RALSTON PURINA COMPANY
Ralston Purina Company
Restated Savings Investment Plan
Ralston Purina Company
1/01/1999
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Table of Contents
Page
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Recitals 1
ARTICLE I - Definitions 3
Section 1.01 - Accounts 3
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Section 1.02 - Affiliated Company 3
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Section 1.03 - After-Tax Supplemental Contributions 3
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Section 1.04 - After-Tax Supplemental Investment Account 3
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Section 1.05 - Before-Tax Investment Account 3
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Section 1.06 - Before-Tax Matched Contributions 3
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Section 1.07 - Before-Tax Unmatched Contributions 3
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Section 1.08 - Beneficiary 3
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Section 1.09 - Board of Directors 3
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Section 1.10 - CBG Stock 3
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Section 1.11 - Closing Price 4
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Section 1.12 - Code 4
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Section 1.13 - Common Stock 4
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Section 1.14 - Commonly Controlled Entity 4
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Section 1.15 - Company 4
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Section 1.16 - Company Contribution Account 4
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Section 1.17 - Company Matching Contributions 4
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Section 1.18 - Company PAYSOP Account Contributions 5
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Section 1.19 - Compensation 5
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Section 1.20 - Covered Service 5
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Section 1.21 - Disability 6
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Section 1.22 - EBAIC 6
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Section 1.23 - Effective Date 6
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Section 1.24 - Eligible Employee 6
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Section 1.25 - Eligible Spouse 6
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Section 1.26 - Employee 6
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Section 1.27 - Employer 6
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Section 1.28 - Entry Date 6
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Section 1.29 - ESOP Allocated Shares Account 7
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Section 1.30 - ESOP Payment Account 7
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Section 1.31 - ESOP Preferred Stock 7
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Section 1.32 - ESOP Suspense Account 7
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Section 1.33 - ESOP Loan 7
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Section 1.34 - Five-Percent (5%) Owner 7
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Section 1.35 - Highly Compensated Employee 7
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Section 1.36 - Investment Fund or Funds 7
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Section 1.37 - Leased Employee 7
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Section 1.38 - Member 8
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Section 1.39 - Minimum Redemption Value 8
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Section 1.40 - Non-Highly Compensated Employee 8
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Section 1.41 - Participating Unit 8
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Section 1.42 - Plan 8
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Section 1.43 - Prior Plan 8
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Section 1.44 - Plan Administrator 8
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Section 1.45 - Plan Year 8
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Section 1.46 - Profits of EPS 8
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Section 1.47 - Profits of Golden Cat 8
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Section 1.48 - RPG Stock 9
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Section 1.49 - Retirement 9
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Section 1.50 - Rollover Contribution 9
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Section 1.51 - Temporary Employee 9
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Section 1.52 - Termination of Employment 9
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Section 1.53 - Trustee 9
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Section 1.54 - Trust Fund 9
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Section 1.55 - Valuation Date 9
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Section 1.56 - Withdrawal Valuation Date 9
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ARTICLE II - Membership 10
Section 2.01 - Eligibility 10
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Section 2.02 - Membership Application 10
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Section 2.03 - Rehired Former Employee 10
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ARTICLE III - Service 10
Section 3.01 - Absence in Military Service 10
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Section 3.02 - Approved Leave of Absence 10
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Section 3.03 - Family Medical Leave 10
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Section 3.04 - Period of Service 10
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Section 3.05 - Service Definitions 11
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ARTICLE IV - Contributions 12
Section 4.01 - Before-Tax Matched Contributions 12
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Section 4.02 - Company Contributions 12
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Section 4.03 - Before-Tax Unmatched Contributions 14
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Section 4.04 - After-Tax Supplemental Contributions 15
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Section 4.05 - Deferral Percentages 15
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Section 4.06 - Contribution Percentages 17
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Section 4.07 - Change in Before-Tax Matched, Before-Tax Unmatched, and
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Supplemental Contributions 19
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Section 4.08 - Suspension of Before-Tax Matched, Before-Tax Unmatched, and
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Supplemental Contributions 19
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Section 4.09 - Limitation of Contributions 19
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ARTICLE V - Trust Fund 20
Section 5.01 - The Trust Agreement 20
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Section 5.02 - The Trustee 20
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Section 5.03 - Separate Investment Funds 20
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Section 5.04 - Temporary Investment 20
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Section 5.05 - Investment Managers 20
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ARTICLE VI - ESOP Preferred Stock Fund 21
Section 6.01 - The ESOP Preferred Stock Fund 21
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Section 6.02 - ESOP Loans 21
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Section 6.03 - ESOP Loan Payments 22
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Section 6.04 - Release of ESOP Preferred Stock 22
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Section 6.05 - ESOP Preferred Stock Dividends 24
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Section 6.06 - Withdrawals and Distributions. 24
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Section 6.07 - Voting and Tendering 24
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Section 6.08 - Diversification Elections 25
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ARTICLE VII - ESOP Common Stock Fund 26
Section 7.01 - The ESOP Common Stock Fund 26
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Section 7.02 - ESOP Common Stock Dividends 26
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Section 7.03 - Withdrawals and Distributions 27
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Section 7.04 - Voting and Tendering 27
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Section 7.05 - Diversification Elections 27
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ARTICLE VIII - Other Investment Funds 28
Section 8.01 - Other Investment Funds 28
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Section 8.02 - Investment of Contributions 30
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Section 8.03 - Member Responsibility For Selection of Funds 30
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Section 8.04 - Voting and Tendering - Ralston Common Stock 31
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Section 8.05 - Voting and Tendering - Other Stock Funds 31
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ARTICLE IX - Valuation of Assets and Members' Accounts 32
Section 9.01 - Valuation of Assets 32
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Section 9.02 - Valuation of Accounts 32
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Section 9.03 - Statement of Accounts 32
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Section 9.04 - Accounts in Units 32
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ARTICLE X - Vesting of Contributions 32
Section 10.01 - Vesting of Before-Tax and Supplemental Investment
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Accounts 32
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Section 10.02 - Vesting of Company Contributions Account 33
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ARTICLE XI - Distributions 33
Section 11.01 - General 33
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Section 11.02 - Methods of Distribution 34
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Section 11.03 - Qualified Joint and Survivor Annuity 35
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Section 11.04 - Election Not to Receive a Qualified Joint and Survivor
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Annuity 36
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Section 11.05 - Completion of Appropriate Forms 37
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Section 11.06 - Accounts of Former Employees 37
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Section 11.07 - Consent to Payment 37
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Section 11.08 - Latest Deferral of Payment 37
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Section 11.09 - Lost Payees 38
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Section 11.10 - Distribution of Annuity Contracts 38
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ARTICLE XII - Death Benefits 39
Section 12.01 - Death Benefits 39
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Section 12.02 - Beneficiary Designation 39
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Section 12.03 - Pre-Retirement Survivor Annuity 39
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Section 12.04 - Payment of Benefit 39
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Section 12.05 - Latest Time for Payment 39
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Section 12.06 - Payments in the Event of Death with No Designated Survivor or
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Incompetency 40
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Section 12.07 - Renunciation of Death Benefit 40
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Section 12.08 - Proof of Death and Right of Beneficiary or Other Person 40
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ARTICLE XIII - Withdrawal Prior to Termination of Employment 40
Section 13.01 - Withdrawal of Supplemental Contributions 40
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Section 13.02 - Hardship Withdrawal of Before-Tax Contributions and/or Company
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Contributions 40
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Section 13.03 - Age Fifty-Nine and One-Half (59-1/2) Withdrawal 42
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Section 13.04 - Order of Withdrawals 42
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ARTICLE XIV - Forfeitures 42
Section 14.01 - Time of Forfeiture and Restoration 42
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Section 14.02 - Disposition of Forfeitures 43
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Section 14.03 - Effect of Withdrawal Under Article XIII 43
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Section 14.04 - Maternity Absence 43
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ARTICLE XV - Administration of Plan 43
Section 15.01 - Plan Administrator 43
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Section 15.02 - Benefits Council 43
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Section 15.03 - Benefits Policy Board 44
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Section 15.04 - EBAIC 44
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Section 15.05 - Authority and Duties of Various Fiduciaries 45
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Section 15.06 - Named Fiduciaries 46
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Section 15.07 - Delegation 46
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Section 15.08 - Multiple Capacities 46
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ARTICLE XVI - Amendments, Termination, Permanent Discontinuance of
Contributions, Merger or Consolidation 46
Section 16.01 - Amendments 46
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Section 16.02 - Termination or Permanent Discontinuance of Contributions 47
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Section 16.03 - Partial Termination 47
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Section 16.04 - Benefits in Case of Merger or Consolidation 47
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ARTICLE XVII - Loans 47
Section 17.01 - Loans 47
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Section 17.02 - Interest Rates 48
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Section 17.03 - Other Rules 48
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ARTICLE XVIII - Miscellaneous 48
Section 18.01 - Benefits Payable from Trust Fund 48
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Section 18.02 - Elections 48
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Section 18.03 - No Right to Continued Employment 49
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Section 18.04 - Inalienability of Benefits and Interest 49
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Section 18.05 - Payments for Exclusive Benefits of Members 49
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Section 18.06 - Missouri Law to Govern 49
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Section 18.07 - No Guarantee 49
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Section 18.08 - Address of Record 49
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Section 18.09 - Participating Units 50
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Section 18.10 - Headings 50
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Section 18.11 - Use of Masculine Terms 50
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Section 18.12 - Payment of Expenses 50
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Section 18.13 - Rollover Contributions 50
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ARTICLE XIX - Claim Procedure 51
Section 19.01 - Initial Determination 51
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Section 19.02 - Review 51
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ARTICLE XX - Limitation on Contributions 51
Section 20.01 - Maximum Annual Additions 51
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ARTICLE XXI - Top-Heavy Provisions 54
Section 21.01 - Application of Top-Heavy Provisions 54
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Section 21.02 - Definitions 55
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Section 21.03 - Minimum Contribution 56
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Section 21.04 - Limit on Annual Additions: Combined Plan Limit 56
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EXHIBIT A 58
<PAGE>
RALSTON PURINA COMPANY RESTATED SAVINGS INVESTMENT PLAN
Ralston Purina Company (hereinafter the "Company") on behalf of itself and those
domestic corporations (hereinafter the "Affiliated Companies") in which it
directly or indirectly owns more than 50% of the voting stock and which, with
the approval of the Company, elects to adopt the savings and stock bonus plan
covered hereby,
WITNESSETH:
Whereas, the Company established the Ralston Purina Company Savings Investment
Plan for salaried, administrative, and clerical employees (the "SAC SIP"),
effective January 1, 1989, which resulted from the merger of the Ralston Purina
Savings Investment Plan effective April 1, 1983, and the implementation of a
leverageable employee stock ownership plan component (the "Leveraged ESOP");
Whereas, the Company established the Ralston Purina Company Savings Investment
Plan for Production Employees, effective January 1, 1988, for production
employees (the "Production SIP");
Whereas, the Company merged the Production SIP with the SAC SIP, effective
January 1, 1992;
Whereas, the Leveraged ESOP expired effective December 31, 1998 as a result of
the payment in full of the ESOP Notes;
Whereas, the Company has reserved the right to amend the Plan;
Whereas, effective as of January 1, 1999, the Company wishes to amend the Plan
to adopt a new Company Matching Contribution formula, and to implement a Common
Stock ESOP;
Whereas, the Company wishes to further amend the Plan to comply with the
provisions of the Uruguay Round Agreements Act ("GATT"), the Small Business Job
Protection Act of 1996, and the Uniformed Services Employment and Reemployment
Rights Act of 1994 ("USERRA"), the Taxpayer Relief Act of 1997 ("TRA '97"), and
the Internal Revenue Service Restructuring and Reform Act of 1998;
Whereas, the Company wishes to further amend the Plan to reflect credit for past
service for eligibility and vesting of certain employees as a result of the
acquisition by the Company of certain businesses; and
Whereas, effective December 3, 1997, the Company sold its protein technologies
business; effective April 1, 1998, the Company spun off its international animal
feed business and, effective April 1, 2000, spun off its battery and lighting
products business, to the shareholders of Ralston Purina Company common stock,
in spin-offs qualifying under Code Section 355; the Plan is hereby amended to
reflect the spin-off of the account balances of participants who were employees
of the respective divested companies.
Now, therefore, resolved that the Ralston Purina Company Savings Investment Plan
is hereby amended and restated to reflect the above changes, generally effective
as of January 1, 1999, unless otherwise indicated.
<PAGE>
RALSTON PURINA COMPANY RESTATED SAVINGS INVESTMENT PLAN
ARTICLE I - Definitions
Section 1.01 - Accounts
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Accounts shall mean, with respect to any Member, his Basic and Supplemental
Investment Accounts, his Company Contribution Account, and his Rollover Account.
Section 1.02 - Affiliated Company
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Affiliated Company shall mean (a) any company more than fifty percent (50%) of
the voting stock of which is directly or indirectly owned by Ralston Purina
Company or by any successor, and (b) any Commonly Controlled Entity; provided,
however, that a company shall not be an Affiliated Company unless Common Stock
would be employer securities within the meaning of Code Section 409(l) with
respect to such company.
Section 1.03 - After-Tax Supplemental Contributions
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After-Tax Supplemental Contributions shall mean the matched and unmatched
contributions of a Member which are credited to his After- Tax Supplemental
Investment Account in accordance with Section 4.04.
Section 1.04 - After-Tax Supplemental Investment Account
--------------------------------------------
After-Tax Supplemental Investment shall mean that portion of the Trust Fund
which, with respect to any Member, is attributable to his own After-Tax
Supplemental Contributions, and any investment earnings and gains or losses
thereon.
Section 1.05 - Before-Tax Investment Account
-------------------------------
Before-Tax Investment Account shall mean that portion of the Trust Fund which,
with respect to any Member, is attributable to Before-Tax Matched and Before-Tax
Unmatched Contributions under the Plan and any investment earnings and gains or
losses thereon.
Section 1.06 - Before-Tax Matched Contributions
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Before-Tax Matched Contributions shall mean the amount remitted by the Employer
in accordance with Section 4.01.
Section 1.07 - Before-Tax Unmatched Contributions
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Before-Tax Unmatched Contributions shall mean the amount remitted by the
Employer in accordance with Section 4.03.
Section 1.08 - Beneficiary
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Beneficiary shall mean any person or persons designated in accordance with
Section 12.02.
Section 1.09 - Board of Directors
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Board of Directors shall mean the Board of Directors of Ralston Purina Company
and any committee of directors authorized by such Board to act in its behalf
with reference to the Plan.
Section 1.10 - CBG Stock
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CBG Stock shall mean the Ralston-Continental Baking Group $.10 Par Value Common
Stock, effective July 30, 1993 through May 15, 1995.
Section 1.11 - Closing Price
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Closing Price shall mean the price assigned to a transaction order on a
Valuation Date. Generally, the Closing Price is determined by the Trustee on
the day the order is placed. However, if, in the best judgment of the EBAIC, it
would not be in the best interests of Plan Participants to determine the Closing
Price on the day the order is placed, due to unusual circumstances, EBAIC may,
in its sole discretion, complete the order in such manner as the members thereof
deem prudent. If a transaction is completed over several days, Participants who
placed such orders on the original date will not be permitted to effect any
other transactions, other than making contributions and loan repayments, until a
Closing Price for the original Valuation Date is established. The Closing Price
assigned to such orders will reflect the average price of the transactions
necessary to complete the orders.
Section 1.12 - Code
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Code shall mean the Internal Revenue Code of 1986, as amended from time to time.
Reference to any section or subsection of the Code includes reference to any
comparable or succeeding provisions of any legislation which amends, supplements
or replaces such section or subsection.
Section 1.13 - Common Stock
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Common Stockshall mean the common stock of Ralston Purina Company and shall
include any other authorized class or series of Common Stock outstanding upon
the reclassification of any of such classes or series of Common Stock,
including, without limitation, any stock split-up, stock dividend, creation of
targeted stock or other distributions of stock in respect of stock (other than
stock distributions with respect to transactions under Code Section 355); or any
reverse stock split-up, or recapitalization of the Company, or any merger or
consolidation of the Company with any Affiliated Company. Common Stock shall
include CBG or RPG Stock from July 30, 1993 through February 1, 1996.
Section 1.14 - Commonly Controlled Entity
----------------------------
Commonly Controlled Entity shall mean (1) any corporation which is a member of
the same controlled group of corporations within the meaning of Code Section
414(b) as Ralston Purina Company, (2) any trade or business (whether or not
incorporated) which is under common control with Ralston Purina Company within
the meaning of Code Section 414(c), and (3) any organization which is a member
of an affiliated service group within the meaning of Code Section 414(m) of
which a Company is also a member, and (4) any entity which is required to be
aggregated under Code Section 414(o).
Section 1.15 - Company
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Company shall mean Ralston Purina Company, a Missouri corporation, and any
Affiliated Company.
Section 1.16 - Company Contribution Account
------------------------------
Company Contribution Account shall mean that portion of the Trust Fund which,
with respect to any Member, is attributable to any contributions made on the
Member's behalf by the Company in accordance with Section 4.02 and any
investment earnings and gains or losses thereon.
Section 1.17 - Company Matching Contributions
--------------------------------
Company Matching Contributions shall mean the amount contributed by the Employer
in accordance with Section 4.02(a)(i).
Section 1.18 - Company PAYSOP Account Contributions
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Company PAYSOP Account Contributions shall mean the amount contributed by the
Employer in accordance with Section 4.02(a)(iii).
Section 1.19 - Compensation
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Compensation, or Benefit Earnings, shall mean the basic compensation and such
other forms of cash compensation paid for employment in Covered Service, as
determined by the Plan Administrator including but not limited to, regular cash
bonuses (unless the Member elects to defer such compensation under a Company
sponsored deferred compensation plan); payments made under a Code Section 125
Cafeteria Plan; payments received by Members as a result of non-occupational
sicknesses or injuries as wage replacement; and payments received by a Member
under any type of Company sponsored voluntary supplementation of worker's
compensation payments. Compensation shall not include employer paid
reimbursements and allowances, or non-recurring awards. Compensation for
purposes of this Plan is based on total compensation from the Company, subject
to the exclusions noted in Exhibit A. The exclusions are designed to eliminate
payments which do not constitute regular, recurring compensation. Benefit
Earnings are calculated before contributions to the Savings Investment Plan or
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the Section 125 Plan are deducted. The list included in Exhibit A is intended
to be illustrative and is not all inclusive. For Plan Years commencing on or
after January 1, 1994, Compensation for purposes of the Plan shall not exceed
the dollar limit provided under Code 401(a)(17) of the Code, or such increases
as the Secretary of Treasury may determine in accordance with Code Section
401(a)(17).
Section 1.20 - Covered Service
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Covered Service means employment of an Employee by an Employer in a
Participating Unit, as a regular Employee for which the Employee is paid from a
United States dollar payroll maintained in the United States and for which the
Employee receives a regular and stated compensation or retainer and an Employee,
while designated as an Internationally Assigned Employee in a sales,
administrative, clerical, or production capacity for which the Employee receives
a regular stated compensation or retainer which is subject to taxes imposed by
the Federal Insurance Contributions Act; provided that the following service
shall not be Covered Service:
(a) Employment excepted by the Board of Directors, or by the Plan
Administrator pursuant to authority delegated to it by the Board of Directors,
on a uniform and nondiscriminatory basis with respect to persons similarly
situated including, but not limited to, employment as an Employee engaged in the
Golden Products business located at the Springfield, Missouri location, other
than an Employee who immediately prior to being engaged in such business was
engaged in other Covered Service;
(b) Employment subject to a collective bargaining agreement the terms
and conditions of which do not make this Plan applicable to it; and
(c) Employment as a Leased Employee;
(d) Employment as a Temporary Employee; and
(e) Employment as a fee-for-service worker or independent contractor or
in a similar capacity (rather than in the capacity of an Employee), or as an
employee of a temporary help firm, technical help firm, staffing firm, or
similar organization, or as a worker not contemporaneously classified as an
Employee on the Company's payroll system; regardless of such individual's status
under common law, including any such individual who is or has been determined by
a third party (including, without limitation, a government agency or board or
court or arbitrator) to be an Employee of the Company, or any Affiliated Company
for any purpose, including, for purposes of any employee benefit plan of the
Company or any Affiliated Company (including this Plan) or for purposes of
federal, state, or local tax withholding, employment tax, or employment law.
Section 1.21 - Disability
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Disability shall mean, (a) being disabled within the meaning of any pension plan
or long term disability plan of an Employer under which a Member is entitled to
receive benefits and which results in Termination of Employment, or (b) if (a)
is not applicable, as provided in Code Section 72(m)(7), being unable to engage
in any substantial gainful activity by reason of any medically determined
physical or mental impairment which can be expected to result in death or to be
of a long continued and indefinite duration which results in a Termination of
Employment.
Section 1.22 - EBAIC
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EBAIC shall mean the Employee Benefit Asset Investment Committee, as provided in
Article XV.
Section 1.23 - Effective Date
---------------
Effective Date shall mean January 1, 1999, except as otherwise provided herein,
in respect of Ralston Purina Company, and the date as of which the Plan is
adopted by an Affiliated Company, with respect to such company.
Section 1.24 - Eligible Employee
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Eligible Employee shall mean an Employee who has satisfied the eligibility
requirement of Section 2.01 and is employed in Covered Service.
Section 1.25 - Eligible Spouse
----------------
Eligible Spouse shall mean the person to whom a Member is lawfully married at
the time benefit payments to the Member from this Plan commence, or in the case
of a Member who dies before such time, the person to whom the Member is lawfully
married on the date of death of the Member.
Section 1.26 - Employee
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Employee shall mean any person employed by the Company, including a Leased
Employee.
Section 1.27 - Employer
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Employer shall mean Ralston Purina Company or any Affiliated Company by whom the
Employee is employed that contributes to the Plan for the benefit of its
employees with the approval of the Plan Administrator. Any such Company that
contributes to the Plan shall thereby agree to all of the terms and conditions
of the Plan.
Section 1.28 - Entry Date
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Entry Date shall mean, with respect to an Eligible Employee first hired after
February 28, 1995, the first day of the second month immediately following his
or her Employment Commencement Date. For all other Eligible Employees, Entry
Date shall mean the earlier of: (i) the first day of the month immediately
following the completion by the Employee of a one-year Period of Service, or
(ii) May 1, 1995.
Notwithstanding the foregoing, for all Eligible Employees of Energizer Power
Systems, a division of Eveready Battery Company, Inc., who were employed by
Gates Energy Products Inc. as of August 27, 1993, Entry Date shall mean August
28, 1993.
Section 1.29 - ESOP Allocated Shares Account
--------------------------------
ESOP Allocated Shares Account shall mean that portion of the Ralston Purina ESOP
Preferred Stock Fund described in Section 6.04(a).
Section 1.30 - ESOP Payment Account
----------------------
ESOP Payment Account shall mean that portion of the Ralston Purina ESOP
Preferred Stock Fund described in Section 6.03.
Section 1.31 - ESOP Preferred Stock
----------------------
ESOP Preferred Stock shall mean the Series A Convertible Preferred Stock issued
by Ralston Purina Company to be held as qualifying employer securities under the
Plan.
Section 1.32 - ESOP Suspense Account
-----------------------
ESOP Suspense Account shall mean the separate account to which shares of ESOP
Preferred Stock acquired with the proceeds of an ESOP Loan are allocated.
Section 1.33 - ESOP Loan
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ESOP Loan shall mean a loan to the Plan from or guaranteed by the Company which
satisfies the requirements of Article VI.
Section 1.34 - Five-Percent (5%) Owner
-------------------------
Five-Percent (5%) Owner shall mean an Employee who is a five-percent (5%) owner
as defined in Code Section 416(i)(1)(B)(i).
Section 1.35 - Highly Compensated Employee
-----------------------------
Highly Compensated Employee shall mean any Employee who is a highly-compensated
employee as defined in Section 414(q) of the Code and regulations thereunder.
Section 1.36 - Investment Fund or Funds
---------------------------
Investment Fund or Funds shall mean the separate funds established within the
Trust in accordance with Article VIII.
Section 1.37 - Leased Employee
----------------
Leased Employee shall mean a person who provides services to the Company and --
(1) such services are provided pursuant to an agreement (written
or oral) between the Company, and any other person ("leasing organization"),
(2) such person has performed such services for the Company on a
substantially full-time basis for a period of at least one year, and
(3) such services are performed under primary direction or control
by the recipient for all Plan years beginning after December 31, 1996. For all
Plan years beginning prior to January 1, 1997, this item 3 shall read: such
services are of a type historically performed in the business field of the
Company by Employees.
A person shall not be deemed a Leased Employee if he is covered by a plan
maintained by a leasing organization which is a money purchase pension plan with
a non-integrated employer contribution rate of at least ten percent (10%) of
compensation, and provides for immediate participation and for full and
immediate vesting provided that Leased Employees constitute less than twenty
percent (20%) of the Company's Non-Highly Compensated Employees.
Section 1.38 - Member
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Member shall mean any person included in the membership of the Plan as provided
in Article II. Unless otherwise specified, Member shall include "EPS Member"
and "Golden Cat Member" as defined in Article IV.
Section 1.39 - Minimum Redemption Value
--------------------------
Minimum Redemption Value shall be an amount equal to the total cost of ESOP
Preferred Stock acquired by the Trustee with the proceeds of an ESOP Loan
divided by the total number of shares so acquired.
Section 1.40 - Non-Highly Compensated Employee
---------------------------------
Non-Highly Compensated Employee shall mean any Employee who is neither a Highly
Compensated Employee nor a family member of a Highly Compensated Employee, as
defined in Section 414(q) of the Code and regulations thereunder.
Section 1.41 - Participating Unit
-------------------
Participating Unit shall mean Ralston Purina Company or any subsidiary of
Ralston Purina Company that contributes to the Plan for the benefit of its
Employees with the approval of the Plan Administrator, and any unit of Employees
of the Company or an Affiliated Company authorized to participate in the Plan in
accordance with Section 18.09.
Section 1.42 - Plan
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Plan shall mean the Ralston Purina Company Restated Savings Investment Plan, as
described herein or as hereafter amended.
Section 1.43 - Prior Plan
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Prior Plan shall mean the Ralston Purina Company Savings Investment Plan as in
effect on December 31, 1998.
Section 1.44 - Plan Administrator
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Plan Administrator shall mean Ralston Purina Company.
Section 1.45 - Plan Year
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Plan Year shall mean the calendar year.
Section 1.46 - Profits of EPS
----------------
Profits shall mean both the accumulated earnings and profits and current net
taxable income of the Company attributable to the Energizer Power Systems
division ("EPS"), before deduction of federal, state, and local income taxes and
before any contributions made by the Company to this or any other employee
benefit plan maintained by the Company, on behalf of employees of EPS, as
determined by its independent public accountants in accordance with generally
accepted accounting principles.
Section 1.47 - Profits of Golden Cat
------------------------
Profits shall mean both the accumulated earnings and profits and current net
taxable income of the Company attributable to the Golden Cat Division ("Golden
Cat"), before deduction of federal, state, and local income taxes and before any
contributions made by the Company to this or any other employee benefit plan
maintained by the Company, on behalf of employees of Golden Cat, as determined
by its independent public accountants in accordance with generally accepted
accounting principles.
Section 1.48 - RPG Stock
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RPG Stock shall mean the Ralston - Ralston Purina Group Common $.10 Par Value
Stock, effective July 30, 1993, through February 1, 1996.
Section 1.49 - Retirement
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Retirement shall mean early or normal retirement under any other retirement plan
of the Company, provided such retirement results in the Member's Termination of
Employment.
Section 1.50 - Rollover Contribution
----------------------
Rollover Contribution shall mean that portion of the Trust Fund which, with
respect to any Member, is attributable to Rollover Contributions under Section
18.13 under the Plan, and any investment earnings and gains or losses thereon.
Section 1.51 - Temporary Employee
-------------------
Temporary Employee shall mean an Employee who is hired (i) to complete a special
project of limited duration, or (ii) to fill the vacancy of an Employee who is
on a leave of absence.
Section 1.52 - Termination of Employment
---------------------------
Termination of Employment shall mean separation from the employment of the
Company for any reason, including, but not limited to, Retirement, death,
Disability, resignation or dismissal by the Company; provided, however, that a
transfer of employment between Ralston Purina Company and an Affiliated Company
or between Affiliated Companies shall not be deemed to be "Termination of
Employment." Notwithstanding the foregoing, for purposes hereunder, an Employee
who has been placed on inactive status for a twelve (12) consecutive month
period shall be treated as having incurred a termination of Employment;
provided, however, if a definite date has been established at which time the
Employee is expected to return to Covered Service, then the person shall not be
deemed to have incurred a "Termination of Employment". With respect to any
leave of absence or any period of service in the Armed Forces of the United
States ("Armed Forces"), Article III shall govern.
Section 1.53 - Trustee
-------
Trustee shall mean a trustee or trustees at any time acting as such under a
trust agreement or agreements established for purposes of this Plan.
Section 1.54 - Trust Fund
-----------
Trust Fund shall mean the cash and other properties arising from contributions
made in accordance with the provisions of this Plan.
Section 1.55 - Valuation Date
---------------
Valuation Date shall mean the date reflecting the effective date on which a
transaction was implemented at the Closing Price established for that date.
Section 1.56 - Withdrawal Valuation Date
---------------------------
Withdrawal Valuation Date shall mean, with respect to a Member, the Valuation
Date coinciding with, or immediately following, the date on which his request
for a withdrawal under the Plan is effected by the Plan Administrator.
ARTICLE II - Membership
Section 2.01 - Eligibility
-----------
An Employee shall be eligible for membership in the Plan on any Entry Date on
which the Employee is employed in Covered Service.
Section 2.02 - Membership Application
-----------------------
An Eligible Employee may become a Member on an Entry Date by completing and
submitting to the Plan Administrator in a timely manner an application form
supplied by the Plan Administrator on which he designates the percentage of his
Compensation he wishes to be contributed to this Plan by means of deductions
from his Compensation, he chooses one or more Investment Fund(s), and he names a
Beneficiary. Participation in the Plan by an Eligible Employee is voluntary.
Section 2.03 - Rehired Former Employee
-------------------------
If a former Employee formerly eligible for membership under Section 2.01 above
is rehired after a Severance from Service Date as defined in Section 3.05(d),
the former Employee shall again be eligible to become a Member of the Plan on
the date of his re-employment as an Eligible Employee.
ARTICLE III - Service
Section 3.01 - Absence in Military Service
------------------------------
If an Employee shall have been absent from the service of the Company because of
service in the Armed Forces of the United States and if he shall have returned
to the service of the Company within the period during which re-employment
rights are extended by law, such absence shall not count as a period of
severance. Any period of such absence which is not otherwise included in his
Period of Service shall be so included. Notwithstanding any provision of this
Plan to the contrary, contributions, benefits, and service credit with respect
to qualified military service will be provided in accordance with Section 414(a)
of the Internal Revenue Code.
Section 3.02 - Approved Leave of Absence
----------------------------
A period during which an Employee is on a leave of absence approved by the
Company not otherwise included in a Period of Service shall, if the Plan
Administrator so determines, be so included under rules established by the Plan
Administrator uniformly applicable to all Employees similarly situated.
Section 3.03 - Family Medical Leave
----------------------
If an Employee is absent from the service of the Company because of a leave of
absence which qualifies as a leave under the Family Medical Leave Act, such
absence shall be included in the Period of Service.
Section 3.04 - Period of Service
-------------------
The Period of Service of an Employee means the period of Covered Service
beginning on an Employment Commencement Date of an Employee and ending on the
Severance from Service Date of the Employee that next follows such an Employment
Commencement Date. Nonconsecutive Periods of Service shall be aggregated and
three hundred sixty-five (365) days of service shall equal a whole year of
service. If an Employee performs an Hour of Service within twelve (12) months
of a Severance from Service Date, the Employee's Period of Service shall include
the time which elapsed between the date of such a Severance from Service Date
and such date of re-employment.
Additionally, the following Covered Service shall be included in an Employee's
Period of Service:
(a) service with Beech-Nut Nutrition Corporation, a division of
Nestle, Inc., for all employees of Beech-Nut Nutrition Corporation on November
2, 1989, who became Employees of the Company on November 3, 1989;
(b) service with Solka-Floc, a division of James River Traders,
Inc., for all employees of Solka-Floc on September 29, 1991, who became
Employees of the Company on September 30, 1991;
(c) service with Gates Energy Products, Inc., for all employees
who were employed by Gates Energy Products, Inc. on August 27, 1993, who became
Employees of Eveready Battery Company, Inc. on August 28, 1993;
(d) service with Interstate Brands Corporation for all employees
who were employed by Interstate Brands Corporation on January 23, 1994, at their
Los Angeles bakery location, who became Employees of Continental Baking Company
on January 24, 1994;
(e) service with National Oats, a division of Curtice Burns, Inc.,
for all employees of National Oats on November 18, 1993, who became Employees of
the Company on November 19, 1993.
(f) service with Breckenridge Ski Corporation for all employees of
Breckenridge Ski Corporation on May 2, 1993 who became Employees of Keystone
Management, Inc. on May 3, 1993.
(g) service with Golden Cat Corporation for all employees who were
employed by Golden Cat Corporation on April 6, 1995 who became Employees of the
Company on April 7, 1995 ("Golden Cat Member").
Section 3.05 - Service Definitions
--------------------
(a) "Employment Commencement Date" shall mean the date the
Employee first performs an Hour of Service; provided that, if an Employee incurs
a Break in Service of at least one year, the Employment Commencement Date of the
Employee shall be the first day on which the Employee performs an Hour of
Service after incurring such a Break in Service.
(b) "Break in Service" means the period following a Severance from
Service Date extending until the Employee again completes an Hour of Service.
(c) "Hour of Service" means an hour for which an Employee is paid,
or entitled to payment, for the performance of duties for the Company.
(d) "Severance from Service Date" means the earlier of (1) the
date the Employee retires, dies, resigns or is discharged, or (2) the first
anniversary of the date on which the Employee begins a period of absence, with
or without pay, with the Company, subject, however, to the provisions of Section
1.52.
ARTICLE IV - Contributions
Section 4.01 - Before-Tax Matched Contributions
----------------------------------
(a) Subject to the provisions of subparagraphs (b) and (c) hereof:
(i) For Plan Years commencing on or after January 1, 1999, each
Member, other than an EPS Member, may elect to reduce his Compensation in any
amount from one percent (1%) to four percent (4%) [in one percent (1%)
increments] of his Compensation for each payroll period subject to the
provisions set forth in Sections 4.01(b) and (c), 4.05, 4.09, and Article XX,
and his Employer shall remit to the Plan on his behalf Before-Tax Matched
Contributions equal to the amount of the reduction in his Compensation as soon
as practicable after the end of the payroll period. Such contribution shall in
no event be made later than the time period specified in Department of Labor
Regulation 2510.3-102.
(ii) For Plan Years commencing on or after January 1, 1989, but
ending on or before December 31, 1998, each Member, other than an EPS Member,
may elect to reduce his Compensation in any amount from two percent (2%) to six
percent (6%) [in one percent (1%) increments] of his Compensation for each
payroll period subject to the provisions set forth in Sections 4.01(b) and (c),
4.05, 4.09, and Article XX, and his Employer shall remit to the Plan on his
behalf Before-Tax Matched Contributions equal to the amount of the reduction in
his Compensation as soon as practicable after the end of the payroll period.
Such contribution shall in no event be made later than the time period specified
in Department of Labor Regulation 2510.3-102. Notwithstanding the foregoing, an
Employee of the Golden Cat business, who was an employee of such business
immediately prior to its acquisition by the Company and who, as a result of the
acquisition, became an Employee ("Golden Cat Member"), shall not be entitled to
elect to make Before-Tax Matched Contributions for the period commencing April
7, 1995 through December 31, 1995.
(b) From the period commencing August 28, 1993 through October 31,
1999, an Employee of the EPS business immediately prior to its acquisition by
the Company, and who, as a result of the acquisition, became an Employee ("EPS
Member"), may elect to reduce his Compensation in any amount from one percent
(1%) to three percent (3%) [in one percent (1%) increments] of his Compensation
for each payroll period, subject to the provisions set forth in Sections
4.01(c), 4.05, 4.09, and Article XX, and his Employer shall remit to the Plan on
his behalf Before-Tax Matched Contributions equal to the amount of the reduction
in his Compensation as soon as practicable after the end of the payroll period.
Such contribution shall in no event be made later than the time period specified
in Department of Labor Regulation 2510.3-102.
(c) Notwithstanding the foregoing, the Employer shall not remit to
the Plan any Before-Tax Matched Contributions on behalf of any Member who
receives a hardship withdrawal of his Before-Tax Contribution Account or his
Company Matching Contribution Account after February 28, 1995, in accordance
with Section 13.02, during the twelve-month period immediately following such
withdrawal.
Section 4.02 - Company Contributions
----------------------
(a) (i) Company Matching Contributions, Post-1998. For Plan
-------------------------------------------
Years commencing on or after January 1, 1999, the Company shall contribute to
the Plan as of each payroll period an amount equal to twenty-five percent (25%)
of the aggregate Before-Tax Matched Contributions described in Section
4.01(a)(i), for such period. Notwithstanding the foregoing, no Company Matching
Contributions shall be made on behalf of any Member who has not completed a one
(1)-year Period of Service.
(ii) Company Matching Contributions, Pre-1999. For Plan
-------------------------------------------
Years commencing on or after January 1, 1989 and ending on or before December
31, 1998, the Company shall from time to time, within a loan amortization
period, contribute to the Plan such amounts which will, in the aggregate at the
end of such loan amortization payment period (as described in Section 6.04
herein), equal the amount which, when combined with other amounts credited to
the Loan Payment Account and, at the EBAIC's direction, with dividends paid or
payable with respect to shares of ESOP Preferred Stock allocated to Member's
Accounts, equal the dollar amount of the loan amortization payment which may be
required pursuant to the terms of any outstanding ESOP Loan.
(iii) Company "PAYSOP" Account Contributions. The Company
-----------------------------------------
shall also contribute to the Plan as of each December 31, commencing December
31, 1989 and ending December 31, 1993, an amount equal to twenty percent (20%)
of the aggregate value of the accounts transferred on March 1, 1989 from the
Purina ESOP for Production Employees, and Purina ESOP for SAC Employees, (the
"PAYSOPs") to the SAC SIP and the Production SIP, of Members who are Employees
on the September 30 immediately preceding the respective above-designated
contribution date. For purposes of determining the amount of the Company
contribution described hereunder, the value of the accounts transferred from the
PAYSOPs shall be determined as of December 31, 1988.
(iv) Golden Cat Company Profit Sharing Contribution. For the
----------------------------------------------
period commencing April 7, 1995 and ending December 31, 1995, the Company, in
its sole discretion, shall contribute to the Plan on behalf of each Golden Cat
Member an amount equal to 7.818% of the Member's Compensation for such period,
based on the Profits of Golden Cat for such period and subject to the provisions
of Article XX.
(v) Energizer Power Systems Company Basic Contributions. The
----------------------------------------------------
Company shall contribute to the Plan each month on behalf of each EPS Member an
amount equal to three percent (3%) of each Member's monthly Compensation. Such
Company Basic Contributions shall be made from Profits, as determined in the
sole discretion of the Company.
(vi) Energizer Power Systems Company Matching Contributions.
--------------------------------------------------------
The Company shall contribute to the Plan on behalf of each EPS Member who makes
an election in accordance with Section 4.01(b), an amount out of Profits equal
to one hundred percent (100%) of the Before-Tax Matched Contributions made on
behalf of each EPS Member, subject to the provisions of Article XX, if the
Profits of EPS are sufficient, as determined in the sole discretion of the
Company.
(b) (i) Each Employer shall, for any Plan Year, contribute a
portion of the total Company Matching Contributions, made pursuant to
subparagraphs (a)(i) and (ii) above, equal to the total Company Matching
Contributions multiplied by a fraction, the numerator of which is the aggregate
Before-Tax Matched Contributions described in Section 4.01(a), allocated to each
Member, for periods while they are Employees of such Employer, and the
denominator of which is the total aggregate Before-Tax Matched Contributions
described in Section 4.01, subject to the provisions of Section 14.02.
Notwithstanding the foregoing, for purposes of this subparagraph, the Before-Tax
Matched Contributions of a Member who has not completed a one (1) year Period of
Service shall not be taken into account.
(ii) Each Employer shall, for each Plan Year ending on or
after December 31, 1989, but no later than December 31, 1998, contribute a
portion of the total Company PAYSOP Account Contributions, made pursuant to
subsection (a)(ii) above, equal to the total Company PAYSOP Account
Contributions of Members who are Employees of such Employers on September 30
immediately preceding the contribution date identified in subparagraph (a)(ii)
above.
(iii) The Employer of an EPS Member may, in its discretion,
for any Plan Year, contribute a portion of the total Company Matching
Contributions, made pursuant to subparagraph (a)(vi) above, equal to the total
Company Matching Contributions multiplied by a fraction, the numerator of which
is the aggregate Before-Tax Matched Contributions described in Section 4.01(b),
allocated to each EPS Member, for periods while they are Employees of such
Employer, and the denominator of which is the total aggregate Before-Tax Matched
Contributions described in Section 4.01(b) of all EPS Members, subject to the
provisions of Section 14.02 .
(c) In satisfaction of its obligation under subsection (a), an
Employer may pay its contribution in cash or, for Plan Years on or beginning
after January 1, 1989, but ending on or before December 31, 1998, to the extent
provided by Section 6.04(b) may contribute shares of ESOP Preferred Stock, or
for Plan Years beginning after December 31, 1998, may contribute shares of
Common Stock.
(d) In the event that the Commissioner of Internal Revenue, on
timely application made after the adoption of the Plan, as restated, determines
that the Plan and the implementing trust do not qualify for tax-exempt status,
or refuses, in writing, to issue a favorable determination with respect to the
Plan and such trust, the Employer contributions made on or after the date on
which such determination or refusal is applicable shall be returned to the
Employer without interest. In the event that an Employer contribution to the
Plan is made by a mistake of fact or all or part of the Employer's deductions
under Code Section 404 for con-tributions to the Plan are disallowed by the
Internal Revenue Service, the portion of the contributions attributable to such
mistake of fact or to which such disallowance applies shall be returned to the
Employer without interest.
Any such return shall be made within one year after the making of such
contribution by mistake of fact or the denial of qualification or disallowance
of deductions, as the case may be.
Section 4.03 - Before-Tax Unmatched Contributions
------------------------------------
(a) For Plan Years commencing on or after January 1, 1999, a
Member, other than an EPS Member, who has elected the maximum Before-Tax Matched
Contribution rate of four percent (4%) may elect to further reduce his
Compensation by an additional one percent (1%) to ten percent (10%) [in one
percent (1%) increments] of his Compensation for each payroll period, subject to
the provisions set forth in Sections 4.03(c) and (d), 4.05, 4.09, and Article
XX, and his Employer shall remit to the Plan on his behalf Before-Tax Unmatched
Contributions equal to the amount of the reduction in his Compensation as soon
as practicable after the end of the payroll period. Such contribution shall in
no event be made later than the time period specified in Department of Labor
Regulation 2510.3-102.
(b) For Plan Years commencing on or after January 1, 1989 and
ending on or before December 31, 1998, a Member who has elected the maximum
Before-Tax Matched Contribution rate of six percent (6%) may elect to further
reduce his Compensation by an additional one percent (1%) to six percent (6%)
[in one percent (1%) increments] of his Compensation for each payroll period,
subject to the provisions set forth in Sections 4.03(c) and (d), 4.05, 4.09, and
Article XX, and his Employer shall remit to the Plan on his behalf Before-Tax
Unmatched Contributions equal to the amount of the reduction in his Compensation
as soon as practicable after the end of the payroll period. Such contribution
shall in no event be made later than ninety (90) days after the end of such
payroll period. Notwithstanding the foregoing, a Golden Cat Member, during the
period beginning April 7, 1995 and ending December 31, 1995, may elect to reduce
his Compensation by one percent (1%) to thirteen percent (13%) in one percent
(1%) increments of his Compensation for each payroll period subject to the
provisions set forth in Sections 4.03(d), 4.05, 4.09, and Article XX, and his
Employer shall remit to the Plan on his behalf Before-Tax Unmatched
Contributions equal to the amount of the reduction in his Compensation as soon
as practicable after the end of the payroll period. Such contribution shall in
no event be made later than the time period specified in Department of Labor
Regulation 2510.3-102.
(c) An EPS Member who has elected the maximum Before-Tax Matched
Contribution rate of three percent (3%), may elect to further reduce his
Compensation by an additional one percent (1%) to six percent (6%) [in one
percent (1%) increments] of his Compensation for each payroll period, subject to
the provisions set forth in Sections 4.03(d), 4.05, 4.09 and Article XX, and his
Employer shall remit to the Plan on his behalf Before-Tax Unmatched
Contributions equal to the amount of the reduction in his Compensation as soon
as practicable after the end of the payroll period. Such contribution shall in
no event be made later than the time period specified in Department of Labor
Regulation 2510.3-102.
(d) Notwithstanding the foregoing, the Employer shall not remit to
the Plan any Before-Tax Unmatched Contributions on behalf of any Member who
receives a hardship withdrawal of his Before-Tax Contribution Account or his
Company Matching Contribution Account after February 28, 1995, in accordance
with Section 13.02, during the twelve-month period immediately following such
withdrawal.
Section 4.04 - After-Tax Supplemental Contributions
--------------------------------------
(a) For Plan Years beginning on or after January 1, 1988 and
ending on or before December 31, 1998, a Member may elect to make After-Tax
Supplemental Contributions by authorizing payroll deductions of one percent (1%)
to ten percent (10%) of his Compensation in one percent (1%) increments which
shall be paid to the Trustee as soon as practicable after the end of the month
in which the applicable payroll period ends, but in no event later than ninety
(90) days after the end of such payroll period. For Plan Years beginning on or
after January 1, 1999, a Member (other than an EPS Member) may elect to make
After-Tax Supplemental Contributions by authorizing payroll deductions of one
percent (1%) to Twenty-Three and Seventy-Five Hundredths Percent (23.75%). For
Plan Years beginning on or after January 1, 1999, an EPS Member may continue to
elect to make After-Tax Supplemental Contributions of from one percent (1%) to
ten percent (10%) in the manner set forth above. A Member's election of
Supplemental Contributions may be made in addition to any Before-Tax Matched or
Before-Tax Unmatched Contributions elected by the Member, or may be made in lieu
of such other contributions, subject to the provisions set forth in Section 4.06
and Article XX. Notwithstanding the foregoing, from April 7, 1995 through
December 31, 1995, a Golden Cat Member may not elect to make any After-Tax
Supplemental Contributions.
The Plan Administrator may implement rules limiting the
Supplemental Contributions which may be made on behalf of some or all Highly
Compensated Employees so that these limits are satisfied.
(b) Notwithstanding the foregoing, a Member may not elect to make
After-Tax Supplemental Contributions during the twelve-month period immediately
following the distribution of any hardship withdrawal of his Before-Tax
Contribution Account or his Company Matching Contribution Account made after
February 28, 1995, in accordance with Section 13.02.
Section 4.05 - Deferral Percentages
---------------------
(a) The actual deferral percentage for the Highly Compensated
Employees shall satisfy at least one of the following tests:
(i) The actual deferral percentage for the eligible Highly
Compensated Employees for the Plan Year does not exceed the actual deferral
percentage for the eligible Non-Highly Compensated Employees for the current
Plan Year, multiplied by 1.25; or
(ii) The actual deferral percentage for the eligible Highly
Compensated Employees for the Plan Year does not exceed the actual deferral
percentage for the eligible Non-Highly Compensated Employees for the current
Plan Year, multiplied by 2.0; provided, however, that the actual deferral
percentage for the eligible Highly Compensated Employees may not exceed the
actual deferral percentage for the eligible Non-Highly Compensated Employees by
more than two percentage points.
(b) (i) The actual deferral percentage with respect to
Before-Tax Contributions for a specified group of Employees for a Plan Year
shall be the average of the ratios (calculated separately for each Employee in
such group) of:
(A) The amount of Before-Tax Contributions actually paid
to the Plan on behalf of each such Employee for such Plan Year, to
(B) The Employee's compensation (within the meaning of
Code Section 414(s)) for such Plan Year.
(ii) The actual deferral percentage tests described in
paragraph (a) shall be computed separately for each controlled group [determined
in accordance with Code Sections 414(b), (c), (m), (n), and (o)] whose Employees
participate in the Plan, and separately (A) with respect to Before-Tax
Contributions to the ESOP Preferred Stock Fund for Plan Years beginning on or
after January 1, 1989 and ending on or before December 31, 1998, and (B) with
respect to Before-Tax Contributions to the ESOP Common Stock Fund, for Plan
Years beginning on or after January 1, 1999.
(c) In making the deferral percentage calculations set forth
above, the Plan Administrator, as permitted by law, may, but is not required to,
take into account other contributions made by the Company on behalf of Eligible
Employees; provided that such other contributions must be one hundred percent
(100%) vested and subject to the withdrawal restrictions applicable to qualified
non-elective contributions [as defined in Code Section 401(m)].
(d) If the actual deferral percentage of eligible Highly
Compensated Employees exceeds the amounts allowed under Paragraphs (a) and (b)
above, the excess Before-Tax Contributions (as determined below) shall be
distributed to the Members as soon as practicable (but in no event later than
the last day of the next succeeding Plan Year). Any such distribution shall
include income and loss allocated to the excess in accordance with Reg. Section
1.401(k) - 1(f)(4).
(e) The amount of excess Before-Tax Contributions to be so
distributed to a Highly Compensated Employee shall equal:
(i) The total Before-Tax Contributions specified in clause
(A) of paragraph (b)(i) for such Employee, less
(ii) The reduced deferral dollar amount (determined below)
for such Employee with respect to Before-Tax Contributions.
(f) The reduced deferral dollar amount for each Highly Compensated
Employee shall be determined by first reducing the Before-Tax Unmatched
Contributions, and then the Before-Tax Matched Contributions, as necessary, of
the Highly Compensated Employee with the highest actual deferral dollar amount
of Before-Tax Contributions, to whichever deferral dollar amount is higher: (i)
the deferral dollar amount which enables the highly compensated group to satisfy
one of the tests of paragraph (a), or (ii) the deferral dollar amount that is
equal to that of the Highly Compensated Employee with the next highest actual
deferral dollar amount.
The above process shall be repeated until the highly compensated group
satisfies one of the tests set forth in paragraph (a).
(g) The Plan Administrator may implement rules limiting the
Before-Tax Matched and Unmatched Contributions which may be made on behalf of
some or all Highly Compensated Employees so that the tests set forth in Section
4.05 are satisfied.
(h) For purposes of determining the actual deferral percentage of
a Member who is either a five-percent (5%) owner or one of the ten (10) most
highly-paid Highly Compensated Employees, the Contributions and Compensation of
such Member shall include the Before-Tax Contributions of family members, for
Plan Years ending on or before December 31, 1996. Family members of Members who
are either five-percent (5%) owners or one of the ten (10) most highly-paid,
deferral Highly Compensated Employees shall be disregarded as separate employees
in determining the actual contribution percentages for both Members who are
Highly Compensated Employees and for Members who are Non-Highly-Compensated
Employees.
Section 4.06 - Contribution Percentages
-------------------------
(a) The actual contribution percentage for the Highly Compensated
Employees, for each Plan Year, shall not exceed the greater of (i) the actual
contribution percentage for eligible Non-Highly Compensated Employees for such
Plan Year multiplied by 1.25, or (ii) the lesser of (A) two hundred percent
(200%) of the actual contribution percentage of the eligible Non-Highly
Compensated Employees for such Plan Year, or (B) the actual contribution
percentage of the eligible Non-Highly Compensated Employees for such Plan Year,
plus two (2) percentage points.
(b) The actual contribution percentage for a specified group of
employees shall be the average of the ratios (calculated separately for each
Employee in such group) of:
(i) The sum of the following which are actually paid on
behalf of such Employee for such Plan Year,
(A) Company Matching Contributions
(B) After-Tax Supplemental Contributions, and
(C) Any Qualified Non-Elective Contributions [as defined in Section
401(m)(4)(C) of the Code], to
(ii) The Employee's compensation (within the meaning of Code
Section 414(s)) for such Plan Year.
(c) The actual contribution percentage test described in paragraph
(a) shall be computed separately (i) with respect to Company Contributions
described in Section 4.06(b)(i) to the ESOP Preferred Stock Fund for Plan Years
beginning on or after January 1, 1989 and ending on or before December 31, 1998,
and (ii) with respect to Company Contributions described in Section 4.06(b)(i)
to the ESOP Common Stock Fund for Plan Years beginning on or after January 1,
1999.
(d) In making the contribution percentage calculations set forth
above, the Plan Administrator, as permitted by law, may, but is not required to,
take into account other contributions made by the Company on behalf of Eligible
Employees.
(e) If the actual contribution percentage of Highly Compensated
Employees exceeds the amounts allowed under paragraph (a) above, the excess
contributions (as determined below) shall be distributed to the Members as soon
as practicable (but in no event later than the last day of the next succeeding
Plan Year). Any such distribution shall include income and loss allocated to
the excess in accordance with Reg. Section 1.401(m)-1(e)(3).
(f) The amount of excess contributions to be so distributed to a
Highly Compensated Employee shall equal
(i) The total contributions specified in clause (i) of
Section 4.06(b), less
(ii) The reduced contribution dollar amount (determined
below) for such employee.
(g) The reduced contribution amount for each Highly Compensated
Employee shall be determined by reducing the actual contribution amount of the
Highly Compensated Employee with the highest actual contribution dollar amount
to whichever of the following amounts is higher:
(i) The amount which enables the highly compensated group to
satisfy one of the tests of paragraph (a); or
(ii) The amount that is equal to that of the Highly
Compensated Employee with the next highest actual contribution amount.
The above process shall be repeated until the highly compensated
group satisfies one of the tests set forth in paragraph (a).
(h) The multiple use of the alternative non-discrimination tests
set forth in Section 4.05(a)(ii) and Section 4.06(a)(ii) shall be limited as
prescribed by law. If restrictions on such multiple use apply, the Plan
Administrator shall designate either the actual deferral percentages or the
actual contribution percentages of Highly Compensated Employees to be reduced,
and shall reduce such percentages in the manner described above, until the
multiple use limitations are no longer exceeded.
(i) The Plan Administrator may implement rules limiting the
Supplemental Contributions which may be made by some or all Highly Compensated
Employees, so that the test set forth in Section 4.06(a) is satisfied.
(j) For purposes of determining the actual contribution percentage
of a Member who is either a five-percent (5%) owner or one of the ten (10) most
highly-paid, Highly Compensated Employees, the Company matching Contributions,
Supplemental Contributions, qualified non-elective contributions, other matching
contributions, and Compensation of such Member shall include the Company
Matching Contributions, Supplemental Contributions, qualified non-elective
contributions, other matching contributions, and Compensation of family members
for Plan Years ending on or before December 31, 1996. Family members of Members
who are either five-percent (5%) owners or one of the ten (10) most highly-paid,
Highly Compensated Employees shall be disregarded as separate employees in
determining the actual contribution percentages for both Members who are Highly
Compensated Employees and for Members who are Non-Highly-Compensated Employees.
Section 4.07 - Change in Before-Tax Matched, Before-Tax Unmatched, and
-------------------------------------------------------------
Supplemental Contributions
---------------------------
Subject to the provisions of Sections 4.01, 4.03, and 4.04, and not more than
once in any one-month period, a Member may change the election permitted by
Sections 4.01, 4.03 and 4.04 by giving at least fifteen (15) days' prior written
notice to the Plan Administrator or such shorter period as the Plan
Administrator or its delegatee may approve. Such changed election shall become
effective no later than the first day of the first month commencing on or after
the expiration of the notice period. In addition, where Before-Tax Matched,
Before-Tax Unmatched, or Supplemental Contributions by payroll deduction are or
may be prohibited by law, in the opinion of counsel to the Company, a Member,
upon approval by the Plan Administrator, may make contributions directly to the
Trustee for each payroll period by a method satisfactory to the Plan
Administrator as long as such deposits are timely made on the same schedule as
payroll deductions. The Trustee shall not accept direct contributions not
timely made by a Member.
Section 4.08 - Suspension of Before-Tax Matched, Before-Tax Unmatched, and
--------------------------------------------------------------
Supplemental Contributions
---------------------------
(a) A Member may cause the suspension of Before-Tax Matched,
Before-Tax Unmatched, and/or Supplemental Contributions on his behalf at any
time by giving at least fifteen (15) days' prior written notice to the Plan
Administrator, or such shorter period as the Plan Administrator or its delegatee
may approve, in advance of the date on which such a suspension shall become
effective. The suspension shall become effective as soon as practicable after
notification is received. During such period of suspension of Before-Tax
Matched Contributions no Company Matching Contributions on behalf of such a
Member shall be made by the Company.
(b) A Member who has caused the suspension of Before-Tax Matched,
Before-Tax Unmatched, and/or Supplemental Contributions may have them resumed in
accordance with Sections 4.01, 4.03 and 4.04 by notifying the Plan Administrator
in writing at least fifteen (15) days in advance of the date on which
contributions are resumed, or such shorter period as the Plan Administrator or
its delegatee may approve. Contributions shall resume on the first day of the
first month commencing immediately after the expiration of the fifteen (15) day
notice period.
(c) A Member for whom contributions under Sections 4.01, 4.03 and
4.04 have ceased because he is on an unpaid absence from service shall again be
eligible to have such contributions made on the date he returns to service as an
Eligible Employee. No contributions may be made for a Member for any unpaid
period of absence from service including, but not limited to, absence due to
sickness, leave of absence due to sickness, leave of absence under the Family
and Medical Leave Act, or service in the Armed Forces, other than in compliance
with Code Section 414(u).
(d) A Member for whom contributions under Sections 4.01, 4.03 and
4.04 have ceased because he has ceased to be an Eligible Employee but,
nevertheless, continues to be an Employee shall again be eligible to have such
contributions made on the next Entry Date after he again becomes an Eligible
Employee and gives written notice to the Plan Administrator on the prescribed
form.
Section 4.09 - Limitation of Contributions
-----------------------------
The sum of Before-Tax Matched Contributions and Before-Tax Unmatched
Contributions remitted on behalf of any Member shall be limited to $10,000, or
such other dollar amount as may be specified by the Secretary of the Treasury
pursuant to Section 402(g) of the Code. Contributions shall be further limited
as described in Article XX. In accordance with Code Section 402(g)(2)(A)(ii),
any excess deferral shall be distributed to a Member by April 15 following the
close of the Plan Year in which such excess deferral occurred. Any such
distribution shall include income and loss allocated to such excess.
ARTICLE V - Trust Fund
Section 5.01 - The Trust Agreement
---------------------
The Ralston Purina Company shall enter into one or more trust agreements (the
"Trust Agreement") which shall contain such provisions as shall render it
impossible for any part of the corpus of the Trust Fund or income therefrom to
be at any time used for, or diverted to, purposes other than for the exclusive
benefit of Members. Any or all rights or benefits accruing to any person under
the Plan with respect to any Company contributions deposited under the Trust
Agreement shall be subject to all the terms and provisions of the Trust which
shall be part of the Plan.
Section 5.02 - The Trustee
------------
The Trustee shall be appointed by the Board of Directors or its delegatee to
serve at its pleasure. The Trust Fund may be held by the Trustee as part of a
master or collective trust comprised of assets of various qualified plans
maintained by the Company.
Section 5.03 - Separate Investment Funds
---------------------------
The Trustee will maintain as many separate Investment Funds, each with different
investment objectives, as the EBAIC deems advisable. Such Investment Funds may
be added or deleted as the EBAIC so determines in accordance with the provisions
of Section 15.04. The Investment Funds are described in Articles VI, VII, and
VIII. Each Investment Fund may be part of a fund with the same investment
objectives maintained by the Trustee for the benefit of participants in other
qualified plans maintained by the Company, or may be a separate fund maintained
only for the benefit of Members of this Plan. Earnings or gains derived from
the assets of any Investment Fund will be invested in that Fund. Appropriate
Accounts for each Member shall be established and maintained in each Investment
Fund in which a Member has an interest.
Section 5.04 - Temporary Investment
---------------------
Pending permanent investment of the assets of any Investment Fund, the Trustee
temporarily may make short-term investments in obligations of the United States
Government, commercial paper, an interim investment fund for tax qualified
employee benefit plans established by the Trustee unless otherwise provided by
applicable law, or other investments of a short-term nature.
Section 5.05 - Investment Managers
--------------------
Ralston Purina Company may, by action of the parties authorized under Article
XV, enter into a written agreement with, or direct the Trustee to enter into an
agreement with, one or more investment managers to manage the investments of one
or more of the Investment Funds. Such investment managers may include one or
more insurance companies which enter into guaranteed investment contracts with
the Trustee. Ralston Purina Company may, from time to time, remove any such
investment manager or any successor investment manager, or direct the Trustee to
do so, and any such investment manager may resign. Ralston Purina Company may,
upon removal or resignation of an investment manager, provide for the
appointment of a successor investment manager.
ARTICLE VI - ESOP Preferred Stock Fund
The following Article VI is effective for Plan Years beginning on or after
January 1, 1989 and ending on or before December 31, 1998.
Section 6.01 - The ESOP Preferred Stock Fund
---------------------------------
The assets of the Ralston Purina ESOP Preferred Stock Fund shall be invested
primarily in ESOP Preferred Stock during the period beginning February 1, 1989
and ending December 31, 1998. Beginning February 1, 1989, and ending December
31, 1998, all Before-Tax Matched Contributions, Company Matching Contributions,
and Company PAYSOP Account Contributions remitted to the Plan shall be invested
solely in the ESOP Preferred Stock Fund. Notwithstanding the foregoing, (i) the
Before-Tax Matched Contributions and Company Contributions made on behalf of EPS
Members, and (ii) the Before-Tax Contributions and Company Contributions made on
behalf of a Golden Cat Member for the period commencing April 1, 1995 and ending
December 31, 1995, shall be invested in other Investment Funds in accordance
with the provisions of Article VIII.
Section 6.02 - ESOP Loans
-----------
(a) The Trustee shall enter into one or more loan transactions
(individually an "ESOP Loan") as directed by the EBAIC and upon such terms as
the EBAIC directs, which terms shall be in conformity with the provisions
hereof. Each ESOP Loan must be primarily for the benefit of Members and their
beneficiaries. The terms of each ESOP Loan must, at the time the loan is made,
be at least as favorable to the Trust as the terms of a comparable loan
resulting from arm's length negotiations between independent parties. Each ESOP
Loan shall be for a specific term and shall bear a reasonable rate of interest.
An ESOP Loan may be secured by a pledge of the ESOP Preferred Stock acquired
with the proceeds of the ESOP Loan (or acquired with the proceeds of a prior
ESOP Loan which is being refinanced). No other Trust assets may be pledged as
collateral for an ESOP Loan, and no lender shall have recourse against Trust
assets other than (a) collateral given for the ESOP Loan, (b) contributions
(other than contributions of ESOP Preferred Stock) made to meet the Company's
obligation under the ESOP Loan, and (c) earnings attributable to such collateral
and the investment of such Contributions. An ESOP Loan shall not be payable on
demand except in the event of default. In the event of default of an ESOP Loan,
the value of plan assets transferred in satisfaction of the Loan shall not
exceed the amount of default. If the lender is a disqualified person within the
meaning of Code Section 4975(e)(2), the ESOP Loan must provide for a transfer of
Trust assets on default only upon and to the extent of the failure of the Trust
to meet the payment schedule of the ESOP Loan. Payments of principal and/or
interest on any ESOP Loan shall be made by the Trustee only from collateral
given for the ESOP Loan, Contributions that are made to meet the obligations
under the ESOP Loan and from earnings attributable to such collateral and the
investment of such contributions.
(b) The ESOP Loan proceeds shall be used by the Trustee within a
reasonable time after receipt to acquire ESOP Preferred Stock or to repay a
prior ESOP Loan. With respect to any such acquisition of ESOP Preferred Stock,
the EBAIC shall take all appropriate and necessary measures to ensure that the
Trust pays no more than "adequate consideration" [within the meaning of Section
3(18) of the Employee Retirement Income Security Act of 1974, as amended
(ERISA)] for such securities. All ESOP Preferred Stock acquired with the
proceeds of an ESOP Loan shall be placed in an ESOP Loan Suspense Account
established by the Trustee. To the extent required for the purpose of pledging
such ESOP Preferred Stock as collateral for the ESOP Loan, the shares held as
collateral in the ESOP Loan Suspense Account may be physically segregated from
other Trust assets. Any pledge of ESOP Preferred Stock must provide for the
release of the securities so pledged as payments on the ESOP Loan are made by
the Trustee and for such securities to be transferred to the appropriate Member
Accounts pursuant to Section 6.04 hereunder.
(c) Except as otherwise permitted in Code Section 409(h) or Code
Section 4975 and regulations promulgated thereunder, no ESOP Preferred Stock
acquired with the proceeds of an ESOP Loan shall be subject to any put, call or
other option, or any buy-sell or similar agreement while held by and when
distributed from the Trust, whether or not the Plan constitutes an "employee
stock ownership plan" within the meaning of Code Section 4975(e)(7) at such
time, and whether or not the ESOP Loan has been repaid at such time.
(d) The Trustee, at the direction of the EBAIC, may at any time
elect to require Ralston Purina Company to redeem shares of ESOP Preferred Stock
held in the Trust for cash or for shares of Common Stock, or to convert such
shares of ESOP Preferred Stock into shares of Common Stock.
Section 6.03 - ESOP Loan Payments
--------------------
ESOP loan amortization payments shall be made by the Trustee from amounts held
in the ESOP Payment Account. The ESOP Payment Account shall be credited with
(1) Before-Tax Matched, Company Matching Contributions and Company PAYSOP
Account Contributions received by the Trust in accordance with Article IV; (2)
dividends paid with respect to ESOP Preferred Stock held in the ESOP Suspense
Account; (3) as directed by the EBAIC, dividends paid with respect to other
shares of ESOP Preferred Stock; and (4) all other earnings of the ESOP Suspense
Account and the ESOP Payment Account. Assets held in the ESOP Payment Account
may be temporarily invested in obligations of the United States Government,
commercial paper, an interim investment fund for the qualified employee benefit
plans established by the Trustee unless otherwise provided by applicable law, or
other investments of a temporary nature.
Section 6.04 - Release of ESOP Preferred Stock
-----------------------------------
(a) From time to time during the period beginning the day after an
ESOP Loan amortization payment becomes due and extending until the next
following loan amortization payment becomes due (the "loan amortization payment
period"), a number of shares of the ESOP Preferred Stock shall be released from
the ESOP Suspense Account and transferred to the ESOP Allocated Shares Account.
The total number of shares so released shall at least equal the number of shares
of ESOP Preferred Stock held in the ESOP Suspense Account with respect to such
ESOP Loan immediately prior to the release multiplied by a fraction. The
numerator of the fraction shall be the amount of principal paid by the Trust on
the ESOP Loan in such loan amortization payment. The denominator of the
fraction shall be the sum of the numerator plus the principal to be paid on such
ESOP Loan for all future amortization payments. The shares that are transferred
to the ESOP Allocated Shares Fund pursuant to this Section shall be allocated to
the appropriate Member Account in the manner specified paragraphs (b) and (c)
below.
(b) Shares of ESOP Preferred Stock transferred to the ESOP
Allocated Shares Account shall be allocated to the Accounts of Members on at
least an annual basis. The number of shares to be allocated to each Member's
Account shall be determined as follows:
(i) the number of shares to be allocated to the Account of
each Member who was first hired by the Company on or before June 30, 1993,
("Grandfathered Member") shall be determined by multiplying the total number of
shares to be allocated to the Accounts of Grandfathered Members by a fraction,
the numerator of which equals the amount of Before-Tax Matched Contributions
described in Section 4.01(a)(ii) made on behalf of such Grandfathered Member
during the period of allocation, and the denominator of which equals the total
of all such Before-Tax Matched Contributions made on behalf of the Grandfathered
Members for the period of allocation; and
(ii) The number of shares to be allocated to the Account of
each Member who is first hired on or after July 1, 1993, ("New Member") shall be
determined by multiplying the total number of shares to be allocated to the
Accounts of New Members by a fraction, the numerator of which equals the amount
of Before-Tax Matched Contributions described in Section 4.01(a)(ii), as the
case may be, made on behalf of such New Member during the period of allocation
multiplied by twenty percent (20%) for each whole year [not to exceed five (5)
whole years] included in the New Member's Period of Service, regardless of
whether such employment occurs before or after participation in the Plan; and
the denominator of which equals the total of all Before-Tax Matched
Contributions made on behalf of the New Members for the period of allocation.
Notwithstanding the foregoing, the Before-Tax Matched Contributions of a Member
who has not completed a one (1) year Period of Service shall not be taken into
account for purposes of this paragraph.
(iii) The number of shares to be allocated pursuant to
subparagraph (b)(i) and (ii) shall not exceed two hundred percent (200%) of such
Member's Before-Tax Matched Contributions for the period of allocation divided
by the Minimum Redemption Value.
(iv) The number of shares to be allocated to the Account of
each Member who is entitled to a Company PAYSOP Account Contribution (the
"PAYSOP Member") shall be determined by multiplying the total number of shares
to be allocated to the Accounts of the PAYSOP Members in accordance with the
provisions of Section 4.02(b)(ii), by a fraction, the numerator of which equals
the value of the PAYSOP Account of each PAYSOP Member, and the denominator of
which equals the total of all PAYSOP Accounts of the PAYSOP Members.
(v) In the event that, as of the end of any Plan Year shares
of ESOP Preferred Stock are released from the ESOP Suspense Account pursuant to
paragraph (a) in excess of the total number of shares allocated pursuant to
subparagraph (b)(i), (ii) and (iv), the excess shares shall be allocated among
those Members who remain participants on the last day of the Plan Year in the
same manner as set forth in subparagraphs (b)(i), (ii) and (iv).
(vi) Notwithstanding the foregoing, no shares of ESOP
Preferred Stock shall be allocated to (A) the Accounts of EPS Members; (B) the
Accounts of Golden Cat Members for the period commencing April 1, 1995 and
ending December 31, 1995; or (C) a Member who has not completed a one (1) year
Period of Service.
(c) In the event that the Minimum Redemption Value of ESOP
Preferred Stock allocated to the Member's Accounts pursuant to paragraph (b)(i)
does not equal or exceed two hundred percent (200%) of Before-Tax Matched
Contributions, the Company shall make additional Company Matching Contributions
to the Plan to provide for release of additional shares of ESOP Preferred Stock,
or, alternatively, the Company may contribute additional shares of ESOP
Preferred Stock.
(d) Upon conversion or redemption of the ESOP Preferred Stock at
the time of payment in full of the ESOP Notes, the shares of Common Stock
received, or the shares of each class of Common Stock, as applicable, purchased
by the Trustee with the cash received from the Company, will be transferred to
new or existing accounts for each ESOP Preferred Stock Fund participant
established pursuant to the Common Stock Fund. In the event of more than one
class of Common Stock, the amount of shares of each such class of stock which
will be allocated to such accounts in the event of a redemption will be based
upon the relative per share market price of each class of stock at the time of
redemption Stock, or if the Company redeems in cash and the Trustee acquires
shares of each such class of stock, will be based upon the relative market
capitalizations of the classes of stock.
Section 6.05 - ESOP Preferred Stock Dividends
---------------------------------
(a) ESOP Preferred Stock Allocated to Member Accounts. Cash
-------------------------------------------------------
dividends paid with respect to ESOP Preferred Stock credited to a Member's
Accounts may be used to make ESOP Loan amortization payments on an outstanding
ESOP Loan or, alternatively, the EBAIC may in its sole discretion direct the
Trustee to pay such dividends directly to the Members. In the event that
dividends are used to make ESOP Loan amortization payments, there shall be
released from the ESOP Suspense Account, or repurchased by the Trustee from
Members' Accounts in accordance with Section 6.06, in the sole discretion of the
EBAIC, and allocated to Members' Accounts additional shares of ESOP Preferred
Stock. The aggregate number of shares so released or repurchased shall be
determined by dividing the dollar value of the cash dividends by the Minimum
Redemption Value of the ESOP Preferred Stock. Shares released pursuant to this
section shall be in addition to shares released pursuant to Section 6.04.
(b) Stock in ESOP Suspense Account. Cash dividends paid with
----------------------------------
respect to ESOP Preferred Stock credited to the ESOP Suspense Account shall be
allocated to the ESOP Payment Account and used to make ESOP Loan Amortization
Payments.
(c) Stock Dividends. Shares of ESOP Preferred Stock received by
----------------
the Trustee as stock dividends or stock splits with respect to ESOP Preferred
Stock allocated to any Member's Accounts shall be credited to such Member's
Accounts. Shares of ESOP Preferred Stock received by the Trustee as stock
dividends or stock splits with respect to shares of ESOP Preferred Stock held in
the ESOP Suspense Account shall be credited to the ESOP Suspense Account.
Section 6.06 - Withdrawals and Distributions.
-------------------------------
In the event that a Member becomes entitled to a distribution, or withdrawal, or
loan of some or all of amounts invested in the ESOP Preferred Stock Fund, the
Trustee shall cause as many shares of his ESOP Preferred Stock as are the
subject of such distribution, loan, or withdrawal to be either redeemed for cash
or stock, as appropriate, or converted into shares of Common Stock in accordance
with the distribution election of the Member; provided, however, that if a
Member elects to take a distribution in cash, or if an annuity contract is to be
purchased, and the market value of a share of Common Stock, determined pursuant
to Section 9.01(a) on the Valuation Date preceding a distribution is greater
than the Minimum Redemption Value of a share of ESOP Preferred Stock, then
shares of ESOP Preferred Stock shall first be converted into shares of Common
Stock which will then be sold and the proceeds distributed to such Member. Any
such conversion or redemption shall be made effective as of the last day of the
calendar quarter in which the Member terminates, requests a withdrawal, or loan,
or dies; provided, however, that in the case of any Member who requests a
deferral of his distribution pursuant to Article XI, such conversion or
redemption shall be made effective as of the end of the Plan Year in which the
Member terminates his service.
Section 6.07 - Voting and Tendering
----------------------
Each Member shall have the right and shall be afforded the opportunity to
instruct the Trustee how to vote at any meeting of Ralston Purina Company
shareholders those shares of ESOP Preferred Stock allocated or credited to his
Accounts as of a date prior to such meeting as established by the Plan
Administrator for administrative purposes. Instructions by Members to the
Trustee shall be in such form and pursuant to such regulations as the Plan
Administrator may prescribe and any such instructions shall remain in the strict
confidence of the Trustee. If the Trustee does not timely receive instructions
from a Member regarding his shares, the Trustee shall be required to vote such
shares in the same proportion as were voted those shares for which the Trustee
received Member instruction. ESOP Preferred Stock remaining in the ESOP
Suspense Account shall be voted in the same proportion as were voted shares for
which the Trustee received Member instruction.
Each Member shall have the right to instruct the Trustee in writing as to the
manner in which to respond to a tender or exchange offer (other than a tender or
exchange offer made by Ralston Purina Company) for any or all shares of ESOP
Preferred Stock credited to such Member's Accounts as of a date prior to the
expiration of the offer, as established by the Plan Administrator for
administrative purposes. The Trustee shall notify each Member and utilize its
best efforts to timely distribute or cause to be distributed to him such
information as will be distributed to shareholders of the Company in connection
with any such tender or exchange offer. Upon its timely receipt of such
instructions, the Trustee shall tender or exchange such shares of ESOP Preferred
Stock as and to the extent so instructed. The failure of a Member to instruct
the Trustee to tender or exchange shares of ESOP Preferred Stock credited to his
account shall be deemed to be an instruction not to tender or exchange such
shares of stock. Accordingly, if the Trustee does not receive instructions from
a Member regarding any such tender or exchange offer for ESOP Preferred Stock,
the Trustee shall not tender such shares. Shares not allocated or credited to a
Member's Account as of the date and ESOP Preferred Stock remaining in the ESOP
Suspense Account shall be tendered or exchanged or not tendered or exchanged in
the same proportion as were tendered or exchanged or not tendered or exchanged
Shares for which the Trustee received Member instructions. Notwithstanding the
foregoing, the rights of Members and duties of the Trustee set forth herein
shall not apply in the event of a tender offer by the Company for any or all
shares of ESOP Preferred Stock credited to such Members' Accounts; nor shall the
Trustee tender or exchange any ESOP Preferred Stock.
Section 6.08 - Diversification Elections
--------------------------
(a) A Member who has attained age fifty-five (55) and completed
ten (10) years of participation in the Plan may, within ninety (90) days after
the close of each Plan Year in the "qualified election period", as defined
below, direct the Trustee to diversify as soon as the Trustee, in its sole
discretion, deems it prudent and practicable, the investment of twenty-five
percent (25%) of his Accounts in the ESOP Preferred Stock Fund (to the extent
such portion exceeds the amount to which a prior election applies). In the case
of the last year in which such an election applies, fifty percent (50%) shall be
substituted for twenty-five percent (25%). The maximum percentage of a Member's
Account that is subject to diversification is applied to the value of such
Member's Account as of the last day of the preceding Plan Year. For purposes of
this Section, the qualified election period means a period of five Plan Years
commencing with the Plan Year following the Plan Year in which the Participant
has both attained age fifty-five (55) and completed ten (10) years of
participation in the Plan. Additional Investment Funds shall be established in
accordance with Article V to the extent required under the provisions of ERISA
or the Code.
(b) Notwithstanding the foregoing, effective August 22,1996, a
Member who has attained age fifty-five (55) and completed ten (10) years of
participation in the Plan (and any predecessor plan thereof), may, at any time
and from time to time following the close of the Plan Year during which the
Member has satisfied these requirements, elect to diversify the investment of up
to an aggregate of fifty percent (50%) of the shares of ESOP Preferred Stock in
his ESOP Preferred Stock Fund Account (to the extent such portion exceeds the
amount to which a prior election applies), as determined on the last day of the
Plan Year immediately preceding the Plan Year during which the election occurs,
by electing to invest such portion of his Account in the Investment Funds
authorized by the EBAIC and maintained by the Trustee in accordance with Section
8.01 hereof. For purposes of this paragraph (c), any reduction in the Member's
Account in the ESOP Preferred Stock Fund after the close of such immediately
preceding Plan Year which is attributable to (i) a hardship withdrawal as
described in Section 13.02 hereof, or (ii) a Member's loan as described in
Section 17.01 hereof, shall be treated as subject to the Member's election to
diversify for purposes of applying the fifty percent (50%) limit. (Restrictions
on such loans and hardship withdrawals, however, shall be governed solely by
Article XVII and Article XIII, respectively.)
ARTICLE VII - ESOP Common Stock Fund
The following Article VII is effective for Plan Years beginning on or after
January 1, 1999.
Section 7.01 - The ESOP Common Stock Fund
------------------------------
(a) As of January 1, 1999, all shares of ESOP Preferred Stock
shall be converted into shares of Common Stock in accordance with the
Certificate of Designation of ESOP Preferred Stock, as amended, and held in the
Ralston Purina ESOP Common Stock Fund. Effective April 22, 1999, the Ralston
Purina Common Stock Fund, as described in Section 8.01, and the ESOP Common
Stock Fund will be merged and recharacterized as one ESOP Fund, and will be
designated as the Ralston ESOP Common Stock Fund. The assets of the ESOP Common
Stock Fund shall be invested primarily in Ralston Purina Company Common Stock.
Such Common Stock shall be purchased by the Trustee regularly on the open
market, or in privately negotiated transactions, including purchases directly
from Ralston Purina Company or any Affiliated Company, in accordance with a
nondiscretionary purchase program, as the Trustee shall determine to be in the
best interest of the Fund. The Trustee may invest assets of the ESOP Common
Stock Fund temporarily as provided in Section 5.04, pending permanent investment
in Common Stock. All shares of Common Stock held in the Fund shall be held in
the name of the Trustee or its nominee renamed. All Company Matching
Contributions remitted to the Plan on or after January 1, 1999 shall be invested
solely in the ESOP Common Stock Fund, subject to the provisions of Section
8.02(b).
(b) It is intended that the ESOP Common Stock Fund constitute an
"employee stock ownership plan" within the meaning of Code Section 4975(e)(7) .
(c) Shares of ESOP Common Stock shall be allocated to the Accounts
of Members as soon as practicable. Subject to the provisions of Section
4.02(a)(i), the number of shares of ESOP Common Stock acquired with Company
Matching Contributions made on or after January 1, 1999 to be allocated to each
Member's Account shall be determined by multiplying the total number of shares
to be allocated to Members' Accounts by a fraction, the numerator of which
equals the amount of Before-Tax Matched Contributions made on behalf of such
Member during the period of allocation, and the denominator of which equals the
total of all Before-Tax Matched Contributions made on behalf of the Members for
the period of allocation. Notwithstanding the foregoing, for purposes of this
subparagraph (c), the Before-Tax Matched Contributions made on behalf of (i)
Members who have not completed a one (1)-year Period of Service, and (ii) EPS
Members shall not be taken into account, and such Members shall not be entitled
to an allocation of shares of ESOP Common Stock.
Section 7.02 - ESOP Common Stock Dividends
------------------------------
(a) ESOP Common Stock Allocated to Member Accounts.
-------------------------------------------------- Cash dividends paid
with respect to ESOP Common Stock credited to a Member's Accounts may, at the
direction of the Company in its sole discretion, be paid by the Trustee directly
to the Members.
(b) Stock Dividends.
--------------- Shares of ESOP Common Stock received by the Trustee as
stock dividends or stock splits with respect to ESOP Common Stock allocated
to any Member's Accounts shall be credited to such Member's Accounts. Shares of
an Affiliated Company received by the Trustee in a transaction qualifying under
Section 355 of the Code with respect to ESOP Common Stock allocated to any
Member's Accounts shall be credited to such Member's Accounts.
Section 7.03 - Withdrawals and Distributions
-------------------------------
In the event a Member becomes entitled to a distribution or withdrawal, or loan
of some or all of amounts invested in the ESOP Common Stock Fund, the Trustee
shall cause as many shares of such Member's ESOP Common Stock as are the subject
of such distribution, loan, or withdrawal to be sold in the open market, or
redeemed or repurchased for cash or, in the case of a distribution or
withdrawal, distributed in kind, in accordance with the distribution election of
the Member.
Section 7.04 - Voting and Tendering
----------------------
Each Member shall have the right and shall be afforded the opportunity to
instruct the Trustee how to vote at any meeting of Ralston Purina Company
shareholders, those shares of ESOP Common Stock allocated or credited to his
Accounts as of a date prior to such meeting as established by the Plan
Administrator for administrative purposes. Instructions by Members to the
Trustee shall be in such form and pursuant to such regulations as the Plan
Administrator may prescribe and any such instructions shall remain in the strict
confidence of the Trustee. If the Trustee does not timely receive instructions
from a Member regarding his shares, the Trustee shall be required to vote such
shares in the same proportion as were voted those shares for which the Trustee
received Member instruction.
Each Member shall have the right to instruct the Trustee in writing as to the
manner in which to respond to a tender or exchange offer (other than a tender or
exchange offer made by the Company) for any or all shares of ESOP Common Stock
credited to such Member's Accounts as of a date prior to the expiration of the
offer, as established by the Plan Administrator for administrative purposes.
The Trustee shall notify each Member and utilize its best efforts to timely
distribute or cause to be distributed to him such information as will be
distributed to shareholders of the Company in connection with any such tender or
exchange offer. Upon its timely receipt of such instructions, the Trustee shall
tender or exchange such shares of ESOP Common Stock as and to the extent so
instructed. The failure of a Member to timely instruct the Trustee to tender or
exchange shares of ESOP Common Stock credited to his account shall be deemed to
be an instruction not to tender or exchange such shares of stock. Accordingly,
if the Trustee does not receive instructions from a Member regarding any such
tender or exchange offer for ESOP Common Stock, the Trustee shall not tender
such shares. Notwithstanding the foregoing, the rights of Members and duties of
the Trustee set forth herein shall not apply in the event of a tender offer by
the Company for any or all shares of ESOP Common Stock credited to such Members'
Accounts; nor shall the Trustee tender or exchange any ESOP Common Stock.
Section 7.05 - Diversification Elections
--------------------------
(a) Effective January 1, 1999 through April 21, 1999, a Member may
elect to diversify by giving notice to the Plan Administrator to have that
portion of his Account in the ESOP Common Stock Fund derived from the Member's
Before-Tax Contributions and earnings thereon, determined as of January 1, 1999,
transferred to any other investment fund, in accordance with Section 8.02.
(b) Effective April 22, 1999, a Member may elect to diversify, by
giving notice to the Plan Administrator, to have up to one hundred percent
(100%) of the value of his Account in the ESOP Common Stock Fund transferred to
any other investment fund, in accordance with Section 8.02.
ARTICLE VIII - Other Investment Funds
Section 8.01 - Other Investment Funds
------------------------
Other Investment Funds, as authorized by the EBAIC and maintained by the
Trustee, from time to time may include the following:
(a) The Ralston Purina Common Stock Fund. Subject to
-----------------------------------------
subparagraphs 8.01(b) and (c), the assets of the Ralston Purina Common Stock
Fund shall be invested primarily in Ralston Purina Company Stock. Such Common
Stock shall be purchased by the Trustee regularly on the open market, or in
privately negotiated transactions, including purchases directly from Ralston
Purina Company or any Affiliated Company, in accordance with a nondiscretionary
purchase program, as the Trustee shall determine to be in the best interest of
the Fund. The Trustee may invest assets of the Common Stock Fund temporarily as
provided in Section 5.04, pending permanent investment in Common Stock. All
shares of Common Stock held in the Fund shall be held in the name of the Trustee
or its nominee renamed.
(b) The CBG Stock Fund. The assets of the CBG Stock Fund shall be
------------------
invested primarily in CBG Stock. Such CBG Stock shall be purchased by the
Trustee regularly on the open market, or in privately negotiated transactions,
including purchases directly from Ralston Purina Company or any Affiliated
Company, in accordance with a nondiscretionary purchase program, as the Trustee
shall determine to be in the best interest of the Fund. The Trustee may invest
assets of the CBG Stock Fund temporarily as provided in Section 5.04, pending
permanent investment in CBG Stock. All shares of CBG Stock held in the Fund
shall be held in the name of the Trustee or its nominee. This Fund shall be in
existence during the period commencing July 30, 1993 and ending May 15, 1995.
(c) The RPG Stock Fund. The assets of the RPG Stock Fund shall be
------------------
invested primarily in RPG Stock. Such RPG Stock shall be purchased by the
Trustee regularly on the open market, or in privately negotiated transactions,
including purchases directly from Ralston Purina Company or any Affiliated
Company, in accordance with a nondiscretionary purchase program, as the Trustee
shall determine to be inn the best interest of the Fund. The Trustee may invest
assets of the RPG Stock Fund temporarily as provided in Section 5.05, pending
permanent investment in RPG Stock. All shares of RPG Stock held in the Fund
shall be held in the name of the Trustee or its nominee renamed. This Fund
shall be in existence during the period commencing July 30, 1993 and ending
February 1, 1996.
(d) U.S. Government Money Market Fund. The objective of the Fund
----------------------------------
is to seek the maximum current income consistent with preservation of principal
and liquidity. The Fund invests in short-term securities issued by the United
States Government, its agencies and instrumentalities, and in repurchase
agreements collateralized by such securities. A portion of the U.S. Government
securities held by the Federal Portfolio may not be backed by the full faith and
credit of the U.S. Government.
(e) Fixed Income Fund. The objective of the Fund is to provide a
------------------
stable principal amount, but a higher yield than can be earned in a money market
fund. Assets are primarily invested in contracts with insurance companies which
provide for repayment by the issuing company of principal with interest at a
fixed rate, or fixed minimum rate, for a specified period and in short-term
corporate and government bonds. The yield on the Fund is a blended rate
reflecting the interest rates on all investments in the Fund.
-
(f) Balanced Funds. The objective of these Funds is to follow a
---------------
diversified and balanced program of investing in bonds and common stock. Each
Fund invests its net assets in different combinations of stocks, bonds, and cash
reserves, reflecting varying degrees of potential risk and reward. The Funds
are designed to provide conservation of principal, a reasonable income return,
and potential growth of capital.
(g) Equity Index Fund. A growth and income fund, the Fund invests
-----------------
in all of the stock included in the Standard & Poor's (S&P) 500 Index in
approximately the same proportions as they are represented in the S&P 500 Index.
The Fund is designed to provide investment results that correspond to the
performance of the Standard & Poor's 500 Composite Stock Price Index.
(h) Growth and Income Fund. This Fund invests in common stocks
-------------------------
that have a history of paying dividends. The Fund selects common stocks that,
in the opinion of the investment manager, are undervalued in the marketplace.
The Fund seeks long-term capital growth and a reasonable level of dividend
income.
(i) Aggressive Growth Fund. The Fund primarily invests in common
-----------------------
stocks of smaller companies with favorable prospects for growth in market value.
The Fund seeks long-term growth of capital.
(j) International Growth Fund. This Fund invests in a diversified
-------------------------
portfolio of international stocks, or stocks of companies based outside of the
United States. The Portfolio seeks to provide long-term growth of capital. The
Portfolio provides little, if any, dividend income.
(k) The Ralcorp Stock Fund. The assets of the Ralcorp Stock Fund
-----------------------
shall be invested solely in the common stock of Ralcorp Holdings, Inc. ("Ralcorp
Stock"), credited to a Member's Account upon the spin-off of Ralcorp Holdings,
Inc. by the Company effective April 1, 1994, which resulted in all holders of
RPG Stock receiving one (1) share of Ralcorp Stock for every three (3) shares of
RPG Stock. Except for the reinvestment of dividends, the Trustee shall not
purchase any additional shares of Ralcorp Stock for crediting to Members'
Accounts. All shares of Ralcorp Stock held in the Fund shall be held in the
name of the Trustee or its nominee. Any assets remaining in the Ralcorp Stock
Fund on March 31, 1995 shall be invested in the U.S. Government Money Market
Fund.
(l) The Agribrands Stock Fund. The assets of the Agribrands Stock
-------------------------
Fund shall be invested solely in the common stock of Agribrands Holdings, Inc.
("Agribrands Stock"), credited to a Member's Account upon the spin-off of
Agribrands Holding, Inc. by the Company effective April 1, 1998, which resulted
in all holders of Common Stock receiving one (1) share of Agribrands Stock for
every ten (10) shares of Common Stock. Except for the reinvestment of
dividends, the Trustee shall not purchase any additional shares of Agribrands
Stock for crediting to Members' Accounts. All shares of Agribrands Stock held
in the Fund shall be held in the name of the Trustee or its nominee. Any assets
remaining in the Agribrands Stock Fund on March 31, 1999 shall be invested in
the U.S. Government Money Market Fund.
(m) The Energizer Stock Fund. The assets of the Energizer Stock
--------------------------
Fund shall be invested solely in the common stock of Energizer Holdings, Inc.
("Energizer Stock"), credited to a Member's Account upon the spin-off of
EnergizerHoldings, Inc. by the Company effective April 1, 2000, which resulted
in all holders of Common Stock receiving one (1) share of EnergizerStock for
every three (3) shares of Common Stock. Except for the reinvestment of
dividends, the Trustee shall not purchase any additional shares of
EnergizerStock for crediting to Members' Accounts. All shares of Energizer
Stock held in the Fund shall be held in the name of the Trustee or its nominee.
Section 8.02 - Investment of Contributions
-----------------------------
(a) Election. Subject to the provisions of Sections 6.01 and
--------
7.01, all (i) Before-Tax Unmatched Contributions, (ii) Supplemental
Contributions, (iii) Rollover Contributions, (iv) Before-Tax Matched
Contributions remitted to the Plan before February 1, 1989 or after December 31,
1998, (v) Before-Tax and Company Contributions made on behalf of an EPS Member,
and (vi) Before-Tax and Company Contributions made on behalf of a Golden Cat
Member during the period April 1, 1995 through December 31, 1995, will be
invested at the election of the Member in multiples of one percent (1%) in the
Investment Funds authorized by the EBAIC and maintained by the Trustee in
accordance with Section 8.01, other than the Ralcorp Stock Fund, the Agribrands
Stock Fund, and the Energizer Stock Fund. Contributions for which a Member does
not make a valid election shall be invested in the U.S. Government Money Market
Fund. Amounts in the Common Stock Fund attributable to Company Matching
Contributions made after January 1, 1988 and before February 1, 1989, including
the earnings thereon, can, prior to March 1, 1995, be invested only in the
Common Stock Fund, or transferred between such Funds.
Investment directions of each new Member shall be delivered in
writing to the Plan Administrator or its delegatee. Except with respect to
contributions invested solely in the ESOP Preferred Stock Fund in accordance
with Section 6.01, a Member may change his direction governing the investment of
future contributions to be credited to his respective Accounts at any time upon
providing the appropriate notice to the Plan Administrator or its delegatee. An
investment direction once given shall be deemed to be a continuing direction
until explicitly changed by the Member by a subsequent direction to the Plan
Administrator or its delegatee in accordance with appropriate procedures set
forth by the Plan Administrator or its delegatee.
(b) Transfer of Investments. Except with respect to Contributions
-----------------------
invested solely in the ESOP Preferred Stock Fund in accordance with Section
6.01, or the ESOP Common Stock Fund in accordance with Section 7.05(a), a Member
may elect, at any time, to have all or any multiple of one percent (1%) of the
value of his Account as of any future Valuation Date or any dollar amount of his
Account transferred to any separate Investment Fund maintained by the Trustee in
accordance with Section 8.01, other than the ESOP Preferred Stock Fund in
accordance with Section 6.01, or the Ralcorp, Agribrands, or Energizer Stock
Funds.
(c) Notwithstanding anything in this Section to the contrary, any
contributions invested in an investment contract shall be subject to any and all
terms of such contract regarding the transfer of assets from such contract.
Section 8.03 - Member Responsibility For Selection of Funds
-------------------------------------------------
Each Member is solely responsible for the selection of his Investment Funds.
Neither the Trustee, the Plan Administrator, the Company nor any of the officers
or supervisors of the Company are empowered to advise a Member as to the manner
in which his Accounts shall be invested. The fact that a security is available
to members for investment under the Plan shall not be construed as a
recommendation for the purchase of that security, nor shall the designation of
any Investment Fund impose any liability on the Company, its directors, officers
or employees, the Trustee, or the Plan Administrator.
When an investment election regarding the Fund is required to be made by
Members, such Member shall be informed as to the manner in which their funds
will be invested if they fail to make an affirmative election in a timely
manner. In such event, those Members who fail to communicate an election to the
Plan Administrator or its delegatee shall be deemed to have elected the
specified investment and the Company, its directors, officers or employees, the
Trustee, the EBAIC, and any other plan fiduciary shall be deemed to be relieved
of fiduciary responsibility for the investment of such funds.
Section 8.04 - Voting and Tendering - Ralston Common Stock
-------------------------------------------------
(a) Each Member shall have the right and shall be afforded the
opportunity to instruct the Trustee how to vote at any meeting of Ralston Purina
Company shareholders those shares of Common Stock held in the Ralston Common
Stock Fund through April 21, 1999, or the ESOP Common Stock Fund, which are
allocated to his Accounts as of a date prior to such meeting as established by
the Plan Administrator for administrative purposes. Instructions by Members to
the Trustee shall be in such form and pursuant to such regulations as the Plan
Administrator may prescribe and any such instructions shall remain in the strict
confidence of the Trustee. If the Trustee does not receive timely instructions
from a Member regarding the voting of his shares, the Trustee shall be required
to vote such shares in the same proportion as were voted those shares for which
the Trustee received Members' instructions.
(b) Each Member (or in the event of his death, his Beneficiary)
shall have the right to instruct the Trustee in writing as to the manner in
which to respond to a tender or exchange offer for any or all shares of Common
Stock credited to such Member's Account as of a date prior to the expiration of
the offer as established by the Plan Administrator for administrative purposes.
The Trustee shall notify each Member (or Beneficiary) and utilize its best
efforts to timely distribute or cause to be distributed to him such information
as will be distributed to shareholders of the Company in connection with any
such tender or exchange offer. Upon its timely receipt of such instructions,
the Trustee shall tender or exchange such shares of Common Stock as and to the
extent so instructed. The failure of a Member to timely instruct the Trustee to
tender or exchange shares of Common Stock credited to his Account shall be
deemed to be an instruction not to tender or exchange such shares of Stock.
Accordingly, if the Trustee does not receive instructions from a Member (or
Beneficiary) regarding any such tender or exchange offer for Common Stock, the
Trustee shall not tender or exchange such stock. Notwithstanding the foregoing,
the rights of each Member and duties of the Trustee set forth herein shall not
apply in the event of a tender offer by the Company for any or all shares of
Common Stock credited to such Member's Account under the Trust Fund; nor shall
the Trustee tender or exchange any Common Stock.
Section 8.05 - Voting and Tendering - Other Stock Funds
----------------------------------------------
(a) Each Member shall have the right and shall be afforded the
opportunity to instruct the Trustee how to vote those shares of Ralcorp Stock
from April 1, 1994 through March 31, 1995, Agribrands Stock from April 1, 1998
through March 31, 1999, or Energizer Stock beginning April 1, 2000, as
applicable, held in the respective Ralcorp, Agribrands, or Energizer Stock
Funds, which are allocated to his Accounts, as of a date prior to a meeting of
shareholders of Ralcorp, Agribrands, or Energizer, as applicable, as established
by the Plan Administrator for administrative purposes. Instructions by Members
to the Trustee shall be in such form and pursuant to such regulations as the
Plan Administrator may prescribe and any such instructions shall remain in the
strict confidence of the Trustee. If the Trustee does not receive timely
instructions from a Member regarding the voting of his shares, the Trustee shall
be required to vote such shares in the same proportion as were voted those
shares for which the Trustee received Members' instructions.
(b) Each Member (or in the event of his death, his Beneficiary)
shall have the right to instruct the Trustee in writing as to the manner in
which to respond to a tender or exchange offer for any or all shares of the
Ralcorp Stock from April 1, 1994 through March 31, 1995, Agribrands Stock from
April 1, 1998 through March 31, 1999, or Energizer Stock beginning April 1,
2000, credited to such Member's Accounts as of a date prior to the expiration of
the offer as established by the Plan Administrator for administrative purposes.
The Trustee shall notify each Member (or Beneficiary) and utilize its best
efforts to timely distribute or cause to be distributed to him such information
as will be distributed to shareholders of Ralcorp, Agribrands, or Energizer, as
applicable, in connection with any such tender or exchange offer. Upon its
timely receipt of such instructions, the Trustee shall tender or exchange such
shares of Ralcorp, Agribrands, or Energizer Stock, as applicable, as and to the
extent so instructed. The failure of a Member to timely instruct the Trustee to
tender or exchange such shares of Stock credited to his Account shall be deemed
to be an instruction not to tender or exchange such shares of Stock.
Accordingly, if the Trustee does not receive instructions from a Member (or
Beneficiary) regarding any such tender or exchange offer for Common Stock, the
Trustee shall not tender or exchange such Stock.
ARTICLE IX - Valuation of Assets and Members' Accounts
Section 9.01 - Valuation of Assets
---------------------
(a) At the end of each Valuation Date, the Trustee shall determine
the aggregate fair market value of the assets then held by it in each Investment
Fund.
(1) The market value of shares of Common Stock shall be their
respective closing values on the New York Stock Exchange.
(2) Prior to January 1, 1999, the market value of a share of
ESOP Preferred Stock shall be the greater of the Minimum Redemption Value of the
ESOP Preferred Stock, or the market value of the shares of Common Stock into
which a share of ESOP Preferred Stock may be converted as adjusted in accordance
with the Certificate of Designation of ESOP Preferred Stock, as amended, as
applicable, and to reflect accrued but unpaid dividends. The fair value of each
share of ESOP Preferred Stock shall be determined on at least an annual basis by
an independent appraiser (excluding any increase in value for accrued but unpaid
dividends), such value referred to herein as the "appraised value" of the ESOP
Preferred Stock.
Section 9.02 - Valuation of Accounts
-----------------------
At the end of each Valuation Date, before the calculation and debiting of any
distributions and in-service withdrawals from the Trust fund or the posting of
transfers among Investment Funds, the net credit balances in the Accounts of
Members or their beneficiaries will be adjusted to reflect any contributions to,
and investment gains or losses in, the respective Investment Funds.
Section 9.03 - Statement of Accounts
-----------------------
Each member shall be furnished, at least annually, a statement setting forth the
value of his Accounts.
Section 9.04 - Accounts in Units
-------------------
Each Member's Accounts shall be maintained in units.
ARTICLE X - Vesting of Contributions
Section 10.01 - Vesting of Before-Tax and Supplemental Investment Accounts
-------------------------------------------------------------
Each Member's Before-Tax Investment Account and Supplemental Investment Account
shall at all times be fully vested.
Section 10.02 - Vesting of Company Contributions Account
--------------------------------------------
(a) Subject to the provisions of subparagraph (b), a Member shall
be vested in his Company Contribution Account and a Golden Cat Member shall be
vested in his Golden Cat Company Profit Sharing Contribution Account (i) at the
rate of twenty-five percent (25%) for each whole year included in a Period of
Service regardless of whether such employment occurs before or coincident with
participation in the Plan, or (ii) one hundred percent (100%) in the event of
the occurrence of any one of the following:
(1) attainment of age sixty-five (65),
(2) Retirement,
(3) Disability,
(4) death,
(5) termination of the Plan,
(6) complete discontinuance of Company contributions.
(b) (i) An EPS Member shall at all times be fully vested in
his Company Before-Tax Contribution Account.
(ii) An EPS Member shall be fully vested in his Company
Matching Contribution Account after a three (3) year Period of Service.
(c) Members formerly employed by the Company who are or became
employees of the spun-off company Agribrands International, Inc. on April 1,
1998 shall be fully vested in their Company Contribution Account.
(d) EPS Members who became employees of Moltech Power Systems,
Inc. on November 1, 1999, pursuant to the divestiture of Energizer Power
Systems, shall be fully vested in their Company Contribution Account as of
October 31, 1999.
ARTICLE XI - Distributions
Section 11.01 - General
-------
(a) Upon the Termination of Employment of a Member at or after the
attainment of age sixty-five (65), or upon the occurrence of Retirement,
Disability or other subsection 10.02(a) event, the entire amount credited to all
of his Accounts determined as of the Valuation Date on which the Trustee
receives properly authorized instructions from the Plan Administrator to make
the payment, and such amount, as adjusted in accordance with Article XI shall be
distributed as provided in Section 11.02 to the Member, unless the Member has
elected to defer the distribution of his Accounts in accordance with
subparagraph (c) below.
(b) Upon the Termination of Employment of a Member prior to
attaining age sixty-five (65) for reasons other than Retirement, Disability, or
death, or other Section 10.02(a) event, the vested portion of the value of his
Accounts shall become distributable in accordance with Article X (Vesting of
Contributions) and shall be determined as of the Valuation Date on which the
Trustee receives properly authorized instructions to make the payment from the
Plan Administrator, and such amount, as adjusted in accordance with Section
11.06, shall be distributed as provided in Section 11.02, unless the Member has
elected to defer the distribution of his Accounts in accordance with
subparagraph (c) below.
(c) Effective (i) January 1, 1988, for all Members who were
participants in the Eveready Battery Company Savings Plans in effect immediately
prior to the acquisition of Eveready Battery Company by Ralston Purina Company;
(ii) November 1, 1989, for all participants in the Beech-Nut Savings Plan
immediately prior to the acquisition of Beech-Nut by Ralston Purina Company; and
(iii) January 1, 1992, for all other Members, a Member may, upon the Termination
of Employment for whatever reason, elect to defer the distribution of the vested
portion of the value of his Accounts until a date which is not later than the
December 31 of the calendar year in which the Member attains age seventy and
one-half (70-1/2) years (the "Deferral Period") by notifying the Plan
Administrator or its delegatee in writing of such election to defer as soon as
practicable after Termination of Employment, in accordance with procedures
established by the Plan Administrator. At any time during the Deferral Period,
a Member may revoke the election to defer all or a portion of the total
remaining balance of the vested portion of his Accounts, and request a timely
distribution of all or any portion of the total remaining balance of the vested
portion of his Accounts.
Section 11.02 - Methods of Distribution
-------------------------
Except as otherwise provided in this Article, distributions provided for under
the Plan shall be made in the following manner:
(a) A Member who has incurred a Termination of Employment, for
whatever reason, by written notice on a form approved by the Plan Administrator
for such purpose delivered to the Plan Administrator at least fifteen (15) days
prior to his Termination of Employment, or such shorter period as determined by
the Plan Administrator may irrevocably elect to receive his distribution in
accordance with any one of the following methods of payment:
(1) by purchase of a nontransferable annuity contract from an
Insurance Company, or
(2) by a lump sum payment as soon as practicable after such a
Termination of Employment,
(3) effective for distributions on or after March 1, 1995, in
monthly, quarterly, semiannual or annual installments of principal (together
with earnings on the remaining Account balance) to reflect (A) fixed dollar
installments, (B) fixed percentage installments, (C) declining balance
installments, or (D) life expectancy installments,
(b) A Member who was a participant in the Continental Baking
Company "Interim" Savings Plan on December 31, 1985, and whose Termination of
Employment results from his Retirement or Disability, may, in addition to the
methods of payment set forth in subparagraph (a) above, elect to receive his
distribution in the form of consecutive annual substantially equal installments
of principal (together with earnings on the remaining Account balance) over a
period not extending beyond fifteen (15) years, (the Installment Period"). At
any time during the Installment Period, a Member may, with the approval of the
Plan Administrator, revoke this election and elect to receive the total
remaining balance of his Accounts in the form of a lump sum payment.
(c) If a Member elects a distribution in the form of an annuity
contract that permits payments in the form of a life annuity, the contract shall
provide that benefits are paid automatically in the form of a Qualified Joint
and Survivor Annuity, as defined in Section 11.03, unless the Member, with the
consent of his Eligible Spouse, if any, elects another form of payment in
accordance with Section 11.04.
(d) All distributions from Investment Funds, other than the
Ralston Common Stock Fund, the CBG Stock Fund from July 30, 1993 and ending May
15, 1995, the RPG Stock Fund from July 30, 1993 through February 1,1996, the
ESOP Preferred Stock Fund through December 31, 1998, the ESOP Common Stock Fund,
the Ralcorp Stock Fund from April 1, 1994 through March 31, 1995, the Agribrands
Stock Fund from April 1, 1998 through March 31, 1999, and the Energizer Stock
Fund commencing April 1, 2000, shall be made in cash. Except when an annuity
contract is purchased, distributions from the CBG Stock Fund and RPG Stock Fund
shall be in CBG Stock or RPG Stock with cash paid for any fractional share,
unless the Member or his Beneficiary elects to take cash for distribution.
Except when an annuity contract is purchased, distributions from the ESOP
Preferred Stock Fund, or the ESOP Common Stock Fund, shall be made in Common
Stock, or from the Ralcorp, Agribrands, or Energizer Stock Funds, as applicable,
shall be made in shares of Ralcorp, Agribrands, or Energizer Stock, with cash
paid for any fractional share, as applicable, unless the Member elects to take
cash for distribution.
(e) Notwithstanding any provision of the Plan to the contrary that
would otherwise limit a Distributee's election under Section 11.02, with respect
to distributions made on or after January 1, 1993 a Distributee may elect, at
the time and in the manner prescribed by the Plan Administrator or its delegatee
to have any portion of an Eligible Rollover Distribution paid directly to an
Eligible Retirement Plan specified by the Distributee in a direct rollover.
As used herein, Eligible Rollover Distribution shall mean any
distribution of all or any portion of the balance to the credit of the
Distributee's Accounts except that an Eligible Rollover Distribution does not
include any distribution that is one of a series of substantially equal periodic
payments (not less frequently than annually) made for the life (or life
expectancy) of the Distributee or the joint lives (or joint life expectancies)
of the Distributee and the Distributee's designated beneficiary, or for a
specified period of ten (10) years or more; any distribution to the extent such
distribution is required under Code Section 401(a)(9) and the portion of any
distribution that is not includible in gross income (determined without regard
to the exclusion for net unrealized appreciation with respect to Employer
securities); any hardship distribution described in Code Section
401(K)(2)(B)(i)(iv) received after December 31, 1998, and any other
distribution(s) that is reasonably expected to total less than Two Hundred
Dollars ($200) during a calendar year.
As used herein, Eligible Retirement Plan shall mean an individual
retirement account described in Code Section 408(a), an individual retirement
annuity described in Code Section 408(b), an annuity plan described in Code
Section 403(a), or a qualified trust described in Code Section 401(a), that
accepts the Distributee's Eligible Rollover Distribution. However, in the case
of an Eligible Rollover Distribution of the surviving spouse, an Eligible
Retirement Plan is an individual retirement account or individual retirement
annuity.
A Distributee includes an Employee or former Employee. In
addition, the Employee's or former Employee's surviving spouse and the
Employees' or former Employee's spouse or former spouse who is the alternate
payee under a qualified domestic relations order, as defined in Code Section
414(p) are Distributee's with regard to the interest of the spouse or former
spouse.
A Direct Rollover shall mean a payment by the Plan to the
Eligible Retirement Plan specified by the Distributee.
Section 11.03 - Qualified Joint and Survivor Annuity
----------------------------------------
A Qualified Joint and Survivor Annuity means an annuity for the life of the
Member, with a survivor annuity for the life of the Eligible Spouse which is not
less than fifty percent (50%) and is not greater than one hundred percent (100%)
of the amount of the annuity which is respectively payable during the joint
lives of the Member and the Eligible Spouse and which is the actuarial
equivalent of a single life annuity for the life of the Member. In the case of
a Member who does not have an Eligible Spouse, a Qualified Joint and Survivor
Annuity means an annuity for the life of the Member.
Each Member entitled to receive his benefit in the form of a Qualified Joint and
Survivor Annuity shall furnish proof of the age of the Eligible Spouse within a
reasonable period before payments commence under the Qualified Joint and
Survivor Annuity.
Section 11.04 - Election Not to Receive a Qualified Joint and Survivor Annuity
--------------------------------------------------------------
An election not to receive retirement income in the form of a Qualified Joint
and Survivor Annuity may be made (and any prior such election may be revoked) by
a Member entitled to receive his retirement income in such form, subject to the
following:
(a) The election must be made during the ninety (90) day period
ending on the date payments of benefits to the Member commence ("Election
Period").
(b) The election must be in writing on a form acceptable to the
Plan Administrator (or the insurance company) and must be signed by the Member.
The election form must clearly indicate that the Member is electing to receive
his retirement income in a form other than a Qualified Joint and Survivor
Annuity.
(c) The Eligible Spouse, if any, of the Member must consent to the
election in writing on a form acceptable to the Plan Administrator (or the
Insurance Company), signed by the Eligible Spouse and witnessed by a Plan
representative or a notary public. The consent must acknowledge the effect of
the election. Such a consent is not necessary if the Member establishes to the
satisfaction of the Plan Administrator (or the insurance company) that such
written consent may not be obtained because there is no Eligible Spouse, because
the Eligible Spouse cannot be located, or because of such other circumstances as
Treasury Regulations may prescribe. Any consent by an Eligible Spouse shall be
effective only with respect to such Spouse, and must specifically identify the
beneficiary and the optional form of benefit to which the consent relates.
(d) Any such election may be revoked or changed by the Member by a
subsequent election made in accordance with this Section during the Election
Period. The election may be revoked, but not changed, without the consent of
the Eligible Spouse. The Eligible Spouse may not revoke a consent to a valid
election.
(e) Within a reasonable period [no later than ninety (90) days and
at least thirty (30) days] before the benefit payments commence, the Plan
Administrator (or the insurance company) shall furnish to each Member entitled
to receive his retirement income in the form of a Qualified Joint and Survivor
Annuity, a written explanation of:
(1) The terms and conditions of the Qualified Joint and
Survivor Annuity;
(2) The availability of the election provided by this Section
and the effect of making such an election;
(3) The rights of the Eligible Spouse of the Member; and
(4) The right to revoke a previous election and the effect of
such revocation.
Section 11.05 - Completion of Appropriate Forms
----------------------------------
The Plan Administrator has prescribed forms providing written notice to the
Company in order for a distribution to be made under the Plan. In the event a
Member or a Beneficiary does not complete, execute and return such forms to the
Company, the distribution of such Member's Accounts shall (except to the extent
provided in Section 18.09), be mailed, as provided in Section 11.02(d) in cash,
to the Address of Record as provided in Section 18.08 to a Member as soon as
practicable following the sixty-fifth (65th) birthday of such Member, or to a
Beneficiary. The Valuation Date for purposes of this Section 11.05 shall be as
described in Article IX.
Section 11.06 - Accounts of Former Employees
-------------------------------
The amount credited to the accounts of a Member, if any, after Termination of
Employment of such Member shall be adjusted in accordance with Article IX as of
each Valuation Date next following such Termination of Employment until such
amount shall have been distributed in full in accordance with this Article.
Distribution of the balance of the amount credited to the Accounts of a Member,
determined as of the Valuation Date immediately preceding such distribution,
shall constitute payment in full of the benefits of such Member hereunder. Any
balance of such accounts remaining unpaid at the death of a Member or
Beneficiary shall be distributed in accordance with Article XII.
Any amounts being held for deferred distribution will continue to be held by the
Trustee and invested in accordance with the instructions of the Members. Such
instructions will be given in accordance with the provisions of this Plan.
Persons receiving a deferred distribution are former Members and shall not be
credited with Before-Tax, Supplemental or Matching Company Contributions after
Termination of Employment, except with respect to compensation paid subsequent
to the Termination of Employment but attributable to services performed as an
Employee in Covered Service.
Section 11.07 - Consent to Payment
--------------------
Notwithstanding the foregoing provisions of Article XI, (a) if the aggregate
vested portion of the Accounts of a Member is Three Thousand Five Hundred
Dollars ($3,500) or less [Five Thousand Dollars ($5,000) for Plan Years
beginning on or after January 1, 1998], it shall be distributed in a lump sum
payment; and (b) if the aggregate vested portion of the Accounts of a Member
exceeds Three Thousand Five Hundred Dollars ($3,500) [Five Thousand Dollars
($5,000) for Plan Years beginning on or after January 1, 1998] at the time the
Member first becomes entitled to a distribution under this Article XI, and the
Member has not attained sixty-five (65) years of age, the Member must consent in
writing before any portion of such Account may be distributed to the Member.
Section 11.08 - Latest Deferral of Payment
-----------------------------
Notwithstanding anything to the contrary in the Plan, payment of benefits
pursuant to the Plan (including pursuant to annuity contracts distributed to a
Member) shall not provide for deferment of payments extending beyond the
following periods:
(a) If the Beneficiary or contingent annuitant of a Member under
any method of distribution is other than his Eligible Spouse, the actuarial
present value of payments expected to be made to the Member shall not be less
than fifty-one percent (51%) of the total actuarial present value of the
benefits expected to be paid to the Member and his Beneficiary or contingent
annuitant.
(b) Unless the Member elects otherwise in writing, the latest date
by which payment of benefits must commence shall be the sixtieth (60th) day
after close of the Plan Year in which the latest of the following events occurs:
(1) the Member attains sixty-five (65) years of age; (2) the Member incurs a
Termination of Employment; and (3) ten (10) years have elapsed from the time the
Member commenced participation in the Plan.
If payment in full is not feasible within the time limits
prescribed by this subsection (b) the Plan Administrator may make interim
payments from accounts of the Member.
(c) Notwithstanding anything to the contrary in this Plan and
regardless of any election by the Member, payment of benefits shall commence (i)
for Plan Years ending on or before December 31, 1998, no later than the April 1
of the calendar year immediately following the earlier of the calendar year in
which the Member attains age seventy and one-half (70-1/2) years, or the
calendar year in which the Member actually retires, or (ii) for Plan Years
beginning on or after January 1, 1999, no later than the April 1 of the calendar
year immediately following the later of the calendar year in which the Member
attains age seventy and one-half (70-1/2) years or the calendar year the Member
actually retires, provided that a Member who attained age seventy and one-half
(70-1/2) prior to January 1, 1988, who is not a five-percent (5%) owner, may
defer commencement of benefits until the April 1 of the calendar year following
the calendar year in which such Member actually retires. The minimum
distribution to be made each year shall be the amount equal to the quotient
obtained by dividing the Member's Account balance at the beginning of the year
by the life expectancy of the Member (or the joint life and last survivor
expectancy of the Member and the Beneficiary). If payments are made over the
life expectancy of the Member, or the joint life expectancy of the Member and
his spouse, life expectancy will be determined either: (1) only once, at the
time the Member (or his spouse) receives the first distribution of his account
balance; or (2) periodically, but no more frequently than annually. If payments
are made over the joint life expectancy of the Member and a non-spouse
Beneficiary, the change in the life expectancy of the Member may be determined
periodically, but not more frequently than annually; but the life expectancy of
the non-spouse Beneficiary shall be determined only once at the time the Member
(or Beneficiary) receives the first distribution of his account balance.
Section 11.09 - Lost Payees
------------
In the event the amount credited to the Account(s) of a Member remain unclaimed
for more than five (5) years after such amount becomes distributable pursuant to
Section 11.07, and the Plan Administrator is unable to locate such Member (or
his Beneficiary), the Plan Administrator may direct such amount to be applied to
reduce Company Matching Contributions provided that in the event such Member (or
his Beneficiary) subsequently claims such amounts, the Employer shall contribute
an amount to the Plan which will cause the balance of such Member's account(s)
to equal the amount which would have been credited to such account(s) as of such
date if such amounts had never been reallocated pursuant to this Section.
Section 11.10 - Distribution of Annuity Contracts
------------------------------------
Notwithstanding anything to the contrary in the Plan, the Plan Administrator may
distribute all or any portion of the balance of an account that is distributable
to a Member (or a Beneficiary) by purchasing a nontransferable annuity contract
from an insurance company and transferring ownership of the contract to the
Member. Any annuity contract distributed to a Member (or a Beneficiary) shall
provide payment options that conform to those provided by the terms of the Plan,
so that payments pursuant to the contract satisfy the survivor annuity and other
requirements of the Plan governing payment of benefits.
ARTICLE XII - Death Benefits
Section 12.01 - Death Benefits
---------------
Upon the death of a Member, the amount credited to the Member's account shall
become distributable to the Beneficiary or Beneficiaries of the Member in a lump
sum payment as soon as practicable after the death of such Member, unless the
Member had elected payment of his benefit in the form of a life annuity prior to
his death.
Section 12.02 - Beneficiary Designation
------------------------
Subject to Section 12.03, each Member from time to time on a form acceptable to
the Plan Administrator may designate any person (including a trust) or persons
(concurrently, contingently or successively) to whom the Member's benefits under
the Plan are to be paid if the Member dies before receiving all of such
benefits. A beneficiary designation form shall be effective only when the form
is filed in writing by the Member and shall cancel all beneficiary designation
forms previously signed and filed by the Member.
With respect to a Member who has at least one Hour of Service after August 22,
1984, the designation of a non-spouse Beneficiary shall be valid only if the
surviving spouse of the Member shall have consented in writing to such
designation, the consent acknowledges the effect of such designation and the
consent is witnessed by a Plan representative or a notary public.
Section 12.03 - Pre-Retirement Survivor Annuity
---------------------------------
This Section shall apply only to a Member who is eligible to receive a Qualified
Joint and Survivor Annuity pursuant to Article XI because the Member elected
payment in the form of a life annuity and who dies before payment of benefits
has commenced.
Upon the death of such a Member, at least fifty percent (50%) of the amount
credited to the Member's Accounts (or the cash value of an annuity contract
distributed to the Member) as of the date of death shall be distributed in the
form of a single life annuity for the life of the Member's Eligible Spouse
unless the Eligible Spouse has validly consented to the designation of another
Beneficiary in accordance with Section 12.02 after the earlier of (a) the first
day of the Plan Year in which the Member attained thirty-five (35) years of age,
or (b) the date on which such Member terminates employment. If the amount to be
applied to the purchase of such an annuity is Three Thousand Five Hundred
Dollars ($3,500) [Five Thousand Dollars ($5,000) for Plan Years commencing on or
after January 1, 1998] or less, such amount shall be paid to the Eligible Spouse
in cash in lieu of the annuity.
An Eligible Surviving Spouse entitled to receive a single life annuity may
direct that payments under the annuity commence within a reasonable time after
the Member's death.
Section 12.04 - Payment of Benefit
--------------------
The portion of the death benefit not payable in the form of a Pre-retirement
Survivor Annuity pursuant to Section 12.03 shall be distributed in one lump sum
payment as soon as practicable after the death of the Member. Such payment
shall be made to the Member's Eligible Spouse unless such Eligible Spouse has
consented to another beneficiary pursuant to Section 12.02.
Section 12.05 - Latest Time for Payment
--------------------------
For Plan Years commencing after 1984, if a Member dies after distribution of
benefits has commenced but before the entire interest has been distributed, the
remaining portion of such interest shall be distributed at least as rapidly as
the distribution option elected by the Member.
If a Member dies before a distribution of benefits has commenced, the entire
interest shall be distributed within five (5) years of the Member's death;
unless any portion of the interest is payable to or for a Beneficiary over a
period not to exceed the life or life expectancy of the Beneficiary and payments
commence within one year after the Member's death. However, if the Beneficiary
is the surviving spouse of the Member, distribution need not commence before the
date when the Member would have attained age seventy and one-half (70-1/2)
years; provided that if the surviving spouse dies before distribution to such
spouse begins, this paragraph shall be applied as if the surviving spouse were
the Member.
Section 12.06 - Payments in the Event of Death with No Designated Survivor or
-------------------------------------------------------------
Incompetency
------------
In the event of (a) the death of a Member or Beneficiary not survived by a
person designated to receive any payment then due, or (b) the Plan Administrator
finding that a Member or other person entitled to a benefit is unable to care
for his affairs because of illness or accident or is a minor or has died, or (c)
no Beneficiary being designated, the Plan Administrator may direct that any
benefit payment due him, unless claim shall have been made therefor by a duly
appointed legal representative, shall be paid to his spouse, a child, a parent
or other blood relative, a person with whom he resides, or to any other person
the Plan Administrator considers suitable if such death occurs prior to January
1, 1998, and shall be paid to his spouse, if married at the time of his death,
or to his estate, if single, or to any other person the Plan Administrator
considers suitable, in its sole discretion, if such death occurs on or after
January 1, 1998, and any such payment so made shall be a complete discharge of
the liabilities of the Plan therefor.
Section 12.07 - Renunciation of Death Benefit
--------------------------------
Any Beneficiary of a Member entitled to a benefit under this Plan may disclaim
his right to all or a portion of such benefit by filing a written irrevocable
and unqualified refusal to accept such a benefit with the Plan Administrator
before receiving any such benefit. If such a renunciation is filed by the
Eligible Spouse of the Member, the value of the annuity described in Section
12.03 shall be zero. Any benefits so disclaimed shall be distributable to the
person or persons (and in the proportions) to which such benefit would have been
distributable if the Beneficiary who so disclaims such benefits had predeceased
such Member.
Section 12.08 - Proof of Death and Right of Beneficiary or Other Person
-------------------------------------------------------------
The Plan Administrator may require and rely upon such proof of death and such
evidence of the right of any Beneficiary or other person to receive the
undistributed value of the Accounts of a deceased Member as the Plan
Administrator may deem proper and its determination of death and of the right of
such Beneficiary or other person to receive payment shall be conclusive.
ARTICLE XIII - Withdrawal Prior to Termination of Employment
Section 13.01 - Withdrawal of Supplemental Contributions
-------------------------------------------
A Member who has made Supplemental Contributions may withdraw such contributions
in accordance with guidelines determined by the Plan Administrator at any time
by submitting a written request to the Plan Administrator specifying the amount
to be withdrawn. Payment shall be made to the Member as soon as practicable
after the submission of the Member's written request to the Plan Administrator.
The withdrawal may not exceed the lesser of the Member's Supplemental Investment
Account or his total Supplemental Contributions.
Section 13.02 - Hardship Withdrawal of Before-Tax Contributions and/or Company
--------------------------------------------------------------
Contributions
-------------
A Member may withdraw amounts from his Before-Tax Contribution Account and/or
his Company Contribution Account by submitting his written request to the Plan
Administrator at such time and in such manner as shall be prescribed by the Plan
Administrator subject to the following provisions:
(a) The withdrawal request must be for an immediate and heavy
financial need on account of:
(1) Nonreimbursable medical expenses incurred by the Member,
his Spouse, or dependents;
(2) Costs directly related to the purchase (excluding
mortgage payments) of a principal residence for the Member;
(3) Payment of tuition for the next twelve (12) months of
post-secondary education for the Member, his Spouse, or dependents; or
(4) The need to prevent the eviction of the Member from his
principal residence or foreclosure on the mortgage on the Member's principal
residence.
(b) The amount withdrawn may not exceed the actual expense
incurred or to be incurred by the Member on account of such needs. The amount
of an immediate and heavy financial need may include any amounts necessary to
pay any federal, state, or local income taxes or penalties reasonably
anticipated to result from the distribution. The amount may be withdrawn only
to the extent that the need cannot be satisfied by other resources reasonably
available to the Member.
In making this determination, the Plan Administrator may rely on
the Member's representation that the need cannot be relieved:
(1) Through reimbursement or compensation by insurance or
otherwise;
(2) By reasonable liquidation of the Member's assets;
(3) By other distributions or loans from Company-sponsored
plans, or
(4) By borrowing from commercial sources on reasonable terms.
(c) Only one such withdrawal shall be permitted during a
twelve-month period.
(d) The maximum amount which may be withdrawn is the sum of:
(i) The dollar amount of Before-Tax Contributions made on
behalf of such Member after January 1, 1989 (but excluding income thereon);
(ii) The balance of his Company Matching Contributions
Account, provided he is fully vested in his Company Matching Contribution
Account; and
(iii) The balance of the Member's Before-Tax Investment
Account under the Prior Plan.
(e) The withdrawal shall be paid to the Member as soon as
practicable after the Member's written request is submitted to the Plan
Administrator.
(f) A Member requesting a hardship withdrawal after February 28,
1995 shall be precluded from making any Before-Tax Matched Contributions,
Before-Tax Unmatched Contributions, or Supplemental Contributions during the
twelve (12) month period immediately following such withdrawal.
Section 13.03 - Age Fifty-Nine and One-Half (59-1/2) Withdrawal
----------------------------------------------------
A Member who has attained age fifty-nine and one-half (59-1/2) may withdraw
Before-Tax, Supplemental, and Company Contributions, and related earnings (to
the extent he is vested in such contributions and related earnings) in
accordance with guidelines determined by the Plan Administrator by submitting a
written request to the Plan Administrator specifying the amount to be withdrawn.
Payment shall be made to the Member as soon as practicable after submission of
the Member's written request to the Plan Administrator.
Section 13.04 - Order of Withdrawals
----------------------
(a) A Member wishing to withdraw amounts from his accounts must
first withdraw the total amount in his Supplemental Investment Account.
(b) Once a Member has withdrawn all amounts in his Supplemental
Investment Account, or if a Member has no Supplemental Investment Account, he
must then withdraw amounts from his Company Contribution Account (other than
amounts invested in the ESOP Preferred Stock Fund for Plan Years beginning on or
after January 1, 1989 and ending on or before December 31, 1998, or the ESOP
Common Stock Fund for Plan Years beginning on or after January 1, 1999), subject
to the other requirements set forth in this Article XIII.
(c) When a Member has withdrawn all amounts in his Supplemental
Investment Account or has no Supplemental Investment Account and has also
withdrawn all amounts from his Company Contribution Account (other than amounts
invested in the ESOP Preferred Stock Fund for Plan Years beginning on or after
January 1, 1989 and ending on or before December 31, 1998, or the ESOP Common
Stock Fund for Plan Years beginning on or after January 1, 1999) or is not fully
vested in said Account, then the Member may withdraw amounts from his Before-Tax
Investment Contribution Account (other than amounts invested in the ESOP
Preferred Stock Fund or ESOP Common Stock Fund), subject to the other
requirements set forth in this Article XIII.
(d) When a Member has withdrawn all other amounts, to the extent
he is vested in his Accounts, then the Member may withdraw amounts held in the
ESOP Preferred Stock Fund for Plan Years beginning on or after January 1, 1989
and ending on or before December 31, 1998, or the ESOP Common Stock Fund for
Plan Years beginning on or after January 1, 1999, subject to the other
requirements set forth in this Article XIII.
ARTICLE XIV - Forfeitures
Section 14.01 - Time of Forfeiture and Restoration
--------------------------------------
(a) If a Member incurs a Termination of Employment prior to the
attainment of age sixty-five (65) for reasons other than Retirement, Disability
or death, the portion, if any, of his Company Contribution Account in which he
is not vested pursuant to Article X shall be forfeited as of the Valuation Date
on which (i) the Member has received a distribution of the entire vested portion
of his Accounts, or (ii) the Member has incurred a five consecutive year Break
in Service.
(b) If a Member has forfeited a portion of his Company
Contribution Account pursuant to subsection (a), such forfeited amount will be
restored if he is re-employed by the Company before he has incurred a Break in
Service of at least five (5) years. Any amounts restored and repaid to the
Trust Fund under this Section shall be paid into the remaining Funds in the same
proportion as Before-Tax Unmatched and Supplemental Contributions are currently
being made.
The permissible sources for restoring forfeitures shall be income
or gain to the Plan, forfeitures, or Company contributions (without regard to
the existence of profits).
Section 14.02 - Disposition of Forfeitures
----------------------------
All forfeitures arising out of the application of the provisions of Section
14.01 shall be used to reduce Company Contributions otherwise payable to the
Plan.
Section 14.03 - Effect of Withdrawal Under Article XIII
--------------------------------------------
The non-vested Company Contribution Account of a Member who makes a withdrawal
described in Article XIII shall not be forfeited by reason thereof.
Section 14.04 - Maternity Absence
------------------
In the case of an Employee who is absent from work for maternity or paternity
reasons, the Break in Service of the Employee shall not include the twelve (12)
consecutive month period beginning on the first anniversary of the day such
absence began. Absence from work for maternity or paternity reasons means
absence from work on account of the pregnancy or birth of a child of the
employee, the placement of a child with the Employee in connection with the
adoption of the child, or for purposes of caring for a child following such a
birth or placement.
ARTICLE XV - Administration of Plan
Section 15.01 - Plan Administrator
-------------------
Ralston Purina Company, as the Plan Administrator, shall have the responsibility
for carrying out the provisions of the Plan and the general administration of
the Plan.
Section 15.02 - Benefits Council
-----------------
(a) The claims fiduciary for the Plan, in accordance with Article
XIX, shall be the Benefits Council, to be comprised of no less than three
persons appointed by the Chief Executive Officer of Ralston Purina Company.
(b) Any person appointed a member of the Benefits Council shall
signify his acceptance by filing a written acceptance with the Secretary of the
Benefits Council. Any member of the Benefits Council may resign by delivering
his written resignation to the Secretary of the Benefits Council, and such
resignation shall become effective upon the date specified therein.
(c) The Chief Executive Officer shall appoint a Chairman and a
Secretary of the Benefits Council. The Benefits Council may appoint from its
members such committees with such powers as it shall determine, and may
authorize one or more of its members, or any agent, to execute or deliver any
instrument or make any payment in its behalf.
(d) The Benefits Council shall hold meetings upon such notice, at
such place or places, and at such time or times as it may from time to time
determine.
(e) A majority of the members of the Benefits Council shall
constitute a quorum for the transaction of business. All resolutions or other
action taken by the Benefits Council shall be by the vote of a majority of the
members of the Benefits Council present at any meeting or without a meeting by
an instrument in writing signed by a majority of the members of the Benefits
Council.
Section 15.03 - Benefits Policy Board
-----------------------
(a) The Benefits Policy Board shall have the authority to amend
the Plan to the extent the annual cost to the Plan resulting from such amendment
does not exceed $250,000, unless the Chief Executive Officer is a member of the
Benefits Policy Board and signs the amendment, in which case the cost of such
amendment cannot exceed one million dollars ($1,000,000). Members of the
Benefits Policy Board are appointed by the Chief Executive Officer.
(b) Any person appointed a member of the Benefits Policy Board
shall signify his acceptance by filing a written acceptance with the Secretary
of the Benefits Policy Board. Any member of the Benefits Policy Board may
resign by delivering his written resignation to the Secretary of the Benefits
Policy Board and such resignation shall become effective upon the date specified
therein.
(c) The Benefits Policy Board shall elect from its members a
Chairman, and shall also elect a Secretary who may be, but need not be, one of
the members of the Benefits Policy Board. The Benefits Policy Board may appoint
from its members such committees with such powers as it shall determine, and may
authorize one or more of its members, or any agent, to execute or deliver any
instrument or make any payment in its behalf.
(d) The Benefits Policy Board shall hold meetings upon such
notice, at such place or places, and at such time or times as it may from time
to time determine.
(e) A majority of the members of the Benefits Policy Board shall
constitute a quorum for the transaction of business. All resolutions or other
action taken by the Benefits Policy Board shall be by the vote of a majority of
the members of the Benefits Policy Board present at any meeting or without a
meeting by an instrument in writing signed by a majority of the members of the
Benefits Policy Board.
Section 15.04 - EBAIC
-----
(a) Certain responsibilities to control and manage Plan assets, to
add or delete investment funds, and to appoint and remove the Trustee and any
investment managers retained in connection with the investment of Plan assets,
shall be placed in the Employee Benefit Asset Investment Committee ("EBAIC"), to
be comprised of persons appointed in the manner determined by the Board of
Directors.
(b) Any person appointed a member of the EBAIC shall signify his
acceptance by filing a written acceptance with the Secretary of the EBAIC. Any
member of the EBAIC may resign by delivering his written resignation to the
Secretary of the EBAIC and such resignation shall become effective upon the date
specified therein.
(c) The EBAIC shall elect from its members a Chairman, and shall
also elect a Secretary who may be, but need not be, one of the members of the
EBAIC. The EBAIC may appoint from its members such committees with such powers
as it shall determine, and may authorize one or more of its members, or any
agent, to execute or deliver any instrument or make any payment in its behalf.
(d) The EBAIC shall hold meetings upon such notice, at such place
or places, and at such time or times as it may from time to time determine.
(e) A majority of the members of the EBAIC shall constitute a
quorum for the transaction of business. All resolutions or other action taken
by the EBAIC shall be by the vote of a majority of the members of the EBAIC
present at any meeting or without a meeting by an instrument in writing signed
by a majority of the members of the EBAIC.
Section 15.05 - Authority and Duties of Various Fiduciaries
------------------------------------------------
(a) Except for matters required by the terms of the Plan, or of
the Trust to be decided by the Trustee, the Plan Administrator shall have the
exclusive right to interpret the Plan and to decide any and all matters arising
under the Plan or in connection with its administration, including determination
of eligibility for, and the amount of distributions and withdrawals. The Plan
Administrator shall have full and complete discretion to determine eligibility
for participation and benefits under the Plan, including, without limitation,
the determination of those individuals who are deemed Employees for purposes of
the Plan. The decisions of the Plan Administrator, or its delegatees, shall be
final, binding, and conclusive on all parties having or claiming a benefit under
this Plan. The Company shall have no power to direct or modify any
interpretations, determinations, or decisions of the Plan Administrator. The
Plan Administrator may recommend amendments to the Board of Directors or the
Benefits Policy Board or its delegatee. The Plan Administrator may from time to
time adopt rules for the administration of the Plan and the conduct of its
business, which rules shall be consistent with the provisions of the Plan.
(b) The Plan Administrator, the EBAIC, the Trustee, the Benefits
Policy Board, and any other named fiduciary may each employ counsel, agents, and
such clerical and accounting services as it may require in carrying out its
responsibilities under the Plan. All fiduciaries shall be entitled to rely upon
tables, valuations, certificates, opinions, and reports furnished by any
actuary, accountant, or legal counsel appointed under the provisions of the
Plan.
(c) The Plan Administrator shall keep in convenient form such
personnel data as may be necessary for the Plan. The Plan Administrator shall
prepare, distribute, and file such reports and notices as may be required by
applicable law or regulations.
(d) The Plan Administrator shall control and manage the Plan
assets to the extent it has not delegated its power to do so to the EBAIC. Such
delegation of power may include the right to appoint and remove investment
managers and Trustees. Such delegation may be accomplished by a separate
instrument or by appropriate provisions in the Trust.
(e) The members of the Plan Administrator, the EBAIC, and the
Trustee shall use that degree of care, skill, prudence and diligence that a
prudent person acting in a like capacity and familiar with such matters would
use in his conduct of a similar Situation. A member of the Plan Administrator,
the EBAIC, or the Trustee shall not be liable for the breach of fiduciary
responsibility of another fiduciary unless (1) he participates knowingly in, or
knowingly undertakes to conceal, an act or omission of such other fiduciary,
knowing such act or omission is a breach; (2) by his failure to discharge his
duties solely in the interest of Members and Beneficiaries for the exclusive
purpose of providing their benefits and defraying reasonable expenses of
administering the Plan not met by the Company, he has enabled such other
fiduciary to commit a breach; (3) he has knowledge of a breach by such other
fiduciary and does not make reasonable efforts to remedy the breach; or (4) if
the Plan Administrator, the EBAIC, or the Trustee improperly allocates among
themselves or delegates to others, or fails to properly review such allocation
or delegation of fiduciary responsibilities.
(f) The Company will indemnify and save harmless the EBAIC, the
Trustee, the Benefits Policy Board, the Benefits Council, and any person to whom
fiduciary responsibilities are delegated under this Plan against any and all
expenses (including attorneys' fees), judgments, fines, and amounts paid in
settlement, actually and reasonably incurred by him in connection with any
civil, criminal, administrative, or investigative action, proceeding, or claim
(including an action by or in the right of the Company) by reason of the fact
that he is or was serving in such capacity, provided that such person's conduct
is not finally adjudged to have been knowingly fraudulent, deliberately
dishonest or willful misconduct.
(g) Each Trustee shall maintain accounts showing the fiscal
transactions of the Trust established hereunder. The EBAIC shall keep in
convenient form such financial data as may be necessary for the Plan, and shall
annually cause to be prepared a balance sheet and statement of financial
transactions of the Plan and the Trust.
(h) Whenever, in the administration of the Plan, any discretionary
action is required, the authorized party shall exercise his authority in a
nondiscriminatory manner so that all persons similarly situated will receive
substantially the same treatment.
Section 15.06 - Named Fiduciaries
------------------
(a) The Board of Directors, the Plan Administrator, the Benefits
Council, and the EBAIC shall each constitute named fiduciaries as such term is
defined in ERISA.
(b) Any committee of the Board of Directors or other fiduciary
appointed as a named fiduciary by the Board of Directors by resolution or
appointed by an appropriate instrument executed by an officer of the Company
thereunto authorized by resolution of the Board of Directors, shall also
constitute a named fiduciary in respect of the duty delegated to him or it in
such resolution or instrument.
Section 15.07 - Delegation
----------
Any named fiduciary designated herein or appointed as provided herein, unless
precluded from doing so by the terms of such appointment, may by appropriate
instrument designate any person (including any firm or corporation) to carry out
part or all of such fiduciary's responsibilities and upon such designation the
named fiduciary shall have no liability, except as imposed by applicable law,
for any act or omission of such person. The foregoing does not preclude any
other fiduciary to the extent allowed by ERISA and the terms of his appointment
from delegating part or all of such fiduciary's responsibilities with respect to
the Plan.
Section 15.08 - Multiple Capacities
--------------------
Any fiduciary may serve in more than one fiduciary capacity with respect to the
Plan.
ARTICLE XVI - Amendments, Termination, Permanent Discontinuance of
Contributions, Merger or Consolidation
Section 16.01 - Amendments
----------
The Board of Directors, or the Benefits Policy Board, or any delegatee, or the
EBAIC to the extent authority to do so is granted by the Board of Directors, may
at any time and from time to time, both retroactively and prospectively, modify
or amend, in whole or in part, any or all of the provisions of the Plan,
including any modification in the Plan or in the agreement or agreements
establishing the Trust, as the Plan Administrator shall deem to be necessary or
advisable in order to obtain the qualification or exemption, or to maintain the
qualification or exemption of the Plan and the Trust under the Code to comply
with ERISA, provided, however, that no such modification or amendment shall make
it possible for any part of the funds of the Plan to be used for, or diverted
to, purposes other than for the exclusive benefit of Members, spouses, former
Members, retired Members or Beneficiaries under the Plan; that no modification
or amendment shall be made which has the effect of decreasing retroactively the
Accounts of any Member or of reducing the non-forfeitable percentage of the
Company Contribution Account of a Member below the non-forfeitable percentage
thereof computed under the Plan as in effect on the later of the date on which
the amendment is adopted or becomes effective.
Section 16.02 - Termination or Permanent Discontinuance of Contributions
-------------------------------------------------------------
Ralston Purina Company may by action of its Board of Directors terminate the
Plan with respect to all participating companies or any of them or direct
complete discontinuance of contributions hereunder by all or any of the
participating companies for any reason at any time. In case of such termination
or complete discontinuance of contributions hereunder, there shall automatically
vest in the appropriate Members non-forfeitable rights to the Company
Contributions credited to their Accounts.
Section 16.03 - Partial Termination
--------------------
In the event of a partial termination of the Plan, the provisions of Section
16.02 shall be applicable only to the Members affected by such partial
termination.
Section 16.04 - Benefits in Case of Merger or Consolidation
-------------------------------------------------
The Plan may not be merged or consolidated with, nor may its assets or
liabilities be transferred to, any other plan (including, but not limited to, a
spin-off of the Plan as defined in the regulations to Code Section 414), unless
each Member, spouse, former Member, retired Member or Beneficiary under the Plan
would, if the resulting plan were then terminated, receive a benefit immediately
after the merger, consolidation, or transfer which is equal to or greater than
the benefit he would have been entitled to receive immediately before the
merger, consolidation, or transfer if the Plan had been terminated.
ARTICLE XVII - Loans
Section 17.01 - Loans
-----
In the event of financial necessity, a Member may make application to the Plan
Administrator in writing to borrow from the Trust Fund and the Plan
Administrator may in its sole discretion permit such a loan upon the conditions
hereinafter specified. The authority herein granted to the Plan Administrator
to approve loans from the Trust Fund is for the purpose of assisting a Member to
meet special situations and shall not be used as a means of distributing
benefits before they otherwise become due. Loans shall be granted in a uniform
and non-discriminatory manner and shall be made on the following conditions:
(a) The amount of a loan to a Member (when added to the
outstanding balance of all other loans from the Plan to the Member) shall not
exceed the lesser of --
(1) Fifty percent (50%) of the vested amount in the
Member's Accounts, or
(2) $50,000, reduced by the excess (if any) of the highest
outstanding balance of loans from the Plan to the Member during the one-year
period ending on the day before the date on which such loan was made over the
outstanding balance of loans from the Plan on the date on which such loan was
made.
The maturity of a loan shall not exceed five (5) years, except in
the case of a loan to acquire or construct the Member's principal residence,
which shall mature in not more than ten (10) years.
If the Member is also covered under another qualified plan
maintained by the Company, the limitations of subsections (a)(1) and (2) shall
be applied as though all such qualified plans are one plan.
(b) A note shall be signed by the Member establishing regular
installment payments made by payroll deduction whenever possible and to the
extent permitted by law. The terms of such loans shall require substantially
level amortization over the term of the loan with payments not less frequently
than quarterly. Loans shall bear interest as specified in Section 17.02. Loans
shall be granted only if secured by the Member's vested Account Balances;
provided, however, that no more than fifty percent (50%) of the Member's vested
Account Balance may be pledged as collateral for the loan.
(c) In the event an installment payment is not paid within seven
(7) days following the due date, the Plan Administrator shall give written
notice to the Member sent to his last known address. If such installment
payment is not made within thirty (30) days thereafter, the Plan Administrator
may proceed with such actions as they deem necessary in order to preserve plan
assets from loss including, but not limited to, foreclosure, sale, or other
disposition of the security.
(d) In the event of the Termination of Employment of the Member
before the loan is repaid in full, the unpaid balance thereof, together with
interest thereon, shall become due and payable and the Trustee shall first
satisfy the indebtedness from the amount payable to the Member or to the
Member's Beneficiary before making any payments to the Member or to the Member's
Beneficiary.
Section 17.02 - Interest Rates
---------------
Interest rates for Plan loans shall be regularly reviewed and adjusted in
conformity with interest rates which, in the judgment of the Plan Administrator,
are commensurate with rates charged by commercial lenders for similar types of
loans. The interest rate applicable to a Plan loan shall be fixed as of the
date the application for such a loan is received by the Plan Administrator or
its delegatee, and shall not be subject to change or renegotiation after such
date.
Section 17.03 - Other Rules
------------
In addition to the foregoing, the Plan Administrator shall prescribe such rules
and procedures as it may deem appropriate, including, without limitation, the
imposition of loan application fees, rules and procedures by which the making of
loans may be terminated, suspended or restricted, and the requirement of a
spousal consent to loans of married Members, if and to the extent deemed by the
Plan Administrator to be necessary or desirable in order to effect compliance
with applicable laws and regulations or to provide for effective administration
of such loans.
ARTICLE XVIII - Miscellaneous
Section 18.01 - Benefits Payable from Trust Fund
------------------------------------
All persons with any interest in the Trust Fund shall look solely to the Trust
Fund for any payments with respect to such interest.
Section 18.02 - Elections
---------
Elections hereunder shall be made by a Member in writing by the completion and
delivery to the Plan Administrator of forms prescribed by the Plan Administrator
for such purposes, within the time limits set forth hereunder with respect to
each such election or, if no time limit is set forth, such limit as may be
established by the Plan Administrator.
Section 18.03 - No Right to Continued Employment
------------------------------------
Neither the establishment of the Plan nor the payment of any benefits thereunder
nor any action of the Company, the Board of Directors, the Plan Administrator or
the Trustee shall be held or construed to confer upon any person any legal right
to be continued in the employ of the Company.
Section 18.04 - Inalienability of Benefits and Interest
-------------------------------------------
No benefit payable under the Plan or interest in the Trust Fund shall be subject
in any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance or charge, and any such attempted action shall be void and no such
benefit or interest shall be in any manner liable for or subject to debts,
contracts, liabilities, engagements or torts of any Member or Beneficiary. If
any Member or Beneficiary shall become bankrupt or shall attempt to anticipate,
alienate, sell, transfer, assign, pledge, encumber or charge any benefit payable
under the Plan or interest in the Trust Fund, then to the extent permitted by
law, the Plan Administrator in its discretion may hold or apply such benefit or
interest or any part thereof to or for the benefit of such Member, or his
Beneficiary, his spouse, children, blood relatives, or dependents, or any of
them, in such manner and in such proportions as the Plan Administrator may
consider proper. Notwithstanding the foregoing, any Member may direct that
benefits payable pursuant to Article IX from the Trust Fund shall be paid to the
trustee of a trust created by him for his own benefit or for the benefit of his
immediate family.
Notwithstanding any provision in the Plan to the contrary, the Plan shall make
all payments required by a qualified domestic relations order within the meaning
of Code Section 414(p), including distributions required or permitted by the
qualified domestic relations order to an alternate payee even though such
payments are with respect to a Member who has not separated from service and
which commence before the Member has attained the earliest retirement age under
the Plan; provided, however, the present value of the benefit to be paid to the
alternate payee (1) does not exceed $3,500 (or $5,000 for Plan Years beginning
on or after January 1, 1998, or (2) exceeds at least $3,500 (or $5,000 for Plan
Years beginning on or after January 1, 1998), and the alternate payee consents
in writing to such earlier distribution. The Plan Administrator shall establish
a procedure to determine the qualified status of a domestic relations order and
to administer distributions under such a qualified order.
Section 18.05 - Payments for Exclusive Benefits of Members
-----------------------------------------------
Payments of benefits in respect of the interest of a Member under the Plan to
any person other than such Member in accordance with the provisions of the Plan
shall be deemed to be for the exclusive benefit of such Member.
Section 18.06 - Missouri Law to Govern
-------------------------
All questions pertaining to the construction, regulation, validity and effect of
the provisions of the Plan shall be determined in accordance with the laws of
the State of Missouri, except as provided in Section 514 of ERISA.
Section 18.07 - No Guarantee
-------------
Neither the Company nor the Trustee guarantees the Trust Fund in any manner
against loss or depreciation.
Section 18.08 - Address of Record
-------------------
Each individual or entity with an actual or potential interest in the Plan shall
file and maintain a current record address with the Plan. Communications mailed
by the Company, trustee, or Plan Administrator to such record address fulfills
all obligations to provide required information to Members, including former
employees and Beneficiaries, in regard to the Plan.
If no record address is filed, it may be presumed that the address used by the
Company in forwarding statements of a Member's Account is the record address.
Section 18.09 - Participating Units
--------------------
The Board of Directors or the Plan Administrator, to the extent authority to do
so is granted to the Plan Administrator by the Board of Directors, may include a
designated unit of the Employees of an Affiliated Company in the Plan as
employed in a Participating Unit upon appropriate action by such Affiliated
Company necessary to adopt the Plan. Any such company may terminate its
participation in the Plan with respect to a designated unit of its employees
upon appropriate action by it, in which event the funds of the Plan held on
account of Members in the employ of such company and any unpaid balances of the
Accounts of Members who have separated from the employ of such company, shall be
determined by the Plan Administrator and shall be distributed as provided in
Section 16.02 in the event of termination of the Plan, held and distributed in
accordance with the terms of the Plan governing treatment of Members transferred
from Covered Service, or shall be segregated by the Trustee as a separate trust
fund, pursuant to direction to the Trustee by the Plan Administrator, continuing
the Plan as a separate plan for such employees of such company under which the
board of directors of such company shall succeed to all the powers and duties of
the Board of Directors, including the appointment of the members of the Plan
Administrator.
Section 18.10 - Headings
--------
Headings of Articles and Sections of the Plan are inserted for convenience of
reference. They constitute no part of the Plan.
Section 18.11 - Use of Masculine Terms
-------------------------
As used herein, masculine terms shall include the feminine wherever appropriate.
Section 18.12 - Payment of Expenses
---------------------
(a) Direct charges and expenses arising out of the purchase or
sale of securities, and taxes levied on or measured by such transactions shall
be charged against the Investment Fund or Funds for which the transaction took
place.
(b) To the extent permitted by law, all other expenses reasonably
incurred in administering the Plan, including expenses of the Plan Administrator
and the Trustee, fees for legal services, all taxes, if any, other than those
charged to the Funds, and the brokerage fees arising out of the purchase of
Common Stock for the Ralston Purina Common Stock Fund and the reinvestment of
dividends on such Common Stock shall be charged to the Trust in the manner
determined by the Plan Administrator.
Section 18.13 - Rollover Contributions
-----------------------
(a) An Employee, whether or not he would otherwise be a Member in
the Plan, may contribute a Rollover Contribution to the Trust by delivery of
such contribution to the Trustee, provided that the contribution constitutes an
"eligible rollover distribution" within the meaning of Code Section 402(c) which
the Plan may accept.
(b) A Rollover Contribution shall be considered as a part of the
account of the Employee in this Plan, shall be fully vested and non-forfeitable,
and shall be accounted for separately from Company contributions.
ARTICLE XIX - Claim Procedure
Section 19.01 - Initial Determination
----------------------
The initial determination of a Member's or Beneficiary's eligibility for, and
the amount of, a benefit shall be made by the Benefits Council which shall mail
or deliver to each covered individual who has filed an effective claim for a
benefit a written statement of the amount of his benefit or a notice of denial
of his claim on or before the ninetieth (90th) day following the Council's
receipt of such claim. If special circumstances require additional time for
processing the claim, the Benefits Council may delay issuing its statement or
notice for an additional ninety (90) days provided that the Member or
Beneficiary is notified of the circumstances necessitating the delay and the
date the Committee expects to render its final opinion. A claim for benefits is
not effective unless filed on forms prescribed by the Benefits Council. Each
notice of whole or partial denial of claimed benefits shall set forth the
specific reasons for the denial, the time within which an appeal must be made by
the Member or Beneficiary or his duly authorized representative, and shall
contain such other information as may be required by applicable law. If a
statement or notice is not issued within the prescribed period, the claim shall
be deemed denied.
Section 19.02 - Review
------
Each Member or Beneficiary whose claim for benefits has been wholly or partially
denied shall have such rights to review documents and submit comments as the
Benefits Council may provide, and shall also have the right to request the
Benefits Council to review such denial; such request shall be made on forms
prescribed by the Benefits Council. A request for review shall be filed by the
Member or Beneficiary or his duly authorized representative on or before the
sixtieth (60th) day following the earlier of the Member or Beneficiary's receipt
of notice of denial of his claim or the expiration of the prescribed period for
issuing a statement of benefits or notice of denial. The Benefits Council shall
issue a written statement on or before the sixtieth (60th) day following its
receipt of such request stating the Benefits Council's decision on review and
the reasons therefor, including specific references to pertinent Plan provisions
on which the decision is based, and any other information required by applicable
law. If special circumstances require additional time for processing such
review, the Benefits Council may delay issuing its decision for an additional
sixty (60) days provided that the Member or Beneficiary is notified of such
circumstances and the date the Benefits Council expects to render its final
decision. If the decision is not issued within the prescribed period, the
appeal shall be deemed denied. No Member or Beneficiary shall have recourse to
courts of law until the administrative review process set forth herein has been
completed.
ARTICLE XX - Limitation on Contributions
Section 20.01 - Maximum Annual Additions
--------------------------
(a) The Annual Addition (as defined in subsection (c) below) for a
---------------
Member with respect to a Limitation Year (as defined in subsection (e) below)
shall not exceed the lesser of --
(1) $30,000 or such higher annual amount specified by the
Department of the Treasury to reflect increases in the cost-of-living, effective
January 1 of each year; or
(2) Twenty-five percent (25%) of the Member's Compensation
[as defined in subsection (f)].
(b) (1) If a Member is, or was, covered under a qualified
defined benefit plan maintained by the Company, the sum of the Member's Defined
Benefit Fraction and Defined Contribution Fraction may not exceed 1.0 in any
Limitation Year, for all Plan Years ending on or before December 31, 1999.
(2) The Defined Benefit Fraction is a fraction, the numerator
----------------------------
of which is the sum of the Member's Projected Annual Benefits under all
qualified defined benefit plans (whether or not terminated) maintained by the
Company and the denominator of which is the lesser of --
(A) 1.25 times the dollar limitation of Code Section
415(b) (1)(A) in effect for each Limitation Year, or
(B) 1.4 times the Member's average Compensation for the
three consecutive Plan Years during which the Member both was an active
participant in the Plan and had the greatest aggregate Compensation.
Projected Annual Benefit means the annual benefit to which the
Member would be entitled under the terms of a defined benefit plan, if the
Member continued employment until normal retirement age (or current age, if
later) and the Member's Compensation for the Limitation Year and all other
relevant factors used to determine such benefit remained constant until normal
retirement age (or current age, if later).
(3) The Defined Contribution Fraction is a fraction, the
-------------------------------
numerator of which is the sum of the Annual Additions to the Member's account
under all qualified defined contribution plans (whether or not terminated)
maintained by the Company or a Commonly Controlled Entity of the Company for the
current and all prior Limitation Years, and the denominator of which is the sum
of the lesser of the following amounts determined for such year and for each
prior year of service with the Company or a Commonly Controlled Entity --
(A) 1.25 times the dollar limitation in effect under
Code Section 415(c)(1)(A) for such year [determined without regard to Code
Section 415(e)(6)], or
(B) 1.4 times the amount which may be taken into account
under Code Section 415(c)(1)(B).
In calculating the Defined Contribution Fraction, the Plan
Administrator may, at its discretion, make the election described in Code
Section 415(e)(6).
If the Plan satisfied the applicable requirements of Section 415 of the Code as
in effect for all Limitation Years beginning before January 1, 1987, an amount
shall be subtracted from the numerator of the Defined Contribution Fraction (not
exceeding such numerator) as prescribed by the Secretary of the Treasury so that
the sum of the Defined Benefit Fraction and the Defined Contribution Fraction
does not exceed 1.0 for such Limitation Year.
(c) Annual Addition means the sum of the following amounts for a
----------------
Limitation Year with respect to each Member --
(1) Before-Tax Matched Contributions
(2) Company Contributions
(3) Before-Tax Unmatched Contributions
(4) Supplemental Contributions
(5) Forfeitures
(6) Similar amounts under other qualified defined
contribution plans maintained by the Company, and
(7) Amounts allocated to a post-retirement medical account
described in Code Section 415(1)(2) or Code Section 419A(d).
Annual additions shall include excess contributions as defined in Code Section
401(k)(8) of the Code, excess aggregate contributions as defined in Code Section
401(m)(6)(B), and excess deferrals as described in Code Section 402(g),
regardless of whether such amounts are distributed or forfeited.
Rollover Contributions, repaid distributions, restored forfeitures pursuant to
Section 14.01, and loan payments shall not be treated as Annual Additions.
The Annual Addition for any Limitation Year beginning before January 1, 1987
shall not be recomputed to treat all employee contributions as an Annual
Addition.
(d) For the purpose of this section, Company shall include a
Commonly Controlled Entity as defined in Section 1.14, except that in applying
Section 414(b), the phrase "more than fifty percent (50%)" shall be substituted
for the phrase "at least eighty percent (80%)" each place it appears in Code
Section 1563(a)(1).
(e) "Limitation Year" means the Plan Year.
(f) For the purposes of this section, "Compensation" means
compensation as defined in Treas. Reg. 1.415-2(d) (or any regulation which
replaces or supersedes such regulation) for purposes of the limitations on
benefits and contributions under qualified plans.
(g) If, for any Plan Year, it is necessary to limit the allocation
of an amount to a Member's Account to comply with subsection (a), the Plan shall
limit such allocation by reducing contributions in the following order -
(1) first, to the extent necessary, Supplemental
Contributions and any earnings thereon;
(2) second, to the extent necessary, the Before-Tax Unmatched
Contributions, if any, made on his behalf and any earnings thereon;
(3) third, to the extent necessary, the amount of the
Before-Tax Matched Contributions made on his behalf and any earnings thereon.
The Company Matching Contributions made with respect to such Before-Tax Matched
Contributions and any earnings thereon shall be treated as though they were
forfeitures to the extent necessary and as soon as administratively feasible;
and
(4) fourth, to the extent necessary, other Company or
Commonly Controlled Entity contributions made to this Plan, or to other
qualified defined contribution plans.
If the limitations of subsection (b) are exceeded, the accrued benefit of the
Member under the defined benefit plan shall be reduced to the extent necessary
to satisfy the requirements of subsection (b).
(h) For any Plan Year in which no more than one-third of
contributions to the Plan which are made to meet the obligations under an ESOP
Loan are allocated to Highly Compensated Employees, the dollar limitation of
(a)(1) above shall be increased by the lesser of the dollar amount as computed
without regard to this sentence, or the amount of ESOP Preferred Stock
contributed as or purchased with such contributions for such Plan Year. For any
Plan Year in which no more than one-third of contributions to the Plan which are
made to meet the obligation under an ESOP Loan are allocated to Highly
Compensated Employees, the limitations of this Article XX shall not apply to any
forfeitures of ESOP Preferred Stock acquired with the proceeds of an ESOP Loan
or to contributions which are used to make interest payments under an ESOP Loan
and charged against a Member's account.
ARTICLE XXI - Top-Heavy Provisions
Section 21.01 - Application of Top-Heavy Provisions
--------------------------------------
(a) Except as provided in subsection (b)(2), if as of a
Determination Date, the sum of the amount of the Section 416 Accounts of Key
Employees and the Beneficiaries of deceased Key Employees exceeds sixty percent
(60%) of the amount of the Section 416 Accounts of all Members and
Beneficiaries, the Plan is top-heavy and the provisions of this Article shall
become applicable.
If any individual has not received any compensation (other than
benefits under a plan) from the Company or a Commonly Controlled Entity of the
Company at any time during the five-year period ending on the Determination
Date, the Section 416 Account of such individual or his Beneficiary shall be
excluded from all computations under this Article with respect to Plan Years
beginning after December 31, 1984. However, if such an individual returns to
employment with the Company or Commonly Controlled Entity, his Section 416
account shall be included in calculations under this section. The Section 416
Account of an individual who was a Key Employee but is not a Key Employee for
the Plan Year containing the Determination Date and the preceding four Plan
Years or the Section 416 Account of the Beneficiary of such an individual shall
be excluded from all computations under this Article.
(b) (1) If as of a Determination Date this Plan is part of an
Aggregation Group which is top-heavy, the provisions of this Article shall
become applicable. Top-heaviness for the purpose of this subsection shall be
determined with respect to the Aggregation Group in the same manner as described
in subsection (a) except that if the Aggregation Group includes a defined
benefit plan, the Section 416 Account shall include the present value of the
accrued benefit of a member or a beneficiary under such plan.
(2) If this Plan is top-heavy under subsection (a), but the
Aggregation Group is not top-heavy, this Article shall not be applicable.
(c) The Plan Administrator shall have responsibility to make all
calculations to determine whether this Plan is top-heavy. The Plan
Administrator may use a method which approximates the calculations described in
Section 21.01(a) provided that it mathematically proves that the Plan is not
top-heavy, such as a method which overstates the Section 416 Accounts with
respect to Key Employees and understates the Section 416 Accounts with respect
to non-Key Employees.
Section 21.02 - Definitions
-----------
(a) "Aggregation Group" means this Plan and all other plans
(including a frozen plan) maintained by the Company which covers a Key Employee
or his Beneficiary and any other plan which enables a plan covering a Key
Employee or his Beneficiary to meet the requirements of Code Sections 401(a)(4)
or 410. A terminated plan shall be included in an Aggregation Group if it was
maintained by the Company within the last five (5) years ending on the
Determination Date for the Plan Year in question and would, but for the fact it
was terminated, meet the conditions of the preceding sentence. In addition, at
the election of the Plan Administrator, the Aggregation Group may be expanded by
the company if such expanded Aggregation Group meets the requirements of Code
Sections 401(a)(4) and 410.
(b) "Determination Date" means the last day of the Plan Year
immediately preceding the Plan Year for which top-heaviness is to be determined.
(c) "Key Employee" means an Employee (or a former or deceased
Employee) who, for the Plan Year containing the Determination Date or any of the
four preceding Plan Years (including years before 1984), is:
(1) an officer of the Company or a Commonly Controlled Entity
of the Company having an annual Compensation for a Plan Year greater than one
hundred fifty percent (150%) of the amount in effect under Code Section
415(c)(1)(A) for the calendar year in which the Plan Year ends; provided,
however, that no more than the lesser of --
(A) 50 Employees, or
(B) the greater of (i) three Employees or (ii) ten
percent (10%) of the greatest number of employees of the company and its
Commonly Controlled Entities for the Plan Year containing the Determination Date
and the preceding four Plan Years shall be treated as officers, and such
officers shall be those with the highest annual Compensation in the five-year
period;
(2) one of the ten Employees having an annual Compensation in
excess of the amount in effect under Code Section 415(c)(1)(A) and owning (or
considered as owning within the meaning of Code Section 318) both more than
one-half percent (1/2%) interest in the Company and the largest interests in the
Company;
(3) a five-percent (5%) owner of the Company; or
(4) a one-percent (1%) owner of the Company having an annual
Compensation [as defined in Section 20.01(f)] of more than $150,000.
For the purpose of subsection (c)(1)(B)(ii), if ten percent (10%)
of the number of Employees is not an integer, the number shall be increased to
the nearest integer. The determination as to whether a person is an officer
shall be made on the basis of his actual authority and duties and without regard
to his title. For the purpose of subsection (c)(2), if two Employees have the
same interest in the Company, the Employee having the greater annual
Compensation from the Company, shall be treated as having a larger interest.
For the purpose of subsections (c) (3) and (c)(4), ownership shall be determined
in accordance with Code Section 416 (i)(1)(B) and (C).
(d) "Section 416 Account" means the sum of:
(1) the amount credited to a Member's or Beneficiary's
Account under this Plan as of the most recent Valuation Date occurring within
the twelve (12) month period ending on the Determination Date (or his account
under another qualified defined contribution plan which is part of an
Aggregation Group) including uncontributed amounts due as of such Valuation Date
but which are actually contributed on or before the Determination Date;
(2) the present value of the accrued benefit credited as of a
Determination Date to a Member or Beneficiary under a qualified defined benefit
plan which is part of an Aggregation Group; and
(3) the amount of distributions to the Member or Beneficiary
during the five-year period ending on the Determination Date, including a
distribution under a terminated plan which, if it had not been terminated, would
have been required to be included in an Aggregation Group, a distribution of
Employee contributions, and a distribution made before January 1, 1984, but
excluding a distribution which is a tax-free rollover contribution (or similar
transfer) that is not initiated by the Member or that is contributed to a plan
which is maintained by the Company; reduced by --
(4) the amount of a rollover contribution (or similar
transfer) which is accepted by this Plan (or a plan forming part of an
Aggregation Group) after December 31, 1983 and which was initiated by the Member
and derived from a plan not maintained by the Company or a Commonly Controlled
Entity of the Company, and the earnings on such rollover contribution.
Section 21.03 - Minimum Contribution
---------------------
(a) If this Plan is determined to be top-heavy under the
provisions of Section 21.01, with respect to each Member who is not a Key
employee and is an Employee on the last day of the Plan Year, the sum of
Employer Contributions (other than Before-Tax Contributions), forfeitures
treated as Employer Contributions under this Plan, and under all qualified
defined contribution plans in the Aggregation Group shall not be less than three
percent (3%) of such Member's Compensation [as defined in Section 21.01(f)].
Notwithstanding the provisions of Section 10.02, contributions made pursuant to
this Section shall be fully vested at all times. This Section shall not be
applicable with respect to a Member who is also covered under a defined benefit
plan maintained by the Company which provides the benefit specified by Code
Section 416(c)(1).
(b) The contribution rate specified in subsection (a) shall not
exceed the percentage at which Employer Contributions and forfeitures are
allocated under the Plan or the plans of the Aggregation Group to the account of
the Key Employee for whom such percentage is the highest for the Plan Year. For
the purpose of this subsection, the percentage for each Key Employee shall be
determined by dividing the Employer Contributions and forfeitures for the Key
Employee by the amount of his total compensation for the year not in excess of
$200,000 [as adjusted by the Secretary of the Treasury under Code Section
416(d)]. This subsection shall not apply if this Plan is required to be
included in an Aggregation Group and the Plan enables a defined benefit plan
which is part of the Aggregation Group to meet the requirements of Code Section
401(a)(4) or 410.
Section 21.04 - Limit on Annual Additions: Combined Plan Limit
----------------------------------------------------
(a) If this Plan is determined to be top-heavy under Section
21.01, Sections 20.01(b)(2) and (3) of this Plan shall be applied by
substituting 1.0 for 1.25 for Plan Years ending on or before December 31, 1999.
The transitional rule of Code Section 415(e)(6)(B)(i) shall be applied by
substituting "$41,500" for "$51,875".
(b) Subsection (a) shall not be applicable if --
(1) Section 21.03 is applied by substituting "four percent
(4%)" for "three percent (3%) ", and
(2) this Plan would not be top-heavy if "ninety percent
(90%)" is substituted for "sixty percent (60%)" in Section 21.01.
(c) If, but for this subsection (c), subsection (a) would begin to
apply with respect to the Plan, the application of subsection (a) shall be
suspended with respect to a Member so long as there are --
(1) no Company contributions, forfeitures, or voluntary
nondeductible contributions allocated to such Member, and
(2) no accruals under a qualified defined benefit plan for
such Member.
IN WITNESS WHEREOF, the Ralston Purina Company has caused these presents to be
executed by the undersigned representative of the Company generally effective as
of the first day of January 1999, or as otherwise indicated.
RALSTON PURINA COMPANY
By -------------------------------------
<PAGE>
EXHIBIT A
COMPENSATION
-------------
I. ITEMS INCLUDED IN COMPENSATION
---------------------------------
A. Base Salary and Other Compensation
--------------------------------------
Benefit Earnings include base salary, overtime pay, shift differential payments,
vacation, paid time off (PTO), and holiday pay.
B. Bonuses
-------
Bonuses, including intermediate term bonuses, shall be
included in benefit earnings when paid. Specific inclusions
are the:
Annual Bonus (Corporate and Division annual incentive plans)
Supplemental Special Bonus(1)
CheckMark Creative Bonus
EBC Annual (Special) Bonus(2)
Merit (Lump Sum) Bonus
Performance Incentive Program (PIP)
Sales Incentive Bonus
Leveraged Incentive Plan (LIP)(3)
Deferred bonuses are excluded from SIP.
-------------------
II. ITEMS EXCLUDED FROM COMPENSATION
-----------------------------------
Items to be excluded from Benefit Earnings are listed below,
and some are more specifically discussed following the list:
Allowances
Company loans to employees, or forgiveness of such
indebtedness
EBC "Xtra" Bonus Awards
Expatriation Premium
Grossed-up Amounts
Imputed Income
Non-recurring Incentive Awards
Prizes and Awards
Protein Technologies International, Inc. Key Management Incentive
Plan Ralston Purina International Additional Incentive Compensation
Plan
Reimbursements
Severance Payments
Special Bonus Awards
Stock Options and Awards
Leveraged Incentive Plan Payments(4)
-----------------------------------
(1) Available only to annual bonus plan participants.
(2) For service prior to 01/01/93, these awards, previously called
Special Recognition Awards, are excluded from benefit earnings under the
Grandfathered Eveready Battery Company pension plan provisions.
(3) Included in Benefit Earnings for Ralston Purina Company Retirement
Plan, Ralston Purina Company Supplemental Retirement Plan, Ralston
Company Savings Investment Plan, and Ralston Purina Company Executive
Savings Investment Plan. LIP payments are not included in Benefit
Earnings for life insurance or any other plan including other welfare
plans.
(4) Leveraged Incentive Plan (LIP) payments are included in Benefit Earnings
for Ralston Purina Company Retirement Plan, Ralston Purina Company
Supplemental Retirement Plan, Ralston Company Savings Investment Plan,
and Ralston Purina Company Executive Savings Investment Plan. LIP
payments are not included in Benefit Earnings for life insurance or any
other plan including other welfare plans.
A. Allowances
----------
Allowances are similar to reimbursements and are excluded from Benefit
----------------------------------------------------------------------
Earnings since they represent expenses of the employee rather than
-------------------------------------------------------------------
compensation from the Company. Examples include, but are not
-----------------------------------------------------------------
limited to:
Automobile Allowances
Cost of Living Adjustments
Hiring Packages
Meal Allowances
Mortgage Difference Allowance
Per Diems
Relocation Allowance
Tool Allowance
Trade Class Allowance
Uniform Allowance
B. Imputed Income
---------------
Benefit Earnings do not include imputed income or income
related to any "non-cash" items provided to or used by an employee,
including but not limited to:
Partnership Life Insurance Program
Personal Car Usage
Personal Use of Company Facilities
Personal Use of Company Plan
Spouse Travel
C. Prizes and Awards
-------------------
Excluded are merchandise awards and cash awards of a set amount
which are granted on an occasional, non-recurring basis, such as:
Anniversary and Service Awards
Hospital Audit Program
Merchandise Awards
Sales Prizes
Suggestion Awards
Safety Awards
D. Reimbursements
--------------
Excluded from Benefit Earnings are all payments to make an employee
whole for expenses incurred. Examples include, but are not limited
to, the following:
Automobile Expenses
Financial Planning Reimbursements
Memberships
Moving Expenses
Executive Health Plan Reimbursements
Travel Expenses
Tuition Reimbursements
E. Severance Payments
------------------
Payments made as part of a severance package are excluded. Vacation
pay or paid time off (PTO) paid upon termination is not considered
---
severance and should be included in Benefit Earnings. Severance
------------------------------
package payments, which are excluded, include, but are not limited
to:
Settlement Payments
Lump-Sum Payments
Separation Pay
Severance Pay
Termination Pay
Supplemental Payments
Layoff Payments Or Allowance
