Suhor Industries Employee Handbook Revised June 2004

The first 90 days of employment is considered the probationary period at Suhor Industries. Because Suhor Industries, Inc. and its employees can terminate the employment relationship at will, there is no guarantee that an employee will be employed for the entire probationary period. This explanation of the probationary period will assist your understanding as you read this manual. For purposes of benefits, the effective date for coverage occurs on the 1st day of the next month after completion of the probationary period.

B. Health Insurance

Suhor Industries, Inc. currently provides health insurance to regular full-time employees at a nominal cost. Employees are eligible for coverage after the completion of the probationary period. Dependent coverage is available at an additional cost to employees. Premiums for insurance coverage will be deducted from payroll.

Any questions regarding health insurance coverage can be forwarded to your supervisor or to the Human Resources Department.

Employees and qualified beneficiaries are eligible to continue their health insurance under certain circumstances, and federal law, upon leaving the Company or in taking certain types of leaves from the Company. Details about this are in the health insurance information booklet or you may contact the Human Resources Department for further details.

C. Dental Insurance

Suhor Industries, Inc. currently provides regular full-time employees with dental insurance at nominal cost to eligible employees. Employees are eligible for coverage after completion of the probationary period. Please refer to the dental insurance brochure in order to determine what dental procedures are covered under the plan. Dependent coverage is available at an additional cost to the employee. Premiums for insurance coverage will be deducted from payroll checks.

D. Life Insurance

Suhor Industries, Inc. provides a death benefit for regular full-time employees at no cost after the probationary period. For more information regarding this program, contact the Human Resources Department for further assistance.

Supplemental life insurance for employees and dependents is also available at an additional cost to regular full-time employees. Premiums for coverage will be deducted from payroll check.

E. 401(k) Plan

Suhor Industries, Inc. has a 401(k) Retirement Savings Plan available to all employees who complete their probationary period. The entry dates are January 1st, April 1st, July 1st and October 1st. For additional information concerning the Suhor Industries 401(k) retirement plan, contact your supervisor or the Human Resources Department for a copy of the plan summary document.

F. Flexible Benefit Plan

Suhor Industries, Inc. currently has a Flexible Benefit Plan available to all employees who complete their probationary period. The entry deadline is January 1st of each year. Employees will be sent a Flexible Benefit Form at the end of each year for entrance to the plan or adjustments to contributions.

G. Disability Insurance

A short-term disability policy is included for regular full-time employees. This insurance provides a benefit of $200.00 per week to employees meeting the disability criteria defined as Total Disability.

Total Disability. You, the eligible employee, are totally disabled if you cannot perform the duties of your own occupation or any other work for wage or profit. Two periods of disability are separate if they are separated by return to active work for a period of six consecutive months or they arise from totally unrelated causes.

For more information regarding the disability insurance programs, contact the Human Resources Department for further assistance. When you are off work on short-term disability, it is the employee’s responsibility to make monthly payments to keep their portion of the health, dental and life program current.

H. Holidays

Suhor Industries, Inc. recognizes the following holidays for regular full-time employees:

New Year’s Day Labor Day
Memorial Day Thanksgiving
Independence Day Christmas

In the event a recognized holiday falls on a Saturday or Sunday, the day to be observed will be at the discretion of Suhor Industries, Inc.

Non-exempt employees (i.e. employees entitled to overtime pay) must work the scheduled day before and after the holiday in order to receive pay for the holiday and must have completed the probationary period in order to be eligible for holiday pay.

The employer may choose to designate certain days as extra holidays, for which a personal day will be used.

I. Vacations

Suhor Industries, Inc. provides vacation to allow employees an opportunity to rest and relax.

Regular full-time employees earn vacation time after one (1) year of continuous employment. During the first year of employment, if termination occurs for any reason, no vacation time will be paid.

A two (2) week notice or request for intention to take vacation days must be submitted in writing to the applicable supervisor for approval. All scheduled vacations are approved by the Plant Manager or by the immediate supervisor. They will determine how many employees may be off at one time. The company retains sole discretion for granting vacation schedules. Vacations are calculated on an employment anniversary basis, and are not carried over into the next anniversary year. Unused vacation time will not be converted to pay at year-end.

Vacation days are earned as follows:

After 1 year 40 hours
Years 2 through 9 80 hours
10 years or more 120 hours

If an employee who is voluntarily leaving the Company provides two weeks of advance written notice of the employee’s last day of work, and works all of their scheduled days during that two weeks, the Company may convert that employee’s earned vacation time to pay. The Company reserves the right to hold any vacation pay if there is an outstanding amount due the Company. Vacation time will not be converted to pay for employees who fail to provide two weeks notice before voluntarily leaving the Company.

Part-time, seasonal and temporary employees are not eligible for paid vacation.

At termination, an employee may be asked to repay vacation time that was taken but not earned. It is not policy to pay before earned. Additionally, the Company may credit any vacation time taken but not earned against any amounts that the Company may owe the employee. Firing with cause voids all vacation benefits earned.

If the scheduled vacation must be cancelled at the request of the Company, buy-out of vacation time will be considered at the discretion of the plant manager or your supervisor.

J. Paid Personal Leave

Regular full-time hourly employees who have completed the probationary period are eligible to earn one (1) day of paid personal leave per full three months of employment up to a maximum accrual of 4 days per year up to a maximum accrual of 20 days. Employees must be working full-time during the full quarter in order to earn personal leave. Holiday and vacation time will not be counted against the employee. Personal leave is paid at the employee’s regular rate of pay and will be paid only for time away from work during scheduled work days. This leave is approved at the supervisor’s discretion.

Paid personal leave will not be paid for any day(s) in which an employee is receiving weekly or daily disability benefits under any Worker’s Compensation Insurance Plan or short or long-term disability.

Upon returning to work after being on an extended sick leave (3 or more days), employees are required to provide Suhor Industries, Inc. with a physician’s certificate that states availability to return to normal work activities.

Accrued or unused personal leave is payable to the employee at time of separation from Suhor Industries, Inc. only if two weeks written advance notice is provided and all scheduled days during those weeks are worked. The payout is subject to any deductions that may be appropriate. At termination or retirement, personal leave time will be paid at the current rate of pay based on the following percentages and lengths of service:

Length of Service: Up to 5 years 50% paid
10 years 100% paid

K. Family and Medical Leave Policy

Suhor Industries, Inc. provides unpaid family and medical leaves of absence from work for up to twelve (12) weeks as required by the Family and Medical Leave Act of 1993. However, most Suhor Industries locations fall outside the qualification criteria. Therefore, in most cases this policy will not apply to Suhor Industries employees. Forward all questions to the corporate office.

Employees who are eligible for Family and Medial Leave are expected to comply with all the requirements of this policy. Failure to comply with such requirements or misuse or abuse of the leave policy may result in disciplinary action, up to and including discharge. Exceptions to any provision of this policy may be made only for good cause and must be approved by the Company.

1. Eligible Employee. An employee is eligible for leave if:

a. 12 months of service have been completed; and

b. The employee has worked 1,250 hours in the 12 months prior to the leave request.

2. Leaves may be granted for one of the following reasons:

a. To care for a newborn child of the employee;

b. To care for an adopted or foster child who has been placed with the employee;

c. To care of the employee's spouse, child or parent when said spouse, child or parent has a serious health conditions; or

d. The employee is unable to perform the functions of their job because of their serious health condition.

3. Employees are entitled to the following leave allowance:

a. A maximum of 12 work weeks of leave in any 12-month-period. A 12-month period is defined as beginning on the date an employee goes on a family and/or medical leave. Example: If the leave begins on November 1, 2003, the employee is not entitled to another leave under this policy until November 1, 2004.

b. For the purpose of this policy, the term “work week” means the employee’s average number of credited hours of service during the 12 full payroll weeks immediately preceding the date the leave application is received, up to a maximum of 40 hours per week.

c. If the employee or spouse both work for the Company, they are collectively entitled to take no more than 12 weeks of leave.

4. Leaves are subject to the following scheduling requirements:

a. A leave to care for a newborn child must be taken during the 12-month period beginning on the date of the child’s birth.

b. A leave to care for an adopted or foster child must be taken during the 12-month period beginning on the date the child is placed with the employee.

c. A leave to care for a newborn, adopted or foster child must be taken on a continuous basis unless the Company approves a request by the employee to take an intermittent basis (non-continuous) or reduced leave basis (reduction in the employee’s usual number of hours per work week), in which case the leave must be taken in accordance with the schedule approved by the applicable supervisor.

d. A leave occasioned by the employee’s own serious health condition OR to care for a child, spouse or parent who has a serious health condition.

e. If an intermittent or reduced leave schedule is requested for a purpose as indicated in subparagraph d above and is because of foreseeable and planned medical treatment, the Company may require the employee to temporarily transfer to an available alternative position for which the employee is qualified, provided such position has equivalent pay and benefits and better accommodates recurring periods of absence than the employee’s regular job.

f. If an employee takes a leave on an intermittent or reduced leave schedule basis, the employee leave allowance will only be charged for the actual decrease in the employee’s usual number of hours per work week or hours per workday.

5. While on leave, the employee’s health insurance coverage will continue at the same cost to the employee as was in effect prior to the leave, subject to any subsequent changes in the cost made by the Company for all employees eligible for group coverage.

6. Employees are required to provide Suhor Industries, Inc. with at least 30 days written notice, or as much notice as is practical, for foreseeable leaves for birth, adoption or planned medical treatment. In the case of planned medical treatment, the employee must make a reasonable effort to schedule the treatment so as not to disrupt business operations, subject to the approval of the health care provider.

7. Employees may be required to provide a physician’s certification verifying a serious health condition. The Company may require a second medical opinion at the Company’s cost. In the event that the first two medical opinions are not in agreement, a third medical opinion, approved by the employee and the Company, may be required. These medical opinions will then be binding. Suhor Industries, Inc. will require returning employees to provide certification that they are able to return to work.

8. Suhor Industries, Inc. requires employees to substitute accrued vacation and/or personal leave, if applicable, for any part of the family and medical leave.

9. In the event an employee fails to return to work after the leave, the Company can recover premiums paid to the health care plan by the Company during the leave unless the failure to return to work was because of:

a. The continuance or reoccurrence or beginning of a serious health problem; or

b. Other circumstances beyond the employee’s control.

10. During leave, the employee shall not accrue employment benefits, such as vacation, sick pay, pension, etc. Employment benefits accrued by the employee up to the day on which the leave begins will not be lost.

11. When the leave ends, if the employee has followed all policy as stated above, the employee will be returned to the job position that they held when they went on the leave, or they may be placed in an equivalent position with equivalent pay and benefits.

NOTE: Any employee in the upper 10% of the Company’s salaried work force may be denied the opportunity to be restored to the same or equivalent position after leave if their leave would cause economic hardship to the Company.

L. Military Leave

A military leave of absence will be granted for those employees who volunteer or are called to active duty. Only employees who are regular full-time employees will be covered under this policy.

A military leave will be granted for a period of not more than four (4) years (plus any involuntary extension for not more than one (1) year). Upon satisfactory completion of military service and timely notice of intent to return to work, an employee will be reinstated to a comparable job to the one that the employee left, provided the employee is qualified and the Company’s circumstances have not changed to the extent that it would be unreasonable or impossible to provide re-employment. This re-employment may be available at a different location.

An employee must reapply for a job within 90 days after being released from active duty. Reservists and National Guardsmen returning from initial active duty for training must apply for reinstatement within 31 days after being released from military duty. Employees returning from all other active duty for training must report to work on the first scheduled working day following completion of training.

Normal salary payments will be suspended until such time as the employee returns to the job as a regular full-time employee of the Company. The employee is required to make monthly payments to keep their portion of the health and dental program current.

M. Jury Duty

Serving on a jury is required by law for those selected. Suhor Industries, Inc. believes it is an obligation that should be accepted by each citizen. The Company recognizes this obligation and will permit time off without pay from scheduled hours of work for the time required to meet this obligation. The employee can use personal leave time for time away from work for jury duty. Employees will be expected to provide adequate notice to their supervisors of their scheduled jury duty so that provisions for such absences can be made.

If practical, employees are expected to return to work, even for a short period of time, during the day when they are not actually serving on the jury, or are not required to be in attendance in the courtroom. Documentation must be provided upon return from jury duty.

N. Bereavement Leave

Regular full-time employees can take time off due to the death of an immediate family member. When this occurs, the employee should notify the applicable supervisor immediately. Up to three (3) days of bereavement leave will be provided to eligible employees without pay. However, personal leave time can be used for time away from work. Immediate family, for purposes of this policy, are defined as:

Spouse, child, brother or brother-in-law, sister or sister-in-law, mother or mother-in-law, father or father-in-law, grandparent or grandchild.

O. Worker’s Compensation Insurance

During the time an employee is off work and on worker’s compensation, they shall not accrue employee benefits, i.e., vacation, personal leave days, etc. The employee is required to keep their health and dental program current while off from work on worker’s compensation.

This insurance provides statutory benefits for on-the-job injuries. All employees are covered upon reporting for work and the entire cost of this coverage is paid by the Company.

The benefit provides for disability arising out of and in the course of your employment. The insurer and Suhor Industries work in concert to expedite payment of claims, your full recovery and return to work.

This insurance covers doctor and hospital bills resulting from this type of injury. It is important that you report immediately any injury you receive to your immediate supervisor. It is his responsibility to complete an accident report form and forward it without delay to the Company’s insurance representative. You must keep in touch at all times with your supervisor as to your condition and eligibility for work.

P. Unemployment Insurance

This insurance is provided each employee as required by law, and the cost of this insurance is paid by the Company.

If you are terminated without cause or laid off, you should go to the nearest local office of the Division of Employment Security and register for employment. This division will assist you in filing a claim for State Unemployment Insurance and will determine whether you are eligible for benefits, in what amount, and for how long.

Q. Social Security

Social Security (Federal Old Age Benefit Insurance FICA) is shared jointly by you and the Company on a 50-50 basis. This is the law. The Company matches, dollar for dollar, every contribution you make to this fund.

Your deductions and the Company’s matching money are paid to your own account, and determine the amount of your pension upon reaching retirement age. It is for this reason that the Company is so insistent upon correct Social Security numbers. You may periodically check your account benefits by writing the Social Security Administration.

R. Furnishing of Wilbert Burial Vaults

Since our Company manufactures predominately Wilbert Burial Vaults, it is our policy to furnish a vault to employees at no charge, if within our trade area and, where possible, in coordination with the plant manager and local funeral directors, as follows:

Employees, their spouse, parents of employees and spouses, and dependent children:

0 - 5 years of service Monticello

Over 5 years of service Continental

Any upgrade would be at your expense and would be the difference in the published wholesale price. All employees should coordinate this policy with their plant manager.

S. Furnishing of Wilbert Monuments

Since our company manufactures monuments, it is our policy to furnish a monument to employees as follows:

1. The benefit is available only to current Suhor Industries, Inc. employees, their spouses, parents of employee and spouse, and dependent children.

2. The monument sold to the employee will be coordinated with the producing Plant Manager and the family's funeral director at wholesale price, plus any applicable setting fees, subject to customer approval.

3. If the monument is to be set outside our market area, it will be the employee's responsibility to pick up the monument at the producing plant and have the monument set.

T. Safety Shoes

Manufacturing and delivery personnel are required to wear safety boots on duty. These boots are to be obtained prior to your first day on the job. The Company will reimburse you 50% of the cost up to $40.00 for purchase of these boots. For new employees, reimbursement will be made after completion of the probationary period. This reimbursement is allowed once per year and a receipt must be presented to the supervisor with your request. In the event an employee works in the plant and also provides CSR duties, the employee will be reimbursed for up to two (2) pair of boots.

U. Uniforms

The Company orders uniforms for employees two weeks after date of employment. Upon quitting or discharge from the Company, all uniforms shall be turned in and any shortages will be deducted from the final paycheck. A payroll deduction will be made out of each payroll check for individuals with uniforms. Uniform deposit may be required and held by the Company. Any clothing with commercial logos or slogans of other companies or illustrations should not be visible during the graveside services. These uniforms should not be worn or carried off premises without the approval of an employee's supervisor, unless to be taken home to clean.

COMPANY AND EMPLOYEE RELATIONS

A.Smoking

For health and safety considerations, the Company philosophy discourages smoking. Smoking is prohibited in all company offices.

PER140 Smoking at Company Facilities states:

It is the objective of Suhor Industries to promote a professional, as well as, healthful image to its customers and employees. The issue of smoking at company facilities has been discussed and it has been determined that there will be no smoking allowed in the Retail Monument Shops. This policy/rule is already in effect for offices within the company. Smoking in the shop will be at the discretion of the Plant Manager (except where prohibited by law – New York State).

B. Housekeeping

Suhor Industries, Inc. wishes to maintain a clean working environment for all its employees. Not only does a clean and neat work area contribute to a more pleasant working environment, it also helps to provide a safe work place. All employees are asked to keep their work areas, locker rooms and lunch area as neat, safe and orderly as possible.

Specifically related to the interment process or gravesite set-up, the Customer Service Representative (CSR) should insure that:

1. The truck is neat and clean, parked away from gravesite.

2. Tent is neat and clean.

3. Wilbert Way and lowering device are cleaned, polished and in good repair.

4. Grass is clean and in good repair.

5. Chair covers are clean and dry.

If a concern exists about your equipment, please notify your Supervisor immediately.

C. Telephone Courtesy and Personal Calls

At Suhor Industries, Inc., our business is communications. It is very important that we use the telephone to communicate the best image of ourselves and the Company to our customers.

Our business depends on satisfying the customer. Employees must always be aware that all telephone calls have a potential for increasing or losing business for the Company.

When answering the telephone, it is important to do so in a courteous manner and to make sure that messages are taken correctly even if it means asking the caller to repeat the name, telephone number and message. These messages should be delivered promptly to their intended party.

Suhor Industries, Inc. realizes that personal phone calls are, at times, unavoidable. However, employees are requested to keep such calls to a minimum. It is important that phone lines are kept open for our customers.

The employee is expected to reimburse the company for any long distance charges placed from company phones or cell phones. Misuse may result in disciplinary action including termination.

D. Safety

Suhor Industries, Inc. makes a conscious effort to provide a work environment that is free from recognized hazards, which may cause injury. Employees are encouraged to follow safe working practices and report any unsafe condition(s) to the applicable supervisor for corrective action.

Employees must report any on-the-job injury IMMEDIATELY to the applicable supervisor. This will ensure the injured employee will receive the proper medical attention. Failure to report an on-the-job accident could result in the loss of disability benefits.

Employees who fail to observe safety rules or report on-the-job injuries will be subject to disciplinary action, up to and including discharge from the Company.

It is of the utmost importance that we maintain a safe work place at Suhor Industries. Our employees are our most important asset. Therefore, each of us needs to promote a safe and healthy work environment. To that end Suhor Industries has in place a safety program. Review the current safety program and forward questions to your supervisor.

E. Rules of Conduct

To assure orderly operations and provide the best possible work environment, Suhor Industries expects employees to follow rules of conduct that will protect the interests and safety of all employees and the Company.

It is not possible to list all forms of behavior that are considered unacceptable in the work place. The following are examples of infractions of rules of conduct that shall result in disciplinary action, up to and including discharge from the Company.

1. Theft or inappropriate removal or possession of Company property or other personal property.

2. Falsification of time keeping or other records.

3. Working under the influence of alcohol or illegal drugs.

4. Possession, distribution, sale, transfer or use of alcohol (unless off-duty use is authorized and overseen by management during a company-sponsored event) or illegal drugs in the work place, while on duty, or while operating a Company vehicle.

5. Fighting or threatening violence in the work place.

6. Boisterous or disruptive activity in the work place including horseplay.

7. Negligence or improper conduct leading to damage of employer-owned or customer-owned property.

8. Insubordination or other disrespectful conduct.

9. Violation of safety or health rules.

10. Smoking in prohibited areas.

11. Sexual or other unlawful harassment.

12. Possession of dangerous or unauthorized materials, such as explosives or firearms in the work place.

13. Excessive absenteeism or any absence without notice.

14. Unauthorized absence from the work place during the workday.

15. Unauthorized use of telephones, cell phones, long distance, mail, credit cards or other employer-owned equipment or service.

16. Unauthorized disclosure of business “trade secrets” or confidential information.

17. Violation of personnel policies.

18. Unsatisfactory performance or conduct.

F. Confidentiality of Company Information

It is the responsibility of all Suhor Industries, Inc. employees to safeguard sensitive company information. The nature of our business and the economic well being of our company is dependent upon protecting and maintaining proprietary company information. Sensitive company information includes any information relating to products, processes, know-how, customers, designs, formulas, test data, marketing data, accounting, pricing, salary information, business plans and strategies, negotiations and contracts, inventions and discoveries.

Failure to comply with this policy will result in disciplinary action up to and including discharge from the Company.

G. Disciplinary Actions

When Company policies and rules of conduct are violated, supervisors may find it necessary to take disciplinary action. These actions can include verbal warnings, written warnings, suspension or discharge. When disciplinary action is required, an employee warning notice will ordinarily be filled out by the supervisor, discussed with the employee and submitted to the employee’s permanent record. Although Suhor Industries, Inc. will often attempt to provide employees warnings that their conduct or job performance must be improved, in some situations Suhor Industries, Inc. may, with no warning, dismiss an employee based upon either the belief of Suhor Industries, Inc. that the seriousness of the conduct/performance justified dismissal without a warning, or the belief of Suhor Industries, Inc. that a warning was not likely to remedy the problem.

H. Open Communication

Suhor Industries, Inc. believes in an open communication philosophy. Employees are encouraged to resolve any disagreement or dispute by a discussion with the applicable supervisor. However, if an employee has a complaint or feels fair treatment has not been received, the employee has a recourse beyond discussion with the applicable supervisor. Employees may elect to go to the next level of management, up to and including the President without fear of retaliatory action on the part of Company management.

GENERAL OPERATING POLICIES

A. Equal Employment Opportunity

The Company is an equal opportunity employer. All employees are hired, compensated, promoted, disciplined and evaluated without regard to race, age, religion, sex, national origin, veteran status, color, protected disability or any other protected status. The Company strictly prohibits any and all discrimination and harassment against individuals because of race, age, color, religion, sex, national origin, veteran status or protected disability and any other protected status. It is the responsibility of every supervisor and employee to ensure that discrimination or harassment does not occur in the work place. Any incident of harassment or discrimination must be immediately reported to the Human Resources Director.

B. Americans with Disabilities Act

In July of 1992, the Americans Disabilities Act (ADA) took effect. It is Suhor Industries’ policy to consider all applicants and employees for their ability to perform their job without regard to their physical or mental disabilities. We encourage all applicants and employees to notify management when accommodations are required for an employee to access a work area or to successfully perform the job duties.

C. Privacy Policy

Suhor Industries is committed to keeping all personal information we have about you confidential and secure. The company has security programs that protect data about you from unauthorized use or disclosure. Access to your files is limited to those who need it to administer our business. We collect personal information about you to administer our business, confirm your identity and meet legal requirements.

The information collected may include information from medical sources (i.e. drug screen results, workers compensation doctor’s reports and return to work authorizations from physicians). All of this information is protected by the Health Insurance Portability and Accountability Act (“HIPAA”). The company maintains a specific Plan that is in compliance with the legislation.

As part of your initial employment process, you will be furnished a Notice of Privacy Practices packet. Please take time to review it carefully. You are asked to take a short test, located at the back of the packet, covering the contents of the Plan as part of the required training process. Please sign and date the declaration of receipt of the information at the back of the packet and return it to your manager as it will become a permanent part of your Human Resource file.

D. Conditions of Employment

1. Employment Eligibility Verification. The Immigration Reform and Control Act of 1986 requires completion of Section 1 of the Employment Eligibility Verification Form (Form I-9) at the time of hire. The act also requires all new employees to present, within three (3) business days of hire, documentation indicating identity and authorization to work in the United States. The Act requires an employer to verify such documentation of Form I-9 and retain this verification form for a period as stated by law. All employees, regardless of position held, must complete the I-9 Form and furnish the required documentation within the above stated time frame and the Company must verify the accuracy of their documents on the I-9 form. Failure to complete Section 1 of the I-9 Form at the time of hire or to provide required documentation within three (3) days is grounds for discharge.

2. Employment Drug and Alcohol Screening. After an offer of employment, applicants will be subject to testing for the presence of alcohol, and any unlawful drugs or controlled substances as follows:

Applicants being considered for full-time employment shall undergo employment screening by urinalysis. A confirmed positive result shall be grounds for denying or revoking employment to the applicant.

Suhor Industries, Inc. reserves the right to hire only those individuals who have passed this screening. Testing should be completed prior to time of hire. Retests will only be done upon demand by the applicant, the cost of which will be born by the applicant.

3. Employment Physical. After an offer of employment, applicants will be subject to an employment physical evaluation, which may include back X-rays and/or other tests.

4. Employee Probationary Period. All new employees and re-hired employees are considered to be in a probationary period during the first ninety (90) days of their employment. During that time, employees may not be eligible to participate in certain Company benefit programs. As previously stated, the effective date of coverage occurs on the 1st day of the month following the probationary period. During this probationary period, employment may be terminated, with or without cause, by the employee or the Company.

E. Alcohol and Drug Policy

1. The Company, having a commitment to and an investment in its employees, recognizes that alcohol and drug abuse is one of the major health problems in the United States. Alcohol and drug abuse affects employee health, safety of employees and others, job performance, and the quality of work performed. Because of the Company’s concern for work and public safety and because it

wishes to establish a drug-free work place, the Company has implemented this policy:

· The unauthorized use or possession of alcoholic beverages on Company premises are prohibited.

· The use, manufacture, distribution, dispensing, sale, or possession of illegal drugs or other controlled substances on Company premises is prohibited.

· Having a detectable level of alcohol or any unlawful drugs or controlled substances in your system is prohibited.

· Employees reporting or returning to work who appear to be under the influence of a drug or alcohol will be tested to determine fitness for work.

Employees who violate this policy are subject to disciplinary action up to and including discharge.

2. The Company retains the right to conduct searches of Company property for controlled substances or alcohol. This could include lockers, storage areas, Company vehicles, or rooms to store employee’s personal property. If a Supervisor has a suspicion that an employee possesses alcohol or controlled substances, that Supervisor may require the employee to submit to a search of the employee’s property. Failure to cooperate in such searches may result in notification of local law enforcement and shall be grounds for disciplinary action up to and including discharge.

3. Applicants being considered for employment and existing employees shall be subject to testing for the presence of alcohol, and any unlawful drugs or controlled substances as follows:

Applicants. Applicants being considered for employment shall undergo employment screening by urinalysis. A confirmed positive result shall be grounds for denying or revoking employment to the applicant.

Employees. Testing of employees may be conducted under the following circumstances:

a. If an employee is involved in a work-related accident in which management suspects the worker was guilty of carelessness or negligence. In the case of a work-related vehicular accident, testing will be mandatory.

b. Testing may be conducted in instances that management determines they have reasonable suspicion that an employee is currently under the influence of alcohol, a controlled substance or other drugs. Reasonable suspicion may exist, for example, when the Company has received a report of employee violation of this policy or when a Supervisory employee has observed or received reports concerning the appearance, behavior, speech or body coordination of the employee.

Those observations or reports may include, but are not limited to:

· drinking alcohol or using unlawful drugs or controlled substances

· any on-duty accident or incident which results in personal injury or property damage

· slurred speech

· unsteady gait

· unsafe actions

· odor of alcohol

· inability to perform routine tasks

· disorientation and confusion

· erratic behavior

c. The employer will conduct random testing to endeavor to keep alcohol and drug abuse out of the workplace.

Refusal to submit to a request for testing for the presence of alcohol, drugs and controlled substances or refusal to complete the forms required shall constitute insubordination and be grounds for discharge. Employment shall be suspended until final test results are received from the laboratory.

Initial positive results indicating the presence of drugs shall be confirmed by the legally recognized testing method (GC/MS Gas Chromatography/Mass Spectrometry). Positive test results shall be grounds for discharge.

d. The Department of Transportation has specific regulations regarding drivers with Commercial Drivers License who test positive for illegal drugs. The regulations apply to drivers of trucks with a gross weight of 26,001 pounds or more. Any driver who tests positive for drugs is prohibited from driving a vehicle for the company until after the driver:

· Has been evaluated by a substance abuse professional.

· Has passed a drug test and has complied with other terms and conditions as set out by management.

· Other employee requirements

· Employee will pay for rehab

· Employee will pay for testing

The company will comply with DOT regulations including the following:

? Supervisors must receive training regarding drug abuse so that they may identify individuals who are under the influence of drugs.

? Drivers must be selected at random.

? Tests must be conducted each quarter.

? The total number of random tests each year must equal 50% of the drivers. (Because some drivers may be tested more than once through random selection, it is possible that the number of tests equals 50%, although less than 50% of the individuals were tested.)

? Employees who drive only part time are subject to the testing requirements the same as full time drivers.

? Strict confidentiality restrictions must be followed.

? Before each person is tested, the employee must be notified either in writing or verbally that the test is required by the Department of Transportation and Federal Highway Administration.

Employee's Responsibilities

a. Employees are expected to arrive to work free from the effects of drugs and alcohol. Arrival at work with performance-altering drugs or alcohol in their system is prohibited.

b. Employees are expected to conduct themselves in a legal and lawful manner while employed by Suhor Industries, Inc. Sale, possession, distribution or use of illegal substances on Company business is prohibited.

c. Each employee must agree to abide by this policy and notify the Company of any drug statute conviction no later than five (5) days after conviction.

Company's Responsibilities

a. As part of implementation, Suhor Industries, Inc. will inform its employees of the dangers of drug abuse in the work place.

b. The Company will allow employees who voluntarily come forward to management and admit to an alcohol or substance abuse problem to enter a drug and/or alcohol rehabilitation program. Full-time employees may utilize the benefits for such programs in the Medical Insurance Plan. Suhor Industries, Inc. encourages employees to seek assistance for drug/alcohol problems. Seeking help before the problem becomes a disciplinary issue is beneficial to the employee and the Company. The Company will grant a leave of absence in accordance with the established policies for leaves of absence. The employee will not be subject to disciplinary action, provided they comply with the conditions of the rehabilitation program. Once a violation of the alcohol and drug policy occurs, subsequent use of drug and/or alcohol treatment will not lessen any disciplinary action.

c. The Company will review each violation or suspected violation of this policy and retain the sole right to determine what investigation, actions, and discipline are appropriate.

d. Within thirty (30) days of receiving notice of drug conviction, the Company will review such conviction and impose appropriate discipline up to and including discharge.

F. Sexual Harassment

It is the policy of the Company to maintain a work environment free from sexual harassment, including unwarranted sexual advances, requests for sexual favors, and verbal or physical conduct of a sexual nature.

The Company recognizes that all employees have a right to work in an environment free of all forms of unlawful harassment including sexual harassment. Harassment against an individual on the basis of race, religion, color, national origin, sex, age, or any other classification protected by applicable state or federal employment discrimination laws is in violation of the Company’s policy and will not be tolerated. All employees and supervisors should be aware that the Company is concerned and prepared to take action to prevent and correct such behavior. Suhor Industries, Inc. strongly admonishes all employees to refrain from any type of sexually oriented behavior including overtures, discussions, innuendoes and jokes which may be unwelcome or which otherwise make your co-workers feel uncomfortable. Any such conduct is strictly prohibited.

If anyone has been subjected to, or has become aware of, sexually oriented behavior such as overtures, discussions, innuendoes and jokes which have not been welcome, or which have placed a co-worker in an uncomfortable situation, please immediately bring the incident to the attention of the Human Resources Director, or to any management employee of your choosing. If you do not receive a satisfactory response from the Human Resources Director or the management person whom you choose to contact, you should then refer the matter to the President. Suhor Industries, Inc. encourages you to report any incident of inappropriate conduct. The reporting of such an incident will not in any way harm or adversely affect your employment. We will promptly investigate any reported incident, and, to the extent possible, attempt to maintain as much confidentiality as circumstances permit. All necessary disciplinary and other measures will be taken to prevent the reoccurrence of any verified incident of sexual harassment. While every effort will be made to investigate and resolve sexual harassment complaints lodged in good faith by employees, management prohibits claims that an employee knows are false, spurious, or made with the intent to take revenge against or otherwise harm a fellow employee. Employees who make such accusations knowing that they are not justified by the facts are subject to discipline up to and including discharge. Any questions regarding this policy should be directed to the Human Resources Director.