January Uses in No Actual Investment Clause

No Actual Investment from Deferred Compensation Plan

No Actual Investment. Notwithstanding any other Plan provision that may be interpreted to the contrary, the Measurement Funds are to be used for measurement purposes only. Neither a directors election of any Measurement Fund nor the crediting or debiting of amounts to the directors Account in accordance with that election shall be construed as an actual investment of the directors Account in any Measurement Fund. 9. Safeco Stock Ownership Fund (a) Dividends. To the extent cash dividends are paid by the Company on the Common Stock, a directors Account shall be credited with phantom dividends by virtue of his or her allocation, if any, in the Safeco Stock Ownership Fund. The amount of phantom dividends to be credited to a directors account shall equal the product of the dividend paid on a share of Common Stock multiplied by the number of shares of Common Stock deemed to be allocated to a directors Account by virtue of the directors allocation to the Safeco Stock Ownership Fund on the record date for the cash dividend. The number of shares deemed to be allocated to a directors Account shall be determined by dividing the dollar value of the directors Safeco Stock Ownership Fund Units as of the dividend record date by the closing price of a share of Common Stock also as of the dividend record date. Phantom dividends shall be credited to a directors Account in the form of additional Safeco Stock Ownership Fund Units. The number of additional Safeco Stock Ownership Fund Units credited shall be determined based on the closing price of the Safeco Stock Ownership Fund on the dividend payment date. (b) No Actual Shares. No actual shares of Common Stock will be issued directly or indirectly under the Plan in respect of Safeco Stock Ownership Fund Units. (c) No Voting Rights. No voting or other rights of any kind associated with the ownership of Common Stock shall inure to a director by virtue of the directors allocation of all or any part of the directors Account to the Safeco Stock Ownership Fund. 10. Distribution of Deferred Compensation Account (a) General. Except as otherwise expressly provided in this Plan, no withdrawal or payment shall be made from a directors Account except following the first to occur of the directors death, permanent disability, retirement as a director or other termination of service as a director of the Company. Payments shall be made in accordance with paragraphs (b) and (c) of this Section 10 unless the director has filed an election under paragraph (d) of this Section requesting an alternative distribution type and/or time period. All payments shall be made in cash, regardless of the Measurement Funds selected by the director. (b) Retirement and Disability Distributions. If a director terminates service as a director on account of a permanent disability, as determined by the Administrative Committee, or retires as a director of the Company under the Companys retirement policy for directors as then in effect, the balance in the directors Account shall be paid to the director in 10 annual installments, with each installment payable in January as soon as practicable after year-end, commencing the January next following the directors retirement or termination of service. The amount of the installment payable following any given year-end shall be determined by valuing the directors Account as of the close of business on the last business day of the year and then multiplying that value by a fraction, the numerator of which is one and the denominator of which is the remaining number of installment payments. (c) Distributions Following Death and Other Non-Retirement Terminations. If a director dies prior to retirement as a director or terminates service as a director of the Company for any reason besides retirement or a permanent disability, the entire balance of the directors Account shall be paid out in a single lump sum within 30 days after the termination of service or the date the Company is notified, in a form acceptable to the Administrative Committee, of the directors death, as applicable. The value of the directors Account shall be determined as of the date of the directors death or termination of service.