WELCOME TO ! Rev. 06/04

Starting a new job is sometimes unsettling and a little confusing. This employee handbook has been developed to help you get acquainted and answer many of your initial questions. As an employee of Gillies', the importance of your contribution cannot be overstated. Our goal is to provide the finest-quality products and services to customers and to do this more efficiently and economically than our competitors. By satisfying our customers' needs they will continue to do business with us and will recommend us to others. You are an important part of this process for your work directly influences our company's reputation. This employee handbook explains our personnel policies and benefits as well as the specific opportunities and responsibilities that exist for you within our company. In an effort to be responsive to the needs of a growing organization, changes or additions to this handbook will be made when necessary. We will keep you informed when these changes are made. We are glad you have joined us, and we hope you will find your work to be both challenging and rewarding.

Sincerely,

David L. Gillie

President & General Manager

GILLIES' CONEY ISLAND, INC.

6524 N. Dort Hwy.

Mt. Morris MI 48458

810-686-1200

EMPLOYEE HANDBOOK

GILLIES

A WORD ABOUT THIS HANDBOOK...... 1
EQUAL EMPLOYMENT OPPORTUNITY...... 1
A WORD ABOUT OUR EMPLOYEE RELATIONS PHILOSOPHY...... 1
NON-HARASSMENT POLICY...... 2
CATEGORIES OF EMPLOYMENT...... 2
INTRODUCTORY PERIOD...... 2
FULL-TIME EMPLOYEES...... 2
PART-TIME...... 2
SUGGESTIONS AND IDEAS...... 2
TALK TO US...... 2
RECORDING YOUR TIME...... 2
PAYDAY...... 2
METHOD OF COMPENSATION...... 2
PROMOTIONS...... 2
PAY RAISES...... 2
OVERTIME...... 2
CHRISTMAS OBSERVANCE...... 2
LEAVE OF ABSENCE...... 2
MEDICAL INSURANCE...... 2
DISABILITY LEAVE...... 3
WORKERS' COMPENSATION...... 3
SOCIAL SECURITY...... 3
CREDIT UNION...... 3
UNIFORMS...... 3
SECTION 125 PLAN...... 3
NEW EMPLOYEE ORIENTATION...... 3
MEAL TIME...... 3
ATTENDANCE AND PUNCTUALITY...... 3
STANDARDS OF CONDUCT...... 4
CUSTOMER AND PUBLIC RELATIONS...... 4
SOLICITATION AND DISTRIBUTION...... 4
CHANGES IN PERSONAL DATA...... 4
PROTECTING COMPANY INFORMATION....4
CARE OF EQUIPMENT...... 4
NAME TAGS...... 4
SIGNING IN AND OUT...... 4
PERSONAL TELEPHONE CALLS...... 4
DRESS POLICY...... 4
PARKING...... 4
IF YOU MUST LEAVE US...... 4
EACH EMPLOYEE'S RESPONSIBILITY...... 4
GOOD HOUSEKEEPING...... 4
SMOKING IN THE WORKPLACE...... 4
RECEIPT OF EMPLOYEE HANDBOOK...... 5

A WORD ABOUT THIS HANDBOOK

The programs outlined in this booklet are guidelines, which in a developing business will require changing from time to time. The company retains the right to make decisions involving employment as needed in order to conduct its work in a manner that is beneficial to the employees and Gillies'. This employee handbook summarizes the current benefit plans maintained by Gillies'. If any questions arise regarding the interpretation of these plans, the answers will be determined by reference to the actual plan documents and policies rather than the summaries contained in this handbook. The policies contained in this employee handbook are not intended as a contract of employment and may be added to or changed as needed by our company, except that we will not modify our policy of employment-at-will in any case. Our company adheres to the policy of employment-at-will, which enables the company or the employee to terminate the employment relationship at any time for any or no reason.

EQUAL EMPLOYMENT OPPORTUNITY

Our company is committed to the full utilization of all human resources and to a policy of equal employment opportunity. Our company will not discriminate against employees or applicants for employment on any legally recognized basis including, but not limited to, race, age, color, religion, sex, marital status, national origin, handicap/disability or veteran status. You may discuss equal employment opportunity related questions with the president or any other member of management.

A WORD ABOUT OUR EMPLOYEE RELATIONS PHILOSOPHY

We are committed to providing the best possible climate for maximum development and achievement of goals for all employees. Our practice has always been to treat each employee as an individual. We have always sought to develop a spirit of teamwork; individuals working together to attain a common goal. In order to maintain an atmosphere where these goals can be accomplished, we have provided a workplace that is comfortable and progressive. Most importantly, we have a workplace where communications are open and problems can be discussed and resolved in a mutually respectful atmosphere taking into account individual circumstances and the individual employee. We believe the main reason we have been able to adhere to our policy of individual and team recognition is that we have been able to speak directly to each other without the interference of an outside third party, which would have no real stake in the future of our company and our employees. We firmly believe that by our communicating with each other directly, we can continue to resolve any difficulties that may arise and develop a mutually beneficial relationship.

NON-HARASSMENT POLICY

It is our policy to prohibit harassment of one employee by another employee or supervisor on basis of age, race, color, handicap, national origin, religion and/or sex. The purpose of this policy is not to regulate our employees' personal morality. Rather, it is to assure that, in the workplace, no employee harasses another on any of these bases. While it is not easy to define precisely what any of these basis are, they certainly include slurs, epithets, threats, derogatory comments, unwelcome jokes, teasing, sexual advances, requests for sexual favors and other similar verbal or physical contact. Any employee who feels that (s)he is a victim of such harassment should immediately report the matter to the president or any other member of the management. Violations of this policy will not be permitted and may result in discipline up to and including discharge.

CATEGORIES OF EMPLOYMENT:

INTRODUCTORY PERIOD

Full-time and part-time employees are on an introductory period during their first 90 days of employment. During this period of time, you will be able to determine if your new job is suitable for you and your supervisor will have an opportunity to evaluate your work performance.

FULL-TIME EMPLOYEES

Regularly work 32 hours or more each work week and are eligible to apply for our fringe benefits package in accordance with their position and length of employment.

PART-TIME

Work less than 32 hour each week and are eligible for statutory benefits only.

SUGGESTIONS AND IDEAS

We are always interested in your constructive ideas and suggestions for improving our operations. Your suggestions should be submitted to the manager or the president. After your suggestion is investigated, you will be notified whether or not it is feasible to put into practice.

TALK TO US

We encourage you to bring your questions, suggestions and complaints to our attention. Careful consideration is given to each of these in our continuing effort to improve operations. If you feel you have a problem, you should present the situation to the shift supervisor or the manager so that the problem can be settled by examination and discussion of the facts. We hope that (s)he will be able to satisfactorily resolve most matters. If you find that you still have questions after meeting with the shift supervisor or the manager or that you would like further clarification on the matter, you may request a meeting with the president. He will review the issues and meet with you to discuss possible solutions. Your suggestions and comments on any subject are important to us so we encourage you to take every opportunity to discuss them with us. Your job will not be adversely affected in any way because you choose to use this procedure.

RECORDING YOUR TIME

You are required to maintain an accurate record of all time worked. All employees must record their hours on time cards and return them to the time card rack near the office each day. Get supervisors' permission before working hours outside those scheduled, and then get their initials on your time card.

PAYDAY

You will be paid biweekly on Friday for the period that has ended on the previous Saturday. When our payday is a holiday, you normally will be paid on the last working day before the holiday.

METHOD OF COMPENSATION

You have the option of receiving a payroll check or being paid through our direct deposit program. Upon your request, we can direct deposit your pay to any bank on the evening before payday. You still get a stub.

PAY RAISES

Depending upon your performance and our company's profitability, adjustments in your pay may be made when there has been an improvement in or sustaining of an already good performance during the review period. When considering a salary adjustment, the president will evaluate your willingness to work, ability to learn and record of accomplishments.

OVERTIME

There may be times when you will need to work overtime so that we may successfully meet the needs of our customers. All overtime must be approved by the manager in advance. Hourly employees will be paid a rate of time and one-half their regular hourly rate for hours worked over 40 in a week.

CHRISTMAS OBSERVANCE

Our company will be closed on Christmas Day. Employees will receive this time off unpaid.

LEAVE OF ABSENCE

Under special circumstances, an employee with three months of employment may be granted a leave of absence without pay. The granting of this type of leave is normally for compelling reasons to employees in good standing if the business can accommodate such a leave and is dependent upon the advance written approval of the president. Leaves may not exceed 30 days. We will make reasonable efforts to return you to the same or similar job as held prior to the leave of absence, subject to our staffing and business requirements.

MEDICAL INSURANCE

Full-time employees and officers may enroll in either a single or family contract after six months of employment, if accepted by our health insurance carrier. Information and enrollment forms may be obtained from the manager or the president. At present Gillie’s pays most of the cost of a single contract. If you elect dependent coverage, you are responsible for paying the difference through payroll deduction. However, you may pay the premium with your pre-tax earnings. Participating employees are also covered under our medical insurance plan for prescription drugs. Depending upon the circumstances, if you leave our company, you may have the option of continuing your coverage through our plan for a period of 18 months following your termination. To continue on our plan, you would need to pay the premiums plus a small administrative charge in advance each month. For more information on this, please contact the manager or the president.

DISABILITY LEAVE

Full-time employees who have completed six months of employment are eligible for an unpaid disability leave due to illness, injury or pregnancy-related disability for a period not to exceed eight weeks. Please provide the president with written notice of disability, including a doctor's certificate stating the nature of the disability and the expected date of return to work. When you are able to return to work, you should give us at least one week's notice by mail, including a doctor's certificate stating that you are physically able to return your normal duties. WE reserve the right to require a physical examination by a physician of our own choosing prior to your resumption of duties. We will make reasonable efforts to return you to the same similar position as held prior to the disability leave, subject to our staffing and business requirements. Your continued absence from work beyond your disability, as determined by your physician, will be deemed a voluntary termination of your employment.

WORKERS' COMPENSATION

On-the-job injuries are covered by our Workers' Compensation Insurance Policy provided at no cost to you. If you are injured on the job, report the incident immediately to the president. We ask for your assistance in alerting management to any condition, which could lead or contribute to an employee accident. Our designated care provider is McLaren urgent care (after hours for emergencies it is McLaren hospital). Employees MUST go here for care and take an authorization form from a manager in order for care to be covered. If you go elsewhere, or if it is not proven to be a work caused injury, it will not be covered.

SOCIAL SECURITY

Social Security is more than a paycheck deduction. It offers financial security for you and your dependents. Although this is a federally established program, it is your contributions, and ours that pay for this benefit. Both you and the company contribute to provide you with monthly checks and medical coverage once you reach retirement age. These funds are then forwarded to the federal government to support the Social Security Program.

CREDIT UNION

You are eligible to join the Security Federal Credit Union. This union is not-for-profit financial institution owned and operated by its members. Membership privileges include the opportunity of saving at preferential rates, low fees on many services and borrowing funds at low interest rates. Information and enrollment forms may be obtained from the Credit Union. Take proof of employment here such as paycheck stub.

UNIFORMS

The company provides one uniform at the time of hire to qualified employees at no charge. Additional ones may be purchased here for your convenience. Proper care of this uniform is required. All uniforms, accessories or names tags issued by our company must be returned in good condition upon leaving our company.

SECTION 125 PLAN

Our company offers a pre-tax benefit contribution option for employees. This new concept in employee benefit coverages is known as a Section 125 plan. A Section 125 plan is a benefit plan that allows you to make contributions toward certain premiums for medical insurance on a before tax, rather than an after-tax and Social security are calculated. To participate in this plan, you simply need to complete an election form and return it to the manager. Your employer has borne the cost of setting up and administering this program for your benefit. By doing so, you elect to have your gross pay reduced by an amount equal to your cost of medical insurance. Once you have signed the Section 125 card, you may not make any changes to your coverage until the following January 1, unless the change which you elect is a result of a change in family status (such as marriage, divorce, death of a spouse or child, birth or adoption of a child or termination of employment of your spouse). A change in election due to a change in family status will be effective the next pay period.

NEW EMPLOYEE ORIENTATION

Upon joining our company, you will be given a copy of our employee handbook and asked to complete personnel, payroll and benefit forms. Your supervisor is responsible for the operations of your department and (s)he is a good source of information about the company and your job.

MEAL TIME

A 30 minute unpaid meal break should be taken each day by employees who are scheduled to work at least six hours. Your supervisor is responsible for approving the scheduling of this time.

ATTENDANCE AND PUNCTUALITY

Attendance and punctuality are important factors for your success within our company. We work as a team and this requires that each person be in the right place at the right time. If you are going to be late for work or absent, you must notify the manager or your supervisor as soon as you determine that you can not work as scheduled (but under no circumstances less than four hours before the start of your workday.) If not working as scheduled you must have a good reason, which is an emergency and not your fault. If you are absent for two days without notifying a manager or your supervisor, it is assumed that you have voluntarily abandoned your position with the company, and will be removed from the payroll.

STANDARDS OF CONDUCT

Each employee has an obligation to observe and follow the company's policies and to maintain proper standards of conduct at all times. If an individual's behavior interferes with the orderly and efficient operation of a department, corrective disciplinary measures will be taken. Disciplinary action may include a verbal warning, written warning, suspension without pay and discharge. The appropriate disciplinary action imposed will be determined by the company. The company does not guarantee that one form of action will necessarily precede another. The following misconduct may result in discipline up to and including discharge: flagrant misconduct, violation of the company's policies or safety rules, insubordination, poor attendance, possession, use or sale of alcohol or controlled substances on work premises or during working hours, poor performance, theft or dishonesty, physical harassment, sexual harassment or disrespect toward fellow employees, visitors or other members of the public. These examples are not all inclusive. We emphasize that discharge decisions will be based on an assessment of all relevant factors. And that while employees may be disciplined or discharged for the above, that is discretionary with Gillies', and does not