for the account, file any returns, reports, and applications for extension, and pay any taxes or estimated taxes owed with respect to the account. The Custodian may retain suitable accountants, attorneys, or other agents to assist it in performing such responsibilities.

10.07 Disclosures and Voting: The Custodian shall deliver, or cause to be executed and delivered, to Depositor ann notices, prospectuses, financial statements, proxies and proxy soliciting materials relating to assets credited to the account. The Custodian shall not vote any shares of stock or take any other action, pursuant to such documents, with respect to such assets except upon receipt by the Custodian or adequate written instructions from Depositor.

10.08 Miscellaneous Expenses: In addition to those expenses set out in Section 9.05 of this plan, the Depositor agrees to pay any and all expenses incurred by the Custodian in connection with the investment of the account, including expenses of preparation and filing any returns and reports with regard to unrelated business income, including taxes and estimated taxes, as well as any transfer taxes incurred in connection with the investment or reinvestment of the assets of the account.

10.09 Nonbank Custodian Provision: If the Custodian is a nonbank custodian, the Depositor shall substitute another trustee or custodian in place of the Custodian upon receipt of notice from the Commissioner of the Internal Revenue Service or his delegate that such substitution is required because the Custodian has failed to comply with the requirements of Income Tax Regulation Section 1408(a)(2), or is not keeping such records, making such returns, or rendering such statements as are required by applicable law, regulations, or other rulings. The successor trustee or custodian shall be a bank, insured credit union, or other person satisfactory to the Secretary of the Treasury pursuant to Section 408(a)(2) of the Code. Upon receipt by the Custodian of written acceptance by its successor of such successor's appointment, Custodian shall transfer and pay over to such successor the assets of the account (less amounts retained pursuant to Section 9.04 of the Custodial Agreement) and all records (or copies thereof) of the Custodian pertaining thereto, provided that the successor trustee or custodian agrees not to dispose of any such records without the Custodian's consent.

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(Section references are to the Internal Revenue Code unless otherwise noted.)


Form 5305-RA is a model custodial account agreement that meets the requirements of section 408A and has been automatically approved by the IRS. A Roth Individual Retirement Account (Roth IRA) is established after the form is full executed by both the individual (Depositor) and the Custodian. This account must be created in the United States for the exclusive benefit ot the Depositor or his or her beneficiaries. Do not file Form 5305-RA with the IRS. Instead, keep it for your records.

Unlike contribution to traditional individual retirement arrangements, contributions to a Roth IRA are not deductible from the Depositor's gross income; and distributions after 5 years that are made when the Depositor is 59 1/2 years of age or older or on account of death, disability, or the purchase of a home by a first-time homebuyer (limited to $10,000), are not includible in gross income. For more information on Roth IRAs, including the required disclosure the Depositor can get from the Custodian, get Pub. 590, Individual Retirement Arrangements (IRAs).

This Roth IRA can be used by a Depositor to hold: (1) IRA Conversion Contributions, amounts rolled over or transferred from another Roth IRA, and annual cash contributions of up to $2,000 for the Depositor; or (2) if designated as a Roth COnversion IRA, only IRA Conversion contributions for the same tax year. To simplify the identification of funds distributed from he Roth IRAs, Depositors are encouraged to maintain IRA Conversion contributions for each tax year in a separate Roth IRA.


Roth Conversion IRA. A Roth Conversion IRA is a Roth IRA that accepts only IRA Conversion Contributions made during the same tax year.

IRA Conversion Contributions. IRA Conversions Contributions are amounts rolled over, transferred, or considered transferred from a non-Roth IRA to a Roth IRA. A non-Roth IRA is an individual retirement account or annuity described in section 408(a) or 408(b), other than a Roth IRA.

Custodian. The Custodian must be a bank or saving and loan association, as defined in section 408(n), or any person who has the approval of the IRS to act as custodian.

Depositor. The Depositor is the person who establishes the custodial account.



The Depositor may be subject to a 6 percent tax on excess contributions if (1) contributions to other individual retirement arrangements of the Depositor have been made for the same tax year, (2) the Depositor's adjusted gross income exceeds the applicable limits in Article II for the tax year, or (3) the Depositor's and spouse's compensation does not exceed the amount contributed for the tax year. The Depositor should see the disclosure statement or Pub. 590 for more information.


Article IX and any that follow it may incorporate additional provisions that are agreed to by the Depositor and Custodian to complete the agreement. They may include, for example, definitions, investment powers, voting rights, exculpatory provisions, amendment and termination, removal of the Custodian, Custodian's fees, state law requirements, beginning date of distributions, accepting only cash, treatment of excess contributions, prohibited transactions with the Depositor, etc. use additional pages if necessary and attach them to this form.

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IRS regulations require the Custodian to provide you with a financial projected growth of your Roth IRA account based on certain assumptions.


Growth in the value of your Roth IRA is neither guaranteed nor projected. The value of your Roth IRA will be computed by totaling the fair market value of the assets credited to your account. At least once a year the Custodian will send you a written report stating the current value of your Roth IRA assets. The Custodian shall disclose separately a description of:

1. The type and amount of each charge;


2. The method of computing and allocating earnings, and


3. Any portion of the contribution, if any, which may be used for the purchase of life insurance.

The Custodian may charge reasonable fees or compensation for its services and it may deduct all reasonable expenses incurred by it in the administration of your Roth IRA, including any legal, accounting, distribution, transfer, termination or other designated fees. Any charges made by the Custodian will be separately disclosed on an attachment hereto. Such fees may be charged to you or directly to your custodial account. In addition, depending on your choice of investment vehicles, you may incur brokerage commissions attributable to the purchase or sale of assets.

ROTH IRA DISCLOSURE STATEMENT
RIGHT TO REVOKE YOUR ROTH IRA ACCOUNT
You may revoke your Roth IRA within 7 days after you sign the Roth IRA Adoption Agreement by hand-delivering or mailing a written notice to the name and address indicated on the Roth IRA Adoption Agreement. If you revoke you account by mailing a written notice, such notice must be postmarked by the 7th day after you sign the Adoption Agreement. If you revoke your Roth IRA within the 7 day period you will receive a refund of the entire amount of your contributions to the Roth IRA without any adjustment for earnings or any administrative expenses. If you exercise this revocation, we are still required to report the contribution on Form 5498 (except transfers) and the revoked distribution on Form 1099-R.

GENERAL REQUIREMENTS OF A ROTH IRA

1. Your contributions must be made in cash, unless you are making a qualified rollover contribution and the Custodian accepts non-cash rollover contributions.



2. The annual contributions you make on your behalf to all of your Roth IRAs and traditional IRAs may not exceed the lessor of 100% of your compensation or $2,000, unless you are making a rollover or transfer from a traditional IRA or another Roth IRA.



3. Your regular annual Roth IRA contributions for any taxable year may be deposited at any time during that taxable year and up to the due date for the filing of your federal income tax return for that taxable year, no extensions. This generally means April 15th of the following year.



4. The Custodian of your Roth IRA must be a bank, savings and loan association, credit union or a person who is approved to act in such a capacity by the Secretary of the Treasury.



5. No portion of your Roth IRA funds may be invested in life insurance contracts.



6. Your interest in your Roth IRA is non forfeitable at all times.



7. The assets in your Roth IRA may not be commingled with other property except in a common trust fund or common investment fund.



8. You may not invest the assets of your Roth IRA in collectibles (as described in Section 408(m) of the Internal Revenue Code.) A collectible is defined as any work of art, rug or antique, metal or gem, stamp or coin, alcoholic beverage, or any other tangible personal property specified by the IRS. However, if the Custodian permits, specially-minted US gold, silver, and platinum coins and certain state-issued coins are permissible Roth IRA investments. Beginning on 1/1/98, you may also invest in certain gold, silver, platinum or palladium bullion, if the trustee or custodian permits. Such bullion must be in the physical possession of the Roth IRA trustee or custodian.

WHO IS ELIGIBLE TO ESTABLISH A ROTH IRA?
You are permitted to make regular contributions to your Roth IRA for any taxable year if you receive compensation for such taxable year. Compensation includes salaries, wages, tips, commissions, bonuses, alimony, royalties from creative efforts and "earned income" in the case of self-employeds. The amount which is permitted to be contributed depends upon your modified adjusted gross income (Modified AGI);your marital status; and your tax filing status discussed below.

CONTRIBUTIONS TO A ROTH IRA

The maximum amount you may contribute for any year is the lesser of 100% of your compensation or $2,000. Your actual contribution limit depends upon your marital status, tax filing status, and your Modified AGI.

All regular contributions to a Roth IRA are nondeductible. The maximum amount you may contribute to a Roth IRA is reduced by any contributions you make to all of your traditional IRAs for the same tax year. In other words, the total maximum combined annual contribution to a traditional IRA and a Roth IRA is $2,000.

Unmarried Taxpayer (or a Married Person filing a separate return who did not live with their spouse at any time during the year)-If you are unmarried and your Modified AGI is $95,000 or less, you may contribute up to the maximum amount of $2,000 to your Roth IRA. If your Modified AGI is $110,000 or more, no contribution is permitted. If your Modified AGI is over $95,000 but less than $110,000, then a calculation must be made to determine your Roth IRA contribution limit for the year. The calculation reduces your otherwise allowable contribution of $2,000 by .20 for every $1 of Modified AGI between $95,000 and $110,000.

Married Person Filing Joint Tax Return - If you file a joint tax return with your spouse and your combined Modified AGI is $150,000 or less, you may contribute up to the maximum amount of $2,000 to your Roth IRA. If your combined Modified AGI is $160,000 or more, no contribution is permitted. If your Modified AGI is over $150,000 but less than $160,000, then a calculation similar to the one described above must be made. The calculation reduces each spouse's otherwise allowable Roth IRA contribution limit of $2,000 by .13 for every $1 of Modified AGI between $150,000 and $160,000.

Married Persons Filing Separate Returns (who lived together at any time during the year)- If you have Modified AGI of more than $10,000, no contribution is permitted to your Roth IRA. If your or your Spouse's separate Modified AGI is more than $0 but less than $10,000, then the Roth IRA contribution limit of $2,000 is reduced by .20 for every $1 of Modified AGI between $0 and $10,000.


If you and your spouse file a joint tax return and have unequal compensation (including no compensation for one spouse) you may establish separate Roth IRAs for each spouse. The total annual contribution limit for both Roth IRAs may not exceed the lesser of 100% of the combined compensation for both spouses or $4,000, but neither Roth IRA may accept more than $2,000 per spouse.

The maximum Roth IRA contribution of $2,000 for the spouse is then reduced by:

1. regular traditional IRA contributions made on behalf of such spouse; and


2. Roth IRA contributions made on behalf of each spouse.

This $2,000 limit may be further reduced if the modified AGI exceeds the levels discussed above.

$200 Minimum Roth IRA Contribution
If you fall into any of the categories listed above, your minimum allowable Roth IRA contribution will be $200 until phased out under the appropriate marital status.

In other words, if your Roth IRA contribution amount calculated under the appropriate dollar amounts discussed above results in a contribution between $0 and $200, your permitted contribution is $200 instead of the calculated amount. If the result is not a multiple of $10, round up to the nearest $10.

Modified AGI
Modified AGI does not include any distributions from a traditional IRA that are rolled over to a Roth IRA and included in income. Modified AGI is determined after deductible traditional IRA contributions. Caution: Pending technical corrections would provide that modified AGI is determined before a deductible traditional IRA contribution.

Other Contributions
Your Roth IRA may not accept rollovers from an employer-sponsored plan,employer contributions made under a SEP or SIMPLE plan and traditional IRA contributions. However, certain rollovers and transfers as described below may be made.

Miscellaneous Contribution Rules

1. Contributions are permitted after you attain age 70 1/2, so long as you have compensation discussed earlier.


2. Contributions are permitted regardless of whether you are an active participant in an employer-sponsored plan.

EXCESS CONTRIBUTIONS TO A ROTH IRA
Generally, an excess Roth IRA contribution is any contribution which exceeds the contribution limits. Such excess amount is subject to a 6% excise tax on the principal remaining amount or the excess each year until the excess is corrected.

Method of Withdrawing Excess in a Timely Manner - This 6% excise tax may be avoided, if the exxcess amount plus the earnings attributable to the excess are distributed to you by your tax filing deadline including extensions for the year during which the excess contribution was made. If you decide to correct your excess in this manner, the principal amount of the excess returned to you is not taxable, however, the earnings attributable to the excess are taxable to you in the year in which the contribution was made. In addition, if you are under age 59 1/2, the earnings attributable to the excess amount are subject to a 10% additional income tax. This is the only method of correcting an excess contribution that will avoid the 6% excise tax!

Method of Withdrawing Excess After Tax Filing Date is Due - If you do not withdraw your excess contribution in the manner prescribed above by the due date for filing your tax return, then you may withdraw the principal amount of the excess (no earnings need be distributed). The 6% excise tax will, however, apply first to the year in which the excess was made and each subsequent year until it is withdrawn.

Undercontribution Method - Another method of correcting an excess contribution is to treat a prior year excess as a regular Roth IRA contribution in a subsequent year. Basically all you do is undercontribute in the first subsequent year where your have a unused contribution limit until your excess amount is used up. However, once again, you will be subject to the 6% excise tax in the first year and each subsequent year that an excess remains.

CONTRIBUTION CONVERSIONS OF TRADITIONAL IRA TO A ROTH IRA
If you decide by your tax filing deadline (not including extensions) to transfer a current year contribution plus earnings from a Traditional IRA to a Roth IRA, no amount will be included in your gross income as long as you did not take a deduction for the amount of the converted contribution. Caution: Pending technical corrections would also allow you to make a contribution conversion plus earnings from a Roth IRA to a Traditional IRA by your tax filing deadline and would permit such contribution conversions plus earnings to be made by your tax filing deadline including extensions.

ROLLOVER ROTH IRAs
Rollover Contribution from Another Roth IRA - A rollover contribution from another Roth IRA is any amount you receive from one Roth IRA and within 60 days roll some or all of it over into another Roth IRA. You are not required to roll over the entire amount received from the first Roth IRA. However, any taxa bel amount (generally earnings) you do not roll over will be taxed at ordinary income tax rates for federal income tax purposes and may be subject to additional income taxes.

The following special rules also apply to rollovers between Roth IRAs:

1. The rollover must be completed no later than the 60th day after the day the distribution was received by you from the first Roth IRA.



2. You may have only one Roth IRA to Roth IRA rollover during a 12 consecutive month period measured fro the date you received a distribution from a Roth IRA which was rolled over to another Roth IRA.



3. The same property you receive in a distribution from the first Roth IRA must be the same property you roll over into the second Roth IRA. For example, if you receive a distribution from a Roth IRA of property, such as stocks, that same stock must be the property rolled over into the second Roth IRA.



4. You are required to make an irrevocable election indication that this transaction will be treated as a rollover contribution.



5. You are not required to receive a complete distribution from your Roth IRA in order to make a rollover contribution into another Roth IRA, nor are you required to roll over the entire amount you received from the first Roth IRA into the second Roth IRA.



6. If you inherit a Roth IRA due to the death of the participant, you may not roll this Roth IRA into your own Roth IRA unless you are the spouse of the deceased Roth IRA participant.

Rollovers from Employer-Sponsored Plans
You may not roll over from an employer-sponsored plan to a Roth IRA. However, you may roll over from an employer-sponsored plan to a traditional IRA and then "convert" the traditional IRA to a Roth IRA in a Rollover Conversion explained below.

Employer-Sponsored Plans Eligible for Rollovers to Traditional IRAs - Rollovers to Traditions IRAs are permitted if you have received an eligible rollover distribution from one of the following:

1. A qualified plan under Section 401(a);



2. A qualified annuity under Section 403(a);



3. A Tax-Sheltered Annuity (TSA) or Custodial Account under Section 403(b); or



4. A Federal Employee's Thrift Savings Plan.

For more information concerning rollovers from an employer-sponsored retirement plan to a traditional IRA, please refer to the traditional IRA's disclosure statement.

Rollover Conversion from a Traditional IRA to a Roth IRA
You are permitted to make a qualified rollover contribution from a Traditional IRA to a Roth IRA if your Modified AGI (not including the taxable amount rolled over) for the year during which the rollover is made does not exceed $100,000 and your are not a married parson filing a separate tax return. This is called a "rollover conversion" and may be done at any time without waiting the usual 12 months.

Taxation in Completing a Rollover Conversion from a Traditional IRA to a Roth IRA
If you complete a rollover conversion from a Traditional IRA to a Roth IRA, the rollover amount (to the extent taxable) is generally included in your income for the year during which the rollover is made. However, the 10% additional income tax for premature distributions does not apply.

For rollover conversions made during 1998, you will include the taxable amount of the traditional IRA distribution in income "ratably" over a four-tax year period beginning in 1998.

Any rollover conversions from a Traditional IRA to a Roth IRA after 12/31/98 will be fully includible in income the year in which you receive the distribution.

Caution: Pending technical corrections would provide that, with respect to 1998 rollover conversions, if the taxpayer dies before including the taxable amounts in income over a 4-year period, all remaining amounts will be included in gross income for the taxable year of death. However, if the surviving spouse of such deceased Roth IRA participant is the beneficiary of the Roth IRA, the surviving spouse may elect to continue including the remaining amount in income over the 4-year period as if the surviving spouse were the distributee.

The trustee or custodian of your Roth IRA may require you to establish a separate Roth IRA for a 1998 rollover contribution and a separate Roth IRA for rollover conversions after 1998.

DISTRIBUTIONS FROM A ROTH IRA
Taxation of Distributions
"Qualified" distributions are neither subject to income tax nor the 10% additional income tax for premature distributions. Nonqualified distributions are taxable to the extent such distribution is attributable to the income earned in the account.

When you start withdrawing from your Roth IRA, you may take the distributions in regular payments, random withdrawals or in a single sum payment.

Qualified Distributions
A Qualified distribution is one made:

1. on or after you attain age 59 1/2;


2. to a beneficiary after your death;


3. on account of you becoming disabled (defined under Section 72(m)(7)IRC);


4. for qualified first time homebuyer expenses.

AND after the end of the 5 year period beginning with the first taxable year for which you made a regular contribution to a Roth IRA.

For rollover conversion contributions from a traditional IRA to a Roth IRA, the 5 year period begins with the year in which the rollover was made. The custodian of your Roth IRA may require that you establish separate Roth IRA plans for regular Roth IRA contributions, rollovers and transfers between Roth IRAs and rollover conversions from a traditional IRA.

Nonqualified Distributions
Distributions from a Roth IRA which are made as a nonqualified distribution are treated as made from contributions to the Roth IRA to the extent that such distribution, when added to all previous distributions from the Roth IRA, does not exceed the aggregate amount of contributions to the Roth IRA.

In other words, nonqualified distributions are treated as taken from the nontaxable portion first (the contributions) until the aggragate distributions exceed the aggregate contributions. When the aggregate distributions exceed the aggregate contributions, then the earnings will be treated as part of the distribution for tax purposes. The portion of the nonqualified distribution that represents earnings will be taxable and subject to the 10% additional income tax for premature distributions, unless an exception applies. It is anticipated that the IRS will develop a tax form for you to use to keep records on the contributions you make to your Roth IRA and to figure any taxable, nonqualified distributions from your Roth IRA.

Distributions Made Before the End of the 5 Year Period
Distributions taken before the end of the 5 year period are taxable (to the extent you recive the earnings attributable) and are subject to the 10% additional income tax if the participant is not age 59 1/2. However, the 10% additional income tax is avoided it the distribution meets one of the exceptions under Section 72(t).

Caution: Pending technical corrections would provide that the 10% additional tax on early distributions will apply to rollover conversions if the taxpayer withdraws any portion of the taxable conversion amount before the end of the 5 year period, unless an exception under Section 72(t) applies. Also, if the taxpayer withdrews any portion of the taxable conversion amount befor the end of the 5 year period, an additional 10% tax will apply to the taxable portion of the rollover conversion if such conversion occurs in 1998 and the 4-year income inclusion rule applies.

Basis Recovery Rules for Distributions From Different IRA Plans
The taxation of distributions from a Roth IRA shall be treated separately from the taxation of a distribution from other IRA plans. In other words, nondeductible contributions made to your traditional IRA will continue to be recovered tax-free on a ratable basis.

Caution Pending technical corrections would also provide that a Rollover Conversion Roth IRA will be treated separately from regular Roth IRAs and that Rollover Conversion Roth IRAs that are subject to a different 5-year aging period would be treated separately. In addition, pending technical corrections would provide that Roth IRA distributions would be subject to the following ordering rules: first, from rollover conversion contributions to a Roth IRA during 1998 from a traditional IRA eligible for the 4-year income inclusion; second, from rollover conversions contributions to a Roth IRA after 1998 from a traditional IRA not eligible for the 4 year income inclusion; and third, from contributions to a Roth IRA that are not rollover contributions.

Premature Distributions
If you are under age 59 1/2 and receive a "nonqualified" distribution form your Roth IRA, a 10% additional income tax will apply to the taxable portion (generally the earnings portion) of the distribution unless the distribution is received due to the death; disability; a qualifying rollover distribution; the timely withdrawal of the principal amount of an excess; substantially equal periodic payments; certain medical expenses; health insurance premiums paid by certain unemployed individuals; qualified higher education expenses; or qualified first time homebuyer expenses.

Required Distributions
Unlike a traditional IRA, you are nor tequired to begin distributions when you attain age 70 1/2. Also, the incidental death benefit requirements (referred to as MDIB) do not apply to the Roth IRA.

Death Distributions
If you die, the balance in your Roth IRA must generally be distributed no later than December 31st of the year containing the 5th anniversary of your death, However your beneficiary(ies) may elect to receive the balance in your account over the non-recalculated single life expectancy of your designated beneficiary if distributions begin no later than the end of the year containing the one year anniversary of your death. If your spoiuse is your sole beneficiary, your spouse is automatically deemed to assume your Roth IRA as their own Roth IRA.

PROHIBITED TRANSACTIONS WITH A ROTH IRA
If you or your beneficiary engage in a prohibited transaction (as defined under Section 4975 of the Internal Revenue Code) with your Roth IRA, it will lose its tax exemption and you must include the taxable portion of your account in your gross income for that taxable year. If you pledge any portion of your Roth IRA as collateral for a loan, the amount so pledged will be treated as a distribution and the taxable portion will be included in your gross income for that year.

ADDITIONAL TAXES AND PENALTIES
If you are under age 59 1/2 and receive a nonqualified premature distribution from your Roth IRA, an additional 10% income tax will apply on the taxable amount of the distribution (generally the earnings portion only), unless an exception under Section 72(t) applies.

Caution: As mentionae earlier, pending technical corrections would assess a 10% additional tax if you are under age 59 1/2 plus another 10% additional tax regardless of your age if you withdraw any portion of a 1998 Rollover Conversion that you made from your traditional IRA to your Roth IRA befor e the 5-year period ends.

If you make an excess contribution to your Roth IRA and it is not corrected on a timely basis, an excise tax of 6% is imposed on this excess amount. This tax will apply each year to any part or all of the excess which remains in your account.

If you should die, and the appropriate required death distributions are not made from your Roth IRA, and excise tax of 50% is assessed to your beneficiary based upon the difference between the amount that should have been distributed and the amount that was actually distributed.

You must file IRS Form 5329 with the Internal Revenue Service for any year an additional tax is due.

INCOME TAX WITHHOLDING
All withdrawals from your Roth IRA (except a direct transfer) are subject to federal income tax withholding. You may, however, elect not to have withholding apply to your Roth IRA distribution in most cases. If withholding does apply to your distribution, it is at the rate of 10% of the amount of the distribution.

TRANSFERS
A direct transfer of all or a portion of your funds is permitted from this Roth IRA to another Roth IRA or vice versa. Transfers do not constitute a distribution since you are never in receipt of the funds. The monies are transferred directly to the new trustee or custodian. Transfers are neither subject to the 12-month restriction nor the 60 day rollover period usually associated with rollovers.

If you should transfer all or a portion of your Roth IRA to your former spouse's Roth IRA under a divorce decree (or under a written instrument incident to a divorce) or separation instrument, you will not be deemed to have made a taxable distribution, but merely a transfer. The portion so transferred will be treated at the time of the transfer as the Roth IRA of your spouse or former spouse.

If your spouse is the beneficiary of your Roth IRA, in the event of your death, you spouse may "assume" your Roth IRA. The assumed Roth IRA is then treated as your surviving spouse's Roth IRA.

FEDERAL GIFT AND ESTATE TAXES
Generally there is no specific exclusion for Roth IRAs under the estate tax rules. Therefore, in the event of your death, the value of your Roth IRA will be includible in your gross estate for federal estate tax purposes. However, if your surviving spouse is the beneficiary of your Roth IRA, the value of your Roth IRA may qualify for the marital deduction available under Section 2056 of the Internal Revenue Code. A transfer of property for federal gift tax purposes does not include an amount which a beneficiary receives from a Roth IRA plan.

IRS APPROVAL AS TO FORM
This Roth IRA Custodial Agreement has been approved by the Internal Revenue Service as to form. This is not an endorsement of the plan in operation or of the investments offered.

ADDITIONAL INFORMATION
You may obtain further information on Roth and Traditional IRAs form your District Office of the Internal Revenue Service. In particular, you may wish to obtain IRS Publication 590 (Individual Retirement Arrangements).