As filed with the Securities and Exchange Commission on
September 7, 1999, Registration No. 333-[ ]
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
THE CLOROX COMPANY
(Exact Name of Registrant as Specified in Its Charter)
Delaware 310595760
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
1221 Broadway, Oakland, CA 94612-1888
(Address of Principal Executive Offices) (Zip Code)
SAVINGS PLAN FOR EMPLOYEES OF FIRST BRANDS CORPORATION
AND PARTICIPATING SUBSIDIARIES
(Full Title of the Plans)
G. C. Sullivan
Chairman of the Board and Chief Executive Officer
The Clorox Company
1221 Broadway, Oakland, CA 94612-1888
(Name and Address of Agent For Service)
510/271-7000
(Telephone Number, Including Area Code, of Agent For Service)
Copies to:
Peter D. Bewley, Esq. John W. Campbell, III, Esq.
The Clorox Company Morrison & Foerster LLP
1221 Broadway 425 Market Street
Oakland, California 94612-1888 San Francisco, California
(510) 271-7000 94105-2482
(415) 268-7000
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
Title of Each Class of Amount To Be Proposed Maximum Offering Proposed Maximum Aggregate Amount Of
Securities to be Registered Registered Price Per Unit Offering Price Registration Fee
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
$1.00 par value(1) 100,000 shares $45.1875(2) $4,518,750(2) $1,256.21(3)
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) In addition, pursuant to Rule 416(c) under the
Securities
Act of 1933, this registration statement also covers an
indeterminate
amount of interests to be offered or sold pursuant to the
employee
benefit plans described herein.
(2) Estimated solely for the purpose of calculating the
registration
fee pursuant to Rule 457(h). The fee is calculated on the basis
of
the average of the high and low prices for the Registrant's
Common
Stock reported on the New York Stock Exchange Composite Tape on
September 1, 1999.
(3) All of the 100,000 shares registered hereby were
registered
pursuant to the Registrant's Registration Statement on Form S-4,
No. 333-69455, and are unissued as of the date hereof. A
registration
fee of $452,111 was previously paid with respect to such
securities
and, pursuant to Rule 429 under the Securities Act, the
registration
fee payable hereunder is offset completely by such previously
paid amount.
Pursuant to Rule 429 under the Securities Act, the employee
benefit
plan filed as part of this registration statement relates to the
securities registered hereby, including the common stock
previously
registered by the Registrant under its Registration Statement on
Form S-4, No. 333-69455.
Part I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The documents containing the information concerning the Savings
Plan for Employees of First Brands Corporation and Participating
Subsidiaries, restated January 1, 1997, as amended on February
1,
1999 (the "Plan") of The Clorox Company, a Delaware corporation
(the "Registrant") specified in Item 1 and Item 2 of the this
Part I
has or will be sent or given to employees as specified by Rule
428(b)(1) of the Securities Act of 1933, as amended (the
"Securities Act"). Such documents need not be filed with the
Securities and Exchange Commission ("SEC") either as part of
this Registration Statement or as prospectuses or prospectus
supplements pursuant to Rule 424 of the Securities Act. These
documents and the documents incorporated by reference in this
Registration Statement pursuant to Item 3 of Part II hereof,
taken together, constitute a prospectus that meets the
requirements
of Section 10(a) of the Securities Act.
Part II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference
The Registrant hereby incorporates by reference into this
Registration
Statement the following documents previously filed with the SEC.
(a) The Registrant's latest Annual Report on Form 10K for
the fiscal year ended June 30, 1998, filed with the SEC on
September 28, 1998, pursuant to Section 13(a) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
(b) The Plan's latest Annual Report on Form 11-K for the
fiscal year ended December 31, 1998, filed with the SEC on
July 12, 1999, pursuant to Section 15(d) of the Exchange Act.
(c) The Registrant's Quarterly Report on Form 10Q for
the fiscal quarter ended September 30, 1998, filed with the
SEC on November 12, 1998, pursuant to Section 13(a) of the
Exchange Act.
(d) The Registrant's Quarterly Report on Form 10-Q for
the fiscal quarter ended December 31, 1998, filed with the
SEC on February 12, 1999, pursuant to Section 13(a) of the
Exchange Act.
(e) The Registrant's Quarterly Report on Form 10-Q for
the fiscal quarter ended March 31, 1999, filed with the SEC
on May 14, 1999, pursuant to Section 13(a) of the Exchange
Act.
(f) The description of the Registrant's Common Stock
which is contained in its Registration Statement on Form 8-A,
No. 001-07151, filed with the SEC on October 20, 1987,
including any amendment or report filed for the purpose of
updating such description.
All reports and definitive proxy or information statements
filed by the Registrant or the Plan pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the
date of this Registration Statement and prior to the filing
of a post-effective amendment which indicates that all
securities offered hereby have been sold or which deregisters
all securities then remaining unsold shall be deemed to be
incorporated by reference into this Registration Statement
and to be a part hereof from the date of filing of such
documents.
Any statement contained in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Registration
Statement to the extent that a statement contained herein
or in any subsequently filed document which also is deemed
to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified
or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Registration Statement.
Item 4. Description of Securities
Not Applicable.
Item 5. Interests of Named Experts and Counsel
Not Applicable.
Item 6. Indemnification of Director and Officers
Section 145(a) of the Delaware General Corporation Law (the
"DGCL")
provides in relevant part that "a corporation may indemnify
any person who was or is a party or is threatened to be made
a party to any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of
the corporation), by reason of the fact that he is or was
a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments,
fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best
interest of the corporation, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe
his conduct was unlawful." With respect to derivative
actions, Section 145(b) of the DGCL provides in relevant
part that "[a] corporation may indemnify any person who
was or is a party or is threatened to be made a party to
any threatened, pending or completed action or suit by or
in the right of the corporation to procure a judgment in
its favor. . . . [by reason of his service in one of the
capacities specified in the preceding sentence] against
expenses (including attorneys' fees) actually and reasonably
incurred by him in connection with the defense or settlement
of such action or suit if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the
best interest of the corporation and except that no
indemnification shall be made in respect of any claim,
issue or matter as to which such person shall have been
adjudged to be liable to the corporation unless and only
to the extent that the Court of Chancery or the court in
which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses
which the Court of Chancery or such other court shall deem
proper."
The Registrant's Restated Certificate of Incorporation
provides that the Registrant is required to indemnify to
the full extent permitted by the DGCL any person made, or
threatened to be made, a party to an action or proceeding,
whether criminal, civil, administrative or investigative,
by reason of the fact that the person, or the testator or
intestate of such person, is or was a director or officer
of the Registrant, or served any business as a director or
officer at the request of the Registrant. Expenses incurred
by a director of the Registrant in defending a civil or
criminal action, suit or proceeding by reason of the fact
that such person was a director of the Registrant (and not
in any other capacity, including if such person was serving
at the Registrant's request as a director or officer of
another enterprise or corporation) will be paid by the
Registrant in advance of the final disposition of such
action, suit or proceeding upon receipt of an undertaking
by or on behalf of such director to repay such amount if
it shall ultimately be determined that such person is not
entitled to be indemnified by the Registrant as authorized
by relevant sections of the DGCL. The Registrant will
indemnify officers or directors in connection with a proceeding
initiated by them only if such proceeding was authorized by
the Registrant's Board of Directors. Any person who is not
paid pursuant to the foregoing indemnification provisions 90
days after submitting a written claim to the Registrant may
sue to recover such unpaid amounts and, if successful, will
be entitled to be paid the expense of prosecuting such claim
(except for any such claims as the Registrant is not permitted
by law to indemnify, although the burden of proving such
defense will be on the Registrant).
Such Restated Certificate of Incorporation also provides that
no director will be liable to the Registrant for a breach of
fiduciary duty, except (1) for any breach of the director's
duty of loyalty to the Registrant or its stockholders, (2) for
acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of the law, (3) under Section
174 of the DGCL, or (4) for any transaction from which the
director derived an improper personal benefit. The Registrant
may also maintain insurance at its expense, to protect itself
and any director or officer of the Registrant or of another
corporation or other enterprise against any expense, liability
or loss, whether or not the Registrant would have the power
to indemnify such person against such expense, liability or
loss under the DGCL.
The Registrant has purchased and maintains insurance on behalf
of any person who is or was a director or officer against loss
arising from any claim asserted against him and incurred by
him in any such capacity, subject to certain exclusions.
See also the undertakings set out in response to Item 9
herein.
Item 7. Exemption from Registration Claimed
Not Applicable.
Item 8. Exhibits
(a) Exhibit List
Exhibit No. Description
4.1 Restated Certificate of Incorporation of the
Registrant (incorporated by reference to
Exhibit 4.1 to the Registrant's Registration
Statement on Form S-8 (Commission File No.
333-44695)
dated January 22, 1998).
4.2 Restated Bylaws of the Registrant
(incorporated
by reference to Exhibit 3(ii) to the
Registrant's
Annual Report on Form 10-K for the fiscal year
ended June 30, 1998).
4.3 Savings Plan for Employees of First Brands
Corporation and Participating Subsidiaries,
restated January 1, 1997.
4.4 Amendment and Restatement to the Savings Plan
for Employees of First Brands Corporation and
its Participating Subsidiaries.
23.1 Consent of Deloitte & Touche LLP.
23.2 Consent of KPMG LLP, independent public
accountants.
24.1 Powers of Attorney.
(b) Undertaking
First Brands Corporation has submitted the Plan and the
Registrant will submit the amendment[s] thereto to the Internal
Revenue Service ("IRS") in a timely manner and will make all
changes required by the IRS in order to qualify the Plan
under Section 401(a) of the Internal Revenue Code of 1986,
as amended.
Item 9. Undertakings
A. The undersigned Registrant hereby undertakes: (1) to
file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement
(i) to include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933, as amended (the "1933 Act"), (ii)
to reflect in the prospectus any facts or events arising after
the effective date of this Registration Statement (or the most
recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the
information set forth in this Registration Statement, and
(iii) to include any material information with respect to the
plan of distribution not previously disclosed in this
Registration Statement or any material change to such
information in this Registration Statement, provided, however,
that clauses (1)(i) and (1)(ii) shall not apply if the
information required to be included in a post-effective
amendment by those paragraphs is contained in periodic
reports filed by the Registrant pursuant to Section 13 or
Section 15(d) of the Exchange Act that are incorporated by
reference into this Registration Statement; (2) that for the
purpose of determining any liability under the 1933 Act, each
such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered
therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof;
and (3) to remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
B. The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the 1933 Act,
each filing of the Registrant's and the Plan's annual report
pursuant to Section 13(a) or Section 15(d) of the Exchange
Act that is incorporated by reference into this Registration
Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising
under the 1933 Act may be permitted to directors, officers or
controlling persons of the Registrant pursuant to the
indemnity provisions summarized in Item 6 above or otherwise,
the Registrant has been advised that in the opinion of the
SEC such indemnification is against public policy as expressed
in the 1933 Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or
controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy
as expressed in the 1933 Act and will be governed by the final
adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on
Form S8 and has duly caused this Registration Statement to
be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Oakland, State of California, on
September 7, 1999.
THE CLOROX COMPANY
By:
Peter D. Bewley
Senior Vice President-General Counsel and Secretary
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person
whose signature appears below constitutes and appoints,
severally and not jointly, Karen M. Rose and Peter D. Bewley,
with full power to act alone, as his or her true and
lawful attorney-in-fact, with the power of substitution,
for and in such person's name, place and stead, in any
and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration
Statement, and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto each
said attorney-in-fact full power and authority to do and
perform each and every act and thing requisite and necessary
to be done as fully to all intents and purposes as he or she
might or could do in person, hereby ratifying and confirming
all that each said attorney-in-fact may lawfully do or
cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following
persons in the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title
Date
- --------------------- ---------------------------
- -------------
<S> <C>
<C>
/s/ G. C. Sullivan
G. C. Sullivan Chairman of the Board and
September 7, 1999
Chief Executive Officer
/s/ D. Boggan, Jr.
D. Boggan, Jr. Director
September 7, 1999
/s/ J. W. Collins
J. W. Collins Director
September 7, 1999
/s/ U. Fairchild
U. Fairchild Director
September 7, 1999
/s/ T. M. Friedman
T. M. Friedman Director
September 7, 1999
J. Manchot Director
September 7, 1999
/s/ R. W. Matschullat
R W. Matschullat Director
September 7, 1999
/s/ D. O. Morton
D. O. Morton Director
September 7, 1999
/s/ K. Morwind
K. Morwind Director
September 7, 1999
/s/ E. L. Scarff
E. L. Scarff Director
September 7, 1999
/s/ L. R. Scott
L. R. Scott Director
September 7, 1999
/s/ C. A. Wolfe
C. A. Wolfe Director
September 7, 1999
/s/ K. M. Rose
K. M. Rose Group Vice President - Finance
September 7, 1999
and Chief Financial Officer
(Principal Financial Officer)
/s/ H. J. Salvo, Jr.
H. J. Salvo, Jr. Vice President-Controller
September 7, 1999
(Principal Accounting Officer)
</TABLE>
Pursuant to the requirements of the Securities Act of 1933,
the trustee (or other person who administers the Plan) has
duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in
the City of Oakland, State of California, on September 7, 1999.
SAVINGS PLAN FOR EMPLOYEES OF FIRST BRANDS CORPORATION AND
PARTICIPATING SUBSIDIARIES
By: /s/ Peter D. Bewley
Name: Peter D. Bewley
Title: Secretary/Senior Vice President, First
Brands Corporation
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this
Registration
Statement of The Clorox Company on Form S-8 of our report dated
August 30, 1998, appearing in and incorporated by reference in
the
Annual Report on Form 10-K of The Clorox Company for the year
ended June 30, 1998, and of our report dated June 25, 1999
appearing
in and incorporated by reference in the Annual Report on Form
11-K
of The Savings Plan for Employees of First Brands Corporation and
Participating Subsidiaries for the year ended December 31, 1998.
/s/ DELOITTE & TOUCHE LLP
DELOITTE & TOUCHE LLP
Oakland, California
September 3, 1999
CONSENT OF INDEPENDENT AUDITORS
We consent to incorporation by reference in the
registration statement on Form S-8 of The Clorox Company
of our report dated June 4, 1998, relating to the statements
of net assets available for plan benefits of the Savings Plan
for Employees of First Brands Corporation and Participating
Subsidiaries as of December 31, 1997 and 1996 and the related
statements of changes in net assets available for plan benefits
for the years then ended, and the related supplemental schedules
of investments as of December 31, 1997 and 5% reportable
transactions for the year ended December 31, 1997, which report
appears in the December 31, 1997 annual report of the Savings
Plan for Employees of First Brands Corporation and Participating
Subsidiaries on Form 11-K.
/s/ KPMG LLP
New York, New York
September 7, 1999
THE SAVINGS PLAN FOR EMPLOYEES OF FIRST BRANDS CORPORATION
AND ITS PARTICIPATING SUBSIDIARIES
Effective July 1, 1989
Restated January 1, 1997
ARTICLE I
DEFINITIONS
Page
1.1 "Accounts" or "Account" 2
1.2 "Actual Deferral Percentage" 2
1.3 "Affiliate" 2
1.4 "Alternate Payee" 2
1.5 "Basic Contribution" 3
1.6 "Before Tax Contribution" 3
1.7 "Beneficiary" 3
1.8 "Code" 3
1.9 "Committee" 3
1.10 "Company" 3
1.11 "Company Contribution" 3
1.12 "Company Service Credit" 3
1.13 "Compensation" 3
1.14 "Contribution Percentage" 5
1.15 "Credited Service" 5
1.16 "Disability" 5
1.17 "Domestic Relations Order" 6
1.18 "Earnings" 6
1.19 "Eligible Employee" 8
1.20 "Employee" 8
1.21 "Employer" 8
1.22 "ERISA" 8
1.23 "Excess Aggregate Contributions" 8
1.24 "Excess Contributions" 8
1.25 "Excess Deferral Amount" 8
1.26 "Highly Compensated Participant" 9
1.27 "Key Employee" 9
1.28 "Normal Retirement Date" 10
1.29 "Participant" 10
1.30 "Plan" 10
1.31 "Plan Year" 11
1.32 "Qualified Domestic Relations Order" 11
1.33 "Subsidiary" 11
1.34 "Supplemental Contribution" 11
1.35 "Tax Preferred Account" 11
1.36 "Termination of Employment" 11
1.37 "Trust Agreement" 11
1.38 "Trust Fund" 11
1.39 "Trustee" 11
1.40 "Valuation Date" 12
ARTICLE II
PARTICIPATION, CONTRIBUTIONS AND VESTING
2.1 Participation 13
2.2 Exclusions 13
2.3 Participant Contributions 14
2.4 Company Contributions 15
2.5 Supplemental Contributions 15
2.6 Rollovers 16
2.7 Revocation of Compensation Reduction 17
ARTICLE III
INVESTMENT AND VALUATION OF TAX DEFERRED ACCOUNTS
3.1 General 18
3.2 Investment Options 18
3.3 Investment Manager 18
3.4 Temporary Investment 18
3.5 Change of Investments 19
3.6 Instructions By a Participant 19
3.7 Valuation of Accounts 20
3.8 Statements Furnished Participants 21
ARTICLE IV
DISTRIBUTIONS, WITHDRAWALS AND LOANS
4.1 Distribution on Termination of Employment 22
4.2 Rehire Prior to Distribution 26
4.3 Commencement of Benefits 26
4.4 Withdrawal by Participant During Employment 26
4.5 Withdrawal From Standard Investment Account 28
4.6 Loans 29
4.7 Repayment 30
ARTICLE V
LIMITATION ON MAXIMUM CONTRIBUTIONS AND BENEFITS
UNDER ALL PLANS
5.1 General 32
5.2 Affiliate 32
5.3 Limitation Year 32
5.4 Annual Additions 32
5.5 Limits on Before Tax Contributions 33
5.6 Limits on Contributions to
Standard Investment Account 38
5.7 Distribution of Excess Deferrals 41
5.8 Distribution of Excess Contributions 41
5.9 Distribution of Excess Aggregate Contributions 42
5.10 Defined Benefit and Defined Contribution Plans 44
5.11 Aggregation of Defined Contribution Plans 44
5.12 Defined Contribution Plan Limitation 44
5.13 Defined Contribution Plan Fraction
Determination 44
5.14 Defined Benefit Plan Fraction Determination 45
5.15 Combined Limitation 45
5.16 Alternative Method 46
5.17 Participation in Multiple Plans 46
5.18 Notice of Reduction 47
ARTICLE VI
TOP-HEAVY RULES
6.1 Top-Heavy Plan 48
6.2 Minimum Contributions for Non-Key Employees 50
6.3 Vesting 51
6.4 Reduction in Combined Limitation 51
6.5 Coordination With Other Plans 51
6.6 Automatic Removal 51
ARTICLE VII
TRUST
7.1 Trustee 52
7.2 Trust Expenses 52
ARTICLE VIII
ADMINISTRATION
8.1 Administrative Committee 53
8.2 Limitation of Liability; Indemnity 53
8.3 Compensation and Expenses 54
8.4 Voting, Chairmen, Subcommittees 54
8.5 Payment of Benefits 55
8.6 Powers and Authority; Action Conclusive 55
8.7 Counsel and Agents 57
8.8 Reliance on Information 57
8.9 Fiduciaries 57
8.10 Plan Administrator 59
8.11 Notices and Elections 59
8.12 Taxes Payable by Trustee 59
8.13 Credited Service 59
8.14 Company Service Credit 61
ARTICLE IX
AMENDMENT, TERMINATION, ADOPTION AND MERGER
9.1 Modification or Amendment of Plan 63
9.2 Termination of Plan or Discontinuance
of Contributions 63
9.3 Expenses of Termination 64
9.4 Amendments Required for Qualification 64
9.5 Adoption of Plan by Employers 64
9.6 Discontinuance of Participation 66
9.7 Merger 67
ARTICLE X
MISCELLANEOUS
10.1 Claims Procedure 68
10.2 Plan Not an Employment Contract 68
10.3 Consent to Terms of Plan and Trust Agreement 69
10.4 Transfer of Interest Not Permitted 69
10.5 Obligations of Employers Limited 70
10.6 Separation of Invalid Provisions 70
10.7 Payment to a Minor or Incompetent 70
10.8 Doubt as to Right to Payment 71
10.9 Forfeiture Upon Inability to Locate
Distributee 71
10.10 Contributions Conditioned on Deductibility 72
10.11 No Diversion of Trust Fund 72
10.12 Usage 73
10.13 Governing Law 73
10.14 Captions 73
THE SAVINGS PLAN FOR EMPLOYEES OF FIRST BRANDS CORPORATION
AND PARTICIPATING SUBSIDIARIES
INTRODUCTION
This Plan is established by First Brands Corporation,
a Delaware corporation, for the exclusive benefit of its
eligible employees and their beneficiaries and the eligible
employees and their beneficiaries of any company, partnership
or other entity adopting this Plan. Participation in this
Plan by employees is entirely voluntary. The Plan has also
been referred to as the "FIRST Plan" in the Summary Plan
Description and other Plan literature distributed to C
ompany Employees.
ARTICLE I DEFINITIONS
As used in this Plan, the following terms shall have
the designated meaning:
1.1. "Accounts" or "Account" shall mean the Tax
Preferred Account and the Standard Investment Account.
1.2. "Actual Deferral Percentage" shall mean, with
respect to a specified group of Eligible Employees, the
average of the ratios, calculated separately for each
Eligible Employee in that group, of
(a) the amount of Before Tax Contributions
for a Plan Year to
(b) the Employee's Compensation for that Plan Year.
For purposes of determining the Actual Deferral
Percentage; the data for the non-highly compensated
employees shall be derived from the Plan Year preceding
the Plan Year for which the test is being determined,
unless the Committee elects to use the current Plan Year.
1.3 "Affiliate" shall mean, except as otherwise
provided in Article V, each of (a) any corporation (other
than an Employer) of which at least 80% of the total
combined voting power of all classes of stock entitled to
vote is owned at the time of reference, either directly or
indirectly, by the Company; (b) any other trade or business
(other than an Employer), whether or not incorporated,
which, at the time of reference, is controlled by or under
common control with an Employer, within the meaning of
section 414(C) of the Code; or (c) any member (other than
an Employer), at the time of reference, of an affiliated
service group within the meaning of section 414(m) of the
Code, which includes an Employer.
1.4 "Alternate Payee" shall mean any spouse,
former spouse, child or other dependent of a Participant
who is recognized by a Domestic Relations Order as having
a right to receive all, or a portion of, the benefits payable
under the Plan with respect to such Participant.
1.5 "Basic Contribution" shall mean a contribution
made to a Participant's Standard Investment Account pursuant
to Section 2.3 of this Plan.
1.6 "Before Tax Contribution" shall mean a contribution
to a Participant's Tax Preferred Account made pursuant to
Section 2.3 of this Plan.
1.7 "Beneficiary" shall mean the person, persons
or estate entitled under Section 4.1.3 to receive any amount
under this Plan in the event of a Participant's death.
1.8 "Code" shall mean the Internal Revenue Code of
1986, as from time to time amended. Reference to a specific
provision of the Code shall include such provision, any
valid regulation promulgated thereunder and any comparable
provision of future legislation that amends, supplements or
supersedes such provision.
1.9 "Committee" shall mean the Administrative
Committee provided for in Article VIII of this Plan.
1.10 "Company" shall mean First Brands Corporation,
a Delaware corporation, and any successor thereof by merger,
consolidation or otherwise.
1.11 "Company Contribution" shall mean a contribution
to a Participant's Tax Preferred Account or Standard
Investment Account made pursuant to Section 2.4 of this Plan.
1.12 "Company Service Credit" shall mean the period
of service determined under Section 8.14 of this Plan.
1.13 "Compensation" shall mean a Participant's
regular, basic hourly rate of pay or salary for his/her
regularly scheduled hours, determined prior to any reduction in
such hourly rate of pay or salary for Before Tax Contributions,
Basic Contributions, or Supplementary Contributions to this
Plan. For purposes of this Plan, a Participant's regular, basic
hourly rate of pay or salary shall include any shift premium
paid to such Participant and shall include sales bonuses,
and sales commissions if authorized by the Committee.
Compensation, for purposes of this Plan, shall be limited
to a maximum of $200,000, as adjusted by the Secretary of
the Treasury or his delegate at the same time and in the same
manner as under section 415(d) of the Internal Revenue Code.
If the $200,000 limitation (as adjusted) is exceeded due to
the application of this rule, then such limitation shall be
prorated among the affected individual's Compensation as
determined without regard to this limitation. The dollar
increase in effect on January 1 of any calendar year shall
be effective for the Plan Year beginning with or within such
calendar year and the first adjustment to the $200,000
limitation shall be effective on January 1, 1990. For any
short Plan Year the annual compensation limit shall be an
amount equal to the annual compensation limit for the calendar
year in which the Plan Year begins multiplied by the ratio
obtained by dividing the number of full months in the short
Plan Year by twelve (12).
In addition to other applicable limitations set forth in the
Plan, and notwithstanding any other provision of the Plan to
the contrary, for Plan Years beginning on or after January 1,
1994, the Compensation of each Employee taken into account
under the Plan shall not exceed the Omnibus Budget
Reconciliation
Act of 1993 (OBRA '93) annual compensation limit. The
OBRA '93 annual compensation limit is $150,000, as adjusted
by the Commissioner of the Internal Revenue Service for
increases in the cost of living in accordance with
section 401(a)(17)(B) of the Code. The cost-of-living
adjustment in effect for a calendar year applies to any
period, not exceeding 12 months, over which Compensation
is determined (determination period) beginning in such
calendar year. If a determination period consists of
fewer than 12 months, the OBRA '93 annual compensation
limit will be multiplied by a fraction, the numerator of
which is the number of months in the determination period,
and the denominator of which is 12.
For Plan Years beginning on or after January 1, 1994,
any reference in this Plan to the limitation under
section 401(a)(17) of the Code shall mean the OBRA '93
annual compensation limit set forth in this provision.
If Compensation for any prior determination period is
taken into account in determining an Employee's benefits
accruing in the current Plan Year, the Compensation for that
prior determination period is subject to the OBRA '93 annual
compensation limit in effect for that prior determination
period. For this purpose, for determination periods
beginning before the first day of the first Plan Year
beginning on or after January 1, 1994, the OBRA '93 annual
compensation limit is $150,000.
1.14 "Contribution Percentage" means, with respect
to a specified group of Eligible Employees, the average of
the ratios, calculated separately for each Eligible Employee
in that group, of:
(a) the amount of Basic Contributions and Company
Contributions for a Plan Year to
(b) the Eligible Employee's Compensation for
that Plan Year.
1.15 "Credited Service" shall mean the period of
service credited to an Employee for purposes of determining
his/her share of Company Contributions made pursuant to
Section 2.4 of the Plan and his/her eligibility to participate
in this Plan, as determined under Section 8.13 of this Plan.
1.16 "Disability" shall mean a Participant's total
physical or mental inability to perform any work for
compensation or profit in any occupation for which he/she
is reasonably qualified by reason of training, education
or ability, and which is adjudged to be permanent, as
determined by the Committee on the basis of medical evidence
satisfactory to it.
1.17 "Domestic Relations Order" shall mean any
judgment, decree, or order (including approval of a
property Settlement agreement) which is (a) related 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 (b) made pursuant
to a state domestic relations law (including a community
property law).
1.18 "Earnings" for any Limitation Year means
total compensation actually paid or made available by the
Company and its Affiliates for such year, including, but
not limited to, bonuses, income from sources without the
United States whether or not excludable for federal income
tax purposes, amounts related to the value of property
transferred in connection with the performance of services
which are includable for federal income tax purposes under
Code section 83(b), and taxable income attributable to
employer-provided life insurance. Earnings shall not
include deferred compensation (other than payments under
an unfunded plan that are Currently includable in income),
amounts realized from the exercise of a non-qualified stock
option or a stock appreciation right, exercise payments
under a stock option plan, amounts contributed on behalf
of a Participant to a plan which meets the requirements of
Code sections 401(a) and 401(k), or other distributions which
receive special tax benefits. Compensation, for purposes of
this Plan, shall be limited to a maximum of $200,000, as
adjusted by the Secretary of the Treasury or his delegate at
the same time and in the same manner as under section 415(d)
of the Internal Revenue Code. In determining the Compensation
of a Participant for purposes of this limitation, the rules
of Code section 414(q)(6) shall apply, except that in applying
such rules the "family" shall only include the spouse and
lineal descendants of the Participant that have not attained
age 19 before the close of the year. If the $200,000 limitation
(as adjusted) is exceeded due to the application of this rule,
then such limitation shall be prorated among the affected
individual's Compensation as determined without regard to this
limitation. The dollar increase in effect on January 1 of any
calendar year shall be effective for the Plan Year beginning
with or within such calendar year and the first adjustment to
the $200,000 limitation shall be effective on January 1, 1990.
For any short Plan Year the annual compensation limit shall
be an amount equal to the annual compensation limit for the
calendar year in which the Plan Year begins multiplied by
the ratio obtained by dividing the number of full months
in the short Plan Year by twelve (12).
In addition to other applicable limitations set forth in
the Plan, and notwithstanding any other provision of the
Plan to the contrary, for Plan Years beginning on or
after January 1, 1994, the Compensation of each Employee
taken into account under the Plan shall not exceed the
OBRA '93 annual compensation limit. The OBRA '93 annual
compensation limit is $150,000, as adjusted by the
Commissioner for increases in the cost of living in
accordance with section 401(a)(17)(B) of the Code. The
cost-of-living adjustment in effect for a calendar year
applies to any period, not exceeding 12 months, over which
Compensation is determined (determination period)
beginning in such calendar year. If a determination
period consists of fewer than 12 months, the OBRA '93
annual compensation limit will be multiplied by a fraction,
the numerator of which is the number of months in the
determination period, and the denominator of which is 12.
For Plan Years beginning on or after January 1, 1994, any
reference in this Plan to the limitation under
section 401(a)(17) of the Code shall mean the OBRA '93
annual compensation limit set forth in this provision.
If Compensation for any prior determination period is
taken into account in determining an Employee's benefits
accruing in the current Plan Year, the Compensation for
that prior determination period is subject to the OBRA '93
annual compensation limit in effect for that prior
determination period. For this purpose, for determination
periods beginning before the first day of the first Plan
Year beginning on or after January 1, 1994, the OBRA '93
annual compensation limit is $150,000.
1.19 "Eligible Employee" shall mean any Employee,
other than an Employee who is a member of a class of
Employees excluded from coverage under this Plan pursuant
to Section 2.2, if such individual is compensated on an
hourly, salaried or commission basis.
1.20 "Employee" shall mean any individual who,
under the rules applicable in determining the employer-employee
relationship for purposes of section 3121 of the Code,
has the status of an employee of an Employer or an Affiliate;
and any officer of an Employer or an Affiliate.
1.21 "Employer" shall mean (a) the Company, and
(b) any other Subsidiary which has adopted this Plan in
accordance with Section 9.5.
1.22 "ERISA" shall mean the Employee Retirement
Income Security Act of 1974, as from time to time amended.
Reference to a specific provision of ERISA shall include
such provision, any valid regulation promulgated thereunder
and any comparable provision of future legislation that
amends, supplements or supersedes such provision.
1.23 "Excess Aggregate Contributions" shall mean
the amount described in Section 401(m)(6)(B) of the Code.
1.24 "Excess Contributions" shall mean the amount
described in Section 401(k)(8)(B) of the Code.
1.25 "Excess Deferral Amount" shall mean the
amount of Before Tax Contributions for a calendar year
that the Participant allocates to this plan pursuant to
the procedure set forth in Section 5.7.
1.26 "Highly Compensated Participant" means an
Employee who:
(a) at any time during the Plan Year, or the
preceding Plan Year, was a five-percent owner of the
outstanding stock of the Employer or stock possessing
more than five (5) percent of the total combined voting
power of all stock of one Employer; or
(b) for the preceding year:
(i) earned more than $80,000 (as adjusted
by the Secretary of the Treasury at the same time and the
same manner as under section 415(d) of the Code) in
compensation (within the meaning of Code section 415(c)(3))
from the Employer; and
(ii) if the Employer elects the application
of this subsection, was a member of the top-paid group of
Employees (within the meaning of Sections 414(q)((3) and (5).
1.27 "Key Employee" shall mean any Employee or
former Employee (and beneficiaries of such employee) of
the Employer who, at any time during the Plan Year including the
Determination Date or during any of the four (4) preceding Plan
Years, is or was:
(a) an officer of the Employer or an Affiliate,
but in no event shall more than fifty (50) employees (or if
lesser, the greater of three (3) employees or ten (10)
percent of the employees), be treated as officers. For
purposes of this subsection (i) an officer shall not
include an employee having an annual compensation less
than or equal to 50% of the amount in effect under
section 415(b)(1)(A) of the Code for the Plan Year;
(b) one of the ten (10) employees having annual
compensation from the Employer or an Affiliate of more than
the limitation in effect under section 415(c)(1)(A) of the
Code for the calendar year in which the Plan Year ends who
owns (or is considered as owning in accordance with
applicable regulations of the Secretary of the Treasury)
both more than one-half percent interest and the largest
stock interests in the Employer. For purposes of this
subsection (b), if two (2) employees have the same interest
in the Employer or Affiliate, the employee having the
greater annual compensation from the Employer or Affiliate
shall be treated as having the larger interest;
(c) any employee who owns (or is considered as
owning) more than five (5) percent of the outstanding
stock of the Employer or Affiliate or stock possessing
more than five (5) percent of the total combined voting
power of all stock of the Employer or Affiliate; or
(d) any employee who owns (or is considered
as owning) more than one (1) percent of the outstanding
stock of the Employer or Affiliate or stock possessing
more than one (1) percent of the total combined voting
power of all stock of the Employer or Affiliate and
receives compensation of more than $150,000.
For purposes of determining percentage ownership under this
section, employers that would otherwise be aggregated under
sections 414(b), (c) and (m) of the Code shall be treated
as separate employers; however for purposes of determining
compensation under this section, compensation required to
be aggregated under such section shall be taken into
account. Further, for purposes of this section, "compensation"
shall mean compensation as reported on the individual's
Form W-2 for the calendar year that ends with or within
the applicable Plan Year.
1.28 "Normal Retirement Date" shall mean a
Participant's 65th birthday.
1.29 "Participant" shall mean an Eligible
Employee who becomes a Participant in this Plan pursuant to
Section 2.1.
1.30 "Plan" shall mean The Savings Plan for
Employees of First Brands Corporation and Participating
Subsidiaries, as from time to time in effect.
1.31 "Plan Year" shall mean the twelve-month
period starting January 1 and ending December 31.
1.32 "Qualified Domestic Relations Order" shall mean
a qualified domestic relations order as defined in Code section
414(p).
1.33 "Subsidiary" shall mean (a) any Affiliate
and (b) any other corporation, partnership or other entity,
other than an Employer, 20% or more of which is owned at the
time of reference, either directly or indirectly, by the Company.
1.34 "Supplemental Contribution" shall mean a
contribution made to a Participant's Standard Investment Account
or Tax Preferred Account pursuant to Section 2.5 of this Plan.
1.35 "Tax Preferred Account" shall mean an account
established pursuant to Article III of this Plan.
1.36 "Termination of Employment" and similar
references shall mean a Participant's ceasing to be employed
by an Employer or a Subsidiary for any reason. A transfer
between employment by an Employer and employment by a
Subsidiary, between employment by Employers or Subsidiaries,
or between employment compensated on a salaried basis and
employment compensated on an hourly basis shall not
constitute a termination of employment.
1.37 "Trust Agreement" shall mean the agreement
between the Company and the Trustee under which this Plan
is funded, as such agreement may be amended from time to
time.
1.38 "Trust Fund" shall mean the fund created
by the Trust Agreement.
1.39 "Trustee" shall mean the trustee or trustees
from time to time designated under the Trust Agreement.
1.40 "Valuation Date" shall mean each December 31st,
and any other date as of which the Committee, in its sole
discretion, determines the value of all or any portion of
the Trust Fund or determines the Actual Deferral Percentage
of any Employee or any group of Employees.
ARTICLE II
PARTICIPATION, CONTRIBUTIONS AND VESTING
2.1 Participation. An Eligible Employee shall become
a Participant in this Plan upon the earlier of:
(a) his/her authorizing his/her Employer to
deduct from his/her Compensation for each pay period an
amount determined in accordance with Section 2.3 or
Section 2.5; or
(b) the transfer of his/her entire account
under any other plan maintained by an Employer or a
Subsidiary which meets the requirements of sections 401(a)
and 401(k) of the Code to the Trustee for his/her Tax
Preferred Account or Standard Investment Account pursuant
to Section 2.6.
An Eligible Employee shall cease to be a Participant
in this Plan upon the complete distribution to him/her
of his/her Tax Preferred Account and Standard Investment
Account.
2.2 Exclusions. (a) The following employees
are not within the coverage of the Plan:
(i) Individuals who perform services for an Employer
as leased employees. For purposes of this Section 2.2(a)(i)
the term "leased employee" shall mean any individual who:
(1) is not an employee of the Employer and who
provides services to Employer;
(2) provides services pursuant to an agreement
between an Employer and any other person or entity (hereinafter
referred to as "the leasing organization");
(3) has performed such services for an Employer
on a substantially full-time basis for a period of at least one
year; and
4) such services are performed under primary
direction
or control by the Employer.
(ii) Individuals (if any) who are considered by an
Employer to be independent contractors and employees of such
independent contractors, but who may be determined for any
other purpose to be employees of an Employer. The
characterization by an Employer on its books and records of
the relationship of the individual and an Employer shall be
conclusive of the individual's status for purposes of this Plan.
(b) The Committee reserves the right to exclude
from coverage as an Eligible Employee any class or classes of
Employees, provided that any such exclusion does not
discriminate in favor of Employees who are shareholders,
officers, or highly compensated, as determined in accordance
with Code section 4l0.
2.3 Participant Contributions.
2.3.1 A Participant may authorize his/her
Employer to deduct contributions from his/her Compensation.
The deduction from Compensation authorized by a Participant
shall range from 1% to 6%, inclusive, of his/her Compensation,
in multiples of 1%.
2.3.2 A Participant shall designate the
portions of his/her contribution which shall be pre-tax
("Before Tax Contribution") and post-tax ("Basic Contribution");
provided that each such designation must consist of a
multiple of 1% of the Participant's Compensation.
2.3.3 Within the limits of this Article II and
Article V, a Participant may, at any time, increase or
decrease the amount to be deducted from his/her Compensation
for subsequent pay periods.
2.4. Company Contributions.
2.4.1 At the time Before Tax Contributions are
paid to the Trustee on behalf of a Participant, the
Participant's
Employer shall pay to the Trustee as Company Contributions
for such Participant an amount equal to fifty percent (50%)
of the Before Tax Contributions paid to the Trustee on
behalf of such Participant, but in no event shall the Company
Contribution hereunder exceed three percent (3%) of the
Participant's Compensation.
2.4.2 Company may contribute to the Trust as
Company Contributions such amounts as it may determine from
time to time. Such amounts shall be allocated among all
Participants who (i) have earned a year of Credited Service
for the fiscal year on account of which any such contribution
is made; and (ii) shall not have suffered a Termination of
Service prior to the date the contribution is made. Such
contributions shall be allocated among qualifying Participants
in proportion to their respective Credited Service.
Notwithstanding anything contained herein to the contrary,
the amounts so contributed (i) shall be fully vested; (ii)
may not be distributed to any Participant prior to a
Participant's Termination of Service; (iii) shall be permanently
invested in the shares of the Company; and (iv) shall not be
subject to the provisions of Section 4.6.1.
2.5 Supplemental Contributions.
2.5.1 Subject to the terms of Article V,
Participants who have authorized the maximum allowable
deduction from Compensation for Before Tax Contributions
and Basic Contributions may authorize additional deductions
from their Compensation. Deductions for Supplemental
Contributions shall range from 1% of the Participant's
Compensation to 10% of the Participant's Compensation, in
multiples of 1%. The Committee may suspend the right to
authorize Supplemental Contributions, and may raise or reduce
the limit or Supplemental Contributions (within the limits of
Articles II and V) at any time.
2.5.2 A Participant shall designate the portions
of his/her Supplemental Contribution which shall be pre-tax
("Before Tax Contribution") and post-tax ("Basic Contribution");
provided that each such designation must consist of a
multiple of 1% of the Participant's Compensation.
2.5.3 Within the limits of Article II and
Article V, a Participant may, at any time, increase or decrease
the amount to be deducted from his/her Compensation for
Supplemental Contributions.
2.5.4 Supplemental Contributions shall not be
taken into consideration in determining the Company Contribution
to be allocated to any Participant.
2.6 Rollovers.
2.6.1 An Employee who has received a distribution of
his entire interest in another plan which meets the
requirements of section 401(a) of the Code (the "Other Plan")
may, in accordance with procedures approved by the Committee,
transfer any part of the distribution received from the Other
Plan to the Trustee, provided the transfer qualifies as a
rollover under section 402(a)(5) of the Code.
2.6.2 The distributee of an eligible rollover distribution
within the meaning of section 402(c)(4) of the Code made on
or after January 1, 1993 may elect to have such distribution
paid directly to an eligible retirement plan within the
meaning of section 401(a)(31)(D) of the Code provided the
eligible retirement plan to which the distribution is to be
directly transferred is specified. The Committee shall,
within a reasonable period of time before making an eligible
rollover distribution within the meaning of the Code
section 402(c)(4) to a Participant, provide a written notice
as prescribed by section 402(f) of the Code to such Participant.
Such Notice shall describe the conditions under which the
Participant may have the distribution directly transferred
to an eligible retirement plan, and the withholding rules if
the distribution is not directly transferred to an eligible
retirement plan. Such notice shall also describe the conditions
under which the distribution will not be subject to tax if
transferred to an eligible retirement plan within 60 days after
the date on which the Participant received the distribution.
The Committee shall also notify the Participant of the
Participant's eligibility for any favorable tax treatment.
2.6.3 The Committee shall develop such procedures,
and may require the furnishing of such information, as it
deems necessary or desirable to determine that the proposed
transfer will meet the foregoing requirements. Upon approval
by the Committee, any amounts transferred shall be credited
to a special Rollover Account.
2.7 Revocation of Compensation Reduction.
2.7.1 A Participant may revoke his/her authorization
for a deduction from his/her Compensation for Before Tax
Contributions, Basic Contributions, and Supplemental
Contributions in a time and manner authorized by the
Committee. If a Participant revokes his/her authorization
for a deduction of his/her Compensation for Before Tax
Contributions or Basic Contributions, the related Company
Contributions will be suspended.
2.7.2 Authorizations for a deduction from
a Participant's Compensation for Before Tax Contributions,
Basic Contributions, and Supplemental Contributions which
a Participant has revoked may be reinstated by the
Participant in a time and manner authorized by the Committee.
If a Participant reinstates the authorization for a
deduction in his/her Compensation for Before Tax
Contributions or Basic Contributions, the related
Company Contributions will be resumed.
ARTICLE III
INVESTMENT AND VALUATION OF TAX DEFERRED ACCOUNTS
3.1 General. Before Tax Contributions, related
Company Contributions, and Supplemental Contributions
authorized by a Participant (and designated as Before Tax
Contributions) shall be paid to the Trustee and held in
the Trust Fund in a Tax Preferred Account established for
such Participant. Basic Contributions, related Company
Contributions, and Supplemental Contributions authorized
by a Participant (and designated as Basic Contributions)
shall be paid to the Trustee and held in the Trust Fund
in a Standard Investment Account established for such
Participant. Within the Tax Preferred Account and
Standard Investment Account of each Participant there
shall be created sub-accounts (the "Tax Preferred Subaccount
and the "Standard Investment Subaccount") to which shall be
credited Company Contributions allocable to the respective
Account, which subaccounts shall be appropriately adjusted
pursuant to the terms of Section 3.13.
3.2 Investment Options. Each Participant shall
direct that contributions to his/her Tax Preferred Account
and Standard Investment Account be invested in one or more
of the investment options designated by the Committee from
time to time, in multiples of 1 percent.
3.3 Investment Manager. The Administrators, or such
of them to whom such power may be allocated, may appoint an
investment manager or managers, as defined in section 3(38)
of ERISA, to manage (including the power to acquire, invest
and dispose of) any assets of the Plan.
3.4 Temporary Investment. Notwithstanding anything
to the contrary in this Section 3.2 of Article III, any monies
allocated to any Fund may be invested temporarily in
obligations of a short-term nature, including prime commercial
obligations or part interests therein, or in interests in any
trust fund that has been or shall be created and maintained
by the Trustee or any other person or entity as trustee for
the collective short-term investment of funds of trusts for
employee benefit plans qualified under Code section 401(a).
Any such earnings paid or accrued shall be applied towards
the payment of cost and expenses of administering the Trust
Fund as set forth in Section 7.2 of Article VII of the Plan.
However, nothing in this Article III shall prevent the Trustee
from holding any cash in the Trust Fund pending its investment
without obligation to credit interest thereon.
3.5 Change of Investments. Subject to the other
provisions of this Article III:
3.5.1 A Participant may at any time change his/her
investment options currently in effect with respect to
subsequent Before Tax Contributions, Basic Contributions,
related Company Contributions and Supplemental Contributions
made to his/her Tax Preferred Account and Standard Investment
Account, subject to the percentage limitations of Section 3.2
of this Plan, by providing written notification on forms
provided therefor. Any change will be effective in accordance
with the Rules of the Committee then pertaining.
3.5.2 A Participant may elect to redeem his/her
interest, in whole or in part, in any investment option, and
reinvest the proceeds therefrom in any other investment option,
subject to the percentage limitations of Section 3.2 of this
Plan. Any election to redeem an investment option will be in
accordance with the Rules of the Committee then pertaining.
3.6 Instructions By a Participant. A Participant
shall give orders for the investment, reinvestment, sale or
redemption of his/her Accounts, subject to the provisions of
this Article III, in accordance with rules and regulations
adopted by the Committee.
3.7 Valuation of Accounts 3.7.1 On any
Valuation Date the unit values of the investment options shall
be equal to the total value of such fund, as determined
pursuant to Section 3.7.2, divided by the number of units in
such fund outstanding on such Valuation Date.
3.7.2 On any Valuation Date, the stock funds
shall be valued at their fair market value on such Valuation
Date, fixed income funds shall be valued at book value plus
accrued interest at the stated rate to such Valuation Date,
and bond funds shall be valued at book value plus accrued
interest to such Valuation Date, determined according to
tables issued by the United States Department of the Treasury,
if applicable.
3.7.3 On any Valuation Date, prior to the
date on which a Participant has been credited with two
years of Credited Service a Participant's interest in the
Trust Fund shall be equal to the value of his/her Tax
Preferred Account and Standard Investment Account
(determined without reference to the balances in any
Subaccount maintained therein). On any Valuation Date
after a Participant has been credited with at least two
years of Credited Service, a Participant's vested interest
in the trust fund shall be equal to the value of his/her
Tax Preferred Account and Standard Investment Account
including the balances in all Subaccounts. The value of a
Participant's Accounts on any Valuation Date shall equal
the greater of zero or the value of his/her Accounts as of
the preceding Valuation Date, increased by:
(a) all Before Tax Contributions, Basic
Contributions, related Company Contributions and Supplemental
Contributions allocated to such account since the preceding
Valuation Date; and
(b) any income and gains (realized and
unrealized) since the preceding Valuation Date on investment
options allocated to his/her Account; and decreased by:
(c) any losses (realized and unrealized) since
the preceding Valuation Date on allocated to his/her Account;
(d) the amount of any distributions to such
Participant under Section 4.1 and withdrawals by such
Participant
under Section 4.4 since the preceding Valuation Date; and
(e) any expenses, taxes or other amounts charged
to the Trust Fund since the preceding Valuation Date pursuant
to Sections 7.2, 8.3, 8.7, 8.12 and 9.3 of this Plan and
allocated to his/her Account.
3.8 Statements Furnished Participants. A Participant
shall be furnished a statement of his/her Accounts by the
Company at such times as the Committee shall determine, but
no less frequently than annually.
ARTICLE IV
DISTRIBUTIONS, WITHDRAWALS AND LOANS
4.1 Distribution on Termination of Employment.
4.1.1 Termination Other Than Death. Unless the
Participant makes an election under Section 4.1.2 of this Plan,
a Participant whose employment terminates (i) for any reason
(including termination on account of Disability) other than
death and who has completed two years of Credited Service; or
(ii) on or after his Normal Retirement Date shall receive the
entire value of his/her Tax Preferred Account and Standard
Investment Account, valued as of the last Valuation Date
preceding his/her termination, in a single-sum payment. A
Participant who has not completed at least two years of
Credited Service shall receive the value of his/her Tax
Preferred Account (exclusive of the value of his/her Tax
Preferred Subaccount) and his/her Standard Investment
Account (exclusive of the value of his/her Standard Investment
Subaccount). Subject to Section 4.3, the payment shall be
made to the Participant as soon as his/her employment
terminates as the Committee shall determine to be
administratively practicable. The value of a Participant's
Tax preferred Subaccount and the value of his/her Standard
Investment Account forfeited shall be used to reduce the
Company contributions under Section 2.4.
4.1.2 Election of Deferred Single-Sum Payment.
Upon prior written notice to the Committee, given in a
time and manner determined by the Committee, a Participant
who has completed three years of Credited Service and whose
employment terminates for any reason (including termination
on account of Disability) other than death, and whose
Accounts exceed (or have at the time of any prior distribution
exceeded) $3,500 or such higher amount as provided by law from
time to time, may elect to receive the amount payable hereunder
to him/her in a single-sum payment on any date following his/her
termination of employment; provided, however, that such date
shall not be later than his/her 65th birthday (unless
termination is by reason of retirement on or after attaining
his/her Normal Retirement Date, in which case the date shall
not be later than attaining age 70-1/2). A Participant who
makes an election to defer receipt of his/her benefit under
this Section 4.1.2 may change his/her Investment Options
during such deferral period in accordance with the terms of
the Plan. If a Participant who makes an election under this
Section 4.1.2 dies after his/her termination of employment
but prior to the date he/she elected to receive the amount
payable hereunder, the election made under this Section 4.1.2
shall be disregarded, the Participant shall be deemed to
have terminated his/her employment on account of death and
the amount payable hereunder, valued as of the last Valuation
Date preceding the Participant's death, shall be paid to
his/her Beneficiary in accordance with Section 4.1.3.
4.1.3 Termination on Death. If a Participant's
employment terminates on account of the Participant's death,
the value of the Participant's Accounts, valued as of the
last Valuation Date preceding the Participant's death, shall
be paid in a lump sum to the Participant's surviving spouse,
unless the Participant has selected a Beneficiary or
Beneficiaries in such manner as the Committee shall require
and such spouse has consented to the designation of the
Beneficiary or Beneficiaries. No consent under this
Section 4.1.3 shall be effective unless either (i) such
consent is in writing, cannot be changed without spousal
consent or the consent of the spouse expressly permits
designations by the Participant without the requirement of
further consent by the spouse, the terms of such consent
acknowledge its effect, the execution of such consent is
witnessed by a person representing the Plan or a notary
public, as the Committee may determine, and such consent
otherwise complies with such rules as the Committee may
adopt; or, (ii) it is established to the satisfaction of
the Committee that the required consent cannot be obtained
because the Participant does not have a spouse, because
the spouse cannot be located, or because of such other
circumstances as the Secretary of the Treasury may prescribe
by regulations. Any consent by a spouse (or establishment
that the consent of a spouse cannot be obtained) shall only
be effective with respect to such spouse.
If a Participant's spouse has consented to a designation of
a Participant's Beneficiary or Beneficiaries and either
(a) the Participant has not effectively designated a
Beneficiary; or (b) the Beneficiary designated has not
survived the Participant and no alternative designation
of Beneficiary shall be effective, then the Participant's
Beneficiary shall be the estate of the deceased Participant.
If the Participant's surviving spouse or Beneficiary cannot
be located for a period of one year following death, despite
mailing to his/her last known address, and if such surviving
spouse or Beneficiary has not made a written claim for
benefits within such period to the Committee, such surviving
spouse or Beneficiary shall be treated as having predeceased
the Participant. The Committee may require such proof of
death and such evidence of the right of any person to receive
all or part of the benefit of a deceased Participant as the
Committee may deem desirable. Subject to Section 4.3, the
lump sum payment shall be made to the Participant's surviving
spouse or Beneficiary as soon after the Participant's death
as the Committee shall determine to be administratively
practicable.
4.1.4 Form of Payment. All payments made
under this Section 4.1 shall be made entirely in cash, unless
the Participant or the Beneficiary, as the case may be,
elects to receive any whole shares of First Brands Corporation
stock in his/her Tax Preferred Account or Standard Investment
Account in lieu of the cash value of such stock.
4.1.5 Cash-Out. Notwithstanding anything
herein to the contrary, if the value of the Participant's
Accounts exceeds (or at the time of any prior distribution
exceeded) $3,500, no distribution may be made to the
Participant prior to his/her Normal Retirement Date without
the approval of the Participant. For purposes of this
paragraph, a Participant's Accounts shall not include
accumulated deductible employee contributions, within the
meaning of Code Section 72(o)(5)(B), for Plan Years
beginning prior to January 1, 1987.
4.1.6 Amendment of Vesting Schedule. If the
Plan's vesting schedule is amended, or the Plan is amended
in any way that directly or indirectly affects the
computation of the Participant's nonforfeitable percentage,
or if the Plan is deemed amended by an automatic change to
or from a top-heavy vesting schedule, each Participant with
at least three (3) Years of Credited Service may elect,
within a reasonable period after the adoption of the amendment
or change, to have the nonforfeitable percentage computed
under the Plan without regard to such amendment or change.
For Participants who do not have at least one (1) hour of
service in any Plan Year beginning after December 31, 1988,
the preceding sentence shall be applied by substituting
"5 years of service" for "3 years of service" where such
language appears. If the vesting schedule of the Plan is
amended, in the case of an employee who is a Participant as
of the later of the date the amendment is adopted or the date
the amendment is effective, the Participant's nonforfeitable
percentage under this Plan (as of such date) will not be less
than his nonforfeitable percentage under the Plan prior to
such amendment.
The period during which the election may be made shall
commence with the date the amendment is adopted or deemed to
be made and shall end on the latest of:
1. 60 days after the amendment is adopted;
2. 60 days after the amendment becomes effective; or
3. 60 days after the Participant is issued written notice
of the amendment by the Committee.
4.2 Rehire Prior to Distribution. In the event that
a Participant whose employment has terminated again becomes an
Employee prior to the distribution of his/her Accounts, such
distribution shall be deferred until the subsequent termination
of
his/her employment.
4.3 Commencement of Benefits. Unless the Participant
makes an election under Section 4.1.2 of this Plan, benefits
under this Plan will be paid to the Participant not later than
the 60th day after the close of the Plan Year in which the
latest of the following events occurs:
4.3.1 the date on which the Participant attains
Normal Retirement Age;
4.3.2 the tenth anniversary of the year in which
the Participant commenced participation in the Plan; or
4.3.4 the Participant's most recent termination
of employment.
4.4 Withdrawal by Participant During Employment. A
Participant may make a withdrawal from his/her Tax Preferred
Account prior to his/her termination of employment if and only
if:
4.4.1 The withdrawal is due to a hardship and is
necessary in light of immediate and heavy financial needs of the
Participant; and
4.4.2 The amount of the withdrawal does not exceed
the amount required to meet the Participant's immediate
financial need created by the hardship and is not reasonably
available from other resources of the Participant.
4.4.3 No Participant shall be permitted a
hardship withdrawal unless, in the determination of the
Committee (or its designee), such Participant meets the
requirements set forth in subsections (a) and (b) below.
(a) A Participant shall have an immediate
and heavy financial need only if the circumstance for which
the Participant is requesting the distribution is
on account of:
(i) Medical expenses described in
Code section 213(d) incurred by the Participant, the
Participant's spouse or any dependents of the Participant
(as defined in Code section 152);
(ii) Purchase (excluding mortgage
payments) of a principal residence of the Participant;
(iii) Payment of tuition and related
educational fees for the next twelve months of post-secondary
education for the Participant, such Participant's spouse,
children or dependents;
(iv) The need to prevent the eviction
of the Participant from such Participant's principal residence
or to prevent foreclosure on the mortgage of the
Participant's principal residence.
(b) A distribution shall be necessary to
satisfy an immediate and heavy financial need of a Participant
only if:
(i) The distribution is not in excess
of the amount of the immediate and heavy financial need of the
Participant;
(ii) The Participant has obtained all
distributions, other than distributions on account of hardship,
and all nontaxable loans currently available under the Plan and
all other plans of the Employer; and
(iii) The Participant's contributions
are suspended and limited in accordance with paragraph (c).
(c) Penalties. Upon making a withdrawal on
account of hardship, for a period of twelve (12) months after
the Participant receives the withdrawal the Participant shall
be suspended from making Before Tax Contributions, Basic
Contributions and Supplemental Contributions.
In addition, upon making a withdrawal on account of hardship,
the Participant's Before Tax Contributions for the calendar
year following the year during which the distribution on account
of hardship is made shall not exceed the limit set forth in Code
section 402(g) ($7,000, as such amount is increased from time
to time by the Secretary of the Treasury) minus the
Participant's
Before Tax Contributions for the calendar year of the
distribution.
4.5 Withdrawal From Standard Investment Account. A
Participant in the employment of an Employer may make
withdrawals
from such Participant's Standard Investment Account of any
amount
up to the entire balance of such Account; provided, that any
Company Contributions made to such Participant's Account during
the preceding twenty-four month period may not be withdrawn. To
the extent that such Participant's Account balance is
attributable
to Participant Contributions made prior to January 1, 1987, such
withdrawals shall be deemed to come first from such
contributions.
4.5A Withdrawal After Attaining Age 591/2. A
Participant
in the employment of an Employer who has attained age 591/2 may
make withdrawals from such Participant's Standard Investment
Account of any amount up to the vested balance of such Account,
and from his Tax Preferred Account of any amount. To the
extent that such Participant's Account balance is attributable
to Participant Contributions made prior to January 1, 1987,
such withdrawals shall be deemed to come first from such
contributions. Such a Participant shall continue to be eligible
to participate in the Plan on the same basis as any other
Participant. Any distribution pursuant to this Section shall
be made in a manner consistent with all notice and consent
requirements of this Plan and the Code.
4.6 Loans.
4.6.1 Loans Authorized. The Committee may
authorize
the granting of loans to Participants pursuant to such uniformly
applied rules and procedures as it shall set, from time-to-time.
All loans shall meet the requirements of Section 4.6.2.
4.6.2 Loan Requirements. A loan shall not be
made to a Participant pursuant to this Section 4.6 unless
such loan:
(a) does not exceed the lesser of (i) $50,000
reduced by the excess (if any) of the highest outstanding
balance of loans from the Plan to the Participant during the
one-year period ending on the day before the date in which the
loan is made, over the outstanding balance of loans from the
Plan to the Participant on the date on which the loan was made,
or (ii) one-half of the Participant's vested interest in the
value of the Participant's Accounts, determined as of the last
Valuation Date preceding the Participant's application for a
loan;
(b) is exempt from the tax imposed by section
4975 of the Code by reason of section 4975(d)(1) of the Code;
(c) is adequately secured by (i) fifty percent
(50%) of the full value of the Participant's Accounts, and/or
(ii) such other or additional security as the Committee may in
its sole discretion require;
(d) bears interest, payable annually to the
Trust Fund or to such account or accounts in the Trust Fund
as the Committee shall determine and at such rate as the
Committee shall deem reasonable in its discretion, not in
excess of the highest rate which may be legally charged an
individual under applicable law;
(e) is, by its terms, required to be repaid
upon the earlier of the date the Participant's employment
terminates, the date of the Participant's death, or the
expiration of a fixed term of not more than five years;
provided, however, that the Committee may extend the five
year term in the case of loans used to acquire the
Participant's principal residence;
(f) is made pursuant to a loan agreement
to be executed by the Participant and the Trustee, on a
form containing such terms and provisions as the Committee
shall in its sole discretion determine;
(g) is consented to by the Participant's
spouse in accordance with the form of consent described in
Subsection 4.1.3 of Section 4.1 of the Plan; and
(h) meets such other requirements as the
Committee may set.
4.6.3 If any loan granted to a Participant
pursuant to this Section 4.6 is not repaid on the date
required under Section 4.6.2(e), the Committee may, without
prior notice to the Participant, direct the Trustee to
sell, redeem or otherwise dispose of such collateral as
the Participant has given for the loan and apply the
proceeds thereof to the repayment of the loan.
4.6.4 If a Participant receives a loan under
this Section 4.6, his/her status as a Participant in the
Plan and his/her rights with respect to his/her Plan
benefits shall not be affected, except to the extent that
the Participant has used his/her interest in his/her
Accounts as security for the loan, pursuant to Section 4.6.2.
4.7 Repayment. Any portion of a Participant's
Accounts forfeited under this Article IV shall be
restored upon repayment by the Participant of the full
amount of the distribution or withdrawal described in
this Article IV. Repayments shall be treated as being an
account of Plan Years in succeeding order of time. Such
repayment may only be made not later than the earliest of:
(i) the end of the five-year period beginning
with the Employee's resumption of employment covered by
the Plan;
(ii) the end of the five-year period beginning
with the date of withdrawal, or
(iii) before the completion of five consecutive
one-year periods of severance.
For the purpose of subparagraph (iii), a period of severance
is a Plan Year in which an employee's rights may be
forfeited under Regulation 1.411(d)-3(a).
ARTICLE V
LIMITATION ON MAXIMUM CONTRIBUTIONS AND BENEFITS
UNDER ALL PLANS
5.1 General. Participant contributions, and related
Company Contributions, for a Participant under this Plan will
not exceed the maximum limitations imposed by section 415 of
the Code, if all other defined contribution plans and all
defined benefit plans of all Employers and Affiliates are
disregarded. It is intended that any limitation imposed by
Section 415 of the Code arising by reason of a Participant's
participation in one or more other such plans shall be
implemented as provided in this Article V, notwithstanding
any contrary provision of the Plan.
5.2 Affiliate. For purposes of this Article V, the
definition of Affiliate in Section 1.2 shall be applied by
substituting the phrase "more than 50 percent" for the
phrase "at least 80 percent" wherever the phrase "at least
80 percent" would otherwise be applicable under said
provision. 5.3 Limitation Year. For purposes of this
Article V, the limitation year shall be the Plan Year.
5.4 Annual Additions. "Annual Addition" shall mean
the total of (1) the Company's or an Affiliate's contribution
and forfeitures allocated to the Participant, (2) the
Participant's contributions (including excess contributions
as defined in section 401(k)(8)(B) of the Code, excess
aggregate contributions as defined in section 401(m)(6)(B)
of the Code, whether such amounts are distributed or forfeited),
(3) contributions to the Participant's Individual Medical
Amount, if any, (4) amounts derived from contributions paid
or accrued after December 31, 1985, in taxable years ending
after such date, which are attributable to postretirement
medical benefits, allocated to the separate account of a key
employee, as defined in section 419A(d)(3) of the Code, under
a welfare benefit fund, as defined in section 419(e) of the
Code, maintained by the Company or an Affiliate. Notwithstanding
the foregoing, for purposes of the twenty-five percent (25%)
limitation described above, any contribution attributable to
medical benefits (within the meaning of section 401(h) or
419A(f)(2) of the Code) that is otherwise treated as an
annual addition under Code sections 415(1)(1) or 419A(d)(2)
shall not be considered. When used with respect to
contributions
or allocations under any other plan maintained by the Company
or an Affiliate, the term "Annual Addition" has the meaning
given it in section 415(c)(2) of the Code, subject to the
special rules set forth under section 415(c)(6) of the Code.
The term Individual Medical Account means any separate account
which is established for a Participant in a pension and annuity
plan maintained by the Company or an Affiliate and from which
benefits described in section 401(h) of the Code are payable
solely to such Participant, his spouse or his dependents.
5.5 Limits on Before Tax Contributions. The
Committee shall determine the Actual Deferral Percentages for
Highly Compensated Participants and for all other Employees
eligible to become Participants in the Plan.
5.5.1 Actual Deferral Percentage of Highly
Compensated Participants. The Actual Deferral Percentage
for Highly Compensated Participants shall not be more than
the Actual Deferral Percentage for other Eligible Employees
eligible to become Participants (i) multiplied by 1.25 or
(ii) multiplied by 2 if not in excess of two percentage points
over the Actual Deferral Percentage for all other Employees
eligible to become Participants. In order to prevent the
multiple use of the alternative method described in (ii)
above and in Code Section 401(m)(9)(A), any Highly Compensated
Participant eligible to make or to receive contributions
pursuant to Section 2.4 or under any other plan maintained
by the Employer or an Affiliate shall have his actual
contribution ratio reduced pursuant to Regulation 1.401(m)-2,
the provisions of which are incorporated herein by reference.
5.5.2 Multiple Plans. If the Company or an
Affiliate maintains two or more plans which include cash or
deferred arrangements (within the meaning of such term as
used in section 401(k)(3)(A) of the Code), the cash or
deferred arrangements included in such plans shall be
treated as one arrangement for purposes of subsection 5.5.1.
If any Participant is a participant in two or more cash or
deferred arrangements of the Company, the Actual Deferral
Percentage for purposes of Section 5.5.1 shall be the sum
of the Actual Deferral Percentages for such Participant
under each of such arrangements.
5.5.3 Decrease of Contributions. Notwithstanding
anything to the contrary in Article II or this Article V,
the Committee may prospectively decrease a Participant's
authorized reduction in his/her Compensation designated
as Before Tax Contributions at any time if the Participant's
Compensation is greater than the Compensation of at least
two-thirds of all other Eligible Employees and the Committee
determines, in its sole discretion, that such action is
necessary in order for either (i) the Actual Deferral
Percentage for those Participants whose Compensation is
greater than the Compensation of at least two-thirds of all
other Eligible Employees to be not more than the Actual
Deferral Percentage of all other Eligible Employees
multiplied by 1.25 or (ii) the excess of the Actual Deferral
Percentage for those Participants whose Compensation is
greater than the Compensation of at least two-thirds of
all other Eligible Employees over that of all other Eligible
Employees to be not more than 2 percentage points, and for
the Actual Deferral Percentage for those Participants whose
Compensation is greater than the Compensation of at least
two-thirds of all other Eligible Employees to be not more
than the Actual Deferral Percentage of all other Eligible
Employees multiplied by 2.0.
(a) If the Committee determines that it
is necessary to prospectively decrease any such Participant's
authorized reduction under this Section 5.5.3, it shall
first decrease by 1/2% the authorized reductions of all
such Participants who authorized the maximum reduction
in their Compensation, determined without regard to this
Section 5.5.3. If the Committee determines further
decreases are necessary, it shall decrease by 1/2% the
authorized reductions of all such Participants whose
authorized reductions in their Compensation are the largest,
determined after taking all previous reductions under
this Section 5.5.3 into account. The Committee shall
continue to make such decreases in multiples of 1/2%
until it determines that the Actual Deferral Percentage
tests in section 401(k)(3)(A) of the Code have been met.
(b) Any Before Tax Contributions which
would have been made to this Plan on behalf of a Participant
but for the decrease in his/her authorized Compensation
reduction under this Section 5.5.3 shall be treated as
Basic Contributions by such Participant.
(c) If the Committee determines, in its
sole discretion, that it is no longer necessary to decrease
a Participant's authorized Compensation reduction under
this Section 5.5.3, the Committee shall increase the
authorized Compensation reductions of all Participants
who had such reductions decreased, in multiples of 1/2%,
until all such Participants have their authorized Compensation
reductions treated as Before Tax Contributions restored to
their originally authorized level or the Committee determines
that the Actual Deferral Percentage tests of section
401(k)(3)(A)
of the Code will not be met, whichever occurs first.
(d) When increasing or decreasing any
Participant's authorized Compensation reduction under Section
2.4,
the Committee shall treat all Participants who authorized the
same reduction in their Compensation in the same manner.
(e) Any action taken by the Committee under
this Section 5.5.3 may be taken without the consent of, or prior
notice to, the affected Participants, but such Participants
shall be promptly informed in writing of the Committee's action.
5.5.4. Excess Contributions. Notwithstanding
anything
in Section 5.5.3 to the contrary, on or before the fifteenth
day of the third month following the end of each Plan Year, the
Highly Compensated Participant having the highest actual
deferral
ratio shall have his portion of Excess Contributions distributed
to him and/or at his election recharacterized as a Basic
Contribution until one of the tests set forth in section 5.5.1
is satisfied, or until his actual deferral ratio equals the
actual deferral ratio of the Highest Compensated Participant
having the second highest deferral ratio. This process shall
continue until one of the tests set forth in section 5.5.1 is
satisfied. For each Highly Compensated Participant, the amount
of Excess Contributions is equal to the Before Tax Contributions
on behalf of such Highly Compensated Participant (determined
prior to the application of this paragraph) minus the amount
determined by multiplying the Highly Compensated Participant's
actual deferral ratio (determined after the application of this
paragraph) by his Compensation. However, in determining the
amount of Excess Contributions to be distributed and/or
recharacterized with respect to an affected Highly Compensated
Participant as determined herein, such amount shall be reduced
by any Excess Compensation previously distributed to such
affected Highly Compensated Participant for his taxable year
ending with or within such Plan Year and any Employer
Contributions matching which relate to such Excess Compensation.
(a) With respect to the distribution of
Excess Contributions, such distribution:
(i) may be postponed but not later than
the close of the Plan Year following the Plan Year to which
they are allocable;
(ii) shall be made first from
unmatched Before Tax or Basic Contributions and, thereafter,
simultaneously from Before Tax or Basic Contributions which
are matched and matching contributions which relate to such
Before Tax or Basic Contributions;
(iii) shall be adjusted for income; and
(iv) shall be designated by the
Employer as a distribution of Excess Contributions (and income).
(b) With respect to the recharacterization
of Excess Contributions such recharacterized amounts:
(i) shall be deemed to have occurred
on the date on which the last of those Highly Compensated
Participants with Excess Contributions to be recharacterized
is notified of the recharacterization and the tax consequences
of such recharacterization;
(ii) shall not exceed the amount of
the Before Tax and Basic Contributions on behalf of any
Highly Compensated Participant for any Plan Year;
(iii) shall be treated as voluntary
Employee contributions for purposes of Code Section 401(k)-1(b).
Excess Contributions recharacterized as Basic Contributions
shall continue to be nonforfeitable and subject to the same
distribution rules provided for in Section 5.6.4;
(iv) are not permitted if the amount
recharacterized plus Basic Contributions actually made by such
Highly Compensated Participant exceed the maximum amount of
Basic Contributions (determined prior to application of this
Section) that such Highly Compensated Participant is permitted
to make under the Plan in the absence of recharacterized; and
(v) shall be adjusted for income.
(c) Any distribution and/or
recharacterization
of less than the entire amount of Excess Contributions shall be
treated as a pro rata distribution and/or recharacterization of
Excess Contributions and income.
5.6 Limits on Contributions to Standard Investment
Account.
5.6.1 Contribution Percentage. The Committee
shall determine the Contribution Percentages for Highly
Compensated
Participants and for all other Employees eligible to become
Participants in the Plan. The Contribution Percentage for
Highly Compensated Participants shall not be more than the
Contribution Percentage for other Employees eligible to become
Participants (i) multiplied by 1.25 or (ii) multiplied by 2 if
not in excess of two percentage points over the Contribution
Percentage for all other Employees eligible to become
Participants.
5.6.2 Combination of Plans. For purposes of this
Section, the Contribution Percentage for any Highly Compensated
Participant for the Plan Year who is eligible to make Basic
Contributions or to receive Company Contributions under two or
more plan described in section 401(a) of the Code or
arrangements
described in section 401(k) of the Code that are maintained by
the Company or an Affiliate shall be determined as if all such
contributions were made under a single plan.
5.6.3 Satisfaction of 410(b). In the event that
this Plan satisfies the requirements of section 410(b) of the
Code only if aggregated with one or more other plans, or if one
or more other plans satisfy the requirements of section 410(b)
of the Code only if aggregated with this Plan, then this Section
shall be applied by determining the Contribution Percentages of
eligible Participants as if all such plans were a single plan.
5.6.4 Excess Aggregate Contributions. In the
event that the "Actual Contribution Percentage" for the Highly
Compensated Participant group exceeds the Actual Contribution
Percentage for the Non-Highly Compensated Participant group,
then (on or before the fifteenth day of the third month
following the end of the Plan Year, but in no event later
than the close of the following Plan Year) the Plan shall
distribute to the Highly Compensated Participant having the
highest actual contribution ratio, his Excess Aggregate
Contributions (and income allocable to such contributions)
until either one of the tests set forth in Section 5.6.1 is
satisfied, or until his actual contribution ratio equals the
actual contribution ratio of the Highly Compensated Participant
having the second highest actual contribution ratio. This
process shall continue until one of the tests set forth in
Section 5.6.1 is satisfied. The distribution and/or forfeiture
of Excess Aggregate Contributions shall be made in the following
order:
(i) Basic Contributions including Excess
Contributions recharacterized as Basic Contributions.
(ii) Employer matching contributions pursuant
to Section 2.4.
(a) Any distribution of less than the entire
amount of Excess Aggregate Contributions shall be treated as
pro rata distribution of Excess Aggregate Contributions and
income. Distribution of Excess Aggregate Contributions shall
be designated by the Employer as a distribution of Excess
Aggregate Contributions (and income).
(b) Excess Aggregate Contributions attributable to
amounts other than Basic Contributions shall be treated as
Employer contributions for purposes of Code Sections 404-415
even if distributed from the Plan.
(c) For each Highly Compensated Participant, the
amount of Excess Aggregate Contributions is equal to the
Employer matching contributions made pursuant to Section 2.4;
Basic Contributions made pursuant to Section 2.3.2 on behalf
of the Highly Compensated Participant (determined prior to the
application of this paragraph); minus the amount determined by
multiplying the Highly Compensated Participant's actual
contribution ratio (determined after application of this
paragraph) by his Compensation. The actual contribution ratio
must be rounded to the nearest one-hundredth of one percent.
In no case shall the amount of Excess Aggregate Contribution
with respect to any Highly Compensated Participant exceed the
amount of Employer matching contributions made pursuant to
Section 2.4; Basic Contributions made pursuant to Section 2.3.2;
and Excess Contributions recharacterized as Basic Contributions
pursuant to Section 5.5.1.
(d) The determination of the amount of Excess Aggregate
Contributions with respect to any Plan Year shall be made after
first determining the Excess Contributions, if any, to be
treated as Basic Contributions due to recharacterizaton for the
Plan Year of any other qualified cash or deferred arrangement
(as defined in Code Section 401(k) maintained by the Employer
that ends with or within the Plan Year.
(e) If the determination and correction of Excess
Aggregate Contributions of a Highly Compensated Participant
whose actual contribution ratio is determined under the family
aggregation rules, then the actual contribution ratio shall be
reduced and the Excess Aggregate Contributions for the family
unit shall be allocated among the Family Members in proportion
to the sum of Employer matching contributions made pursuant to
Section 2.4; Basic Contributions made pursuant to Section 2.3.2;
and Excess Contributions recharacterized as Basic Contributions
pursuant to Section 5.5.1.
5.7 Distribution of Excess Deferrals.
5.7.1 Time of Distribution. Notwithstanding any
other provision of this Plan, Excess Deferral Amounts and income
allocable thereto, shall be distributed not later than each
April 15 to Participants who claim such Excess Deferrals Amounts
for the preceding calendar year.
5.7.2 Statement. For each calendar year in which
a Participant claims an Excess Deferral Amount, the Participant
shall submit a written statement to the Committee no later than
March 1 which specifies the Participant's Excess Deferral
Amounts for the preceding calendar year and which indicates that
if such amounts are not distributed, such Excess Deferral
Amounts, when added to amounts deferred under other plans or
arrangements described in sections 401(k), 408(k) or 403(b) of
the Code, exceeds the limits imposed on the Participant by
section 402(g) of the Code for the year in which the deferral
occurred.
5.7.3 Adjustment for Income. The Excess Deferral
Amounts distributed to a Participant with respect to a
calendar year shall be adjusted for income and, if there is a
loss allocable to the Excess Deferral Amounts, shall in no
event be less than the lesser of the Participant's Tax
Preferred Account or the Before Tax Contribution for the
Plan Year.
5.8 Distribution of Excess Contributions.
5.8.1 Time of Distribution. Notwithstanding
any other provisions of this Plan, if practicable, Excess
Contributions and income allocable thereto shall be distributed
to Participants for whose benefit such Excess Contributions were
made no later than two and one-half months after the end of the
Plan Year in which such Excess Contributions were made in order
to avoid any excise tax. In no event shall such a distribution
occur later than the last day of the Plan Year next following
the Plan Year in which such Excess Contributions were made.
5.8.2 Determination of Income. The income
allocable to Excess Contributions shall be determined by
multiplying income allocable to the Participant's Before
Tax Contributions for the Plan Year by a fraction, the
numerator of which is the Excess Contribution on behalf
of the Participant for the preceding Plan Year and the
denominator of which is the sum of the Participant's Tax
Preferred Account on the last day of the preceding Plan
Year.
5.8.3 Adjustments for Income. The Excess
Contributions which would otherwise be distributed to
the Participant shall be adjusted for income and reduced,
in accordance with regulations, by the amount of Excess
Deferral Amounts distributed to the Participant. If
there is a loss allocable to the Excess Contributions,
the distributable Excess Contributions shall in no event
be less than the lesser of the Participant's Tax Preferred
Account under this Plan or the Participant's Before Tax
Contributions for the Plan Year.
5.9 Distribution of Excess Aggregate Contributions.
5.9.1 Time of Distribution. Excess Aggregate
Contributions attributable to nonvested Company Contributions
and income allocable thereto shall be forfeited. Excess
Aggregate Contributions attributable to vested Company
Contributions and Basic Contributions and income allocable
thereto shall be distributed no later than the last day of
the Plan Year next following the Plan Year with respect to
which such Excess Aggregate Contributions were allocated.
Notwithstanding the foregoing, if practicable, such Excess
Aggregate Contributions shall be distributed within two and
one-half months after the end of the Plan Year with respect
to which such Excess Aggregate Contributions were allocated
to avoid any excise tax. However, to prevent the multiple
use of the alternative method described in this paragraph
and Code Section 401(m)(9)(A), any Highly Compensated
Participant eligible to make elective deferrals pursuant to
any cash or deferred arrangement maintained by the Employer
or an Affiliated Employer and to make Employee contributions
or to receive matching contributions under this Plan or under
and other plan maintained by the Employer or an Affiliated
Employer shall have his actual contribution ratio reduced
pursuant to Regulation 1.401(m)-2. The provisions of Code
Section 401(m) and Regulations 1.401(m)-1(b) and 1.401(m)-2
are incorporated herein by reference.
5.9.2 Determination of Income. The income
allocable to Excess Aggregate Contributions shall be
determined by multiplying the income allocable to the
Participant's Company Contributions and Basic Contributions
for the Plan Year by a fraction the numerator of which is
the Excess Aggregate Contributions on behalf of the
Participant for the preceding Plan Year and the denominator
of which is the sum of the Participant's Tax Preferred
Subaccount and the Standard Investment Account on the last
day of the preceding Plan Year.
5.9.3 Adjustment for Income. The Excess Aggregate
Contributions to be distributed to a Participant shall be
adjusted for income, and, if there is a loss allocable to
the Excess Aggregate Contribution, shall in no event be less
than the lesser of the Participant's Standard Investment
Account and Tax Preferred Subaccount under this Plan or the
Participant's Company Contributions and Basic Contributions
for the Plan Year.
5.9.4 Amounts forfeited by Highly Compensated
Participants under this Section shall be treated as Annual
Additions and applied to reduce employer contributions.
5.10 Defined Benefit and Defined Contribution Plans.
For purposes of this Article V, the term "Defined Benefit
Plan" or "Defined Contribution Plan" means whichever of the
following is applicable: a defined benefit plan or a defined
contribution plan described in section 401(a) of the Code,
which includes a trust which is exempt from income tax under
section 501(a) of the Code; provided that a Participant's
contributions under a plan which otherwise qualifies as a
defined benefit plan shall be treated as a defined
contribution plan.
5.11 Aggregation of Defined Contribution Plans.
In applying the limitation on annual additions provided
in this Article V, all defined contribution plans maintained
by all Employers and Affiliates shall be aggregated.
5.12 Defined Contribution Plan Limitation. The
sum of the Annual Additions for any Participant to all
defined contribution plans maintained by the Employer and
Affiliates for any year shall not exceed the lesser of
(i) the greater of $30,000 or one-fourth (1/4) of the defined
benefit dollar limit set forth in section 415(b)(1) of the
Code as in effect for the limitation year or 25 percent of
the Participant's Compensation (within the meaning of
section 415(c)(3) of the Code) for such limitation year.
5.13 Defined Contribution Plan Fraction
Determination. For purposes of this Section 5.13, a
Participant's "Defined Contribution Plan Fraction" shall
be determined as follows:
5.13.1 Numerator. For any Limitation Year,
the numerator shall be the sum of the Annual Additions to
the Participant's accounts under all Defined Contribution
Plans maintained by the Company or an Affiliate in such year
and in all prior Limitation Years.
5.13.2 Denominator. For any Limitation Year,
the denominator shall be the lesser of the following amounts,
determined for such year and for each prior Limitation Year
of the Participant's Credited Services with the Company or
an Affiliate:
(i) One hundred and twenty-five percent
(125%) of the maximum dollar limit for such year in effect
under section 415(c)(1)(A) of the Code; or
(ii) The product of 1.4 multiplied by the
amount which may be taken into account under section
415(c)(1)(b)
of the Code for such limitation year.
5.14 Defined Benefit Plan Fraction Determination. For
purposes of this Section 5.14, a Participant's "Defined Benefit
Plan Fraction" shall be determined as follows for any
Limitation Year:
5.14.1 Numerator. The numerator shall be the
sum of the projected annual benefits (as defined in section
415(e)(2) of the Code) of the Participant under all Defined
Benefit Plans maintained by the Company or an Affiliate as
of the close of such year, disregarding benefits derived from
the Participant's contributions, if any.
5.14.2 Denominator. The denominator shall be
the lesser of the following amounts:
(i) one hundred and twenty-five percent
(125%) of the maximum dollar limitation applicable to Defined
Benefit Plans for such year under sections 415(b)(1)(A) of
the Code;
(ii) one hundred forty percent (140%) of
the Participant's average annual Earnings for the three (3)
consecutive years in which the Participant's Earnings
were highest.
5.15 Combined Limitation. If a Participant
participates in one or more Defined Benefit Plans maintained
by the Company or an Affiliate, the sum of the Participant's
Defined Contribution Plan Fraction and Defined Benefit Plan
Fraction as of the close of any Limitation Year may not
exceed 1.0. If the sum of the Defined Benefit Plan
Fraction in the Company's defined benefit plan and the
Defined Contribution Plan Fraction in the Company's defined
contribution plan shall exceed 1.0 for any Participant in
any year, the Company shall reduce the contribution
hereunder to the extent necessary to bring the sum of such
fractions to 1.0. If the Defined Contribution Plan
Fraction cannot be sufficiently reduced, the Company shall
adjust or freeze the rate of benefit accrual under its
defined benefit plan so that the sum of both fractions shall
not exceed 1.0 for such Participant for such year.
5.16 Alternative Method. The Committee may, in its
discretion, determine any amounts required to be taken into
account under this Article V by such alternative methods as
shall be permitted under applicable regulations or rulings
issued by the United States Department of the Treasury.
5.17 Participation in Multiple Plans.
5.17.1 If amounts contributed to any defined
contribution plan by or on behalf of a Participant must be
reduced in any Limitation Year to comply with the limit on
Annual Additions in Section 5.4 of this Plan, the amounts
contributed to such defined contribution plans shall be
reduced in the following order:
(a) Supplemental Contributions made under Section
2.5 of this Plan;
(b) Basic Contributions made under Section 2.3
of this Plan;
(c) Forfeitures under this Plan;
(d) Company Contributions made under Section 2.4
of this Plan;
(e) Before Tax Contributions made under Section
2.3 of this Plan; and
(f) Contributions to any defined benefit plan
treated as a defined contribution plan. Amounts contributed
by or on behalf of a Participant to one category shall be
reduced to zero before any reduction is made of any such amounts
contributed to the next lowest category. If, notwithstanding
subparagraph (a) through (f) of this subsection 5.17.1, a
Before Tax Contribution is made on behalf of a Participant
which results in the limitations set forth in Section 5.4
of this Article V being exceeded, then such excess and any
earnings thereon may be returned to such Participant.
5.17.2 The amount of Company Contributions which
may not be allocated to a Participant's Accounts because of
the limitations of this Article V shall be allocated for the
next Limitation Year and (for each succeeding year) to such
Participant to the extent permitted by this section. In the
event that the Participant is not in the service of Company
at the end of the next Limitation Year, then any excess
Company Contribution shall be allocated in accordance with
subsection 5.17.3.
5.17.3 Any remaining amount which cannot be
allocated to Participants as a result of the limitations
specified in this subsection shall be maintained in a
separate account to be allocated among Participants in the
next succeeding Plan Year prior to the allocation of any
contributions or forfeitures for such next Plan Year. Such
separate account shall not share in any investment gains,
losses or other income earned by the Trust. In the event
the Plan is terminated or contributions completely discontinued,
the separate account shall be allocated pursuant to the terms
of this subsection, to the extent permitted by section 415
of the Internal Revenue Code. To the extent the separate
account is not fully depleted by such allocation is shall
revert to the Company.
5.18 Notice of Reduction. The Committee shall
give prompt notice to any Participant whose benefit is
reduced pursuant to the provisions of this Article V.
ARTICLE VI TOP-HEAVY RULES
6.1 Top-Heavy Plan.
6.1.1 Definitions. The following definitions
shall apply for purposes of this Article VI:
(a) "Aggregation Group": The group
of plans, if any, that includes both the group of plans
that are required to be aggregated and the group of plans
that are permitted to be aggregated.
(i) The group of plans that are
required to be aggregated (the "required aggregation group")
includes
(A) each plan of the Company
or Affiliate in which a Key Employee is a participant, and
(B) each other plan of the
Company or Affiliate which enables a plan in which a Key
Employee is a participant to meet the requirements of either
section 401(a)(4) or section 410 of the Code.
(ii) The group of plans that are
permitted to be aggregated (the "permissive aggregation group")
may include any plan that is not part of the required
aggregation group only if, after the addition, the aggregation
as a whole continues to meet the requirements of both section
401(a)(4) and section 410 of the Code.
(b) "Determination Date": The last day of
the immediately preceding Plan Year.
(c) "Top-Heavy Group": The Aggregation Group
if, as of the applicable Determination Date, the sum
(computed as provided in the definition of a Top-Heavy Plan)
of the present value of the cumulative accrued benefits of
Key Employees under all defined benefit plans included in the
Aggregation Group plus the aggregate of the accounts of Key
Employees under all defined contribution plans included in
the Aggregation Group exceeds 60 percent of the sum of the
present value of the cumulative accrued benefits and accounts
of all employees under all such defined benefit plans and
defined contribution plans.
(d) "Top-Heavy Plan": This Plan will be a
Top Heavy Plan for any Plan Year, if, as of the Determination
Date, the present value of the cumulative accrued benefits
under the Plan for Key Employees exceeds 60 percent of the
present value of the cumulative accrued benefits under the
Plan for all Participants or, if this Plan is required to be
in an Aggregation Group which for such Plan Year is a Top-Heavy
Group. For purposes hereof:
(i) the "present value of the accrued
benefit" under any defined benefit plan shall be determined
as the lump sum actuarial equivalent of the Employee's
accrued benefit, using reasonable actuarial assumptions, and
the "present value of the accrued benefit" under any defined
contribution plan in the Aggregation Group shall be the value
of accounts of an employee in such plan on the Valuation Date
of such plan that immediately precedes the Determination date;
(ii) the "present value of the
cumulative accrued benefits" under all defined benefit plans
in the Aggregation Group shall be the sum of the present
values of the accrued benefits under such plans, computed as
aforesaid, and under all defined contributions plans in the
Aggregation Group shall be the sum of the values of the trust
funds for such plans, on the Valuation Date or dates of such
plans immediately preceding the Determination Date;
(iii) the present value of an
account shall include the dollar value of the aggregate
distributions (including distributions to an employee which
represent the entire amount credited to such employee's
account under the applicable plan) made to such employee under
the applicable plan during the five (5) year period ending on
the Determination Date;
(iv) in any case in which an individual
is not a Key Employee with respect to an applicable plan but
was a Key Employee with respect to such plan for any prior
plan year, any accrued benefit and any account of such
individual shall be disregarded. For this purpose, if a
Participant is deemed to be a Key Employee because the
Participant was a Key Employee within any of the four (4)
preceding Plan Years, this provision shall apply only
after the lapse of such status;
(v) if an individual has not
performed any services for the Company or an Affiliate on
the Determination Date, any accrued benefit and any account
of such individual shall be disregarded; and
(vi) the present value or account,
as the case may be, shall not include any contributions
made or deemed made other than by the Company or an Affiliate
nor shall any rollover or transfer to the Plan be included
except a rollover contribution representing a distribution
from a plan maintained by the Company or an Affiliate.
6.2 Minimum Contributions for Non-Key Employees.
For any Plan Year for which this Plan is determined to be
a Top-Heavy Plan, each Eligible Employee who is not a Key
Employee shall be entitled to a Company contribution equal
to the lesser of (a) 3 percent of such Participant's
Compensation, or (b) the highest percentage of Compensation
which is contributed on behalf of any Key Employee,
regardless of whether such Participant has completed 1,000
Hours of Service during such Plan Year regardless of whether
such Eligible Employee has made any Before Tax Contributions
to the Plan. The Company shall make contributions, to the
extent necessary, to provide each Participant who is not a
Key Employee with such minimum contribution.
6.3 Vesting. For any Plan Year in which the Plan
is deemed to be Top Heavy, the provisions of Section 4.1.1
shall apply in determining the nonforfeitable percentage of
a Participant's Accounts attributable to Company
Contributions.
6.4 Reduction in Combined Limitation. If the
Plan is Top-Heavy under Section 6.1, the Participant's
Defined Contribution Plan Fraction and Defined Benefit
Plan Fraction, determined under Sections 5.13 and 5.14,
respectively, shall be determined by substituting "1.0"
for "1.25" in each place "1.25" appears in such sections
unless, on the last day of the Plan Year in which the
Plan is found to be Top-Heavy under Section 6.1, the
aggregate value of the Tax Preferred Accounts of Key
Employees under the Plan does not exceed 90 percent of
the aggregate value of the Tax Preferred Accounts for
all Participants in the Plan and the Company elects to
substitute "four percent (4%)" for "three percent (3%)"
in Section 6.2.
6.5 Coordination with Other Plans. In the event
that another defined contribution or defined benefit plan
is included in the Aggregation Group, and as a result the
Plan is determined to be Top-Heavy, the requirements of
section 416 of the Code shall apply to all plans in the
Aggregation Group.
6.6 Automatic Removal. In the event that it
shall be determined by statute, regulation or ruling of
the Internal Revenue Service that the provisions of this
Article VI are no longer necessary in whole or in part to
qualify this Plan under the Code, this Article VI shall
be ineffective to such extent without amendment to the Plan.
ARTICLE VII
TRUST
7.1 Trustee. To provide for the administration of
the Plan, the Company will enter into a Trust Agreement
with a Trustee appointed by the Company. The Trust Agreement
shall be in such form and contain such provisions as the
Company may deem appropriate, including, but not limited
to, provisions with respect to the powers and authority of
the Trustee (including the management of funds and/or
providing investment options and retirement elections
under this Plan by some other institution or institutions,
as directed by the Committee from time to time), the
authority of the Company to amend the Trust Agreement and to
terminate the Trust Fund, and the authority of the Company to
settle the accounts of the Trustee on behalf of all persons
having an interest in the Plan, and a provision that, except
as provided in Section 10.11 of this Plan, it shall be
impossible at any time for any part of the corpus or income
of the Trust Fund to be used for or diverted to purposes
other than for the exclusive benefit of eligible employees or
their Beneficiaries.
7.2 Trust Expenses. Costs and expenses of
administering the Trust Fund, including Trustee's fees
and investment manager's fees, shall be paid from the
Trust Fund, unless they are paid by an Employer.
ARTICLE VIII
ADMINISTRATION
8.1 Administrative Committee. There is hereby
created an Administrative Committee (the "Committee") which
shall consist of not less than two (2) members to be
appointed by and serve at the pleasure of the Chief Executive
Officer of the Company ("the Company Board"). The Company
Board may, at any time, fill vacancies or require the
resignation of one or more of the members of a Committee
with or without cause. In the event that a vacancy or
vacancies shall occur on the Committee, the remaining
member or members shall act as the Committee until the
Company Board fills such vacancy or vacancies. No person
shall be ineligible to be a member of a Committee because
he/she is, was or may become entitled to benefits under
the Plan or because he/she is a director and/or officer of
an Employer or Affiliate or a Trustee; provided that no
Participant who is a member of the Committee shall participate
in any determination by the Committee specifically
relating to the disposition of his/her own Tax Preferred
Account (including any determination with respect to a
hardship withdrawal or a loan pursuant to Sections 4.4
and 4.5, respectively).
8.2 Limitation of Liability; Indemnity.
8.2.1 Except as otherwise provided by law, no
person who is a member of the Committee, or any employee,
director or officer of any Employer or Affiliate may incur
any liability whatsoever on account of any matter connected
with or related to the Plan or the administration of the Plan.
8.2.2 The Company shall indemnify and save
harmless each member of the Committee, and each employee,
director or officer of any Employer or Affiliate, from and
against any and all loss, liability, claim, damage, cost and
expense which may arise by reason of, or be based upon, any
matter connected with or related to the Plan or the
administration of the Plan (including, but not limited to,
any and all expenses whatsoever reasonably incurred in
investigating, preparing or defending against any litigation,
commenced or threatened, or in settlement of any such claim
whatsoever), unless such person shall have acted in bad
faith or been guilty of willful misconduct or gross
negligence in respect of his/her duties, actions or omissions
in respect of the Plan.
8.3 Compensation and Expenses. The members of the
Committee shall serve without compensation for their services
as such members. All expenses reasonably incurred by the
Committee shall be treated as an expense of the Trust Fund
unless paid by an Employer. The members of the Committee
shall serve without bond unless the Company or the provisions
of any applicable laws shall require otherwise, in which
event the Employers shall pay the premium thereon.
8.4 Voting; Chairmen; Subcommittees.
8.4.1 If there are less than three members of
the Committee at any time, the Committee may do any act
which the Plan authorizes or requires the Committee to do
only upon the unanimous consent of the members of the
Committee eligible to vote on such act. If there are three
or more members of the Committee at any time, a majority of
the members of the Committee at the time in office may do
any act which the Plan authorizes or requires the Committee
to do. The action of such majority of the members expressed
from time to time by a vote at a meeting, or in writing
without a meeting, or by conference telephone or similar
communications equipment allowing all persons participating
in the meeting to hear each other at the same time, shall
constitute the action of the Committee and shall have the
same effect for all purposes as if assented to by all
members at the time in office. Where action is taken by
members of the Committee by conference telephone or similar
communications equipment, such action shall be confirmed in
writing by such members as soon as practicable thereafter.
The Secretary shall maintain minutes reflecting committee
meetings and shall cause each action taken in writing without
a meeting, and each written confirmation of action taken by
conference telephone or similar communications equipment, to
be included in the minutes of the Committee.
8.4.2 The Company Board shall name one of the
members of the Committee as Chairman. The members of the
Committee shall elect a Secretary who may, but need not be,
a member of the Committee, and they may appoint from their
number such subcommittees as they shall determine.
8.5 Payment of Benefits. The Committee shall advise
the Trustee in writing with respect to all benefits which
become payable under the terms of the Plan and shall direct
the Trustee to pay such benefits to or on order of the
Committee. In the event that the Trust fund shall be
invested in whole or in part in one or more insurance
contracts, the Committee shall be authorized to give to
any such insurance company such instructions as may be
necessary or appropriate in order to provide for the
payment of benefits in accordance with the Plan.
8.6 Powers and Authority; Action Conclusive. Except
as otherwise expressly provided in the Plan or in the Trust
Agreement, or by the Company Board.
8.6.1 The Committee shall be responsible for
the administration of the Plan.
8.6.2 The Committee shall have all powers
necessary or helpful for the carrying out of its
responsibilities, and the decisions or action of the
Committee in good faith in respect of any matter hereunder
shall be conclusive and binding upon all parties concerned.
8.6.3 The Committee may delegate to one or more
of its members or any other person the right to act on its
behalf in all matters connected with the administration of
the Plan.
8.6.4 Without limiting the generality of the
foregoing, the Committee shall:
8.6.4.1 Determine all questions arising out
of or in connection with the terms and provisions of the
Plan except as otherwise expressly provided herein;
8.6.4.2 Make rules and regulations for the
administration of the Plan which are not inconsistent with
the terms and provisions of the Plan, and fix the annual
accounting period of the trust established under the Trust
Agreement as required for tax purposes;
8.6.4.3 Construe all terms, provisions,
conditions and limitations to the Plan;
8.6.4.4 Determine all questions relating
to (i) the eligibility of persons to receive benefits
hereunder, (ii) the years of Credited Service, years of
Company Service Credit and the amount of Compensation and
Earnings of a Participant during any period hereunder, and
(iii) all other matters upon which the benefits or other
rights of a Participant or other person shall be based
hereunder;
8.6.4.5 Determine all questions relating
to the administration of the Plan (i) when disputes arise
between an Employer and a Participant or his/her Beneficiary,
spouse or legal representatives, and (ii) whenever the
Committee deems it advisable to determine such questions in
order to promote the uniform administration of the Plan.
The foregoing list of powers is not intended to be either
complete or exclusive, and the Committee shall, in addition,
have such powers as may be necessary for the performance of
its duties under the Plan and the Trust Agreement.
8.7 Counsel and Agents. The Committee may employ
such counsel, including legal counsel, accountants,
investment advisors, physicians, agents and such clerical
and Other services as it may require in carrying out the
provisions of the Plan, and shall charge the fees, charges
and Costs resulting from such employment as an expense of
the Trust Fund unless paid by an Employer. Unless otherwise
provided by law, any person so employed by a Committee may
be legal or other counsel to an Employer, a Subsidiary, a
member of a Committee or an officer or member of the Board
of Directors of an Employer or a Subsidiary.
8.8 Reliance on Information. The members of the
Committee and any Employer and its officers, directors and
employees shall be entitled to rely upon all tables,
valuations, certificates, opinions and reports furnished
by any accountant, trustee, insurance company, counsel or
other expert who shall be engaged by an Employer or the
Committee, and the members of the Committee and any Employer
and its officers, directors and employees shall be fully
protected in respect of any action taken or suffered by
them in good faith in reliance thereon, and all action so
taken or suffered shall be conclusive upon all persons
affected thereby.
8.9 Fiduciaries. The provisions of this
Section 8.9 shall apply notwithstanding any contrary
provisions of the Plan or the Trust Agreement.
8.9.1 The named fiduciaries under the Plan
shall be the members of the Committee, who shall be
named fiduciaries with respect to control or management
of the assets of the Plan, and who shall have authority
to control or manage the operation and administration of
the Plan, except with respect to those matters which
under the Plan or the Trust Agreement are the responsibility,
or subject to the authority, of the Trustee.
8.9.2 The named fiduciaries under the Plan
shall have the right, which shall be exercised in accordance
with the procedures set forth in Section 8.4.1 and/or in the
Trust Agreement for action by the Committee, to allocate
responsibilities, fiduciary or otherwise, among named
fiduciaries, and the named fiduciaries (or any of them to
whom such right shall be allocated) shall have the right to
designate persons other than named fiduciaries to carry out
responsibilities, fiduciary or otherwise, under the Plan.
8.9.3 The members of the Committee shall
together establish and carry out, or cause to be provided
by those persons (including, without limitation, any
investment manager, trustee or insurance company) to whom
responsibility or authority therefor has been allocated or
delegated in accordance with this Plan or the Trust
Agreement, a funding policy and method consistent with the
objectives of the Plan and the requirements of ERISA. For
such purposes, the Committee shall, at a meeting duly
called for the purpose, establish a funding policy and
method which satisfies the requirements of ERISA, and
shall meet annually at a stated time of the year to review
such funding policy and method. All actions taken with
respect to such funding policy and method and the reasons
therefor shall be recorded in the minutes of the meetings
of the Committee.
8.9.4 Any person or group of persons may
serve in more than one fiduciary capacity with respect
to the Plan.
8.9.5 Any named fiduciary under the Plan, and
any fiduciary designated by a named fiduciary pursuant to
Section 8.9.2 to whom such power is granted by a named
fiduciary under the Plan, may employ one or more persons
to render advice with regard to any responsibility such
fiduciary has under the Plan.
8.9.6 The Board of Directors of the Company,
or any director to whom such right shall be allocated, may
appoint an investment manager or managers, as defined in
section 3(38) of ERISA, to manage (including the power
to acquire, invest and dispose of) any assets of the Plan.
8.9.7 Except to the extent otherwise
provided by law, if any duty or responsibility of a
named fiduciary has been allocated or delegated to any
other person in accordance with any provision of this
Plan or of the Trust Agreement, then such named fiduciary
shall not be liable for an act or omission of such person
in carrying out such duty or responsibility.
8.10 Plan Administrator. The Company shall be
the administrator of the Plan, as defined in
section 3(16)(A) of ERISA.
8.11 Notices and Elections. An Employee shall
deliver to the Committee all directions, orders,
designations, notices or other communications on appropriate
forms to be furnished by the Committee. The Committee
shall also receive notices or other communications for
Participants from the Trustee and transmit them to the
Participants. All elections which may be made by an
Employee under this Plan shall be made in a time, manner
and form determined by the Committee unless a specific
time, manner or form is set forth in the Plan.
8.12 Taxes Payable by Trustee. Taxes, if any,
other than transfer taxes, payable by the Trustee shall
be charged against the Tax Preferred Accounts pro rata
to the values of the cash and/or securities affected.
8.13 Credited Service. "Credited Service" means
for any Employee his/her Company Service Credit; provided,
however, that in any case where it will produce a result
more favorable to the Employee, an Employee's Credited
Service shall be determined in accordance with the
following provisions:
8.13.1 Credited Service is the total of
the period of elapsed time which begins as of the date
an Employee first performs an hour of service with an
Employer or an Affiliate and, except as otherwise
provided in this Section 8.13, ends as of his/her severance
from service date, as provided in Section 8.13.2. An "hour
of service" is each hour for which an Employee is paid, or
entitled to payment, for the performance of duties for an
Employer or an Affiliate.
8.13.2 An Employee's severance from service
date shall be the earlier of:
(a) the date the Employee quits, retires,
is discharged or dies; or
(b) the first anniversary of the first
date of the Employee's absence for any other reason.
8.13.3 If an Employee performs an hour of
service with an Employer or an Affiliate within twelve
months of the date he/she quits, retires, is discharged,
or is first absent for any other reason, such Employee
shall be deemed not to have severed his/her service due
to such quit, retirement, discharge or absence. In the
case of an Employee who is absent from work for
maternity or paternity reasons, the 12-consecutive-month
period beginning on the first anniversary of the first
date of such absence shall not constitute a period of
severance. For purposes of this paragraph, an absence
from work for maternity or paternity reasons means an
absence (1) by reason of the 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, or (4) for
the purpose of caring for such child for a period
beginning immediately following such birth or placement.
8.13.4 Credited Service shall be the aggregate
of all an Employee's periods of Credited Service, provided
that in the case of an Employee with no vested interest in
that portion of his Accounts attributable to Company
Contributions who incurs a one-year period of severance,
his/her periods of Credited Service before and after a
period of severance will be aggregated only when: (a) the
Employee's latest period of severance does not exceed
his/her period of Credited Service before such period of
severance; and (b) such Employee has completed one year
of Credited Service after such period of severance.
8.13.5 A "period of severance" is the period
of time commencing on an Employee's severance from service
date and ending on the date on which the Employee again
performs an "hour of service" as defined in Section 8.13.1.
8.14 Company Service Credit. "Company Service
Credit" is based upon employment by the Company and by
any subsidiary of the Company, by any predecessor of such
a subsidiary and by any company acquired by the Company
or by any subsidiary of the Company. Company Service
Credit of all new employees will be determined under
the following rules:
8.14.1 If an Employee receives salary,
wages or commission from the Company, a subsidiary of
the Company, an Employer, or Union Carbide Corporation
without interruption, his/her Company Service Credit
begins as of the date such salary, wages or commission
is first paid to such Employee.
8.14.2 If an Employee is laid off by the
Company or a subsidiary of the Company on account of a
reduction in force and through no fault of his/her own:
(a) if such layoff continues not more than three
consecutive years, Company Service Credit will be given
for service prior to such layoff; and (b) if such layoff
continues more than three consecutive years, no Company
Service Credit will be given for service prior to such
layoff.
8.14.3 In case of absence caused by
temporary suspension of work (other than "layoff" as
in Section 8.14.2), Disability or absence-with-leave
which is authorized by the Company or any subsidiary of
the Company, and does not exceed three months, employment
will be considered as continuous without any reduction
for such absence. However, in case such absence does
exceed three months, the period of absence in excess of
three months will not be considered as Company Service
Credit unless Company Service Credit is otherwise
authorized by the Company or a subsidiary of the Company
for such period. If an employee who is thus absent
fails to return to work when able to do so, and at the
time designated by the Company or a subsidiary of the
Company, he/she will be considered as voluntarily
terminating his/her employment and his/her Company
Service Credit shall end as of the date on which
such absence commenced.
8.14.4 In case of rehire or reinstatement
subsequent to discharge for cause or resignation at the
request of the Company, a subsidiary of the Company, or
an Employer, Company Service Credit will be given for
service only since the last date of rehire or reinstatement
by the Company, the subsidiary, or an Employer unless
Company Service Credit is otherwise authorized by the Company,
the subsidiary, or an Employer for the period prior to such
rehire or reinstatement.
ARTICLE IX
AMENDMENT; TERMINATION; ADOPTION AND MERGER
9.1 Modification or Amendment of Plan. The Company
reserves the right at any time and from time to time to amend
the Plan in whole or in part; provided that, except as provided
in Section 9.4 or as otherwise permitted by law, no amendment
shall be made which (a) would cause or permit any part of the
corpus of the Trust Fund to be diverted to purposes other
than for the exclusive benefit of Participants or their
Beneficiaries, (b) would cause or permit any portion of the
assets of the Trust Fund to revert to or become the property
of any Employer or Affiliate at any time, or (c) would divest
any Participant of any amount previously credited to his/her
Accounts.
9.2 Termination of Plan or Discontinuance of
Contributions. The Plan may be terminated by the Company at
any time in the Company's sole discretion, in whole or in
part. Notwithstanding any other provision of the Plan,
upon Complete termination of the Plan or the complete
discontinuance of contributions thereunder, 100 percent of
each Participant's Tax Preferred Account and Standard
Investment Account shall be nonforfeitable. Upon any such
termination, the Committee shall instruct the Trustee either
(a) to distribute or dispose of the net assets of the Trust
Fund (remaining after payment of or provision for all expenses
of final administration and liquidation) exclusively for the
benefit of all Participants (or their Beneficiaries, as the
case may be) according to their respective shares of the Trust
Fund as of the date of such termination or discontinuance, or
(b) to continue the Trust Fund with distributions to be made
at the time and in the manner provided for by Article IV. In
the event of any partial termination of the Plan (within the
meaning of section 411(d)(3) of the Code), 100 percent of the
Tax Preferred Account and Standard Investment Account of each
Participant affected by such partial termination shall be
nonforfeitable.
9.3 Expenses of Termination. In the event of the
complete or partial termination of the Plan, the expenses
incident thereto shall be a prior claim and lien upon the
assets of the Trust Fund and shall be paid or provided for
prior to the distribution of any benefits pursuant to such
termination, unless such expenses are paid by an Employer.
9.4 Amendments Required for Qualification. All
provisions of this Plan, and all benefits and rights granted
hereunder, are subject to any amendments, modifications or
alterations which are necessary from time to time to qualify
the Plan under section 401(a) of the Code or corresponding
provisions of subsequent law, to continue the Plan as so
qualified, to meet the requirements of section 40l(k) of
the Code or to comply with any other provision of law.
Accordingly, notwithstanding any other provisions of this
Plan, the Company may amend, modify or alter the Plan with
retroactive effect in any respect or manner necessary to
qualify the Plan under section 401(a) of the Code, to continue
the Plan as so qualified, to meet the requirements of section
401(k) of the Code, or to comply with any other provision of
law. The Committee may also amend, modify or alter the Plan
with retroactive effect in any respect or manner necessary to
qualify the Plan under Code Section 401(a), to continue the
Plan as so qualified, to meet the requirements of Code
section 401(k), or to comply with any other provision of
law as long as the cost of such amendment to the Plan for
the Plan Year with respect to which such amendment is effective
does not exceed two percent (2%) of the Company's Contributions
for the Plan Year preceding the effective date of such
amendment.
9.5 Adoption of Plan by Employers.
9.5.1 With the consent of the Company, any
Subsidiary may adopt the Plan and the Trust Agreement for
any of its divisions or locations as it may specify by
delivering to the Committee and the Trustee:
9.5.1.1 a written instrument, duly executed
and acknowledged:
(a) adopting and assuming, jointly and
severally,
the obligations of the Company under the Plan and Trust
Agreement;
(b) appointing the Company and the Committee as
its agents and attorneys-in-fact for all purposes with respect
to the Plan and Trust Agreement, including amending or
terminating
the Plan and Trust Agreement and giving or receiving notices,
instructions, directions and other communications to the
Trustee;
and
(c) specifying the divisions or locations for
which it is adopting the Plan and Trust Agreement.
9.5.1.2 A duly certified copy of resolutions
of the board of directors of the adopting corporation, or a
similar document from the person or persons having the power to
bind the partnership or other entity, authorizing the adoption
of the Plan and the Trust Agreement and approving and
authorizing
the execution, acknowledgment and delivery of the written
instrument described in Section 9.5.1.1; and
9.5.1.3 a copy of a document evidencing the
Company's consent to the adoption of the Plan and the Trust
Agreement by such Subsidiary.
9.5.2 The Company's consent to any adoption of
this Plan and Trust Agreement shall be evidenced by: written
approval and consent to such adoption by the Committee if such
adoption would add fewer than 100 Eligible Employees on its
effective date; or
9.5.2.1 A resolution of the Company's Board of
Directors approving and consenting to Such adoption if such
adoption would add 100 or more Eligible Employees on its
effective
date.
9.5.3 In giving its consent to any adoption of
the Plan and Trust Agreement under Section 9.5.2, the Company
or the Committee may make its consent subject to such terms
and conditions as it may prescribe.
9.6 Discontinuance of Participation. An Employer's
or the Company's discontinuance of its participation under
the Plan may be voluntary or involuntary, partial or
complete, as described below:
9.6.1 Any Employer or the Company may, with
the approval of the Committee, elect, at any time, to
discontinue its participation hereunder in whole or in part
with respect to any of its divisions or locations by filing
written notice thereof with the Committee and specifying
the group or groups of Participants affected by such
election.
9.6.2 The Plan shall discontinue as to all
Participants of any Employer or the Company which shall be
declared bankrupt or which makes any general assignment for
the benefit of creditors.
9.6.3 The Plan shall discontinue as to
participants of any Employer or the Company in the event of
the dissolution, merger, consolidation, or sale or other
disposition of the business and assets or stock of such
Employer or the Company, unless provision is made for the
continuance of the Plan by a successor. In the event the
Plan is discontinued pursuant to this Section 9.6.3, the
Committee shall make such current or deferred distribution
to the Participants affected by such discontinuance as it
shall deem appropriate and in accordance with Section 9.7
and the other provisions of the Plan; provided, however,
if provision is made for the continuance of the Plan by a
successor, the Committee shall, subject to Section 9.7,
direct that the portion of the Trust Fund allocable to
such Participants be transferred to a Successor qualified
plan or funding medium covering such Participants. The
Committee, in its sole discretion, may permit the value
of such Participants' Tax Preferred Accounts to remain
in the Plan pending the completion of the dissolution,
merger, consolidation or sale or other disposition of the
business and assets of such Participants' Employer or the
Company, as the case may be, for such a period of time as
shall be designated by the Committee.
9.7 Merger. Subject to the provisions of this
Section 9.7, the Plan may be amended to provide for the
merger of the Plan, in whole or in part, or a transfer of
all or a part of its assets or liabilities, to any other
qualified plan within the meaning of section 401(a) or 403(a)
of the Code, including such a merger or transfer in lieu of
a distribution which might otherwise be required under the
Plan. In the event of such a merger or consolidation of
this Plan or transfer of its assets or liabilities to any
other plan in whole or in part, each Participant shall be
entitled to a benefit immediately after the merger,
consolidation or transfer (if such other plan then terminated)
which is equal to or greater than the benefit he/she would
have been entitled to receive immediately before the
merger, consolidation or transfer (if the Plan had then
been terminated).
ARTICLE X
MISCELLANEOUS
10.1 Claims Procedure. If a claim for benefits
under this Plan is wholly or partially denied, the claimant
Shall be provided with a notice setting forth the specific
reason or reasons for the denial, specific reference to
pertinent Plan provisions on which the denial is based,
a description of any additional material or information
necessary for the claimant to perfect the claim, an
explanation of why such material or information is
necessary, and an explanation of the Plan's claim review
procedure. Within 60 days after notification of a denial
of benefits, such claimant may, upon written application,
appeal such denial to the Committee for a review. Such
claimant (or his/her duly authorized representative) may
review pertinent documents and submit issues and comments
in writing. Within 60 days of receipt of such written
application for review, the Committee shall make a decision
in writing, including specific reasons for the decision,
with references to the pertinent Plan provisions. Under
special circumstances, the Committee may extend the time
for processing such a review, but a decision shall be
rendered not later than 120 days after receipt of the
request for review. In the event that government
regulations shall impose a different standard for review,
such required standard shall be followed in lieu of the
above.
10.2 Plan Not an Employment Contract. Neither
the adoption of this Plan by an Employer nor any action
of any Employer, the Committee, or the Trustee under this
Plan, nor participation in this Plan or failure to
participate in this Plan by any person, shall be held or
construed to confer upon any person any legal right to
be continued as an employee of any Employer or Affiliate.
All Employees, whether or not they participate in this
Plan, shall be subject to discharge to the same extent as
they would have been if this Plan had never been adopted.
10.3 Consent to Terms of Plan and Trust Agreement.
An Employee by becoming a Participant in this Plan consents
and agrees to all the terms and provisions of this Plan,
the Trust Agreement, and any rules and regulations adopted
by the Committee pursuant to the provisions of this Plan,
as they may each be amended from time to time.
10.4 Transfer of Interest Not Permitted. Except
as respects any assignment or encumbrance to secure a loan
from the Trust Fund which is made pursuant to Section 4.5,
and except as set forth in Section 10.4.1 and as otherwise
may be required by law, no person shall have any power to
assign, transfer, pledge, encumber, commute or anticipate
any interest in the Trust Fund or in any payment to be made
under the Plan, and any attempt to assign, transfer,
pledge, encumber, commute or anticipate the same shall be
void; nor shall any such interest be in any way liable for
or subject to the debts, contracts, liabilities, engagement
or torts of the person entitled to such benefit or payment
or subject to levy, garnishment, attachment, execution or
other legal or equitable process.
10.4.1 Qualified Domestic Relations
Order. The provisions of Section 10.4 shall not be
applicable to a Qualified Domestic Relations Order and
payment of benefits shall be made in accordance with the
terms of such order. The Committee shall promptly notify
a Participant and any Alternate Payee of the receipt of a
Domestic Relations Order and of the Plan's procedure
for determining whether the order constitutes a
Qualified Domestic Relations Order. Within a reasonable
period of time after the receipt of such Order, the
Committee, in accordance with such procedures as it
shall from time to time establish, shall determine
whether such order constitutes a Qualified Domestic
Relations Order and shall notify the Participant and
each Alternate Payee of such determination. During any
period of time in which the issue of whether a Domestic
Relations Order constitutes a Qualified Domestic
Relations Order is being determined by the Committee,
by a court of competent jurisdiction, or otherwise,
the Committee shall segregate in a separate account in
the Plan or in an escrow account the amounts which would
have been payable to the Alternate Payee during such
period if the order had been determined to be a
Qualified Domestic Relations Order. If within 18 months
such order is determined to be a Qualified Domestic
Relations Order, the Committee shall pay the segregated
amounts (plus any interest thereon) to the person or
persons entitled thereto. If within 18 months it is
determined that such order is not a Qualified Domestic
Relations Order, or the issue as to whether such order
so qualifies is not resolved, then the Committee shall
pay the segregated amounts (plus any interest thereon)
to the person or persons who would have been entitled
to such amounts if there had been no order. Any
determination that an order is a Qualified Domestic
Relations Order which is made after the end of the 18-month
period shall be applied prospectively only. The Committee
may treat any Domestic Relations Order entered before
January 1, 1985, as a Qualified Domestic Relations
Order even if such order does not meet the requirements
of the preceding provisions of this Section 10.4.1.
10.5 Obligations of Employers Limited. The
Employers assume no obligations under this Plan except
those specifically stated in this Plan. No person shall
have any right to participate in profits by reason of
this Plan except to the extent expressly set forth herein.
The Employers shall be under no legal obligation to make
any contributions to the Trust Fund except as expressly
provided herein.
10.6 Separation of Invalid Provisions. If
any provision of this Plan or the Trust Agreement is h
eld invalid, the remainder of the Plan or Trust Agreement
shall not be affected thereby.
10.7 Payment to a Minor or Incompetent. In the
event that any amount is payable to a minor or other
legally incompetent person, such amount may be paid in
any of the following ways, as the Committee in its sole
discretion shall determine:
10.7.1 to the legal representatives of
such minor or other incompetent person:
10.7.2 directly to such minor or other
incompetent person;
10.7.3 to a parent or guardian of such minor,
or to a custodian for such minor under the Uniform Gifts
to Minors Act (or similar statute) of any jurisdiction
or to the person with whom such minor shall reside.
Payment to such minor or incompetent person, or to such
other person as may be determined by the Committee, as
above provided, shall discharge all Employers, the
Committee, the Trustee and any insurance company or
other person or corporation making such payment
pursuant to the direction of the Committee, and none
of the foregoing shall be required to see to the
proper application of any such payment to such person
pursuant to the provisions of this Section 10.7.
10.8 Doubt as to Right to Payment. If at
any time any doubt exists as to the right of any person
to any payment hereunder or as to the amount or time of
such payment (including, without limitation, any doubt
as to identity, or any case in which any notice has been
received from any other person claiming any interest in
amounts payable hereunder, or any case in which a claim
from other persons may exist by reason of community
property or similar laws), the Committee shall be
entitled: (i) in its discretion, to direct the Trustee
(or any insurance company) to hold such sum as a
segregated amount in trust until such right or amount
or time is determined or until order of a court of
competent jurisdiction, or to pay such sum into court
in accordance with appropriate rule of law in such case
then provided, or (ii) to make payment only upon receipt
of a bond or similar indemnification (in such amount and
in such form as is satisfactory to the Committee).
10.9 Forfeiture Upon Inability to Locate Distributee.
Notwithstanding any other provision of the Plan, in the
event that the Committee cannot locate any person to whom
a payment is due under the Plan, and no other payee has
become entitled thereto pursuant to any provision of the
Plan, the benefit in respect of which such payment is to
be made shall be forfeited at such time as the Committee
shall determine in its sole discretion (but in all events
prior to the time such benefit would otherwise escheat
under any applicable state law); provided that any benefit
so forfeited shall be restored if such person subsequently
makes a valid claim for such benefit.
10.10 Contributions Conditioned on Deductibility.
Notwithstanding any other provision of this Plan, each
Before Tax Contribution and related Company Contribution
made by an Employer under this Plan is conditioned on
deductibility of such contribution under section 404 of
the Code.
10.11 No Diversion of Trust Fund. It shall be
impossible at any time for any part of the Trust Fund to
be (within the taxable year or thereafter) used for or
diverted to purposes other than for the exclusive benefit
of Participants and their Beneficiaries (including the
payment of the expenses of the administration of the Plan
and of the Trust); provided that:
10.11.1 A contribution that is made by an
Employer by a mistake of fact shall be returned to such
Employer upon its request within one year after the
payment of the contribution; or
10.11.2 A contribution that is conditioned
upon its deductibility under section 404 of the Code
shall be returned to the contributing Employer upon its
request, to the extent that the contribution is
disallowed as a deduction, within one year after
such disallowance; or
10.11.3 A contribution that is conditioned on
qualification of the Plan under section 401 of the Code
shall, if the Plan does not so qualify, be returned to
the contributing Employer within one year after the date
of denial of qualification of the Plan. Subject to
Article IX, the Trust shall continue for such time
as may be necessary to accomplish the purpose for
which it is created.
10.12 Usage. Whenever applicable the masculine
gender, when used in the Plan, shall include the feminine
and neuter genders, and the singular shall include the
plural.
10.13 Governing Law. The Plan shall be governed
by, construed and administered under the law of the State
of Delaware without regard to the principles of conflict
of laws, to the extent not preempted by federal law.
10.14 Captions. The captions contained herein
are inserted only as a matter of convenience and for
reference and in no way define, limit, enlarge or describe
the scope or intent of the Plan and in no way shall affect
the Plan or the construction of any provision thereof.
IN WITNESS WHEREOF, and as evidence of the restatement
of this Plan, the Company has caused this instrument to be
signed by its duly authorized officer and its corporate s
eal to be hereunto affixed and attested as of this
1st day of January, 1997.
FIRST BRANDS CORPORATION
[SEAL] By: /s/ R. F. Dainton
VP-Human Resources
ATTEST:
/s/ [ ]
(Title)
AMENDMENT TO THE SAVINGS PLAN FOR EMPLOYEES OF FIRST BRANDS
CORPORATION AND ITS PARTICIPATING SUBSIDIARIES RESTATED
JANUARY 1,1997
The Savings Plan for Employees of First Brands
Corporation, restated January 1, 1997, is amended as
follows, effective February 1, 1999, to incorporate
special vesting and contribution provisions for certain
employees of First Brands Corporation affected by the
change in control that occurred January 29, 1999.
1. Section 2.4.2 is amended in its entirety to
read as follows:
Company may contribute to the Trust as Company Contributions
such amounts as it may determine from time to time.
Such amounts shall be allocated among all Participants
who earn a year of Credited Service in the 12-month
period ending June 30 and do not incur a Termination of
Employment prior to the effective date of such contributions.
Notwithstanding the prior sentence each Participant who is an
active Employee at January 29, 1999, shall receive an
allocation of any Company Contributions made to the
Plan effective as of any date between January 29, 1999
and July 1, 1999 regardless of whether such Employee
incurs a Termination of Employment prior to the effective
date of such contributions. Company contributions shall
be allocated among qualifying Participants in proportion
to their Credited Service, provided, however, that the
total Credited Service of any qualifying Participant
described in the prior sentence shall be determined as
if the Participant continued in employment to June 30, 1999.
Notwithstanding anything contained herein to the contrary,
the amounts so contributed (i) shall be fully vested;
(ii) may not be distributed to any Participant prior to a
Participant's Termination of Service; (iii) shall be
initially invested in the shares of The Clorox Company,
but thereafter shall be subject to the Participant's
direction as provided in Section 3.2; and (iv) shall not
be subject to the provisions of Section 4.6.1 (loans).
2. Section 3.2 is amended in its entirety to read as
follows:
Investment Options. Each Participant shall direct that
contributions to his/her Tax Preferred Account and Standard
Investment Account, and any amounts attributable to
discretionary Company Contributions made under Section
2.4.2 and held in the Trust on the Participant's behalf
be invested in one or more of the investment options
designated by the Committee from time to time in
multiples of 1 percent.
3. Section 3.5.1 is amended to read as follows:
A Participant may at any time change his/her investment
options currently in effect with respect to subsequent
Before Tax Contributions, Basic Contributions, related
Company Contributions and Supplemental Contributions made
to his/her Tax Preferred Account and Standard Investment
Account, plus any amounts attributable to discretionary
Company Contributions under Section 2.4.2 and held in
the Trust on the Participant's behalf, subject to the
percentage limitations of Section 3.2 of this Plan, by
providing written notification on forms provided therefor.
Any change will be effective in accordance with the Rules
of the Committee then pertaining.
4. The first two sentences of Section 3.7.3 are
amended to read as follows:
On any Valuation Date, prior to the date on which a
Participant is fully vested in his/her Tax Preferred
Account and Standard Investment Account as described in
Section 4.1.1, the Participant's interest in the Trust
Fund shall be equal to the value of such accounts
determined without reference to the balances in any
subaccount maintained therein. On any Valuation Date
after a Participant is fully vested in his/her Tax
Preferred Account and Standard Investment Account as
described in Section 4.1.1, the Participant's interest
in the Trust Fund shall be equal to the entire value of
such accounts.
5. The first two sentences of Section 4.1.1 are amended
to read as follows:
Unless a Participant makes an election under Section 4.1.2
of this Plan, a Participant described in clauses (i)
through (iii) below shall be fully vested in his/her Tax
Preferred Account and Standard Investment Account, and shall
receive the entire value of such accounts, determined as of
the last Valuation Date preceding his/her termination, in a
single sum:
(i) a Participant whose employment terminates for any
reason (including termination on account of Disability)
other than death and who has completed two years of Credited
Service;
(ii) a Participant who was an active Employee at January 29,
1999, and whose terms of employment are not covered by the
terms of a collective bargaining agreement, regardless of
his/her
years of Credited Service; or
(iii) A Participant whose employment terminates on or after
his Normal Retirement Date.
A Participant not described in the prior sentence shall receive
the value of his/her Tax Preferred Account (exclusive of the
value of his/her Tax Preferred Subaccount).
6. Effective January 29, 1999, all references to the common
stock of First Brands Corporation are replaced by references
to the common stock of The Clorox Company.
IN WITNESS WHEREOF, the Company has caused this instrument to be
signed by its duly authorized officer and its corporate seal
to be hereunto affixed and attested as of this 2nd day of
April, 1999.
FIRST BRANDS CORPORATION
By: /s/ Peter D. Bewley
Senior Vice President and Secretary
