THE AES CORPORATION
(Effective June 1, 2006)
1.1 Establishment and Purpose .
There is hereby established, effective June 1, 2006, The AES Corporation Severance Plan (the
“Plan”). The purpose of the Plan is to provide eligible employees who are involuntarily terminated from
employment with severance and welfare benefits as set forth in this Plan. This Plan constitutes a welfare plan
under ERISA and will be interpreted in accordance with the terms of ERISA. This Plan supersedes any prior
severance plans, policies, guidelines, arrangements, agreements, letters and/or other communication, whether
formal or informal, written or oral sponsored by the Employer and/or entered into by any representative of the
1.2 Definitions .
Except as may otherwise be specified or as the context may otherwise require, for purposes of
the Plan, the following terms shall have the respective meaning ascribed thereto.
“ Administrator ” means the Health and Welfare Benefits Plan LLC or such other committee or
persons designated by it to assume the duties of the Administrator.
“ Affiliated Employer ” mean any corporation which is a member of a controlled group of
corporations (as defined in Section 414(b) of the Code) which includes the Company; any trade or business
(whether or not incorporated) which is under common control (as defined in Section 414(c) of the Code) with
the Company; any organization (whether or not incorporated) which is a member of an affiliated service group (as
defined in Section 414(m) of the Code) which includes the Company; and any other entity required to be
aggregated with the Company pursuant to regulations under Section 414(o) of the Code.
“ Annual Compensation ” means (i) an Eligible Employee’s annualized base salary as in effect as