EX-10 3 a2091881zex-10.htm EXHIBIT 10

Exhibit 10

THE NEWHALL LAND AND FARMING COMPANY
EMPLOYEE SAVINGS PLAN

(Restated Effective January 1, 2002)

THE NEWHALL LAND AND FARMING COMPANY
EMPLOYEE SAVINGS PLAN

TABLE OF CONTENTS

		Page
ARTICLE I	ESTABLISHMENT OF THE PLAN	1
1.01	ESTABLISHMENT AND RESTATEMENT OF THE PLAN	1
1.02	PURPOSE	1
1.03	INTENTION	1
1.04	RIGHTS OF PREVIOUS EMPLOYEES	1
ARTICLE II	DEFINITIONS	1
2.01	ACCOUNTING DATE	1
2.02	ACCOUNTS	1
2.03	AFFILIATED COMPANY	1
2.04	ANNIVERSARY DATE	1
2.05	BENEFICIARY	2
2.06	BOARD	2
2.07	BREAK IN SERVICE	2
2.08	CODE	2
2.09	COMMITTEE	2
2.10	COMPANY	2
2.11	EARNINGS	2
2.12	ELIGIBLE EMPLOYEE	2
2.13	EMPLOYEE	3
2.14	ERISA	3
2.15	ESOP	3
2.16	ESOP ACCOUNT	3
2.17	FIDUCIARY	3
2.18	FIVE PERCENT OWNER	3
2.19	HIGHLY PAID EMPLOYEE	3
2.20	HIGHLY PAID PARTICIPANT	4
2.21	HOUR OF SERVICE	4
2.22	LEASED EMPLOYEE	5
2.23	MANAGING GENERAL PARTNER	5
2.24	ONE PERCENT OWNER	5
2.25	PARTICIPANT	6
2.26	PARTICIPATING COMPANY	6
2.27	PERIOD OF SERVICE	6
2.28	PERIOD OF SEVERANCE	6
2.29	PLAN	6
2.30	PLAN ADMINISTRATOR	6
2.31	PLAN YEAR	6
2.32	REGULATIONS	6
2.33	RELATED COMPANY	6
2.34	RESERVED	6
2.35	REMUNERATION	6
2.36	RETIREMENT PLAN	7
2.37	SEASONAL AGRICULTURAL EMPLOYEE	7
2.38	SENIORITY SERVICE	7
2.39	SEPARATION DATE	7
2.40	SUSPENDED PARTICIPANT	7
2.41	TOTALLY DISABLED PARTICIPANT	8
2.42	TRUST	8
2.43	TRUSTEE	8
2.44	VESTED VALUE	8
2.45	VESTED SERVICE	8
2.46	VOLUNTARY EMPLOYEE CONTRIBUTIONS	8
2.47	YEAR OF SERVICE	8
2.48	OTHER DEFINITIONS	9

ARTICLE III	PARTICIPATION	10
3.01	ELIGIBILITY	10
3.02	APPLICATION TO PARTICIPATE	10
3.03	PARTICIPATION AFTER REEMPLOYMENT OR BREAK IN SERVICE	10
3.04	TRANSITION RULE	10
ARTICLE IV	PARTICIPANT DEFERRALS	10
4.01	DEFERRAL ELECTION.	10
4.02	DOLLAR LIMITATION	11
4.03	EMPLOYEE ELECTION OF CONTRIBUTION RATE	12
4.02	SUSPENSION OF BASIC EMPLOYER CONTRIBUTIONS	12
ARTICLE V	EMPLOYER CONTRIBUTIONS	12
5.01	BASIC EMPLOYER CONTRIBUTIONS	12
5.02	MATCHING EMPLOYER CONTRIBUTIONS	13
5.03	LIMITATION ON ANNUAL ADDITIONS	13
5.04	COMPLIANCE WITH THE LIMITATION	14
5.05	RETURN OF CONTRIBUTIONS	15
5.06	ROLLOVER CONTRIBUTIONS	15
ARTICLE VI	NONDISCRIMINATION REQUIREMENTS FOR BASIC EMPLOYER CONTRIBUTIONS AND MATCHING EMPLOYER CONTRIBUTIONS	16
6.01	LIMITATION ON BASIC EMPLOYER CONTRIBUTIONS	16
6.02	REMEDIAL DISTRIBUTIONS OF BASIC EMPLOYER CONTRIBUTIONS	18
6.03	LIMITATION ON MATCHING CONTRIBUTIONS	18
6.04	REMEDIAL DISTRIBUTIONS OF MATCHING CONTRIBUTIONS	20
6.05	RESERVED	20
6.06	FURTHER DISCRIMINATION TEST REQUIREMENTS	20
6.07	MULTIPLE USE LIMITATION	21
6.08	SPECIAL CONTRIBUTION	22
ARTICLE VII	INVESTMENT FUNDS	23
7.01	INVESTMENT OF CONTRIBUTIONS	23
7.02	NEWHALL FUND	23
7.03	INVESTMENT DESIGNATION	23
7.04	TRANSFER OF ACCOUNT BALANCES BETWEEN FUNDS	23
7.05	PURCHASE PRICE	23
7.06	VOTING AND TENDER OFFERS	24
7.07	AGREEMENTS RELATING TO TRUST	24
7.08	ESTABLISHMENT OF TRUST AGREEMENT	24
7.09	APPOINTMENT OF INVESTMENT MANAGER	25
7.10	INSURANCE OR ANNUITY CONTRACTS	25
7.11	EXPENSES OF TRUST	25
7.12	VOTING OF SECURITIES IN TRUST	25
ARTICLE VIII	ACCOUNTS AND VALUATION	26
8.01	PARTICIPANT ACCOUNTS	26
8.02	CREDITING OF CONTRIBUTIONS	26
8.03	ADJUSTMENT OF ACCOUNTS	26
8.04	STATEMENTS	26
8.05	VALUE OF ACCOUNTS	26
ARTICLE IX	WITHDRAWALS PRIOR TO TERMINATION OF EMPLOYMENT	27
9.01	WITHDRAWALS FROM EMPLOYEE CONTRIBUTION ACCOUNT	27
9.02	WITHDRAWALS FROM BASIC EMPLOYER CONTRIBUTION ACCOUNT	27
9.03	WITHDRAWALS BY CERTAIN PARTICIPANTS	28
9.04	LOANS TO PARTICIPANTS	28

9.05	SUSPENSION	30
ARTICLE X	VESTING	30
10.01	VESTING	30
ARTICLE XI	DISTRIBUTIONS	31
11.01	GENERAL	31
11.02	FORM OF DISTRIBUTION	31
11.03	DEATH OF PARTICIPANT	31
11.04	REQUIRED DISTRIBUTIONS TO CERTAIN PARTICIPANTS	32
11.05	PROOF OF DEATH AND RIGHT OF BENEFICIARY	32
ARTICLE XII	ADMINISTRATION OF THE PLAN	32
12.01	THE BOARD AND THE COMMITTEE	32
12.02	ORGANIZATION OF COMMITTEE	32
12.03	POWERS AND DUTIES	33
12.04	UNIFORM ADMINISTRATION	33
12.05	BENEFIT CLAIMS PROCEDURES	33
12.06	LIABILITY OF COMMITTEE MEMBERS	34
12.07	INDEMNITY	34
12.08	RELIANCE ON REPORTS AND CERTIFICATES	34
12.09	MEMBER'S OWN PARTICIPATION	35
12.10	DELEGATION OF RESPONSIBILITY	35
12.11	EXPENSES	35
ARTICLE XIII	AMENDMENT AND TERMINATION	35
13.01	AMENDMENT	35
13.02	TERMINATION	35
13.03	SUCCESSORS	36
13.04	MERGER OR TRANSFER OF PLAN ASSETS	36
13.05	EFFECT OF AMENDMENTS BY PARTICIPATING COMPANIES	36
ARTICLE XIV	MISCELLANEOUS	36
14.01	SOURCE OF PAYMENT	36
14.02	INALIENABILITY OF BENEFITS	36
14.03	NO RIGHT TO EMPLOYMENT	37
14.04	PAYMENTS TO MINORS OR INCOMPETENTS	37
14.05	RETURN OF CONTRIBUTIONS	37
14.06	ELIGIBLE ROLLOVER DISTRIBUTION	37
14.07	APPLICABLE LAW	38
14.08	USERRA COMPLIANCE	38
14.09	LOST PARTICIPANTS	38
ARTICLE XV	TOP-HEAVY RULES	38
15.01	DEFINITIONS	38
15.02	TOP-HEAVY STATUS	41
15.03	MINIMUM BENEFIT	41
15.04	EARNINGS LIMIT	42
15.05	LIMITATION ON ANNUAL ADDITIONS	42
ARTICLE XVI	EXECUTION	43

ARTICLE I

ESTABLISHMENT OF THE PLAN

1.01 Establishment and Restatement of the Plan. The Newhall Land and Farming Company Employee Savings Plan (the "Plan"), established effective January 1, 1980 and restated in its entirety effective March 1, 1983, January 1, 1984, January 1, 1987, and January 1, 1989, is hereby restated effective January 1, 2002 or as otherwise indicated. The January 1, 2002 restatement incorporates the amendment requested by the Internal Revenue Service in connection with the favorable determination letter issued on the Plan dated September 17, 2002.

1.02 Purpose. The purpose of this Plan is to encourage and assist employees of the Participating Companies to invest in their future with the Participating Companies by providing a means by which certain compensation which employees elect to defer and certain matching Participating Company contributions are invested to provide additional security to Participating Company employees at retirement.

1.03 Intention. It is the intention of the Participating Companies that the Plan hereinafter set forth (a) shall constitute a single profit sharing plan; (b) shall meet all applicable requirements of the Employee Retirement Income Security Act of 1974 (ERISA), as amended; and (c) shall be qualified under Sections 401(a) and 401(k) of the Internal Revenue Code of 1986, as amended from time to time, and comply with requirements of the Tax Reform Act of 1986, the Omnibus Budget Reconciliation Act of 1986, the Revenue Act of 1987, the Technical and Miscellaneous Revenue Act of 1988, the Omnibus Budget Reconciliation Act of 1990 and other applicable laws, regulations, and administrative authority.

1.04 Rights of Previous Employees. The rights and benefits of a Plan Participant who ceased to be an Employee on or prior to December 31, 1988 shall be determined in accordance with the provisions of the Plan in effect on the date on which that Participant ceased to be an Employee, and any provisions of this Plan that are specifically made effective to such date.

ARTICLE II

DEFINITIONS

Unless otherwise required by the context, the terms used herein shall have the meanings set forth in the remaining paragraphs of this Article II. As used herein, the masculine pronoun shall include the feminine and the singular shall include the plural, unless a different meaning is plainly required by the context.

2.01 Accounting Date shall mean the last regular business day of March, June, September and December, and any other date as specified by the Committee as of which the assets of the Trust are valued for determining the value of each Participant's interest in the Plan.

2.02 Accounts shall mean, with respect to each Participant, his Employee Contribution Account, his Matching Employer Contribution Account, his Rollover Account and his Basic Employer Contribution Account, as described in Section 8.01(a).

With respect to each Participant who was a participant in the ESOP prior to its merger into the Plan, the term "Account" shall also include such Participant's ESOP Account, as described in Section 8.01(b).

2.03 Affiliated Company shall mean each Participating Company and each entity which is a Related Company with respect to any Participating Company.

2.04 Anniversary Date shall mean January 1 of each year subsequent to the effective date of the Plan on January 1, 1980 and each other date or dates as may be established by the Committee.

2.05 Beneficiary shall mean the person or persons entitled to receive benefits under the Plan upon the death of the Participant as set forth in Section 11.03.

2.06 Board shall mean the Board of Directors of Newhall Management Corporation or such other corporate entity as may from time to time be, directly or indirectly, the Managing General Partner.

2.07 Break in Service shall mean any Plan Year in which:

(a) a Participant who is not at any time during such Plan Year a Seasonal Agricultural Employee and who does not complete more than 500 Hours of Service, or

(b) a Participant who is at any time during such Plan Year a Seasonal Agricultural Employee and who does not complete more than 300 Hours of Service.

2.08 Code shall mean the Internal Revenue Code of 1986 as amended.

2.09 Committee shall mean the Employee Benefit Committee appointed by the Board in accordance with Article XII and shall include, where appropriate, any party to whom responsibility has been properly delegated under Section 12.10.

2.10 Company shall mean The Newhall Land and Farming Company, a California limited partnership.

2.11 Earnings shall mean the compensation reportable for Federal Income Tax purposes (including, for Plan Years beginning after December 31, 1998, any amounts payable to a Participant as general partner income from Newhall General Partnership or as fees for serving as a director of any subsidiary of the Company) that would have been paid to an Employee if such Employee had made no (i) Deferral Election, (ii) election under any plan described in Section 125 of the Code or (iii), for Plan Years beginning after December 31, 1998, deferral of salary or bonus (whether in the form of cash or employer securities) under a non-qualified deferral plan, but excluding (A) that portion of compensation imputed for tax purposes as a result of fringe benefits (including any gain upon the exercise of options to acquire employer securities or the sale of securities acquired thereunder, the vesting of restricted employer securities or other gains from equity compensation other than employer securities that are payable (or would be payable absent a deferral election by the Participant) as an annual bonus) or other similar amounts as determined by the Company, (B) deferred compensation at the time of payment if attributable to amounts that were taken into account at the time of deferral; provided, however, that: for Plan Years beginning after 1988 and before 1994, the annual Earnings taken into account for a Plan Year shall not exceed $200,000; (ii) for Plan Years beginning after 1993 and before 2002, the annual Earnings taken into account for a Plan Year shall not exceed $150,000 adjusted for cost-of-living increases as described in Code Section 401(a)(17)(B); and (iii) for Plan Years beginning after 2001, the annual Earnings taken into account for a Plan Year shall not exceed $200,000 adjusted for cost-of-living increases as described in Code Section 401(a)(17)(B).

2.12 Eligible Employee shall mean any Employee of a Participating Company, but excluding:

(a) any individual who performs services for a Participating Company solely as a Leased Employee, independent contractor, consultant or employee of a third-party employment agency or is classified as such by the Participating Company for whom such services are performed (whether or not such classification is upheld upon governmental or judicial review); and

(b) any Employee whose compensation and conditions of employment are established by the terms of a collective bargaining agreement in the negotiation of which retirement benefits were the subject of good faith bargaining, except that any otherwise eligible Employee whose compensation and conditions of employment are established by the terms of a collective bargaining agreement shall be an Eligible Employee if his participation in this Plan is specifically provided for in a collective

bargaining agreement entered into by a Participating Company with such Employee's lawful representative or bargaining agent. For purposes of the preceding sentence, the term "collective bargaining agreement" shall not apply if more than two percent (2%) of the employees covered pursuant to such agreement are "professionals" as defined in Treas. Reg. 1.410(b)-9(g).

2.13 Employee shall mean (a) any person who is employed by and engaged in rendering personal services to an Affiliated Company, or (b) any Leased Employee unless (i) such individual is covered by a money purchase pension plan described in Section 414(n)(5)(A)(i) of the Code and (ii) Leased Employees do not constitute more than twenty percent (20%) of the Affiliated Companies' non-highly compensated work force (as defined in Section 414(n)(5)(C)(ii) of the Code).

A person employed by an Affiliated Company as an officer shall be deemed an Employee, whether or not he is also a director of such Affiliated Company, but no person shall be deemed an Employee solely by reason of serving as a director of an Affiliated Company.

2.14 ERISA shall mean the Employee Retirement Income Security Act of 1974, as amended.

2.15 ESOP shall mean The Newhall Land and Farming Company Employee Stock Ownership Plan, which was merged into this Plan effective December 1, 1985.

2.16 ESOP Account shall mean the Account in the Plan into which a Participant's interest in the ESOP was transferred upon the merger of the ESOP into this Plan.

2.17 Fiduciary shall mean any person who exercises discretionary authority or control over the management of the Plan assets held under the Trust, or disposition of Trust assets; who renders investment advice for direct or indirect compensation as to assets held under the Plan or has any authority or responsibility to do so; or who has any discretionary authority or responsibility in the administration of the Plan. Any person may serve in more than one fiduciary capacity with respect to the Plan if so duly appointed or delegated such responsibility.

2.18 Five Percent Owner of an entity shall mean any Participant who owns (or is considered as owning, within the meaning of Section 318 of the Code, applied by substituting "one-twentieth" for "50%" in Section 318(a)(2)(C)) more than five percent (5%) of the capital or profits interest of the entity (or, if such entity is a corporation, more than five percent (5%) of its outstanding stock or stock possessing more than five percent (5%) of the total combined voting power of all stock).

2.19 Highly Paid Employee means, effective for Plan Years commencing after January 1, 1996, and in determining whether an Employee is a Highly Compensated Employee for the Plan Year beginning in 1997, an Employee who:

(a) was a Five Percent Owner at any time during the year or the preceding year, or

(b) for the preceding year received aggregate Remuneration from the Employer in excess of $80,000 (or such greater amount as the Internal Revenue Service may determine pursuant to Section 414(q)(1) of the Code) and was in the group of Employees consisting of the top 20% of Employees when ranked on the basis of Remuneration paid during the preceding year.

For purposes of identifying Highly Paid Employees, the following rules shall apply:

(I) For purposes of determining the number of Employees in the top 20% of Employees by Remuneration under subsection (b) above, the Committee shall exclude Employees who: (i) have not completed six (6) months of service; (ii) normally work less than 17¹/2 hours per week; (iii) normally work during not more than six (6) months during any year; (iv) have not attained age 21; (v) are included in a unit of employees covered by a collective bargaining agreement (except to the extent provided in Treasury Regulations); or (vi) rendered no services to any Affiliated Company during such year.

(II) A former Employee who separates from service (whether actually or constructively) shall continue to be treated as a Highly Paid Employee if such Employee was a Highly Paid Employee (i) at any time during the Plan Year in which his/her Severance Date occurs or (ii) at any time after attainment of age fifty-five(55).

(III) For purposes of this Paragraph, notwithstanding Section 2.13, the term "Employee" shall exclude any individual who is, at all times during a Plan Year, a nonresident alien and who receives no earned income (within the meaning of Section 911(d)(2) of the Code) from an Affiliated Company which constitutes income from sources within the United States within the meaning of Section 861(a)(3) of the Code.

(IV) In determining whether an Employee is a Highly Paid Employee for the 1997 Plan Year, the amendments to Section 414(q) of the Code stated above are treated as having been in effect for years beginning in 1996.

2.20 Highly Paid Participant means, with respect to a particular Plan Year, an individual who is both a Highly Paid Employee and a Participant; provided, however, that for purposes of the foregoing:

(a) An Eligible Employee who has otherwise met the eligibility requirements of Article III shall be deemed a Participant notwithstanding a failure to complete a Deferral Election under Section 4.01(a);

(b) No individual who is not at any time during the Plan Year eligible to have a Basic Employer Contribution made on his behalf shall be deemed a Participant; and

(c) No individual ineligible to receive Matching Employer Contributions because his employment terminates during the Plan Year shall be deemed a Participant for purposes of Section 6.03.

2.21 Hour of Service shall mean:

(a) In general:

(1) An hour for which an Employee is paid or entitled to payment by an Affiliated Company for the performance of duties.

(2) An hour for which an Employee is paid or entitled to payment by an Affiliated Company for a period during which no duties are performed (whether or not the employment relationship has been terminated) on account of vacation, holiday, illness, incapacity (including disability), layoff, jury duty, military duty or leave of absence; provided, however, that

(i) No hour for which an Employee is directly or indirectly paid under a plan maintained by an Affiliated Company solely to comply with applicable worker's compensation, unemployment compensation or disability insurance laws or solely to reimburse the Employee for medical or medically related expenses incurred by the Employee shall be counted as an Hour of Service, and

(ii) Under no circumstances shall more than 501 Hours of Service be credited to an Employee for any single continuous period during which the Employee performs no duties.

(3) An hour (to the extent not already credited under paragraphs (1) or (2) above) for which an Employee is awarded back pay from an Affiliated Company, irrespective of mitigation of damages.

(b) Subsection (a) shall be applied in accordance with the following:

(1) The number of Hours of Service to be credited for periods during which the Employee performs no duties and the crediting of Hours of Service to specific Plan Years shall be determined by the Committee in accordance with subsections (b) and (c) of Department of Labor Regulations §2530.200b-2; and

(2) An Employee whose compensation for the performance of duties is computed without reference to specific numbers of hours shall be deemed to have 190 Hours of Service in any calendar month in which such Employee completes one Hour of Service.

(c) Solely for the purpose of determining whether a Break in Service has occurred, an Hour of Service shall include, effective for unpaid absences which commence on or after January 1, 1985, any unpaid absence from work for any period

(1) By reason of pregnancy of the Employee,

(2) By reason of the birth of a child of the Employee,

(3) By reason of the placement of a child with the Employee in connection with the adoption of such child by such Employee, or

(4) For purposes of caring for such child for the period beginning immediately following such birth or placement.

For purposes of calculating Hours of Service under this subsection, the Plan shall treat as Hours of Service either: (i) the hours which otherwise would normally have been credited to the Employee but for such absence; or (ii) in any case in which the Plan is unable to determine the hours described in clause (i), eight (8) hours per day of absence.

Provided, however, that no more than 501 Hours of Service shall be credited for each pregnancy or placement described in (i) through (iv) above. All Hours of Service credited under this subsection shall be credited in the Plan Year during which the first day of the absence described in (i) through (iv) above occurs if, but only if, the Employee would have had a Break in Service in such Plan Year were the Hours of Service under this subsection not credited in such year or, in any other case, in the immediately following Plan Year. No Hours of Service will be credited under this subsection unless the Employee furnishes to the Committee such timely information as the Committee may reasonably require to establish that the absence from work is for reasons set forth in paragraphs (1) through (4) above and the total number of days for which there was such an absence.

2.22 Leased Employee means any person, other than an a common law employee of an Affiliated Company, who pursuant to an agreement between an Affiliated Company and any other person has performed services for the Affiliated Company (or for the Affiliated Company and related persons determined in accordance with Section 414(n)(6) of the Code) on a substantially full-time basis for a period of at least one year, and such services are performed under the primary direction or control of the Affiliated Company.

2.23 Managing General Partner shall mean Newhall Management Corporation, a California corporation, the Managing General Partner of the managing general partner of the Company, and any successor managing general partner.

2.24 One Percent Owner of an entity shall mean any person who would be described by the definition of Five Percent Owner if "one percent (1%)" were substituted for "five percent (5%)" each place it appears in such definition.

2.25 Participant shall mean any Employee who becomes a Participant in the Plan in accordance with Article III. Once an Employee becomes a Participant he will remain a Participant until his Separation Date.

2.26 Participating Company shall mean the Company and any other employer which (i) is authorized by the Board to adopt the Plan and (ii) adopts the Plan for its employees.

2.27 Period of Service shall mean, for any person, the period beginning on the date he first renders an Hour of Service for an Affiliated Company (or the date he returns to service with an Affiliated Company following a Period of Severance) and ending on his Separation Date. A Period of Service shall be determined by taking into account any period for which a person would have been a Leased Employee but for the requirement that the Leased Employee have provided services for an Affiliated Company (or the Affiliated Company and related persons) on a substantially full-time basis for a period of at least one year.

2.28 Period of Severance shall mean, for any person, that period which commences with his Separation Date and ends with the first date thereafter on which he next performs an Hour of Service for an Affiliated Company.

2.29 Plan shall mean The Newhall Land and Farming Company Employee Savings Plan, as set forth in this document and as amended from time to time.

2.30 Plan Administrator shall mean the Managing General Partner.

2.31 Plan Year shall mean the period from any January 1st to the following December 31st.

2.32 Regulations shall mean the Federal Income Tax Regulations, as amended.

2.33 Related Company shall mean, with respect to a particular Participating Company, (i) each other entity, trade or business (whether or not incorporated) which is included within a controlled group of corporations or a group of trades or businesses under common control within which such Participating Company is also included, as determined under Section 414(b) or (c) of the Code, (ii) any employer which is a member of an affiliated service group with such Participating Company, as determined under Section 414(m) of the Code, and (iii) any other entity required to be aggregated with such Participating Company pursuant to regulations under Section 414(o) of the Code. For purposes of the limitation on benefits set forth in Section 5.03, Sections 414(b) and (c) of the Code shall be applied as modified by Section 415(h) of the Code (relating to the substitution of a 50 percent ownership test for an 80 percent ownership test).

2.34 Reserved.

2.35 Remuneration shall mean a Participant's wages, salaries, and fees for personal services actually rendered in the course of employment with an Affiliated Company. Remuneration includes, but is not limited to, (i) commissions, compensation for services on the basis of percentage of profits, overtime payments and bonuses, (ii) earned income from sources without the United States (whether or not excludable from gross income under Section 911 of the Code), (iii) amounts received through accident or health insurance or through a self-insured medical reimbursement plan for personal injuries or sickness (but only to the extent includable in gross income), (iv) in the case of a Participant who has not attained age of 65 before the close of the taxable year and who retired on account of permanent and total disability, wages or payments in lieu of wages (whether or not excludable from gross income under Section 105(d) of the Code), (v) amounts paid or reimbursed by such Participating Company or any Related Company for moving expenses (but only to the extent not deductible by the Participant), and (vi) amounts included in gross income by reason of elections made under Section 83(b) of the Code. Remuneration does not, however, include

(a) Basic Employer and Matching Employer Contributions to this Plan and employer contributions to any other plan of deferred compensation, to the extent deductible by, or not includable in taxable income of, the Participant for the taxable year of contribution (including employer contributions to a simplified employee pension plan), and distributions from any funded plan not qualified under Section 401 of the Code;

(b) Amounts realized from the exercise of an employee option to purchase securities of the employer or a Related Company or the disposition of securities acquired upon exercise of such an option;

(d) All other amounts which receive special tax benefits under the Code.

Notwithstanding the foregoing, for purposes of Paragraphs 2.11(b)(ii) (applicable for Plan Years prior to 1997), 2.19, 5.03 (applicable for Plan Years after 1997), 15.01(b), and Article VI:

(I) Remuneration shall include any employer contribution under a cash or deferred arrangement to the extent not included in gross income under Code Section 402(e)(3); any amount which the employee would have received in cash but for an election under a cafeteria plan (within the meaning of Code Section 125); and, effective January 1, 2001, elective salary reductions not includible in gross income as a qualified transportation fringe under Code Section 132(f)(4).

(II) An Employee's Remuneration shall not exceed the limitation amount contained in Section 2.11(a).

2.36 Retirement Plan shall mean The Newhall Land and Farming Company Retirement Plan.

2.37 Seasonal Agricultural Employee shall mean any Employee engaged as an agricultural worker on a seasonal basis by a component of any Affiliated Company that is predominantly involved in producing agricultural commodities, and who is scheduled to work less than one thousand five hundred (1500) hours per calendar year.

2.38 Seniority Service shall mean, for any person, the aggregate of all Periods of Service.

2.39 Separation Date shall mean:

(a) In general: (i) the date an Employee quits, retires, dies, is discharged; or (ii) the first anniversary of the first date of a period in which an Employee remains absent from service (with or without pay) for any reason other than those specified in clause (i), including but not limited to vacation, holiday, sickness, disability, leave of absence, or layoff.

(b) Notwithstanding subsection (a):

(1) If an Employee quits, retires, or is discharged and then returns to employment of an Affiliated Company prior to the first anniversary of the date of such quit, retirement, or discharge, he shall not be deemed to have a Separation Date by reason of such quit, retirement, or discharge.

(2) With respect to an Employee absent from service for any reason other than quit, discharge or retirement, if during such absence such Employee quits, retires, or is discharged, he shall not have a Separation Date if he returns to service on or before the first anniversary of his initial absence from service.

2.40 Suspended Participant shall mean:

(a) A Participant who has ceased to be an Eligible Employee but remains an Employee; or

(b) A Participant whose status is determined pursuant to Sections 9.01 or 9.04.

2.41 Totally Disabled Participant shall mean a Participant who is permanently disabled as a result of sickness or injury so that he has been incapable of performing any services for the Participating Company which is (or was immediately prior to such sickness or injury) his employer for which he is qualified by education, training, or experience for a period of at least six (6) months and is likely to continue to be so disabled in the future. Medical evidence of disability satisfactory to the Committee shall be required.

2.42 Trust shall mean the aggregate of all the assets of the Plan, including (1) assets held pursuant to a trust agreement entered into between the Company and the Trustee, pursuant to Section 7.08, and (2) assets held pursuant to a contract with an Insurance Company, pursuant to Section 7.10.

2.43 Trustee shall mean any trustee appointed by the Committee.

2.44 Vested Value shall mean the sum of: (i) a Participant's Employee Contribution Account; (ii) his Basic Employer Contribution Account; (iii) his ESOP Account; and (iv) the vested portion (determined in accordance with Article X) of his Matching Employer Contribution Account on the Accounting Date immediately preceding or coincident with the date as of which such value is to be determined, adjusted by the Committee, pursuant to its discretionary authority to administer and interpret the Plan and to determine eligibility for benefits under the Plan. Adjustments will include increases due to contributions to the Accounts since the relevant Accounting Date; decreases due to Plan expenses, distributions, loans, or withdrawals paid from the Accounts since the relevant Accounting Date; and adjustments for income or loss.

2.45 Vested Service shall mean, for any person, the aggregate of all Periods of Service.

2.46 Voluntary Employee Contributions shall mean those after-tax contributions made to the Plan by Participants prior to January 1, 1987, pursuant to the provisions of the Plan then in effect.

2.47 Year of Service shall mean, with respect to any Employee, a consecutive twelve-month period during which he completes at least 1,000 Hours of Service (or, if he is at any time during such period a Seasonal Agricultural Employee, at least 300 Hours of Service) and which is: (i) the period beginning on the date he renders his first Hour of Service with any Affiliated Company; or (ii) any Plan Year beginning after such date. In the case of an Employee who has incurred a Break in Service, the preceding sentence shall be applied as if the date of his return to service with any Affiliated Company were the date he rendered his first Hour of Service with any Affiliated Company. Years of Service shall include any period for which the Employee would have been a Leased Employee but for the requirement that the Leased Employee have provided services for an Affiliated Company (or the Affiliated Company and related persons) on a substantially full-time basis for a period of at least one year.

2.48 Other Definitions. The following terms have the meaning described in the sections listed:

Term		Section
Actual Deferral Percentage		6.01(b)
Annual Addition		5.03(a)
Basic Employer Contributions		5.01
Basic Employer Contribution Account		8.01
Contribution Percentage		6.03(b)
Deferral Election		4.01
Direct Rollover		14.06
Distributee		14.06
Dollar Limitation		4.02(a)
Elective Deferrals		4.02(a)
Eligible Retirement Plan		14.06
Eligible Rollover Distribution		14.06
Employee Contribution Account		8.01
Excess Deferrals		4.02(a)
Insurance Company		7.10
Investment Manager		7.09
Matching Employer Contribution		5.02
Matching Employer Contribution Account		8.01

ARTICLE III

PARTICIPATION

3.01 Eligibility.

(a) Every Eligible Employee who was a Participant on December 31, 1988 shall continue to be a Participant.

(b) Each other Eligible Employee shall be eligible to become a Participant on the first day of the first pay period coinciding with or next following the date on which he has attained age 19 and completed one Year of Service.

(c) An Employee who is not an Eligible Employee on the date he would otherwise be eligible to become a Participant under subsection (b) shall be eligible to become a Participant on the first day of the payroll period coincident with or next following the date on which he thereafter becomes an Eligible Employee.

3.02 Application to Participate. Each Eligible Employee meeting the requirements of Section 3.01 may become a Participant by completing an enrollment form, as provided by the Committee, indicating the amount of his Basic Employer Contribution as specified in Section 4.01 and his authorization to his employer to withhold such amounts from his Earnings and pay the same into the Trust as soon as practicable following the end of the pay period in which they are withheld. Such Eligible Employee may also make an investment designation at the same time, in accordance with Section 7.03.

3.03 Participation after Reemployment or Break in Service.

When a Participant or any other Eligible Employee who has met the requirements of Section 3.01 and would become a Participant upon complying with Section 3.02 terminates employment and is subsequently reemployed by a Participating Company, he shall be eligible to become a Participant by complying with Section 3.02 on the first day of the first pay period next beginning after the later of: (i) his date of rehire; or (ii) the date he becomes an Eligible Employee.

3.04 Transition Rule. For purposes of Section 3.01(c), each Employee shall receive credit for service prior to January 1, 1986 as follows:

(a) An Employee credited with one full year of Vesting Service prior to January 1, 1986 shall be deemed thereby to have met the service requirement of Section 3.01(c).

(b) An Employee credited with a fraction of a year of Vesting Service shall be entitled to a number of Hours of Service determined by crediting forty-five (45) Hours of Service to each 7/365 of a year of Vesting Service credited to such Employee. Such Hours of Service shall be credited to the Plan Year beginning January 1, 1986.

ARTICLE IV

PARTICIPANT DEFERRALS

4.01 Deferral Election.

(a) Effective January 1, 1987 through December 31, 1993, subject to subsections (c) and (d), each Participant may execute a Deferral Election and thereby elect to have the Participating Company which is his employer reduce the amount of Earnings for each pay period by an amount equal to: (i) a multiple of 1% of such Earnings before reduction, rounded to the next higher whole dollar, but not more than 6% of such unreduced Earnings; plus (ii) if the percentage elected under clause (i) is 6%, an additional specified dollar amount which in the aggregate does not exceed $2,000 annually and contribute an equal amount to the Plan pursuant to Section 5.01 as a Basic Employer Contribution on such Participant's behalf.

(b) Effective January 1, 1994, subject to subsections (c) and (d), each Participant may execute a Deferral Election and thereby elect to have the Participating Company which is his employer reduce the amount of Earnings for each pay period by an amount equal to a multiple of 1% of such Earnings before reduction, rounded to the next higher whole dollar.

(1) The applicable Dollar Limitation as defined in Section 4.02(a);

(2) In the case of a Participant who received a withdrawal under Section 9.02 in the prior year, the reduced dollar limitation described in Section 9.02(b)(5); or

(3) In the case of a Highly Paid Participant, such amount as the Committee determines during the course of such Plan Year, on the basis of reasonable estimates as to the Basic Employer Contributions of all Participants, will enable the Plan to comply with Section 6.01.

Notwithstanding any other provision of the Plan, effective for Plan Years beginning on and after January 1, 2002, the portion of a Qualified Participant's Basic Employer Contributions for a Plan Year that is attributable to the Code Section 414(v) Adjustment, determined on a Plan Year basis, is not taken into account in determining compliance with (i) the percentage limitation on Earnings described in Section 4.01(a), (ii) the Dollar Limit described in Section 4.02(a), (iii) the Annual Additions limitation described in Section 5.03(a), or (iv) the nondiscrimination test applicable to Basic Employer Contributions described in Section 6.01. For purposes of this Section 4.01(c), a "Qualified Participant" refers to an Employee who attains age 50 before the close of the Plan Year to which his or her Basic Employer Contributions relate. The Code Section 414(v) Adjustment refers to the applicable dollar amount described in Code Section 414(v)(2)(B) by which limitations otherwise applicable to a Participant's Deferral Election are increased so that the Plan is not treated as failing to satisfy its provisions implementing Code Section 401(k)(3), 401(k)(11), 401(k)(12), 410(b) or 416, as applicable, solely on account of contributions made consistent with such adjustment. Notwithstanding any other provision of the Plan, no Deferral Election that takes into account the Code Section 414(v) Adjustment will become effective prior to the first payroll period ending in April 2002.

(d) The election made by a Participant under this section will be automatically suspended during such time as a Participant is a Suspended Participant. At such time as a Participant ceases to be a Suspended Participant, the Participant may make a new Deferral Election under this Section and a new investment designation under Section 7.01.

4.02 Dollar Limitation.

(a) For purposes of this Section:

(1) "Dollar Limitation" means the sum of $7,000, or such greater amount as may be specified by the Internal Revenue Service pursuant to Section 402(g)(5) of the Code.

(2) "Elective Deferrals" means such contributions under a qualified cash or deferred arrangement (including Basic Employer Contributions to this Plan), a simplified employee pension plan, or an annuity contract as are described in Section 402(g)(3) of the Code.

(3) "Excess Deferrals" means, with respect to a particular calendar year, the amount by which a Participant's Elective Deferrals exceed the applicable Dollar Limitation. Any Basic Employer Contributions for the Plan Year beginning with or within such taxable year previously distributed to the Participant under Section 6.02(a) shall reduce the amount of such Participant's Excess Deferrals.

(b) The total amount of Elective Deferrals for a Participant for any Plan Year shall not exceed the Dollar Limitation for such year.

(c) To the extent that a Participant has made Excess Deferrals to this Plan for a calendar year the amount of such Excess Deferrals (together with income thereon) shall be distributed to the Participant no later than the April 15 following the end of the Plan Year during which such Excess Deferral is made.

(d) If a Participant notifies the Committee in writing no later than the first March 1 following the close of the Participant's taxable year that such Participant's aggregate Elective Deferrals (to all plans maintained by all employers, whether or not Affiliated Companies) for such taxable year exceeded the Dollar Limitation and specifies the portion of such excess allocated to his Participant's Pre-Tax Account, the portion of the excess so allocated shall be treated as an Excess Deferral and shall be distributed to the Participant (together with income thereon) no later than the April 15 following the end of his taxable year during which such excess elective deferrals were made. The Committee may require satisfactory proof that excess elective deferrals were made before distributing any amount to the Participant under this subparagraph.

(e) For purposes of this Section, income on distributed Excess Deferrals shall be determined as follows:

(1) Divide: (i) the amount of Excess Deferrals being distributed to the Participant by (ii) the balance of the Participant's Pre-Tax Account as of the end of the Plan Year adjusted to exclude the year's investment experience by reducing such balance by the gain allocable to such amount for the year and increasing such balance by the loss allocable to such amount for the year; then

(2) Multiply the result found in (1) by the following percentage:

Date of Distribution		Percentage
Before January 15		100%
January 16 to February 15		110%
February 16 to March 15		120%
March 16 to April 15		130%

4.03 Employee Election of Contribution Rate. Subject to Section 4.02, each Participant may elect to change his Basic Employer Contribution rate as of: (i) the first pay period following an Accounting Date; or (ii) such other pay period as the Committee may permit, by giving prior written notice of such change to his employer no later than 10 days prior to the beginning of such pay period.

4.04 Suspension of Basic Employer Contributions. A Participant may terminate his Basic Employer Contribution election as of the first pay period in any month by giving written notice to his employer no later than 10 days prior to the beginning of such pay period. Such termination and suspension may last indefinitely or may be revoked at any time. A Participant having so terminated and suspended may make a new Basic Employer Contribution election effective with any pay period by giving written notice to his employer at least 10 days prior to the beginning of such pay period.

ARTICLE V

EMPLOYER CONTRIBUTIONS

5.01 Basic Employer Contributions. A Participating Company shall contribute to the Plan on behalf of each Participant who is employed by it at any time during a payroll period an amount equal to the Basic Employer Contribution elected by such Participant with respect to his or her Earnings for such payroll period that are attributable to service for such Participating Company.

5.02 Matching Employer Contributions.

(a) Subject to subsections (b), (c) and (d), Section 5.03, and Article VI, each Participating Company shall, with respect to each Participant employed by it during a payroll period, contribute to the Trust in cash a Matching Employer Contribution in an amount determined by multiplying (i) the aggregate amount of Basic Employer Contributions (other than any such contributions attributable to the Code Section 414(v) Adjustment) not in excess of 6% of a Participant's Earnings actually allocated to such Participant's Basic Employer Contribution account for such payroll period by reason of employment with such Participating Company by (ii) a percentage determined by reference to such Participant's years of Seniority Service as of the end of such Plan Year as follows:

Seniority Service		Percentage
1-4 years		25%
5-9 years		50%
10 years or more		75%

(b) With respect to Participants employed by the Company and its Related Companies, the Board may, at its option, suspend the Matching Employer Contributions if it determines that good business reasons for such suspension exist. With respect to any Participating Company not subject to the preceding sentence, the board of directors or managing general partner of such Participating Company may, in its discretion, suspend Matching Employer Contributions if it determines that good business reasons for such suspension exist.

(c) Notwithstanding subsection (a), in the event that Basic Employer Contributions initially allocated to a Participant's Basic Employer Contribution Account are distributed pursuant to Section 4.02 or 6.02 prior to any allocation of Matching Employer Contributions with respect thereto, then no Matching Employer Contributions shall be contributed with respect to such Basic Employer Contributions. Any Matching Employer Contributions paid to the Trustee with respect to such Basic Employer Contributions shall be returned to the contributing Employer.

5.03 Limitation on Annual Additions.

(a) For purposes of this Section 5.03, the term "Annual Addition" shall mean for any Plan Year: (i) the aggregate amount credited to the Participant's Matching Employer Contribution and Basic Employer Contribution Accounts under this Plan (and the Participant's accounts under any other defined contribution plan of the Participating Company employing such Participant or any Related Company) by reason of employer contributions (including any Special Contribution described in Section 6.08) and forfeitures; (ii) the Participant's voluntary contributions to any other defined contribution plan of the Participating Company or any of its Related Companies; (iii) contributions to an individual medical account (as defined in Section 415(l) of the Code) for a Participant as part of a defined benefit plan; and (iv) for purposes of the application of the dollar limit of clause (i) of subsection (b) to a Participant who is a Key Employee, as defined in Section 416(i) of the Code, with respect to such Plan Year or any preceding Plan Year, any amount paid or accrued to such Participant's account under a welfare benefit fund pursuant to Section 419A(d) of the Code. No amounts contributed by reason of rollover from another qualified plan shall be included in the Annual Addition.

Notwithstanding the preceding sentence:

(I) In determining the Annual Addition for any Plan Year prior to 1987 for purposes of Section 5.03(a), a Participant's own after-tax contributions shall be taken into account only to the extent of the lesser of: (i) such contributions in excess of six percent (6%) of such Participant's Remuneration for such Plan Year; or (ii) one-half (¹/2) of such contributions;

(II) Basic Employer Contributions distributed to a Participant pursuant to Section 4.02 or 6.02 shall be disregarded in determining such Participant's Annual Additions; and

For limitation years beginning on and after January 1, 2002, any amount attributable to a Code Section 414(v) Adjustment described in Section 4.01(c) is not taken into account as an Annual Addition.

(b) Effective for Plan Years beginning on and after January 1, 2002, the total Annual Addition to the Accounts of a Participant employed by any Participating Company or any of its Related Companies, under this Plan and any other defined contribution plan of such Participating Company or any of its Related Companies, shall not for any such Plan Year exceed the lesser of forty thousand dollars ($40,000) indexed as described in Code Section 415(d) or one hundred percent (100%) of a Participant's Remuneration from such Participating Company and Related Companies for such Plan Year. For Plan Years beginning prior to 2002, the total Annual Addition to the Accounts of a Participant employed by any Participating Company or any of its Related Companies, under this Plan and any other defined contribution plan of such Participating Company or any of its Related Companies shall not for any such Plan Year exceed the lesser of (i) or (ii) where (i) is thirty thousand dollars ($30,000) indexed as described in Code Section 415(d) or, for limitation years beginning before 1995, one-fourth (¹/4) of the dollar limitation in effect under Section 415(b)(1)(A) of the Code for such Plan Year, if greater than $30,000, and (ii) is twenty-five percent (25%) of the Participant's total Remuneration from such Participating Company and Related Companies for such Plan Year.

(c) For purposes of this Section, an amount shall be credited to a Participant's Account under this Plan and to a Participant's accounts under any other defined contribution plan of an Affiliated Company for a Plan Year if, with respect to employer contributions (including salary deferral contributions), such contributions are made during the Plan Year or no later than 30 days following the end of the taxable year (including extensions) with or within which the Plan Year ends.

(d) For purposes of this Section, an amount shall be credited to a Participant's Account under this Plan and to a Participant's accounts under any other defined contribution plan of an Affiliated Company for a Plan Year if, with respect to the Participant's own contributions, such contributions are made during the Plan Year or no later than 30 days following the end of such Plan Year.

5.04 Compliance with the Limitation. In the event that the Annual Addition to the Accounts of a Participant would for any Plan Year exceed the limitations of Section 5.03(b), the actions specified below shall be taken in the order listed and only to the extent necessary to satisfy the applicable limitations of Sections 5.03(b):

(a) First, the Participant's accrued benefits under the Retirement Plan attributable to service with the Participating Company employing him or any of its Related Companies, or under any other defined benefit plan of such Participating Company or any of its Related Companies, to the extent not already distributed therefrom in the form of an annuity contract or otherwise, shall be limited or reduced.

(b) Then, if any Special Contribution made pursuant to Section 6.08 has been allocated to the Basic Employer Contribution Account of the Participant, such Special Contribution shall be allocated pro rata to the Basic Employer Contribution Accounts of other Participants receiving such Special Contributions;

(c) Then, the Participant's Basic Employer Contributions for the Plan Year shall be limited, or to the extent already made, distributed to the Participant with gains or earnings thereon as a current cash payment.

(d) Then, if the Participating Company employing such Participant or any Related Company has not made its Matching Employer Contribution to the Plan prior to the time a distribution of the Participant's share of the Basic Employer Contribution is effected (under subsection (c) above), the Matching Employer Contribution of such entity for the Plan Year shall be reduced to take into account such distribution, and no reallocation of the Matching Employer Contribution of such entity shall be required.

(e) Then, to the extent that a Matching Employer Contribution was made to such Participant's Matching Employer Account by the Participating Company employing him or any Related Company based on the amount of any Basic Employer Contribution distributed in accordance with subsection (c), such contribution shall be used to reduce the Matching Employer Contributions for other Participants employed by such entity for the Plan Year to the extent possible. Any excess Matching Employer Contributions shall be held unallocated in a suspense account and used to reduce the Matching Employer Contributions of such entity for the next Plan Year (and succeeding Plan Years as necessary). No profits or losses attributable to the assets of the Trust shall be allocated to such a suspense account, nor shall any Employer Contributions be made, while a balance remains in a suspense account, by the entity to which such balance pertains or any of its Related Companies. If the Plan terminates, any unallocable balance remaining in a suspense account shall revert to the Company.

(f) Finally, the Annual Addition to the Participant's accounts under any other qualified defined contribution plan maintained by the Participating Company employing him or any Related Company shall be reduced in accordance with the applicable provisions of such plan.

5.05 Return of Contributions. Assets held in the Trust Fund shall be held for the exclusive benefit of Participants and their Beneficiaries, and such assets may never revert to or inure to the benefit of any Participating Company except under the following conditions:

(a) If the Internal Revenue Service shall deny a deduction for any part of a Basic Employer Contribution or Matching Contribution made by any Participating Company, the amount of the contribution for which no deduction is allowed shall be returned to such Participating Company within one (1) year of such disallowance, whether by agreement with the Internal Revenue Service or by final decision of a court of competent jurisdiction. Earnings of the Plan attributable to such a contribution may not be returned to the Participating Company, but any losses attributable to such a contribution shall reduce the amount returned;

(b) If within one (1) year of making a contribution to the Plan, a Participating Company or the Committee certifies that such contribution was made under mistake of fact, the Trustee shall upon the direction of the Committee before the expiration of such year return such contribution to the Participating Company that made such contribution;

(c) Any balance remaining in the suspense account described in Section 5.03(e) upon the termination of the Plan shall with respect to the Participating Company contributing such balance and all Related Companies be returned by the Trustee to such Participating Company; and

(d) If Basic Employer Contributions are refunded to a Participating Company in accordance with subsections (a) or (b), such contributions, together with the refunded earnings thereon (if any), shall be paid by such Participating Company to the affected Participants on whose behalf they were made, subject to satisfaction of all applicable federal and state withholding requirements.

5.06 Rollover Contributions.

(a) Subject to the nondiscrimination provisions of Sections 401(a)(4) and 401(a)(26) of the Code, the Committee may authorize the Trustee to accept a Rollover Contribution. A Rollover Contribution must be made in cash and must be attributable to a distribution from a plan qualified

under Code Section 401(a) or Code Section 403(a), excluding after-tax contributions; an annuity contract described in Code Section 403(b), excluding after-tax contributions; or an eligible plan under Code Section 457(b) that is maintained by a state, political subdivision of a state. Prior to accepting a Rollover Contribution, the Committee may require the Eligible Employee to establish, and to provide, at the Eligible Employee's expense, an opinion of counsel satisfactory to the Company that the proposed Rollover Contribution is attributable to a qualified total distribution.

(b) A Rollover Contribution shall be held in the Participant's Rollover Account, shall be accounted for separately, shall be fully vested, and shall be treated for all other Plan purposes except for Section 5.03 of the Plan, as though it were attributable to a Company contribution other than a 401(k) contribution.

(c) An Eligible Employee who makes a Rollover Contribution shall become a Participant as of the date of such contribution even if he or she had not previously become a Participant. Such an Eligible Employee shall become a Participant only for the purposes of such Rollover Contribution and shall not be eligible to share in any Company contributions until he or she becomes a Participant in accordance with Section 3.01.

ARTICLE VI

NONDISCRIMINATION REQUIREMENTS FOR BASIC EMPLOYER
CONTRIBUTIONS AND MATCHING EMPLOYER CONTRIBUTIONS

6.01 Limitation on Basic Employer Contributions.

(a) With respect to any Plan Year, the Actual Deferral Percentage (as defined in subsection (b)) of the group consisting of all Highly Paid Participants for such Plan Year shall not exceed the greater of:

(1) 125 percent of the prior year's Actual Deferral Percentage for the group of all non-Highly Paid Participants for the prior Plan Year.

(2) The lesser of: (i) 200 percent of the prior year's Actual Deferral Percentage for the group of all non-Highly Paid Participants for the prior Plan Year; or (ii) the prior year's Actual Deferral Percentage for the group of all non-Highly Paid Participants for the prior Plan Year plus two (2) percentage points.

Notwithstanding the foregoing, the Employer has the right to elect and amend the Plan to use current year data for determining the deferral percentage for all non-Highly Paid Participants.

(b) The "Actual Deferral Percentage" for a specified group of Employees for a Plan Year means the average of the ratios (calculated separately for each Employee in such group) of (1) to (2), where:

(1) Is the amount of Basic Employer Contributions actually allocated for the Plan Year to the Basic Employer Contribution Account of each Employee in such group, adjusted as follows:

(i) Reduced (in the case of any non-Highly Paid Participant) by the amount of any excess Basic Employer Contribution previously distributed to such Employee as described in Section 4.02;

(ii) Increased by any amount designated by the Committee pursuant to subsection (c)(1) which is allocated to such Employee's Basic Employer Contribution Account for such Plan Year;

(iii) Increased by any qualified nonelective contributions designated by the Committee under subsection (c)(2) and allocated to such Employee's accounts;

(iv) Reduced by the amount of such Employee's Basic Employer Contributions taken into account in determining Contribution Percentages pursuant to Section 6.03(d); and

(v) Reduced by any amount distributed to such Employee as described in Section 6.02(a); and

(2) Is the Remuneration of such Employee for the Plan Year, provided, however, that with respect to any Plan Year beginning before January 1, 1990, amounts paid to an Employee on account of any period when he is not eligible to make a Deferral Election shall be excluded.

For purposes of the foregoing:

(I) For Plan Years after December 31, 1984 and before January 1, 1987, the Actual Deferral Percentage of Participants who are eligible to participate in another cash or deferred arrangement maintained by any Affiliated Company shall be determined by treating all the cash or deferred arrangements in which he is eligible to participate as one arrangement and if the arrangements have different Plan Years, the arrangements shall be treated as a single arrangement with respect to the Plan Years ending with or within the same calendar year.

(II) The Committee shall take other plans of the Affiliated Companies into account to the extent provided in Section 6.06(a).

(III) Amounts shall be treated as allocated for the Plan Year if: (i) they are actually paid to the Trust no later than the end of the twelve-month period immediately following the Plan Year to which they relate; (ii) the allocation of such amounts to an Employee's account is not contingent upon his participation in the Plan or performance of services on any date after the end of such Plan Year; and (iii) such amounts relate to Earnings that either: (A) would have been received by the Employee but for his Deferral Election; or (B) is attributable to services performed by the Employee in the Plan Year and, but for the Employee's Deferral Election, would have been received by the Employee within two and one-half (2¹/2) months after the close of the Plan Year.

(IV) For Plan Years beginning after December 31, 1988, percentages shall be calculated to the nearest one-hundredth of one percent.

For Plan Years beginning after December 31, 2001, any amount attributable to a Code Section 414(v) Adjustment for a Qualified Participant (both as defined in Section 4.01(c)) is not taken into account in the Actual Deferral Percentage of a Qualified Participant.

(c) For purposes of computing Actual Deferral Percentages for any Plan Year, the Committee may elect to take into account any or all of the following—

(1) Any Special Contribution made under Section 6.08 and designated by the Employer to be so taken into account.

(2) Any qualified nonelective contributions described in Section 6.06(b), provided that: (i) the amount of such contributions so taken into account is not taken into account for purposes of Section 6.03(b) and satisfies the requirements of Section 401(a)(4) of the Code; and (ii) the use of such contributions for purposes of this Section 6.01 does not have the effect of increasing the difference between the Actual Deferral Percentage for Highly Paid Participants and the Actual Deferral Percentage for non-Highly Paid Participants.

6.02 Remedial Distributions of Basic Employer Contributions.

(a) To the extent required for compliance with the condition set forth in Section 6.01(a) for a Plan Year, taking into account, to the extent determined by the Committee, amounts described in Section 6.01(c), the Committee shall direct the Trustee to distribute, in cash, such Basic Employer Contributions as determined under subsection (b). Such distribution shall include income calculated as described in Section 6.06(c).

(b) For Plan Years commencing on or after January 1, 1997, excess Basic Employer Contributions are allocated to the Highly Paid Participants with the largest dollar amount of Basic Employer Contributions taken into account in Section 6.01(a) above, for the year in which the excess arose, beginning with the Highly Paid Participant with the largest dollar amount of such Basic Employer Contributions and continuing in descending order until the entire excess amount has been allocated. For purposes of the preceding sentence, the "largest dollar amount" is determined after distribution of any Excess Deferrals as described in Section 4.02. Unmatched Basic Employer Contributions will be distributed before matched Basic Employer Contributions. If matched Basic Employer Contributions also must be distributed, they will be accompanied by a proportionate share of Matching Employer Contributions. Excess Basic Employer Contributions are equal to the excess of (i) over (ii) where (i) is the amount of Basic Employer Contributions made on behalf of Highly Paid Participants for the Plan Year and (ii) is the maximum amount of such contributions that could be made on behalf of Highly Paid Participants for the Plan Year determined by hypothetically reducing each Highly Paid Participant's Basic Employer Contributions to the extent necessary to satisfy the test in Section 6.01(a), starting with the Highly Paid Participant with the highest Deferral Percentage.

(c) The distribution described in subsection (a) shall be made during the period beginning with the first day after the close of the Plan Year for which such Basic Employer Contributions were made and ending two and one-half (2¹/2) months following the close of such Plan Year; provided, however, that a failure to make such distribution before the end of such period shall not cause the Plan to be treated as failing to satisfy the requirements of Section 401 of the Code if such distribution is made before the end of the Plan Year following the Plan Year for which such Basic Employer Contributions were made.

6.03 Limitation on Matching Contributions.

(a) With respect to any Plan Year, the Contribution Percentage (as defined in subsection (b)) of the group consisting of all Highly Paid Participants for such Plan Year shall not exceed the greater of:

(1) 125 percent of the prior year's Contribution Percentage for the group of all non-Highly Paid Participants for the prior Plan Year.

(2) The lesser of: (i) 200 percent of the prior year's Contribution Percentage for the group of all non-Highly Paid Participants for the prior Plan Year; or (ii) the prior year's Contribution Percentage for the group of all non-Highly Paid Participants for the prior Plan Year plus two (2) percentage points.

Notwithstanding the foregoing, the Employer has the right to elect and amend the Plan to use current year data for determining the contribution percentage for all non-Highly Paid Participants.

(b) The "Contribution Percentage" for a specified group of Employees for a Plan Year means the average of the ratios (calculated separately for each Employee in such group) of (1) to (2), where:

(1) Is the amount of Matching Employer Contributions and forfeitures allocated to the Participant's Matching Employer Contribution Account for such Plan Year, adjusted as follows:

(i) Increased by any amount designated by the Committee pursuant to subsection (c)(1) and allocated to the Basic Employer Contribution Account of such Employee for such Plan Year;

(ii) Increased by any qualified nonelective contributions designated by the Committee under subsection (c)(2) and allocated to such Employee's account;

(iii) Decreased by any amount distributed to such Employee pursuant to Section 6.04(b);

For purposes of the foregoing:

(I) The Committee shall take other plans of the Affiliated Companies into account to the extent provided in Section 6.06(a).

(II) A Matching Contribution shall be taken into account for a Plan Year only if: (i) it is allocated to the Participant's Matching Employer Contribution Account as of a date within the Plan Year; (ii) it is actually paid to the Trust no later than the end of the twelve-month period immediately following such Plan Year; and (iii) it is made on behalf of an Employee on account of his Basic Employer Contributions for such Plan Year.

(III) For Plan Years beginning after December 31, 1988, percentages shall be calculated to the nearest one-hundredth of one percent.

(c) For purposes of computing Contribution Percentages for any Plan Year, the Committee may elect to take into account either of the following:

(1) Any Special Contribution made under Section 6.08 and designated by the Employer to be so taken into account; or

(2) Any qualified nonelective contributions described in Section 6.06(b) provided that (i) the amount of such contributions so taken into account is not taken into account for purposes of Section 6.01(b) and satisfies the requirements of Section 401(a)(4) of the Code, and (ii) the use of such contributions for purposes of this Section 6.03 does not have the effect of increasing the difference between the Contribution Percentage for Highly Paid Participants and the Contribution Percentage for non-Highly Paid Participants.

(d) For purposes of computing Contribution Percentages for any Plan Year, the Committee may elect to take into account any Basic Employer Contributions (or any elective deferrals under any other qualified cash or deferred arrangement maintained by any Affiliated Company), provided that—

(1) Those Basic Employer Contributions (or elective deferrals under another plan), if any, not so taken into account fulfill the condition of Section 6.01(a) without regard to Section 6.01(c), and

(2) The requirements of Section 6.01(a) (without regard to Section 6.01(c)) are met by such Basic Employer Contributions (or elective deferrals under another plan) separately and are met in the aggregate by all Basic Employer Contributions (or elective deferrals under another plan).

(3) For Plan Years beginning after December 31, 1988, the plan year of the plan under which such elective deferrals are made is the same as the Plan Year.

6.04 Remedial Distributions of Matching Contributions.

(a) To the extent required for compliance with the condition set forth in Section 6.03(a) for a Plan Year, taking into account, to the extent determined by the Committee, the amounts described in Section 6.03(c), the Committee shall direct the Trustee to distribute, in cash, such Matching Contributions as are determined under subsection (b). Such distribution shall include income calculated as described in Section 6.06(c).

(b) For Plan Years commencing on or after January 1, 1997, excess Matching Contributions are allocated to the Highly Paid Participants with the largest dollar amounts of Matching Contributions taken into account in Section 6.03(a) above, for the year in which the excess contributions arose, starting with the Highly Paid Participant with the largest dollar amount of such Matching Contributions and continuing in descending order until the entire excess amount has been allocated. Excess Matching Contributions are equal to the excess of (i) over (ii) where (i) is the amount of Matching Contributions made on behalf of Highly Paid Participants for the Plan Year and (ii) is the maximum amount of such contributions that could be made on behalf of Highly Paid Participants for the Plan Year determined by hypothetically reducing each Highly Paid Participant's Matching Contributions to the extent necessary to satisfy the test in Section 6.03(a), starting the Highly Paid Participant with the highest Contribution Percentage.

(c) The distribution described in subsection (a) shall be made during the period beginning with the first day after the close of the Plan Year for which such Matching Contributions were made and ending two and one-half (2¹/2) months following the close of such Plan Year; provided, however, that a failure to make such distribution before the end of such period shall not cause the Plan to be treated as failing to satisfy the requirements of Section 401 of the Code if such distribution is made before the end of the Plan Year following the Plan Year for which such contributions were made.

6.05 Reserved.

6.06 Further Discrimination Test Requirements. For purposes of this Article:

(a) Aggregation of Plans.

(1) If the Committee so elects and if this Plan and other plan maintained by any Affiliated Company (the "other plan") are treated as a single plan for purposes of Section 401(a)(4) or 410(b) (other than Section 410(b)(2)(A)(ii) as in effect for plan years beginning after 1988) of the Code, then, except as provided in subsection (a)(2):

(i) The cash or deferred arrangements under such plans shall be treated as a single arrangement for purposes of Section 6.01(a) of the Plan and Sections 401(a)(4), 401(k), and 410(b) of the Code, and

(ii) All employee contributions and matching contributions are to be treated as made under the same plan for purposes of Section 6.03(a) of the Plan and Sections 401(a)(4), 401(m), and 410(b) of the Code.

(2) Notwithstanding subsection (a)(1), for Plan Years beginning after December 31, 1988:

(i) Contributions and allocations under an employee stock ownership plan described in Section 4975(e)(7) of the Code shall not be combined with contributions or allocations under any plan not so described; and

(ii) Plans may be aggregated under this subsection only if they have the same plan year.

(b) Qualified Nonelective Contributions. The Committee may elect to take into account nonelective employer contributions under any other plan sponsored by any Affiliated Company if all of the following are satisfied:

(1) Such contributions are: (i) fully vested; and (ii) are not distributable earlier than the employee's retirement, death, disability, separation from service, an event described in Section 401(k)(10) of the Code, (in the case of a profit-sharing or stock bonus plan) the employee's attainment of age 59¹/2 or (for Plan Years beginning before January 1, 1989) hardship.

(2) Such contributions: (i) satisfy the requirements of Section 401(a)(4) of the Code, both with and without including the amount of such contributions taken into account under this subsection; and (ii) are not taken into account in determining whether any other contributions or benefits satisfy Section 401(a)(4) or 401(k)(3) of the Code.

(3) Such contributions: (i) are actually paid to the trust under such plan no later than the end of the twelve-month period immediately following the plan year to which the contribution relates; and (ii) are allocated to the accounts of participating employees under the plan without regard to the employee's participation in the plan or performance of services on any date subsequent to the end of the plan year to which such contribution relates; provided that, for plan years beginning after December 31, 1988, the plan year of the plan under which such contributions are made is the same as the Plan Year.

(c) Income on Distributed Amounts. Income on an amount distributed under this Article VI shall be determined by multiplying such amount by a factor computed as follows:

(1) Divide the amount distributed by the balance, as of the end of the Plan Year, of the account under the Plan to which such amount was (or would have been) allocated, adjusted to exclude the year's investment experience by reducing such year-end balance by the total gain allocable thereto for the year and increasing such year-end balance by the loss allocable thereto for the year; then

(2) Increase the result found in paragraph (1) by ten percent (10%) for each calendar month beginning with the day after the end of the Plan Year for which such amount was distributed and ending with the date of the distribution; provided, however, that a distribution occurring on or before the fifteenth day of the month will be treated as having been made on the last day of the preceding month, and a distribution occurring after such fifteenth day will be treated as having been made on the first day of the next month.

6.07 Multiple Use Limitation. The Provisions describing the Multiple Use Limitation in this Section 6.07 are repealed for Plan Years beginning on and after January 1, 2002.

(a) If both the Actual Deferral Percentage and the Contribution Percentage do not satisfy the basic limitations set forth in Sections 6.01(a)(1) and 6.03(a)(1) and one or more Highly Paid Participants are eligible to have Basic Employer Contributions made on their behalf and to have Matching Contributions made on their behalf, then the sum of the Actual Deferral Percentages of

Highly Paid Participants plus the sum of the Contribution Percentages of Highly Paid Participants shall not exceed the greater of:

(1) The sum of: (i) 125 percent of the greater of the prior year's Actual Deferral Percentage or Actual Contribution Percentage for the group of all non-Highly Paid Participants for the prior Plan Year, plus (ii) two percentage points plus the lesser of the prior year's Actual Deferral Percentage or Actual Contribution Percentage for the group of all non-Highly Paid Participants for the prior Plan Year.

(2) The sum of: (i) 125 percent of the lesser of the prior year's Actual Deferral Percentage or Actual Contribution Percentage for the group of all non-Highly Paid Participants for the prior Plan Year, plus (ii) two percentage points plus the greater of the prior year's Actual Deferral Percentage or Actual Contribution Percentage for the group of all non-Highly Paid Participants for the prior Plan Year.

Notwithstanding the foregoing, the Employer has the right to elect and amend the Plan to use current year data for determining the deferral or contribution percentage for all non-Highly Paid Participants.

6.08 Special Contribution.

(a) With respect to any Plan Year, a Participating Company may make a Special Contribution to the Plan, in such an amount and on behalf of such Participants as it may specify, provided that:

(1) Such contributions shall be allocated to the Basic Employer Contribution Accounts of specified Participants without regard to such Participants' participation in the Plan or performance of services on any date subsequent to the end of such Plan Year.

(2) Such contributions shall satisfy the requirements of Section 401(a)(4) of the Code and, except as provided in Section 6.01(b) and 6.03(b), shall not be taken into account in determining whether any other contributions or benefits satisfy Section 401(a)(4), 401(k)(3), or 401(m) of the Code.

ARTICLE VII

INVESTMENT FUNDS

7.01 Investment of Contributions.

(a) At the direction of the Committee, the Trustee will establish separate funds to which Participants may direct the investment of their Accounts. Investment in these funds will be subject to such restrictions and administrative procedures as are imposed by the Committee, pursuant to its discretionary authority to administer and interpret the Plan, including, but not limited to, procedures for investment of amounts for which no investment direction is given by a Participant.

(b) A Participant may indicate his or her investment designation for future Basic Employer Contributions and Matching Employer Contributions by giving prior written notice to the Committee on a form provided by the Committee.

(c) A Participant may change his or her investment designation at any time by written notice to the Committee on a form provided by the Committee, provided, however, that such change shall apply only with respect to the investment of Basic Employer Contributions and Matching Employer Contributions made subsequent to the first pay period beginning after receipt of such notice by the Committee.

7.02 Newhall Fund. At the discretion of the Committee, the Plan may acquire and hold qualified employer securities as defined in Section 407 of ERISA ("Depositary Units"). Participants may elect to invest amounts held in their Accounts in shares of a fund consisting of cash and Depositary Units ("Newhall Fund"), consistent with the investment policy implemented by the Committee pursuant to its discretionary authority to administer and interpret the Plan. The Newhall Fund shall be established by the Trustee pursuant to Section 7.01 of the Plan and shall be subject to such restrictions and administrative procedures as are imposed by the Committee, pursuant to its discretionary authority to administer and interpret the Plan.

7.03 Investment Designation. Effective July 1, 1994:

(a) A Participant may designate up to 100% (in 10% increments) of future Matching Employer Contributions and up to 30% (in increments of 10%) of future Basic Employer Contributions be invested in the Newhall Fund. Such designation shall become effective as soon as practicable following receipt of the Participant's election by the Committee or its delegate.

(b) As of each Accounting Date, a Participant may elect to transfer a portion of his or her existing funds into the Newhall Fund consistent with the investment policy and procedures implemented by the Committee, provided the aggregate value of his or her Accounts invested in the Newhall Fund does not exceed 30% of the value of his or her Accounts. A transfer that exceeds the percentage limitation shall be reduced pro rata between the originating investment funds. The election provided for in the preceding sentence shall be effective as soon as practicable following receipt of the Participant's election form by the Committee or its delegate.

7.04 Transfer of Account Balances Between Funds. Subject to the limitations in Section 7.03, as of each Accounting Date, a Participant may elect to transfer all or a portion (in such percentages as the Committee shall have authorized pursuant to its discretionary authority to administer and interpret the Plan) of the current value of his or her Accounts among investment funds. The election provided for in the preceding sentence shall be made on a form provided by the Committee which shall be filed by the Participant at least 10 days prior to the effective date of the transfer.

7.05 Purchase Price. All acquisitions of Depositary Units by the Newhall Fund will be effected quarterly from either the Company or on the open market at the prevailing market price.

7.06 Voting and Tender Offers.

(a) A Participant may direct voting of the Depositary Units underlying the Participant's interest in the Newhall Fund. The Trustee will vote such Depositary Units in accordance with the directions of Participants, as communicated in writing to the Trustee.

(1) A Participant whose Account is invested in the Newhall Fund will be notified by the Trustee (or by Company, pursuant to its normal communications with limited partners) of each occasion for the exercise of voting rights, within a reasonable time before those voting rights are to be exercised. This notification will include all the information distributed by the Company to limited partners generally, regarding the exercise of voting rights.

(2) To the extent that a Participant fails to direct the Trustee, in whole or in part, as to the exercise of voting rights with respect to any Depositary Units underlying the Participant's interest in the Newhall Fund, those Depositary Units will not be voted.

(b) Subject to (b)(3) below, if the Trustee receives a tender offer to buy Depositary Units held by the Trustee, a Participant may direct tender of the of Depositary Units underlying the Participant's interest in the Newhall Fund. The Trustee will tender such Depositary Units in accordance with the directions of Participants, as communicated in writing to the Trustee.

(1) All Participants entitled to tender Depositary Units held by the Newhall Fund will be so notified by the Trustee (or by the Company) within a reasonable time before the right to tender is to be exercised. This notification will include information received by the Trustee as limited partners, or distributed by the Company to limited partners generally, regarding their right to tender.

(2) To the extent that a Participant fails to direct the Trustee, in whole or in part, to tender Depositary Units underlying the Participant's interest in the Newhall Fund, those Depositary Units will not be tendered.

(3) The Trustee will not permit Participants to direct the tender of Depositary Units, to the extent that the receipt or holding of the property offered in exchange for the Company Securities would violate any applicable law, including ERISA. The Committee will make investment decisions regarding any non-cash property received by the Newhall Fund as a result of a tender.

(c) For purposes of this Article VII, the Beneficiary of a deceased Participant will be treated as though he or she were a Participant.

7.07 Agreements Relating to Trust. The assets of the Plan shall be held pursuant to one or more written agreements with: (i) Trustees, as described in Section 7.08; (ii) Insurance Companies, as described in Section 7.10; or (iii) a combination.

7.08 Establishment of Trust Agreement. Some or all of the assets of the Plan may be held pursuant to trust agreements with one or more of the Trustees; the Trustees shall be such one or more individuals, banks or trust companies as may be designated by the Committee. Each trust agreement shall provide for the investment of the trust assets and prescribe the powers, duties, obligations and functions of the Trustees with respect to the Plan. Each Trustee shall control and manage the assets of its trust, subject to the terms of its trust agreement and this Plan. To the extent the provisions of the Plan and the trust agreement are inconsistent or otherwise in conflict with respect to the rights, duties or obligations of the Trustee, the provisions of the trust agreement shall control. The Trustee shall be subject to the direction of any Investment Manager appointed pursuant to Section 7.09 with respect to acquisition, retention, or disposition of investments of that portion of the Trust over which such Investment Manager has been given authority by the Committee. Each trust agreement shall authorize

the Trustee to make deposits in the Trustee's commercial banking department (or in any other bank or similar financial institution) provided such deposits bear a reasonable rate of interest.

7.09 Appointment of Investment Manager. The Committee, pursuant to its discretionary authority to administer and interpret the Plan, may appoint one or more Investment Managers within the meaning of Section 3(38) of ERISA, and may authorize such Investment Managers to direct the Trustee with respect to acquisition, retention, or disposition of any specified portion of any investment fund designated by the Committee, up to the whole thereof. Each such Investment Manager must be a person (i) who has the power to manage, acquire or dispose of any assets of the Plan, (ii) who (I) is registered as an investment adviser under the Investment Advisers Act of 1940 or any successor statute ("the Act"), (II) is not registered as an investment adviser under the Act by reason of paragraph (1) of Section 203A(2) of the Act, but is registered as an investment advisor under the laws of the state (referred to in paragraph (1) of Section 203A of the Act) in which it maintains its principal office and place of business, and, at the time the fiduciary last filed the registration form most recently filed by the fiduciary with such state in order to maintain the fiduciary's registration under the laws of such state, also filed a copy of such form with the Secretary of Labor, (III) is a bank as defined in that Act, or (IV) is an insurance company qualified to manage, acquire or dispose of any assets of the Plan under the laws of more than one state, and (iii) has acknowledged in writing that he/she is a fiduciary with respect to the Plan. The Committee shall notify the Trustee in writing of the appointment of such Investment Manager and cause such Investment Manager to acknowledge to the Trustee in writing that such Investment Manager is a fiduciary with respect to the Plan. If the foregoing conditions are met, such Investment Manager shall have the power to manage, acquire or dispose of any Trust assets. No Investment Manager shall issue directions in violation of the Plan or prohibited by the fiduciary responsibility rules of ERISA.

7.10 Insurance or Annuity Contracts. Some or all of the assets of the Plan may be held pursuant to insurance or annuity contracts or policies with one or more Insurance Companies which are qualified to do business as an insurance company under the laws of more than one state. Such contracts or policies may include a contract providing for or guaranteeing a specified rate of interest or return. Each contract described in this Section 7.10 may be executed and held either by a Trustee described in Section 7.08 or, if the Committee so elects, by the Committee.

7.11 Expenses of Trust. The expenses of the Trust, including those relating to reporting obligations, shall be borne by the Participating Companies. The fees and expenses of the Trustee, the Insurance Company, and the Investment Manager, if any, shall be borne by the Participating Companies. Brokerage fees, commissions, stock transfer taxes and other charges and expenses incurred in connection with transactions relating to the acquisition or disposition of property for the Trust and distributions from the Trust, shall be borne by the Trust assets as specified in Section 12.11. Taxes incurred as a result of unrelated business taxable income will be charged to the Newhall Fund.

7.12 Voting of Securities in Trust. Subject to Section 7.06, each Trustee and Insurance Company shall have the authority to exercise any voting rights relating to stock and securities held in its respective portion of the Trust, except that an Investment Manager may exercise voting rights with respect to those securities which are managed by such Investment Manager by complying with such procedures as the Committee or the Trustee shall determine.

ARTICLE VIII

ACCOUNTS AND VALUATION

8.01 Participant Accounts.

(a) The Committee shall establish and maintain for each Participant the following Accounts:

(1) Matching Employer Contribution Account—this Account shall be credited with the Participant's share of all Matching Employer Contributions.

(2) Basic Employer Contribution Account—this Account shall be credited with the Participant's share of all Basic Employer Contributions and any Special Contribution made pursuant to Section 6.08.

(3) Employee Contribution Account—this Account shall be credited with the value of the Participant's Voluntary Employee Contributions under the Plan as in effect prior to January 1, 1987.

(4) Rollover Account—this Account shall be credited with the Participant's share of any Rollover Contributions accepted by the Plan.

(b) The Committee shall establish and maintain an ESOP Account for each Participant who was a participant in the ESOP.

(c) In the event that a Participant for whom one or more Accounts are being maintained pursuant to subsection (a) terminates employment and is subsequently employed by a Participating Company which is not a Related Company with respect to such Participant's former employer, the Committee shall establish and maintain separate accounts for such Participant with respect to his participation in the Plan after his transfer of employment.

8.02 Crediting of Contributions. Rollover Contributions and Basic Employer Contributions shall be credited to a Participant's Account for the respective Funds as soon as practicable following their receipt by the Trust.

8.03 Adjustment of Accounts. As of each Accounting Date, the Committee shall determine the fair market value of trust assets and shall adjust each Participant's Accounts as follows:

(a) First, all Basic Employer Contributions, Rollover Contributions and Matching Employer Contributions allocated since the last preceding Accounting Date and not previously credited to Accounts shall be credited to the proper Accounts.

(b) Next, all withdrawals or distributions made since the last preceding Accounting Date that have not been charged previously shall be charged to the proper Accounts.

(c) Finally, each Participant's Accounts in each Fund (including the Accounts of any Suspended Participant), as adjusted pursuant to subsections (a) and (b), shall be credited with their pro rata share of any increase (or charged with their pro rata share of any decrease) in the value of that Fund as of that Accounting Date as compared with the immediately preceding Accounting Date.

8.04 Statements. As soon as practicable after the last Accounting Date in each Plan Year, the Committee shall furnish each Participant with a statement showing his Account balances in the respective Funds as of such Accounting Date.

8.05 Value of Accounts. The value of an Account on any date shall be deemed to be the net credit balance of such Account on the Accounting Date immediately preceding or coincident with the date as of which such value is to be determined, increased by any contributions to, and reduced by any distributions or withdrawals from or forfeitures made with respect to, such Account since such Accounting Date.

ARTICLE IX

WITHDRAWALS PRIOR TO TERMINATION OF EMPLOYMENT

9.01 Withdrawals from Employee Contribution Account.

(a) A Participant who has, at least 30 days prior to an Accounting Date, given written notice in the manner and upon a form provided by the Committee may withdraw from his Employee Contribution Account an amount not exceeding the value of such Account as of such Accounting Date. The amount so requested shall be paid to such Participant as soon as practicable after such Accounting Date.

(b) Any Participant who makes a withdrawal pursuant to this Section 9.01 shall become a Suspended Participant for all purposes under the Plan for a period determined as follows:

(1) If such Participant elected to suspend Basic Employer Contributions under Section 4.04 at the time notice was given under subsection (a) of this section, a period of 6 months beginning on the date of such election and notice; or

(2) In any other case, a period of 6 months beginning on the date 15 days prior to the Accounting Date specified in subsection (a). Provided, however, that the suspension shall terminate only upon such Participant's written notice to his employer that the 6-month suspension period has elapsed.

9.02 Withdrawals from Basic Employer Contribution Account.

(a) A Participant who satisfies the requirements of subsection (b) may withdraw on a specified date an amount determined in accordance with subsection (c), provided, however, that such Participant shall incur the suspension described in Section 9.04.

(b) A Participant shall be eligible for an in-service withdrawal if:

(1) He certifies to the Committee that the requested withdrawal is on account of one of the following:

(i) Medical expenses (described in Section 213(d) of the Code) incurred by such Participant, his spouse, or any of his dependents (as defined in Section 152 of the Code) or necessary for these persons to obtain such medical care;

(ii) Purchase (excluding mortgage payments) of a principal residence for the Participant;

(iii) Payment of tuition, related educational fees, and room and board expenses, for the next 12 months of post-secondary education for the Participant, or the Participant's spouse, children, or dependents; or

(iv) The need to prevent the eviction of the Participant from his principal residence or foreclosure on the mortgage of the employee's principal residence.

(2) He has not received a withdrawal at any time during the preceding twelve months (or, in the case of a withdrawal for payment of tuition described in item (3) of subsection (a), he has not received more than two withdrawals in the preceding twelve months).

(3) He has obtained all other distributions and nontaxable (at the time of the loan) loans available to him under the Plan and any other plan maintained by any Affiliated Company.

(4) His participation in this Plan is suspended pursuant to Section 9.04, and his participation in each other plan of deferred compensation maintained by any Affiliated Company is suspended for a 12-month period beginning on the date of the withdrawal.

(5) The dollar amount of his Basic Employer Contributions (and deferrals under any other cash or deferred arrangement maintained by any Affiliated Company) for the Plan Year following the Plan Year in which the withdrawal occurs shall not exceed the Dollar Amount (as defined in Section 4.02(a)(1) for such Plan Year decreased by the amount of his Basic Employer Contributions for the Plan Year in which the withdrawal occurs.

(c) The amount withdrawn by a Participant under this Section 9.02 shall not exceed the amount reasonably required for satisfaction of the need specified in subsection (b)(1), and further, shall not exceed his Basic Employer Contribution Account balance as of December 31, 1988, plus the lesser of: (i) the Participant's Basic Employer Contributions made after December 31, 1988, without added earnings; or (ii) the current value of those Basic Employer Contributions made after December 31, 1988 (but not more than the amount of his Basic Employer Contributions not previously withdrawn).

(d) All withdrawals from the Plan will be made in a single sum cash payment.

9.03 Withdrawals by Certain Participants.

(a) Totally Disabled Participant. Notwithstanding Section 9.02, no more than once during a Plan Year, a Totally Disabled Participant who has filed a written request with the Committee at least 30 days prior to an Accounting Date may withdraw: (i) up to one hundred percent (100%) of his Basic Employer Contribution Account; and (ii) provided he has withdrawn or concurrently withdraws the maximum permissible amount from his Employee Contribution Account and his Basic Employer Contribution Account, all or such portion as he shall specify of the Vested Value of his Matching Employer Contribution Account.

(b) Participant Over Age 59¹/2. Notwithstanding Section 9.02, no more than once during a Plan Year, a Participant who has attained age 59¹/2and who has filed a written request with the Committee at least 30 days prior to an Accounting Date may withdraw up to one hundred percent (100%) of his Basic Employer Contribution Account.

9.04 Loans to Participants. Upon approval of his or her application by the Committee (in accordance with the procedure and criteria set forth in subsection (a)), a Participant may borrow from the Trust an amount as specified in subsection (b), upon the terms and conditions set forth in subsection (d).

(a) Procedure and Criteria for Approving Loans.

(1) Loans shall be available pursuant to the procedures of this Section to all Participants who are currently Employees and, to the extent required under ERISA or the Code (but only to such extent), to other Participants and to Beneficiaries of deceased Participants (collectively referred to as "Borrowers").

(2) A Borrower requesting a loan shall submit to the Committee a completed form of application supplied by the Committee, containing the following information:

(i) The dollar amount of the loan requested;

(ii) The term of the loan requested, which shall not exceed 5 years;

(iii) In the case of a Borrower who is not then an Employee, such information and/or representations as to the source(s) of funds for repayment of the loan as the Committee may deem appropriate;

(iv) In the case of a Borrower whose Basic Employer Contribution Account is invested in more than one investment fund or vehicle, the fund or vehicle from which

assets are withdrawn to fund such loan, or, if amounts are to be withdrawn from more than one fund or vehicle, allocation of loan amounts between such funds or vehicles; and

(v) Such other information as the Committee may specify.

(b) Amount of Loan.

(1) No loan shall be made for an amount less than $500.

(2) No loan shall be made for an amount greater than the smallest of (i), (ii), or (iii) below.

(i) 50% of the combined balance of the Borrower's Basic Employer Contribution Account and Matching Employer Contribution Account (excluding any unvested portion thereof) as of the preceding Accounting Date, determined after such balance is reduced by: (I) the amount of any subsequent in-service withdrawal under Article IX; and (II) the outstanding balance of any prior loan(s) on the Accounting Date prior to the Funding Date;

(ii) The balance of the Borrower's Basic Employer Contributions Account on the most recent Accounting Date, reduced by: (I) any amount withdrawn from such Account pursuant to Article IX following such Accounting Date; and (II) the outstanding balance of any prior loan(s) on such Accounting Date;

(iii) $50,000, reduced by the excess, if any, of (I) the Borrower's highest outstanding loan balance under this Plan and the plans of Affiliated Companies during the 12 month period ending on the day before the loan is made, over (II) the Borrower's outstanding loan balance under this Plan and the plans of Affiliated Companies on the date the loan is made.

In determining the limitations set forth in clauses (i) and (ii) above, the Committee may, in its discretion, substitute a more recent date for the most recent Accounting Date, provided that such substitution shall apply to all loans made from the date of such Committee action to the next Accounting Date.

(1) Within a reasonable time after receipt of a loan application, the Committee or its delegate shall approve or disapprove such application. The Committee shall notify the Borrower of its decision and, if the application is approved, shall instruct the Trustee to make the loan as soon as administrative feasible.

(2) Upon receipt of instructions as to a Borrower's loan, the Trustee shall create a Loan Account for such Participant and fund such Loan Account by transferring assets to it from the Participant's Basic Employer Contribution Account, commencing with amounts invested in the fund or vehicle as specified by the Participant.

(3) Within a reasonable time after approval of the Participant's loan application, the Trustee shall disburse the cash balance of the Loan Account to the Participant upon receipt of his duly executed promissory note (in the form approved by the Committee). In the case of a Participant with a prior loan outstanding, the proceeds of the new loan shall first be applied to discharge the prior loan in full, including principal and accrued interest, and the balance of the proceeds of the new loan shall then be disbursed to the Participant.

(4) Loan payments when received by the Trust shall be credited to the Participant's Loan Account and appropriately allocated to principal and interest and shall be invested in such fund or vehicle as may be designated for all loans by the Committee, unless otherwise

designated by the Participant. As of each pay period, principal from the Participant's Loan Account, along with interest allocable to such principal, shall be reallocated to his Basic Employer Contribution Account.

(d) Terms and Conditions of Loan.

(1) Each loan shall bear interest at a reasonable rate determined from time to time by the Committee pursuant to written procedures.

(2) No loan shall be made for a term in excess of five (5) years.

(3) Each loan shall be repaid by periodic payments representing substantially level amortization of such loan over its term. During any period in which the Participant is an Employee, the loan shall be repaid by level payroll deductions. During any period in which the Participant is not an Employee, the loan shall be repaid by check, with level payments due at the end of each calendar month. Payment amounts shall be determined by the Committee at the time of the loan and at any subsequent time when a change in such amounts is required. Any loan balance may be prepaid without penalty.

(4) A Participant's loan shall be secured by his Accounts under the Plan to the extent of fifty percent (50%) of the aggregate dollar amount thereof, determined immediately after the loan is made; the remaining balance of his Accounts shall be unencumbered. In the event of any failure of the Participant to make a payment within 30 days of the date due, the Trustee shall enforce such security interest at the earliest time at which the Participant is entitled to receive a distribution under Section 9.03 or Article XI of the Plan. In addition, in the event of such a failure to repay, the Committee may direct a Trustee to exercise every creditor's right at law or equity available to the Trustee. In the event a Participant whose loan is in default requests a distribution (including a hardship withdrawal under Section 8.02) from the Plan, the otherwise distributable amount shall first be applied (but only to the extent of the security interest described in the first sentence of this paragraph (4)) to offset the remaining balance of principal and accrued but unpaid interest under the loan, and only the remaining distributable amount shall be paid over to the Participant.

9.05 Suspension. Any Participant who makes a withdrawal pursuant to Section 9.02 or 9.03 shall become a Suspended Participant for all purposes under the Plan for a period of 12 months beginning on the date of receipt of the withdrawal. Provided, however, that the suspension shall terminate only upon such Participant's written notice to his employer that the 12-month suspension period has elapsed.

ARTICLE X

VESTING

10.01 Vesting.

(a) A Participant shall at all times be fully vested in his Employee Contribution Account, his Rollover Account, his Basic Employer Contribution Account and his ESOP Account, if any.

(b) Each Participant with an Hour of Service on or after January 1, 1989 shall be fully vested in his Matching Employer Contribution Account.

(c) The vesting in the Matching Employer Contribution Account of any Participant with no Hour of Service after December 31, 1988 shall be determined in accordance with the Plan as in effect when he had his last Hour of Service.

ARTICLE XI

DISTRIBUTIONS

11.01 General. Upon the termination of employment of a Participant (severance from employment with respect to distributions on and after January 1, 2002), except by death:

(a) If the Participant's Vested Value does not exceed $3,500 ($5,000 on and after July 15, 1998), such Vested Value shall be distributed to such Participant in a lump sum within 60 days following the Accounting Date which coincides with or next follows his termination of employment.

(b) If such Participant's Vested Value exceeds $3,500 ($5,000 on and after July 15, 1998), the Committee shall distribute such Vested Value in a lump sum upon such Participant's attainment of age 65 or, if later, within 60 days following the Accounting Date which coincides with or next follows his termination of employment.

(c) Notwithstanding subsection (b), a Participant may elect in writing at any time following his or her termination of employment to receive a distribution of his or her entire Vested Value in a lump sum provided that such distribution occurs not more than 90 days following such Participant's election. A Participant shall be required to reconfirm his or her initial election to assure that the commencement of such distribution occurs within 90 days of an election. The Committee shall notify the Participant of the right to defer any distribution until the Participant attains age 65. Such notification shall be provided no less than 30 days and no more than 90 days prior to the commencement of benefits.

(d) Distribution may commence less than 30 days after the notice required under Section 1.411(a)-11(c) of the Regulations is given, provided that: (i) the Plan Administrator clearly informs the Participant that the Participant has a right to a period of at least 30 days after receiving the notice to consider the decision of whether or not to elect a distribution (and, if applicable, a particular distribution option), and (ii) the Participant, after receiving the notice, affirmatively elects a distribution.

11.02 Form of Distribution.

(a) Amounts held in a Participant's Account will be paid in cash as a total distribution, unless the Participant (or Beneficiary) elects otherwise pursuant to subsection (b).

(b) When requesting a distribution under this Article XI, a Participant (or Beneficiary) may elect to receive the portion of his or her Account that is invested in the Newhall Fund in whole Depositary Units as determined on the preceding Accounting Date. The Plan shall not make distributions of less than 100 Depositary Units. Any balance representing fractional shares will be distributed in cash.

11.03 Death of Participant.

(a) Upon the death of a Participant, the Participant's Vested Value shall be distributed to his Beneficiary (determined as specified in subsections (b) and (c) in a lump sum within 60 days following the end of the calendar quarter in which the death occurred.

(b) If a Participant dies after having submitted to the Committee on a form supplied by the Committee a written designation of a beneficiary which (unless such Participant is unmarried at death or unless such Beneficiary is, at the time of death, the spouse of such Participant) is consented to by such Participant's spouse in a writing which (i) acknowledges the effect of such consent, (ii) acknowledges the specific non-spouse beneficiary, and (iii) is witnessed by a notary public, the beneficiary so designated shall be the Beneficiary, entitled to the Participant's Vested Value as set forth in subsection (a).

(c) If a Participant dies without having complied with subsection (b), then for purposes of subsection (a) the Beneficiary shall be the Participant's surviving spouse. If such Participant is not survived by a spouse, then the Participant's children then living shall be equal Beneficiaries. If there are no such living children, then the Beneficiary shall be the estate of the Participant.

11.04 Required Distributions to Certain Participants.

(a) Effective January 1, 1985, distributions will be made in accordance with the Regulations under Section 401(a)(9), including the minimum distribution incidental benefit requirement of Section 401(a)(9)(G) of the Code.

(b) Notwithstanding Section 11.01 or any Participant's consent, distribution shall occur no later than April 1 of the calendar year following the later of: (i) the calendar year in which the Participant attains age 70¹/2 or, if the Participant attains age 70¹/2 after December 31, 1999, and is not, with respect to the Plan Year ending in the calendar year in which he attains age 70¹/2, a Five Percent Owner, (ii) the calendar year in which the Participant retires; provided, however, that:

(1) Any Participant who has not at any time been a Five Percent Owner and who has attained age 70¹/2 before January 1, 1988 may elect to defer distribution of his benefits until his actual retirement, and

(2) Any Participant who attains age 70¹/2 during 1988 shall be treated for purposes of this Section as having attained age 70¹/2 in 1989.

11.05 Proof of Death and Right of Beneficiary. The Committee may require and rely upon such proof of death and such evidence of the right of any Beneficiary to receive the Vested Value of the Accounts of a deceased Participant as the Committee may deem proper, and its determination of death and of the right of such Beneficiary to receive payment shall be conclusive.

ARTICLE XII

ADMINISTRATION OF THE PLAN

12.01 The Board and the Committee.

(a) The Board shall from time to time appoint an Employee Benefit Committee of two or more members (who may, but need not, be members of the Board, officers or individual general partners of the Company or officers of the Managing General Partner of the managing general partner) which shall be responsible for the administration of the Plan. Such members shall serve at the pleasure of the Company. The Committee and the members thereof shall be deemed to be the "named fiduciaries" of the Plan for purposes of Section 402(a) of ERISA.

(b) Any member of the Committee may resign at any time by giving written notice to the other members and to the Secretary of the Company, effective as therein stated. Any member of the Committee employed by a Participating Company who leaves the employ of said Participating Company and who is not thereupon employed by any other Participating Company, shall be deemed to have resigned as a member of the Committee on the date of his termination of employment. Upon the death, resignation, or removal of any member, the Board shall appoint a successor.

12.02 Organization of Committee.

(a) The members of the Committee shall elect from their number a chairman. They shall also elect a secretary who may, but need not, be one of the members of the Committee.

(b) The Committee shall hold meetings upon such notice, and at such place or places and at such intervals as it may from time to time determine.

(c) A majority of the members of the Committee at any time in office shall constitute a quorum for the transaction of business. All resolutions or other actions taken by the Committee shall be by vote of a majority of those present at a meeting of the Committee; or without a meeting by instrument in writing signed by a majority of the members of the Committee.

12.03 Powers and Duties. The Committee shall have full discretionary authority to administer and interpret the Plan, including discretionary authority to determine eligibility for participation and benefits under the Plan. The Committee may, however, delegate such discretionary authority and such duties and responsibilities as it deems appropriate to facilitate the day-to-day administration of the Plan as set forth in Section 12.10. Any determination by the Committee or the Committee's delegate shall be final and conclusive upon all persons. The Committee's duties shall include, but not be limited to, the following:

(a) To make and enforce such rules and regulations as it shall deem necessary or proper for the efficient administration of the Plan and Trust;

(b) To interpret the Plan and to decide any and all matters arising hereunder; including the right to remedy possible ambiguities, inconsistencies or omissions; provided, however, that all such interpretations and decisions shall be applied in a uniform and nondiscriminatory manner to all Employees similarly situated;

(c) To select or establish funds or vehicles for investment of Accounts hereunder and to establish rules for allocations of Accounts among such funds or vehicles;

(d) To compute the Vested Value of an Account which shall be payable to any Participant or Beneficiary in accordance with the provisions of the Plan;

(e) To authorize disbursements from the Trust. Any instructions of the Committee to the Trustee or Insurance Company shall be evidenced in writing and signed by a member of the Committee delegated with such authority by a majority of the Committee; and

(f) To provide for disclosure of all information and filing or provision of all reports and statements to Participants, Beneficiaries, or governmental bodies as shall be required by ERISA or the Code.

12.04 Uniform Administration. Whenever in the administration of the Plan any action is required by the Committee, including, but not limited to, action with respect to valuation, such action shall be uniform in nature as applied to all persons similarly situated and no such action shall be taken which will discriminate in favor of officers, shareholders or highly compensated Participants.

12.05 Benefit Claims Procedures.

(a) All applications for benefits under the Plan (including applications for in-service withdrawals under Article IX) shall be submitted to The Newhall Land and Farming Company, Attention: Employee Benefit Committee, 23823 Valencia Boulevard, Valencia, California 91355. Applications for benefits (including in-service withdrawals) must be in writing on the forms prescribed by the Committee and must be signed by the Participant or, if he is deceased, by his Beneficiary or legal representative.

(b) Each application shall be acted upon and approved or disapproved within sixty (60) days following its receipt by the Committee. In determining whether to approve or deny any application for benefits (including in-service withdrawals), the Committee shall exercise discretionary authority to interpret the Plan and the facts presented with respect to such application. If any application for benefits is denied, in whole or in part, the Committee shall notify the applicant in writing of such denial and of his right to a review by the Committee and shall set forth in a manner calculated to be understood by the applicant, specific reasons for such denial, specific references to pertinent Plan

provisions on which the denial is based, a description of any additional material or information necessary for the applicant to perfect his application, an explanation of why such material or information is necessary, and an explanation of the Plan's review procedure.

(c) Any person whose application for benefits is denied in whole or in part, or his duly authorized representative, may appeal from such denial to the Committee for a review of the decision by submitting to the Committee within sixty (60) days after receiving the written statement described above, a writing:

(1) Requesting a review of his application for benefits by the Committee;

(2) Setting forth all of the grounds upon which his request for review is based and any facts in support thereof; and

(3) Setting forth any issues or comments which the applicant deems relevant to his application.

(d) The Committee shall act upon each such application within sixty (60) days after the later of receipt of the applicant's request for review by the Committee or receipt of any additional materials reasonably requested by the Committee from such applicant.

(e) The Committee shall make a full and fair review of each such application and any written materials submitted by the applicant or the employer in connection therewith and may require the employer or the applicant to submit within thirty (30) days of written notice by the Committee therefor, such additional facts, documents, or other evidence as the Committee, in its sole discretion, deems necessary or advisable in making such review. On the basis of its review and in the exercise of its discretionary authority to interpret the Plan and the facts presented with respect to the request for review, the Committee shall make an independent determination of the applicant's eligibility for benefits under the Plan. The decision of the Committee on any application for benefits shall be final and conclusive upon all persons.

(f) If the Committee denies an application in whole or in part, the Committee shall give written notice of its decision to the applicant setting forth in a manner calculated to be understood by the applicant the specific reasons for such denial and specific references to the pertinent plan provisions on which the Committee decision was based.

12.06 Liability of Committee Members. No member of the Committee will be liable for any act of omission or commission except as expressly provided by ERISA.

12.07 Indemnity. The Committee and the individual members thereof shall be indemnified by the Company against any and all liabilities arising by reason of any act or failure to act made in good faith pursuant to the provisions of the Plan, including expenses reasonably incurred in the defense of any claim relating thereto.

12.08 Reliance on Reports and Certificates. The Committee will be entitled to rely conclusively upon all certificates, opinions and reports which will be furnished by an accountant, controller, counsel or other person who is employed or engaged for such purposes.

12.09 Member's Own Participation. No member of the Committee may act, vote or otherwise influence a decision of the Committee specifically relating to his own participation under the Plan.

12.10 Delegation of Responsibility. The Committee from time to time may allocate to one or more of its members and may delegate to any other persons or organizations any of its rights, powers, duties and responsibilities with respect to the operation and administration of the Plan and may employ, and authorize any person to whom any of its fiduciary responsibility has been delegated to employ, persons to render advice with regard to any fiduciary responsibility held thereunder; provided, however, that: (i) no person shall be employed to exercise discretion with respect to investments except as set forth in Section 7.09; and (ii) the power to select or establish investment funds or vehicles and prescribe rules for allocation of Accounts among such funds or vehicles under Section 12.03(c) shall not be delegated. Any such allocation and delegation shall be reviewed at least annually by the Committee and shall be terminable upon such notice as the Committee, in its sole discretion, deems reasonable and prudent under the circumstances.

12.11 Expenses. Any brokerage commissions, transfer taxes and other charges and expenses in connection with the purchase and sale of securities or other property for a Fund shall be charged to that Fund. Any taxes payable with respect to a Fund shall likewise be charged to that Fund. Any other investment management or trustee expenses associated with the administration of the Plan other than those stated above shall be charged ratably to each Participating Company and shall not be charged to the Trust.

ARTICLE XIII

AMENDMENT AND TERMINATION

13.01 Amendment. The Plan, any Trust Agreement, and any contract described in Section 7.10 may be amended at any time and from time to time by an instrument in writing executed pursuant to authority granted by the Board. Any such amendment shall be effective on the date specified therein without notice to Participants and beneficiaries. Notwithstanding the foregoing, however, no such amendment shall:

(a) Increase the duties or responsibilities of any Trustee or Insurance Company without its consent thereto in writing;

(b) Have the effect of reverting in the Company or any other Affiliated Company the whole or any part of the principal or income of the Trust (except as permitted by Section 5.04) or of diverting any part of the principal or income of the Trust to purposes other than for the exclusive benefit of the Participants or their Beneficiaries;

13.02 Termination. The Plan and Trust hereunder is purely voluntary on the part of the Company and each Participating Company, and the Company and each Participating Company hereby reserves the right in its sole discretion (subject to the consent of the Board) to discontinue its contributions to the Plan or to terminate the Plan, the Trust Agreement, each contract described in Section 7.10, and the Trust hereunder with respect to its Employees. For the purposes of this Section, a partial termination shall be deemed to occur only if an event is determined to be a partial termination within the meaning of Section 411(d)(3)(A) of the Code, where such determination is either (i) made or agreed to by the Committee, or (ii) made by the Internal Revenue Service and approved by a final decision of a court of competent jurisdiction. Upon complete termination or partial termination of the Plan, benefits shall be distributed to such Participants as may be affected, as soon as practicable; provided, however, that no amount in an ESOP Account representing the proceeds of sale of stock of The Newhall Land and Farming Company, a corporation (or of depositary receipts received in exchange for such stock) shall be distributed until permitted under Section 409(d) of the Code.

13.03 Successors. In case of the merger, consolidation, liquidation, dissolution or reorganization of a Participating Company, or the sale by a Participating Company of all or substantially all of its assets, provision may be made in written agreement between the Company and any successor corporation or other entity acquiring or receiving a substantial part of such Participating Company's assets, whereby the Plan, each Trust Agreement and each contract described in Section 7.10 will be continued by the successor. If the Plan is to be continued by the successor, then effective as of the date of the applicable event the successor shall be substituted for the Participating Company under the Plan and the Trust Agreement. The substitution of a successor for a Participating Company shall not constitute a termination of the Plan for any purpose.

13.04 Merger or Transfer of Plan Assets. No merger or consolidation with, or transfer of assets or liabilities of the Plan to, any other plan shall occur unless each Participant in the Plan would, if the Plan terminated immediately after such merger, consolidation, or transfer of assets or liabilities, receive a benefit equal to or greater than the benefit that he would have been entitled to receive immediately before such merger, consolidation or transfer if the Plan had then terminated.

13.05 Effect of Amendments by Participating Companies. Except for technical amendments, an amendment to the Plan shall be binding upon a Participating Company and its employees when approved in writing by the Participating Company.

ARTICLE XIV

MISCELLANEOUS

14.01 Source of Payment. Benefits under the Plan shall be payable only out of the Trust, and no Participating Company shall have any legal obligation, responsibility or liability to make any direct payment of benefits under the Plan. Neither the Participating Companies, the Trustee nor the Insurance Company guarantees the Trust against any loss or depreciation or guarantees the payment of any benefits hereunder. No persons shall have any rights under the Plan with respect to the Trust, or against the Trustee, Insurance Company, Company or any Participating Company, except as specifically provided for herein.

14.02 Inalienability of Benefits.

(a) Subject to subsection (b), benefits under the Plan or from the Trust may not be assigned or hypothecated, and except to the extent required by law, no such benefits shall be subject to legal process or attachment for the payment of any claim against any person entitled to receive the same.

(b) The prohibition set forth in subsection (a) shall apply to the creation, assignment or recognition of a right to any benefit payable with respect to a Participant pursuant to a Domestic Relations Order (as defined in subsection (c)) unless the order is determined to be a Qualified Domestic Relations Order (as defined in subsection (d)). Benefits shall be paid in accordance with the applicable requirements of any Qualified Domestic Relations Order.

(c) For purposes of this Section, the term "Domestic Relations Order" means any judgment, decree or order (including approval of a property settlement agreement) which relates to the provision of child support, alimony payments or marital property rights to a spouse, former spouse, child, or other dependent of a Participant, and is made pursuant to a State domestic relations law (including a community property law).

(d) For purposes of this Section, the term "Qualified Domestic Relations Order" means: (i) a Domestic Relations Order which creates or recognizes the existence of an alternate payee's right, or assigns to an alternate payee the right, to receive all or a portion of the benefits payable with respect to a Participant under the Plan and with respect to which the requirements of Section 206(d)(3) of ERISA are met; or (ii) any other Domestic Relations Order entered prior to January 1, 1985 if:

(I) benefits are being paid by the Plan under such order as of January 1, 1985; or (II) the Committee elects to treat such order as a Qualified Domestic Relations Order.

(e) In the case of any Domestic Relations Order received by the Plan,

(1) The Committee shall promptly notify the Participant and any other alternate payee of the receipt of such order and the procedures for determining the qualified status of Domestic Relations Orders, and

(2) Within a reasonable period after receipt of such order, the Committee shall determine whether such order is a Qualified Domestic Relations Order and notify the Participant and each alternate payee of such determination.

(f) The Committee shall establish reasonable procedures to determine the qualified status of Domestic Relations Orders, to account separately for amounts during such determination, and to administer distributions under such orders.

(g) The prohibition set forth in subsection (a) shall not apply to an offset to a Participant's Account against an amount that the Participant is ordered or required to pay the Plan with respect to a judgment, order or decree issued, or a settlement entered into, on or after August 5, 1997 in accordance with Sections 401(a)(13)(C) and (D) of the Code.

14.03 No Right to Employment. Nothing contained herein nor any action taken under the provisions hereof shall be construed as giving any Employee the right to be retained in the employ of his employer.

14.04 Payments to Minors or Incompetents. If a Participant or Beneficiary entitled to receive payments hereunder is a minor or is deemed by the Committee or is adjudged to be legally incapable of giving valid receipt and discharge for such payments, they will be paid to such persons as the Committee might designate or to the duly appointed guardian or conservator. Any such payment shall be made for the account of such person and shall discharge the Plan of any liability therefor.

14.05 Return of Contributions. This Plan is intended to qualify, and the Trust is intended to be exempt from tax, under the provisions of Section 401(a) and Section 501(a) of the Code, and all contributions hereunder are intended to be deductible under Section 404 of the Code. Therefore, all assets held by the Trustee or held by any Insurance Company must be held for the exclusive benefit of the Participants and their Beneficiaries, and such assets may never revert to or inure to the benefit of a Participating Company except under the conditions set forth in Section 5.04.

14.06 Eligible Rollover Distribution.

(a) This Section applies to distributions made on or after January 1, 1993. Notwithstanding any provision of the Plan to the contrary that would otherwise limit a Distributee's election under this Section, a Distributee may elect, at the time and in the manner prescribed by the Plan Administrator, to have any portion of an Eligible Rollover Distribution paid directly to an Eligible Retirement Plan specified by the Distributee in a Direct Rollover.

(b) For purposes of this Section:

(1) "Eligible Rollover Distribution" means any distribution of all or any portion of the balance to the credit of the Distributee, except that an Eligible Rollover Distribution does not include: any distribution that is one of a series of substantially equal periodic payments (not less frequently than annually) made for the life (or life expectancy) of the Distributee or the joint lives (or joint life expectancies) of the Distributee and the Distributee's designated Beneficiary, or for a specified period of ten years or more; any distribution to the extent such distribution is required under section 401(a)(9) of the Code; the portion of any distribution that is not includable in gross income (determined without regard to the exclusion for net

unrealized appreciation with respect to employer securities); and any hardship withdrawal pursuant to Section 9.02.

(2) Eligible Retirement Plan means an individual retirement account described in Section 408(a) of the Code, an individual retirement annuity described in Section 408(b) of the Code, an annuity plan described in Section 403(a) of the Code, or a qualified trust described in Section 401(a) of the Code, that accepts the Distributee's Eligible Rollover Distribution. However, in the case of an Eligible Rollover Distribution to the surviving spouse, an Eligible Retirement Plan is an individual retirement account or individual retirement annuity, provided, however, that this restriction does not apply to Eligible Rollover Distributions effective January 1, 2002. Effective January 1, 2002, Eligible Retirement Plan also shall include an annuity contract described in Code Section 403(b) and an eligible plan under Code Section 457(b) that is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state, provided the plan agrees to separately account for amounts transferred into such plan from the Plan.

(3) Distributee means an Employee or former Employee. In addition, the Employee's or former Employee's surviving spouse and the Employee's or former Employee's spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in Section 414(p) of the Code, are Distributees with regard to the interest of the spouse or former spouse.

(4) Direct Rollover means a payment by the Plan to the Eligible Retirement Plan specified by the Distributee.

14.07 Applicable Law. The Plan shall be construed, administered and governed in all respects in accordance with ERISA and other pertinent federal laws and in accordance with the laws of the State of California to the extent not preempted by ERISA; provided, however, that if any provision is susceptible of more than one interpretation, such interpretation shall be given thereto as is consistent with the Plan being a qualified employees' pension plan within the meaning of the Code. If any provision of this Plan shall be held by a court of competent jurisdiction to be invalid or unenforceable, the remaining provisions of the Plan shall continue to be fully effective.

14.08 USERRA Compliance. Notwithstanding any provision of this Plan to the contrary, contributions, benefits and service credit with respect to qualified military service shall be provided in accordance with Section 414(u) of the Code.

14.09 Lost Participants. Notwithstanding Section 5.05, if a Plan benefit remains unpaid for five years from the date it becomes payable because the Committee, exercising due diligence, cannot locate the recipient, the benefit will be forfeited and used for other Plan purposes, including reduction of Participating Company contributions to the Plan. On presentation of an authenticated claim, by the recipient or the recipient's representative, amounts forfeited will be restored, without earnings, from a contribution made by the Participating Company designated by the Committee.

ARTICLE XV

TOP-HEAVY RULES

15.01 Definitions. For purposes of this Article XV, the following terms shall have the meanings indicated:

(a) Determination Date shall mean, for any Plan Year, the last day of the preceding Plan Year.

(b) Effective January 1, 2002, Key Employee with respect to a particular Participating Company for a particular Plan Year, shall mean any Participant or former Participant (or the

Beneficiary of a deceased Participant) who at any time during the Plan Year containing the determination date was either:

(1) an officer of such Participating Company or any of its Related Companies having annual Remuneration greater than $130,000 (as adjusted under Code §416(i));

(2) a five percent owner of the Participating Company or any of its Related Companies; or

(3) a one percent owner of the Participating Company or any of its Related Companies having annual Remuneration of more than $150,000 within the meaning of Code §415(c)(3).

The determination of who is a key employee will be made consistent with Code §416(i) and related regulations.

For Plan Years beginning before 2002, the following definition of "Key Employee" applies:

Key Employee with respect to a particular Participating Company for a particular Plan Year, a Participant or former Participant (or the Beneficiary of a deceased Participant) who, at any time during the Plan Year containing the Determination Date for the Plan Year in question or any of the four immediately preceding Plan Years, was:

(1) An officer of such Participating Company or any of its Related Companies having aggregate annual Remuneration from all such entities for a Plan Year greater than one hundred fifty percent (150%) of the maximum dollar limitation in effect under Code Section 415(c)(1)(A) for the calendar year in which such Plan Year ended;

(2) One of the ten employees of such Participating Company or any of its Related Companies owning the largest interests in value of any such entity, provided that: (i) such employee owns more than a one-half percent (¹/2%) interest in such entity; and (ii) such employee's aggregate annual Remuneration from all such entities exceeds the maximum dollar limitation under Section 415(c)(1)(A) of the Code;

(3) A Five-Percent Owner of such Participating Company or any of its Related Companies; or

(4) A One-Percent Owner of such Participating Company or any of its Related Companies whose aggregate annual Remuneration from all such entities exceeds $150,000.

The determination of Key Employee status shall be made pursuant to the following:

(I) For purposes of determining ownership in any entity under this subsection, the attribution principles of Section 318 of the Code shall apply by substituting "5%" for "50%" in Section 318(a)(2)(C).

(II) For purposes of item (I) above, the individuals actually considered as Key Employees with respect to a Participating Company by virtue of being officers: (i) shall not in number exceed the lesser of fifty (50) or that number not in excess of the greater of three (3) officers or ten percent (10%) of the total number of employees of the Participating Company and its Related Companies; and (ii) shall be those individuals belonging to the group of all Participants determined to be officers for the Plan Year containing the Determination Date or any of the preceding four (4) Plan Years, who received the highest annual Remuneration from such entities for any Plan Year during such five (5) year period. Notwithstanding the preceding sentence, no entity other than a corporation shall be deemed to have officers for purposes of clause (1) for any Plan Year beginning before March 1, 1985.

(III) For purposes of item (II) above, should two employees own the same percentage interest in an entity, then the employee having the greater annual Remuneration shall be deemed to own the larger percentage interest.

(c) Top-Heavy Ratio of a plan or group of plans with respect to a particular Participating Company and its Related Companies shall be a fraction, the numerator of which is the sum of: (i) the present value of all cumulative accrued benefits for all Key Employees under this Plan and under each other defined benefit plan included in the determination; and (ii) the account balances for all Key Employees under each defined contribution plan (including any simplified employee pension plan) included in the determination, and the denominator of which is the sum of: (A) the present value of the cumulative accrued benefits for all Participants under this Plan and each other defined benefit plan included in the determination; and (B) the account balances for all Participants under each defined contribution plan (including any simplified employee pension plan) included in the determination, disregarding any accrued benefits or account balances not provided with respect to an Employee of such Participating Company or any of its Related Companies.

In determining the Top-Heavy Ratio with respect to a particular Participating Company, the following rules apply:

(1) In determining the accrued benefits and account balances of a Participant employed by a particular Participating Company, benefits attributable to service with an entity other than such Participating Company or any of its Related Companies (including service with a predecessor employer) shall be excluded.

(2) Present value of accrued benefits shall be calculated in accordance with the provisions of the Plan (or such other defined benefit plan to which such benefits pertain). The value of account balances shall be determined as of the most recent Accounting Date that falls within or ends with the 12-month period ending on the Determination Date. Amounts attributable to employer contributions and employee contributions (other than deductible contributions) shall be taken into account. In the event that two or more plans with different plan years are included in the determination, accrued benefits under such plans shall be aggregated as of the Determination Dates for such plans that fall within the same calendar year. Account balances and accrued benefits so determined shall be adjusted for the amount of any contributions: (i) made after the date of such valuation but on or before the Determination Date; or (ii) due but unpaid as of the Determination Date, and, except as otherwise provided in paragraphs (3) or (4) below, shall include any amount distributed during the 5-year period (1-year period effective January 1, 2002) ending on the Determination Date.

(3) The accrued benefit of any Participant who is not a Key Employee with respect to the Plan Year in question, will be treated as accruing at the slowest rate applicable to any plan maintained by the Participating Company.

(4) With respect to a transfer from one qualified plan to another (by rollover or plan-to-plan transfer) which is: (i) incident to a merger or consolidation of two or more plans or a division of a single plan into two or more plans; (ii) made between two plans maintained by the same employer or by employers required to be aggregated under Section 414(b), (c), or (m) of the Code; or (iii) otherwise not initiated by the employee, a Participant's accrued benefit or account balance under a plan shall include any amount attributable to any such transfer received or accepted by such plan on or before the Determination Date but shall not include any amount transferred by such plan to any other plan in such a transfer on or before the Determination Date. With respect to any rollover or plan-to-plan transfer not described in the preceding sentence, a Participant's accrued benefit or account balance under a plan shall include: (I) any amount distributed or transferred by such plan, unless the distributed or transferred amount is excludable under paragraph (2); and (II) any amount attributable to

assets received in any such transfer accepted prior to January 1, 1984, but such accrued benefit or account balance shall not include any amount attributable to assets received by such plan in any such transfer accepted after December 31, 1983.

(5) No accrued benefit or account balance for any Participant shall be taken into account with respect to: (i) a Participant who is not a Key Employee with respect to the Plan Year in question, but who was a Key Employee with respect to a prior Plan Year; or (ii) for Plan Years commencing after December 31, 1984, an Employee who has not performed services for the Participating Company or any of its Related Companies within the five (5)-year period (one-year period effective January 1, 2002) ending with the Determination Date.

(6) Account shall be taken of any accrued benefit or account balance payable to a beneficiary (or group of beneficiaries) after the death of a Participant by disregarding the death of such Participant.

(d) Required Aggregation Group means a group of two or more plans consisting of: (i) a qualified plan of a Participating Company or any of its Related Companies (including a simplified employee pension plan) in which at least one Key Employee participates (or has participated in the five (5)-year period ending with the Determination Date); and (ii) any other qualified plan or plans which enable the plan described in (i) to meet the requirements of Sections 401(a)(4) or 410 of the Code.

(e) Permissive Aggregation Group means a group of plans consisting of: (i) one or more qualified plans of a Participating Company in which at least one Key Employee participates (or has participated in the five (5)-year period ending with the Determination Date) or one or more Required Aggregation Groups of plans; and (ii) any other qualified plan or plans of the Participating Company or any of its Related Companies which, when considered as a group with the plan or plans specified in (i), would continue to satisfy the requirements of Sections 401(a)(4) and 410 of the Code.

15.02 Top-Heavy Status.

(a) Subject to subsection (b), with respect to a particular Participating Company, this Plan shall be considered "Top-Heavy" with respect to any Plan Year if, as of the Determination Date for such Plan Year, either:

(1) The Top-Heavy Ratio for the Participating Company's portion of this Plan exceeds sixty percent (60%) and the Participating Company's portion of this Plan is not part of any Required Aggregation Group; or

(2) The Participating Company's portion of this Plan is part of a Required Aggregation Group of plans and the Top-Heavy Ratio for the Required Aggregation Group exceeds sixty percent (60%).

(b) Notwithstanding subsection (a), if the Participating Company's portion of this Plan is part of one or more Permissive Aggregation Groups of plans for which the Top-Heavy Ratio does not exceed sixty percent (60%), this Plan shall not be Top-Heavy with respect to such Participating Company.

15.03 Minimum Benefit.

(a) With respect to any Plan Year for which the Plan is Top-Heavy, each Participant who is not a Key Employee, and who has not ceased to be an Employee prior to the end of such Plan Year, shall be entitled to a contribution under this section. No Participant otherwise entitled to an allocation under this subsection shall be ineligible for such allocation solely because he or she has not completed 1,000 Hours of Service for the Plan Year.

(b) Solely for the purposes of this section, years of Cumulative Vesting Service shall not include a particular year of service if: (i) the Plan was not Top-Heavy with respect to such Participating Company for any Plan Year ending during such year of service; or (ii) such year of service was completed in a Plan Year beginning before January 1, 1984.

(c) The benefit of each Participant who meets the requirements of subsection (a), and who does not participate in any defined benefit plan of any Affiliated Company, shall be such Participant's Company Contribution (including forfeitures) under the other provisions of the Plan; provided that the total employer contribution (including forfeitures) allocated to the Account of such Participant shall be not less than an amount which, when added to such Participant's allocable share of employer contributions and forfeitures under any other defined contribution plan of any of the Affiliated Companies, equals at least 4% of his or her Remuneration. The benefit described in this subsection (b) is subject to the following:

(I) In the event that the percentage of employer contributions and forfeitures under the plans in which such Participant participates for the Plan Year on behalf of the Key Employee for whom such percentage is greatest is less than 4% of such Key Employee's Remuneration for the Plan Year, then such Participant shall not be entitled to a contribution under this subsection (b) for the Plan Year in excess of such percentage of such Participant's Remuneration, unless this Plan enables a defined benefit plan included in a Required Aggregation Group with this Plan to satisfy the requirements of Section 401(a) or 410 of the Code (except the average benefits test).

(II) Notwithstanding the preceding paragraph, if the highest rate allocated to a Key Employee is less than 3%, amounts contributed as a result of a salary reduction agreement shall be included when determining contributions made on behalf of Key Employees.

(III) If a Participant also participates in a defined benefit plan of an Affiliated Company, then the minimum contribution requirement of this Section with respect to such Participant shall be fulfilled in accordance with the floor offset approach under which the defined benefit minimum is provided in the Retirement Plan and is offset by the benefits provided under the this Plan.

For Plan Years beginning on and after January 1, 2002, Matching Employer Contributions are taken into account as an employer contribution for purposes of the minimum benefit.

15.04 Earnings Limit. With regard to any Plan Year for which the Plan is Top-Heavy with respect to a particular Participating Company, neither the annual Remuneration nor the annual Earnings of any Participant from such Participating Company and all its Related Companies taken into account for any purpose under the Plan (other than for the purposes of Sections 5.03) shall exceed the limit in effect under Section 401(a)(17) of the Code (as adjusted by the Commissioner for increase in cost of living for such year).

15.05 Limitation on Annual Additions. With regard to any Plan Year for which the Plan would be Top-Heavy with respect to a particular Participating Company if "ninety percent (90%)" were substituted for "sixty percent (60%)" each place it appears in Section 15.02, Section 5.04 shall be modified by substituting "1.0" in place of "1.25" in the definitions of "Defined Contribution Fraction" and "Defined Benefit Fraction" with respect to such Participating Company and its Related Companies, provided that in no event shall the accrued benefit or account balance of any Participant be reduced below the amount of such accrued benefit or account balance immediately before the Plan becomes Top-Heavy with respect to such Participating Company.

ARTICLE XVI

EXECUTION

To record the adoption of this amendment and restatement, Newhall Management Corporation, a California corporation, managing general partner of Newhall Management Limited Partnership, a California limited partnership, managing general partner of The Newhall Land and Farming Company, a California limited partnership, has caused this Plan to be executed on behalf of such partnership by its duly authorized officer this 15th day of October, 2002.

		THE NEWHALL LAND & FARMING COMPANY (A CALIFORNIA LIMITED PARTNERSHIP)

		By:	NEWHALL MANAGEMENT LIMITED PARTNERSHIP, MANAGING GENERAL PARTNER

		By:	NEWHALL MANAGEMENT CORPORATION, MANAGING GENERAL PARTNER

		By	/s/ EDWARD C. GIERMANN
		Its	Secretary and General Counsel