RALSTON PURINA RETIREMENT PLAN
(as amended and restated as of January 1, 1999)
restated as of January 1, 1999
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TABLE OF CONTENTS
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ARTICLE I - DEFINITIONS 2
Section 1.1A Accrued Benefit 2
Section 1.1B Actuarial Equivalent 2
Section 1.1C Affiliated Company 2
Section 1.2 Annual Earnings 2
Section 1.2A Annuity Starting Date 3
Section 1.2B Applicable Interest Rate 3
Section 1.2C Applicable Mortality Table 3
Section 1.3 Average Annual Earnings 3
Section 1.4 Beneficiary 3
Section 1.5 Board of Directors 3
Section 1.5A Cash Balance Account 4
Section 1.5B Cash Balance Benefit 4
Section 1.6 Code 4
Section 1.7 Commonly Controlled Entity 4
Section 1.8 Company 4
Section 1.9 Credited Service 4
Section 1.9A Employment Commencement Date 4
Section 1.9B Adjusted Employment Commencement Date 4
Section 1.9C Re-employment Commencement Date 4
Section 1.9D Hour of Service 4
Section 1.9E Period of Service 5
Section 1.9F Severance from Service Date 5
Section 1.9G Period of Severance 6
Section 1.9H Maternity or Paternity Absence 6
Section 1.9I Service Spanning. 6
Section 1.9J Re-employment. 6
Section 1.9K Leave of Absence 7
Section 1.9L Family Medical Leave. 7
Section 1.9M Military Absence 7
Section 1.10 Deferred Retirement Date 7
Section 1.11 Early Retirement Date 7
Section 1.12 Employee 8
Section 1.12A Admin Employee 8
Section 1.12B Production Employee 8
Section 1.13 ERISA 8
Section 1.13A FAP Benefit 8
Section 1.14 Foreign Affiliate 8
Section 1.15 Investment Manager 8
Section 1.16 Leased Employee 8
Section 1.17 Normal Form 8
Section 1.18 Normal Retirement Date 8
Section 1.19 Participant 9
Section 1.19A Pension Benefit 9
Section 1.19B Pension Equity Benefit 9
Section 1.19C Periodic Interest Rate 9
Section 1.20 Plan 9
Section 1.21 Plan Administrator 9
Section 1.22 Plan Year 9
Section 1.23 Predecessor Plan 9
Section 1.23A Rehired Participant 9
Section 1.24 Retiree 9
Section 1.25 Social Security Benefit 9
Section 1.25A Social Security Covered Compensation 10
Section 1.26 Social Security Offset 10
Section 1.27 Social Security Retirement Age 10
Section 1.27A Spouse 10
Section 1.28 Temporary Employee 11
Section 1.29 Trustee or Trustees 11
Section 1.30 Year of Credited Service 11
ARTICLE II - PARTICIPATION 11
Section 2.1 Prior Participants 11
Section 2.2 Enrollment 11
Section 2.3 Re-employment -- Service Credit 11
Section 2.3A Re-employment -- Eligibility for Pension Benefit Provisions 11
Section 2.3B Re-employment -- Calculation of Accrued Benefit and Suspension
of Benefit Payments 12
Section 2.4 Employees Covered by a Collectively Bargained Plan 12
Section 2.5 Employees Covered by Merged Plans 12
Section 2.6 Participation in Pension Equity Benefit 13
Section 2.7 Participation in Cash Balance Benefit 13
ARTICLE III - CONTRIBUTIONS 13
Section 3.1 Employee Contributions 13
Section 3.2 Affiliated Company Contributions 13
ARTICLE IV - VESTING 14
Section 4.1 Vesting 14
Section 4.2 Years of Credited Service for Vesting 14
ARTICLE V - AMOUNT OF BENEFIT 15
Section 5.1 Normal Retirement Benefit 15
Section 5.2 Compliance With Code Section 401(a)(17) 19
Section 5.3 Intentionally Omitted 19
Section 5.4 Prior Service Guarantees 19
Section 5.5 Offset for Retirement Payments Required by Foreign Law 19
Section 5.6 Maximum Limitation on a Participant's Retirement Benefit 20
Section 5.7 Maximum Benefit if Participant Covered Under Both the Plan
and a Defined Contribution Plan For Plan Years Beginning
On Or Before December 31, 1999 21
ARTICLE VI - RETIREMENT BENEFITS 22
Section 6.1 Normal Retirement 22
Section 6.2 Deferred Retirement 22
Section 6.2A Suspension of Benefits 23
Section 6.3 Early Retirement -- FAP Benefit Only 23
Section 6.4 Vested Deferred Retirement -- FAP Benefit Only 23
Section 6.4A Vested Deferred Retirement -- Pension Equity Benefit and Cash
Balance Benefit 23
Section 6.5 Commencement of Retirement Benefits 24
Section 6.6 Withdrawal of Contributions 24
Section 6.7 Inability to Locate Participants or Beneficiaries 24
ARTICLE VII - FORM OF RETIREMENT BENEFIT 24
Section 7.1 Form of Benefit 24
Section 7.2 Qualified Joint and Survivor Annuity 25
Section 7.2A Election Out of Qualified Joint and Survivor Annuity 25
Section 7.3 Optional Forms of Retirement Benefit 25
Section 7.3A Option A 26
Section 7.3B Option B 26
Section 7.3C Option C 26
Section 7.3D Social Security Adjustment Option 27
Section 7.3E "Pop-up" Benefit 27
Section 7.3F Single Sum Payment-- Pension Equity Benefit and Cash Balance
Benefit Only 27
Section 7.4 Small Payments 28
Section 7.5 Direct Rollovers 28
Section 7.6 Restrictions on Benefits 29
ARTICLE VIII - DEATH BENEFITS 29
Section 8.1 Death Prior to Retirement/Employee Contributions 29
Section 8.2 Death After Retirement 29
Section 8.3 Election of Beneficiary 29
Section 8.4 Survivor Benefit 29
Section 8.4A 30
Section 8.4B 30
Section 8.4C 30
Section 8.5 Pension Equity and Cash Balance Account Death Benefit 30
Section 8.6 Qualified Preretirement Survivor Annuity Provisions 31
ARTICLE IX - VESTED BENEFITS 31
Section 9.1 Return of Contributions 31
Section 9.2 Form of Benefit 32
Section 9.3 Survivor Benefit -- Vested Terminated Participant 32
Section 9.4 Pension Equity and Cash Balance Account Death Benefit 32
ARTICLE X - PERMANENT AND TOTAL DISABILITY BENEFIT 32
Section 10.1 Permanent and Total Disability Defined 32
Section 10.2 Vesting and Benefit Accrual During Periods of Disability 33
Section 10.3 Effect of Re-employment Upon Cessation of Disability 33
Section 10.4 Effect of Failure of Re-employment Upon Cessation of
Disability 33
Section 10.5 Physical Examination Requirements 33
Section 10.6 Pension Equity Disability Benefit 33
ARTICLE XI - CONTINENTAL BAKING COMPANY PROVISIONS 34
Section 11.1 Application 34
Section 11.2 Definitions 34
Section 11.3 Normal Retirement Benefit for Former Participants in the CBC
Plan 35
Section 11.4 Early Retirement for Former Participants in the Continental
Baking Company Salaried Pension Plan 35
Section 11.5 Transitional Early Retirement Benefit 36
Section 11.6 Optional Benefit Amounts 37
Section 11.7 Change in Employment Status 38
Section 11.8 Interstate Bakeries Corporation Provisions 38
ARTICLE XII - EVEREADY BATTERY COMPANY PROVISIONS 38
Section 12.1 Application 38
Section 12.2 Definitions 39
Section 12.3 Frozen Accrued Benefit 41
Section 12.4 Retirements After January 1, 1993 42
Section 12.5 Optional Forms 43
Section 12.6 Surviving Spouse's Benefit of Active Participant 44
Section 12.7 Surviving Spouse's Benefit of Vested Terminated Partici-
Pant 44
Section 12.8 Disability Benefit 44
Section 12.9 Adjustment for Pension Equity Benefit Provisions 45
ARTICLE XIII - PLAN ADMINISTRATION 45
Section 13.1 Plan Administrator 45
Section 13.2 Benefits Council 45
Section 13.3 Benefits Policy Board 45
Section 13.4 EBAIC 46
Section 13.5 Authority and Duties of Various Fiduciaries 46
Section 13.6 Named Fiduciaries 48
Section 13.7 Delegation 48
Section 13.8 Multiple Capacities 48
Section 13.9 Standard of Review 48
ARTICLE XIV - FUNDING 49
Section 14.1 Funding. 49
ARTICLE XV - RIGHTS OF AFFILIATED COMPANIES TO DISCONTINUE OR AMEND 49
Section 15.1 Right to Terminate the Plan. 49
Section 15.2 Plan Amendment Procedure. 49
ARTICLE XVI - TERMINATION OF PLAN 50
Section 16.1 Plan Termination. 50
Section 16.2 Termination Restrictions. 50
Section 16.3 Rights of Affiliated Companies to Remaining Amounts. 52
ARTICLE XVII - TOP-HEAVY PROVISIONS 52
Section 17.1 Top-Heavy Determination. 53
Section 17.2 Valuation as of Determination Date. 53
Section 17.3 Key Employee 53
Section 17.4 Vesting Requirements. 54
Section 17.5 Minimum Benefits 54
Section 17.6 Adjustment to Combination Defined Benefit Plan and Defined
Contribution Plan Limitations 54
ARTICLE XVIII - PROVISIONS TO PREVENT DISCRIMINATION 55
Section 18.1 Restrictions of Benefits Upon Plan Termination 55
Section 18.2 Restrictions on Distributions. 55
Section 18.3 Purposes for Restriction 56
ARTICLE XIX - SPECIAL PROVISIONS 56
Section 19.1 No Right to Continued Employment 56
Section 19.2 Payments and Liabilities Not Attributable to Affiliated
Companies 56
Section 19.3 Interpretation of Agreement 56
Section 19.4 Required Participant Information 56
Section 19.5 Participants' Mailing Addresses 56
Section 19.6 Change of Status 57
Section 19.7 Transfers From Controlled Corporations Which Are Not
Affiliated Companies 57
Section 19.8 Transferred Employees and Payment Source 57
Section 19.9 Plan Maintained for Exclusive Benefit of Participants 57
Section 19.10 Return of Employer Contributions 58
Section 19.11 Employer Withholding 58
Section 19.12 Spinoff or Merger of Assets or Liabilities 58
Section 19.13 Merger, Consolidation or Transfer of Assets 58
Section 19.14 Agreement Binding Upon All Successors 58
Section 19.15 Titles 58
Section 19.16 Construction 59
Section 19.17 Severability 59
Section 19.18 Counterparts 59
Section 19.19 Non-Alienation of Retirement Benefits 59
Section 19.20 Special Vesting of Participants who were Employees of
Foodservices, Inc. 59
Section 19.21 Special Provision for Female Employees with an Age Sixty (60)
Normal Retirement Date 59
APPENDIX A - TABLE OF ACTUARIAL ASSUMPTIONS 61
APPENDIX B - PRODUCTION PLAN PROVISIONS 62
APPENDIX C - METHODOLOGY TO BE FOLLOWED IN DETERMINING BENEFIT
PAYABLE UNDER PENSION EQUITY PROVISIONS, CONSIDERING
UNION CARBIDE OFFSET 63
APPENDIX E - VOLUNTARY ENHANCED RETIREMENT OPTION EVEREADY BATTERY
COMPANY FIELD SALES ORGANIZATION 65
APPENDIX F - ENHANCED RETIREMENT BENEFIT EVEREADY BATTERY COMPANY
FREMONT FACILITY 66
APPENDIX G - VOLUNTARY ENHANCED RETIREMENT OPTION EVEREADY BATTERY
COMPANY WESTLAKE AND ST. LOUIS 67
APPENDIX H - ENHANCED RETIREMENT BENEFIT EVEREADY BATTERY COMPANY
CUSTOMER SERVICE EMPLOYEES 68
APPENDIX I - VOLUNTARY ENHANCED RETIREMENT OPTION EVEREADY BATTERY
COMPANY 69
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RESTATED RALSTON PURINA RETIREMENT PLAN
PLAN AND TRUST
January 1, 1999
WHEREAS, Ralston Purina Company (the "Company") previously established the
Purina Retirement Plan for Sales, Administrative, and Clerical Employees (the
"Admin Plan") to provide retirement income benefits for eligible employees of
Ralston Purina Company and its affiliates;
WHEREAS, Company reserved the right to amend the Admin Plan pursuant to
Article XV thereof;
WHEREAS, the Company has previously amended and restated the Admin Plan
effective January 1, 1989;
WHEREAS, the Company's Board of Directors authorized the merger of the
Purina Retirement Plan for Production Employees (the "Production Plan"), a plan
qualified under Code Section 401(a), into the Admin Plan effective September 30,
1996, and renamed the Admin Plan, the Ralston Purina Retirement Plan (the
"Plan");
WHEREAS, the Company desires to further amend and completely restate the
Plan, to reflect (i) the merger of the Admin Plan and the Production Plan,
effective September 30, 1996, (ii) the adoption of a "Pension Equity Benefit",
and a "Cash Balance Account", as defined in Article V hereof, effective January
1, 1999, and (iii) other miscellaneous revisions.
Except as otherwise explicitly provided in the Plan, the provisions of the
Plan as so amended and restated, shall govern the rights and benefits of each
Employee who terminates employment or retires on or after January 1, 1999. The
rights and benefits, if any, of an Employee who retired or terminated employment
before January 1, 1999 shall be determined in accordance with the provisions of
the Plan applicable to that Employee as in effect on the date that the Employee
retired or terminated employment, except as otherwise explicitly provided in the
Plan.
Now, THEREFORE, resolved that the Ralston Purina Retirement Plan is hereby
amended and completely restated in its entirety conditioned on the receipt of a
favorable determination by the Internal Revenue Service of the qualified status
of the Plan, as follows:
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ARTICLE I - Definitions
Section 1.1A Accrued Benefit
Accrued Benefit means the sum of a Participant's accrued benefits calculated
under the Plan provisions used to calculate the FAP Benefit, the Pension Equity
Benefit, and the Cash Balance Benefit.
A Participant's Accrued Benefit under the plan provisions used to calculate the
FAP Benefit is the FAP Benefit payable as a single life annuity payable in the
Normal Form at a Participant's Normal Retirement Date (or, if later, such
Participant's actual retirement date).
A Participant's Accrued Benefit under the plan provisions used to calculate the
Pension Equity Benefit is the single life annuity payable in the Normal Form to
a Participant, commencing on the Participant's Normal Retirement Date (or, if
later, such Participant's actual retirement date). Such single life annuity
shall be the Actuarial Equivalent (using the Applicable Interest Rate and
Applicable Mortality Table) as of a Participant's Normal Retirement Date (or, if
later, such Participant's actual retirement date) of the Participant's Pension
Equity Benefit, as of the time of reference, adjusted using an interest rate of
3% from the time of reference to the Participant's Normal Retirement Date (or,
if later, such Participant's actual retirement date).
A Participant's Accrued Benefit under the plan provisions used to calculate the
Cash Balance Benefit is the single life annuity payable in the Normal Form to a
Participant, commencing on the Participant's Normal Retirement Date (or, if
later, such Participant's actual retirement date). Such single life annuity
shall be the Actuarial Equivalent (using the Applicable Interest Rate and
Applicable Mortality Table) as of a Participant's Normal Retirement Date (or, if
later, such Participant's actual retirement date) of the Participant's Cash
Balance Account, as of the time of reference, adjusted using the Periodic
Interest Rate from the time of reference to the Participant's Normal Retirement
Date.
The Accrued Benefit attributable to employee contributions shall be included in
the FAP Benefit or Pension Equity Benefit, as applicable to a Participant.
The foregoing provisions, and all other Plan provisions, shall be deemed to
comply with the rules of Section 411(b)(1).
Section 1.1B Actuarial Equivalent
Actuarial Equivalent for any annuity or benefit means another annuity or benefit
calculated under the Plan, commencing at a different date or payable in a
different form than the specified annuity or benefit, but which has the same
present value as the specified annuity or benefit, when measured using the
factors specified in the Plan under Appendix A hereto.
Section 1.1C Affiliated Company
Affiliated Company shall mean (a) any company more than fifty (50) percent of
the voting stock of which is directly or indirectly owned by Ralston Purina
Company or by any successor, (b) any Commonly Controlled Entity or (c) an
Affiliated Service Group as defined under Code Section 414(m).
Section 1.2 Annual Earnings
Annual Earnings means the total compensation (excluding reimbursed expenses,
amounts paid by reason of employment relocations and other items of compensation
as determined from time to time by the Plan Administrator or its delegatee and
applied in a uniform, consistent and nondiscriminatory manner) (i) paid an
Employee during a calendar year by the Company or Affiliated Company; (ii)
deferred by any Employee to a nonqualified plan of deferred compensation
maintained by the Company or an Affiliated Company, or (iii) contributed by
means of salary reduction by any Employee to a plan of deferred compensation
maintained by the Company or an Affiliated Company and intended to satisfy the
requirements of Section 401(k) of the Code and payments made under a Code
Section 125 Cafeteria Plan. "Annual Earnings" during an unpaid Leave of Absence
or Military Absence shall be deemed to be the Participant's Annual Earnings for
the year prior to the year in which such absence began. Notwithstanding the
foregoing, effective January 1, 1994, "Annual Earnings" shall not include
compensation designated by the Company as a "Special Bonus". The "Annual
Earnings" of a Participant taken into account under this Plan shall not exceed
the compensation limit set forth in Code Section 401(a)(17) as adjusted by the
Secretary of the Treasury.
Section 1.2A Annuity Starting Date
Annuity Starting Date means (a) with respect to an annuity form of benefit, the
first day on which an amount is payable as an annuity; and (b) with respect to a
form of benefit which is not an annuity, the date on which all events have
occurred which entitle the Participant to such benefit. In either case, an
Annuity Starting Date must be the first day of a calendar month.
Section 1.2B Applicable Interest Rate
Applicable Interest Rate means the annual interest rate on 30-year Treasury
securities as specified by the Commissioner of the Internal Revenue Service in
revenue rulings, notices or other guidance, published in the Internal Revenue
Bulletin, (a) to the extent required by Treasury Regulations, for the 12-month
period commencing on October 1, 1997 and ending on September 30, 1998, the
lesser of the rate in effect for the second month preceding the first day of the
month in which the Annuity Starting Date occurs (resulting in a one month
stability period) or the rate in effect for August, 1997, whichever results in
the larger distribution, and (b) for periods commencing on and after October 1,
1998, for the August preceding the first day of the Plan Year in which the
Annuity Starting Date occurs (resulting in a one year stability period).
Section 1.2C Applicable Mortality Table
Applicable Mortality Table means the mortality table based on the prevailing
commissioners' standard table (described in section 807(d)(5)(A) of the Code)
used to determine reserves for group annuity contracts issued on the date as of
which present value is determined (without regard to any other subparagraph of
section 807(d)(5) of the Code), that is prescribed by the Commissioner of the
Internal Revenue Service in revenue rulings, notices, or other guidance,
published in the Internal Revenue Bulletin.
Section 1.3 Average Annual Earnings
Average Annual Earnings means the average of an Employee's five (5) highest
consecutive Annual Earnings during the ten (10) completed calendar years ending
prior to or coincident with the date on which the Employee reaches his Normal
Retirement Date or otherwise terminates his service, if earlier. If an Employee
has less than five (5) years of Annual Earnings, Average Annual Earnings shall
be the average of all his Annual Earnings.
Section 1.4 Beneficiary
Beneficiary means any person (including a trust) designated by the Participant
as provided in Article VIII to receive benefits as a result of a Participant's
death.
Section 1.5 Board of Directors
Board of Directors means the Board of Directors of Ralston Purina Company.
Section 1.5A Cash Balance Account
Cash Balance Account means the notional account established for each Employee
who is eligible to become a Participant in such an Account in accordance with
the terms of Article II.
Section 1.5B Cash Balance Benefit
Cash Balance Benefit means the benefit payable from the Plan which is based on
the Cash Balance Account.
Section 1.6 Code
Code means the Internal Revenue Code of 1986, as amended, or any successor
statute thereto.
Section 1.7 Commonly Controlled Entity
Commonly Controlled Entity shall mean (a 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, (b) 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 (c) 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 (d) any entity which is required to be
aggregated under Code Section 414(o).
Section 1.8 Company
Company means Ralston Purina Company, a Missouri Corporation, or any Affiliated
Company.
Section 1.9 Credited Service
Credited Service means an Employee's entire Period of Service after December 31,
1975, including any Leave of Absence described in Section 1.9K, Family Medical
Leave described in Section 1.9L, or Military Absence described in Section 1.9M,
computed in full years and completed months. Credited Service shall include
certain Periods of Severance, as described in Section 1.9G, under the Service
Spanning rules as described in Section 1.9I, and certain prior Periods of
Service under the Re-employment rules, as described in Section 1.9J. Credited
Service shall also include an Employee's Continuous Service earned under the
terms of the Purina Administrative Plan or Purina Production Plan in effect on
December 31, 1975, or any successor Plan.
Section 1.9A Employment Commencement Date
Employment Commencement Date means the date on which the Employee first performs
an Hour of Service for the Company.
Section 1.9B Adjusted Employment Commencement Date
Adjusted Employment Commencement Date means an Employee's Employment
Commencement Date, recalculated to reflect noncreditable Periods of Severance.
Section 1.9C Re-employment Commencement Date
Re-employment Commencement Date means the date an Employee first performs an
Hour of Service following a Period of Severance.
Section 1.9D Hour of Service
Hour of Service means:
(a) each hour for which an Employee is paid, or is entitled to payment, for
the performance of duties for the Company or an Affiliated Company; or
(b) each hour for which an Employee is paid, or entitled to payment, by the
Company or an Affiliated Company during a period in which no duties are
performed (irrespective of whether the employment relationship has been
terminated) due to vacation, holiday, illness, incapacity (including
disability), layoff, jury duty, Leave of Absence described in Section 1.9K,
Family Medical Leave described in Section 1.9L, Military Absence as described in
Section 1.9M, and similar pay periods.
Section 1.9E Period of Service
Period of Service means the period of service commencing on the Employee's
Employment Commencement Date, Adjusted Employment Commencement Date or
Re-employment Commencement Date, whichever is applicable, and ending on his
Severance from Service Date. Period of Service shall include periods of
Permanent and Total Disability to the extent provided in Article X. For
purposes of Article II and Article IV regarding eligibility for participation
and vesting, respectively, a Period of Service shall include (1) service with
Gates Energy Products, Inc. for all employees who were employed by Gates Energy
Products, Inc. as of August 28, 1993 who became Employees of Eveready Battery
Company, Inc. on such date, except those Employees employed by Energizer Power
Systems division of Eveready Battery Company; (2) service with Interstate Brands
Corporation for all employees who were employed by Interstate Brands Corporation
as of January 24, 1994, at their Los Angeles bakery location, who became
Employees of Continental Baking Company on such date and (3) service with the
Golden Cat Company for all employees who were employed by the Golden Cat Company
on April 7, 1995, who became Employees of the Company on April 7, 1995. For
purposes of determining a Participant's FAP Benefit, PEP Benefit, or Cash
Balance Benefit, under Article V, a Period of Service shall not include service
with the Company or any Affiliated Company while classified by the Company or
any Affiliated Company. as a (i) Temporary Employee, (ii) a Leased Employee, or
(iii) as a fee-for-service worker or independent contractor or in a similar
capacity (rather than in the capacity of an Employee), regardless of such
individual's status under common law, including, without limitation, 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,
without limitation, 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 1.9F Severance from Service Date
Severance from Service Date shall occur on the earlier of:
(a) the date on which an Employee quits, retires, is discharged or dies; or
(b) the first anniversary of the first date of a period in which an Employee
is absent from service (with or without pay) with the Company or an Affiliated
Company for any reason other than a quit, retirement, discharge or death, such
as vacation, holiday, sickness, Leave of Absence (unless such Leave is
authorized to extend beyond one (1) year) or is a Family Medical Leave described
in Section 1.9M, Military Absence (unless the Participant complies with Section
1.9M) or layoff.
Section 1.9G Period of Severance
Period of Severance means the period of time commencing on an Employee's
Severance from Service Date and ending on his Re-employment Commencement Date
and shall be determined on the basis of 12 consecutive month periods during
which each such 12 month period the Employee does not complete an Hour of
Service.
Section 1.9H Maternity or Paternity Absence
Maternity or Paternity Absence means an absence of an Employee from work by
reason of:
(a) the pregnancy of the Employee,
(b) the birth of a child of the Employee,
(c) the placement of a child with the Employee in connection with the
adoption of such child by such Employee, or
(d) the care of such child for a period beginning immediately following
such birth or placement.
Section 1.9I Service Spanning.
An Employee's Period of Service shall include the following Periods of
Severance:
(a) If an Employee severs from service by reason of a quit, discharge
or retirement and then performs an Hour of Service within twelve (12) months of
the Severance from Service Date, the Plan shall take into account the Period of
Severance;
(b) if an Employee severs from service by reason of a quit, discharge
or retirement during an absence from service of twelve (12) months or less for
any reason other than a quit, discharge, or retirement and then performs an Hour
of Service within twelve (12) months of the date on which the Employee was first
absent from service, the Plan shall take into account the Period of Severance.
Section 1.9J Re-employment.
(a) Upon re-employment an Employee's Credited Service shall include
prior Periods of Service only if either:
(i) the Employee had any vested interest in Plan benefits pursuant to
Article IV; or
(ii) the Employee did not have any vested interest pursuant to said Article,
but his Period of Severance did not exceed the greater of:
(A) his prior Periods of Service (determined without including service not
required to be credited by reason of any prior break), whether or not
consecutive, completed before his Period of Severance, or
(B) five (5) years
and, if his Period of Severance commenced before January 1, 1985, his Period of
Severance as of December 31, 1984 did not exceed his prior Periods of Service.
(b) If an Employee who severed service before January 1, 1976 is
re-employed, his Credited Service shall include prior Continuous Service if:
(i) he meets either the requirements of paragraph (a) above or the
requirements of subsection 1.9I, whichever is applicable, and
(ii) he completes ten (10) years of uninterrupted Credited Service after his
re-employment.
(c) If an Employee who was a non-vested employee of Continental Baking
Company severed service and is re-employed prior to January 1, 1986, he shall
have his prior service with Continental Baking Company reinstated for purposes
of this Plan if he completed a Period of Service subsequent to his re-employment
which equals the lesser of ten (10) years or his Period of Severance.
Section 1.9K Leave of Absence
Leave of Absence means any absence from work which shall have been approved by
the Company or an Affiliated Company under uniform rules and regulations. A
Leave of Absence which extends beyond one (1) year shall be approved by the Plan
Administrator. Leave of Absence shall include a period of layoff which does not
exceed one (1) year.
Section 1.9L Family Medical Leave.
If an Employee is absent from the service of the Company or an Affiliated
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 Employee's
Period of Service.
Section 1.9M Military Absence
Military Absence means an absence for any period of military service with the
Armed Forces of the United States to the extent required to be taken into
account under federal law, provided that the Employee returns to work with the
Company or an Affiliated Company within the period during which re-employment is
required under federal law.
Notwithstanding any provision of this Plan to the contrary, contributions,
benefits, and credited service with respect to qualified military service will
be provided in accordance with Code Section 414(u).
Section 1.10 Deferred Retirement Date
Deferred Retirement Date means the date upon which a Participant who has
remained in the employ of the Company or an Affiliated Company after his Normal
Retirement Date actually retires.
Section 1.11 Early Retirement Date
Early Retirement Date means the first day of the month nearest the date on which
a Participant both attains age fifty-five (55) and completes two (2) years of
Credited Service or the first day of any month thereafter on which such
Participant elects to retire prior to his Normal Retirement Date. If an
Employee's birthday is equally near the first days of two months, than the Early
Retirement Date of such Employee shall be the first day of the month in which
such birthday occurs.
Section 1.12 Employee
Employee means a person who is employed by the Company or any Affiliated Company
which, with the approval of Ralston Purina Company, elects to adopt this Plan;
or a U.S. citizen or resident alien employed by a Foreign Affiliate and covered
under an agreement entered into by the Company or any of the Affiliated
Companies with the Internal Revenue Service under Title II of the Social
Security Act, but provided that contributions under a funded plan of deferred
compensation are not made by any other employer with respect to the remuneration
paid to such citizen.
Section 1.12A Admin Employee
Admin Employee means an Employee who is classified by the Company as employed in
a sales, administrative, or clerical capacity, including officers.
Section 1.12B Production Employee
Production Employee means an Employee who is classified by the Company as
employed in a production employee capacity.
Section 1.13 ERISA
ERISA means the Employee Retirement Income Security Act of 1974, including all
amendments thereto.
Section 1.13A FAP Benefit
FAP Benefit means that portion of a Participant's Accrued Benefit derived from
the Plan provisions granting a Plan benefit based on a Participant's Average
Annual Earnings, as set forth in Section 5.1(a) of the Plan, and shall also
include the Supplemental FAP Benefit, as set forth in Section 5.1(d).
Section 1.14 Foreign Affiliate
Foreign Affiliate means a foreign entity in which any one of the domestic
Affiliated Companies has not less than a ten-percent (10%) interest. An
Affiliated Company has a ten-percent (10%) interest in any entity if such
company has such an interest directly (or through one or more entities), (i) in
the case of a corporation, in the voting stock thereof, and (ii) in the case of
any other entity, in the profits thereof.
Section 1.15 Investment Manager
Investment Manager means any entity designated by a named fiduciary which
qualifies as an Investment Manager as that term is defined by ERISA, Title I,
Section 3(38), which acknowledges in writing its status as a fiduciary with
respect to the Plan, and which has the power to manage, acquire or dispose of
any Plan asset.
Section 1.16 Leased Employee
Leased Employee shall mean a person who provides services to the Company or an
Affiliated Company and is considered a "leased employee" under Code Section
414(n)(2).
Section 1.17 Normal Form
Normal Form means the Normal Retirement Benefit with sixty (60) monthly payments
guaranteed as further described in Section 7.1.
Section 1.18 Normal Retirement Date
Normal Retirement Date means the first day of the month nearest an Employee's
sixty-fifth (65th) birthday. If a particular Employee's birthday is equally
near the first days of two calendar months, then the Normal Retirement Date of
such Employee shall be the first day of the month in which such birthday occurs.
Section 1.19 Participant
Participant means an Employee who participates in this Plan in accordance with
Article II hereof. As the context requires, the term Participant shall also
include Beneficiaries receiving benefits under the Plan, and any other persons
entitled to benefits under the Plan.
Section 1.19A Pension Benefit
Pension Benefit means the FAP Benefit or Pension Equity Benefit, as elected by a
Participant or as provided under the terms of this Plan.
Section 1.19B Pension Equity Benefit
Pension Equity Benefit means the benefit provided under the Plan calculated
under the formula set forth in Section 5.1(b), as expressed as a single sum.
Section 1.19C Periodic Interest Rate
Periodic Interest Rate means, for every Plan Year, the monthly average yield on
Treasury Constant Maturities, 30-year, as published in the Federal Reserve
Statistical Release H.15(519) of the Board of Governors of the Federal Reserve
System for the August of the prior Plan Year.
Section 1.20 Plan
Plan means the Ralston Purina Company Retirement Plan as herein set forth, and
as amended from time to time.
Section 1.21 Plan Administrator
Plan Administrator means Ralston Purina Company.
Section 1.22 Plan Year
Plan Year means any twelve (12) month period beginning on any October 1 and
ending on the following September 30 for all years beginning on or after October
1, 1990. For the Plan Year beginning immediately prior to October 1, 1990, the
Plan Year means the short year beginning January 1, 1990 and ending September
30, 1990. For Plan Years beginning prior to January 1, 1990, the Plan Year
means any twelve (12) month period beginning on any January 1 and ending on the
following December 31.
Section 1.23 Predecessor Plan
Predecessor Plan means the Purina Retirement Plan for Sales, Administrative and
Clerical Employees, as in effect from time to time.
Section 1.23A Rehired Participant
Rehired Participant means any Participant who has terminated employment with the
Company and all Affiliated Companies, but is rehired and is entitled to
restoration of past Credited Service.
Section 1.24 Retiree
Retiree means a Participant who has retired under the terms of the Plan before
January 1, 1999.
Section 1.25 Social Security Benefit
Social Security Benefit means the Social Security Primary Insurance Amount
payable to a Participant at Social Security Retirement Age under Title II of the
Social Security Act as in effect on the date of his retirement or on his
Severance from Service Date, whichever is applicable computed in accordance with
the following:
(a) A Participant's Social Security Benefit shall be calculated using
such Participant's actual earnings history for the period before his date of
hire if the Participant provides such earnings history to the Plan Administrator
within 180 days after his retirement or separation.
(b) If a Participant fails to provide his actual earnings history, his
Social Security Benefit shall be calculated using an estimated earnings history
determined as follows:
(i) For the period before the first full calendar year of Form W-2 earnings
on file with an Affiliated Company, Social Security earnings shall be estimated
based on the assumption that the Participant has been continuously covered under
the Social Security Act since the later of 1951 or his twenty-first birthday and
that his Form W-2 earnings for the calendar year preceding such first full
calendar year of Form W-2 earnings shall be equal to such first Form W-2
earnings divided by 1.06. Earnings for each preceding year shall be equal to
the estimated earnings for the next subsequent year divided by 1.06.
(c) If a Participant is eligible for Early Retirement on his Severance
from Service Date, he shall be assumed to have no earnings in or after the year
of his termination to age sixty-two (62), and it shall be further assumed that
Social Security benefits will commence at age sixty-two (62). For a Participant
eligible for Early Retirement who terminates after age sixty-two (62), it shall
be assumed that Social Security benefits commence on the date of his
termination.
(d) If a Participant is vested but not eligible for Early Retirement at
his Severance from Service Date, he shall be assumed to have estimated earnings
equal to those received in the calendar year preceding his termination for each
year until his Normal Retirement Date. This assumption shall also apply to the
computation of the Survivor Benefit under Section 8.4.
Section 1.25A Social Security Covered Compensation
Social Security Covered Compensation means the average of the Social Security
Maximum Taxable Wage Bases in effect under Section 230 of the Social Security
Act for each year in the 35 consecutive calendar year period ending with the
earlier of (a) the Participant's Severance from Service Date or (b) any year in
which the Accrued Benefit is determined.
Section 1.26 Social Security Offset
Social Security Offset means an amount equal to one-half (1/2) of the
Participant's Social Security Benefit multiplied by a fraction (not to exceed
one) in which the numerator is the Participant's actual Credited Service, and
the denominator is the greater of the Participant's projected Credited Service
at his Normal Retirement Date or thirty (30) years.
Section 1.27 Social Security Retirement Age
Social Security Retirement Age means the age used as the retirement age for the
Participant under Section 216(l) of the Social Security Act, except that such
section shall be applied without regard to the age increase factor, and as if
the early retirement age under Section 216(l)(2) of such Act were sixty-two
(62).
Section 1.27A Spouse
Spouse means the person to whom the Participant is married under local law on
the date specified in the Plan document.
Section 1.28 Temporary Employee
Temporary Employee means an employee of the Company or an Affiliated Company
hired (a) for a specific project of limited duration, or (b) to fill the vacancy
of an Employee who is on a leave of absence.
Section 1.29 Trustee or Trustees
Trustee or Trustees means any corporation, person or persons who may be
designated by the Board of Directors from time to time to hold, invest,
reinvest, and disburse certain funds of this Plan, in accordance with the terms
of a trust agreement or agreement established for the purposes of this Plan.
Section 1.30 Year of Credited Service
Year of Credited Service means any aggregated 12 months of Credited Service.
ARTICLE II - Participation
Section 2.1 Prior Participants
Any Employee who was a Participant in the Plan on December 31, 1998 shall
continue to be a Participant.
Section 2.2 Enrollment
Any other Employee shall be enrolled in the Plan on the first day of the month
commencing with or next following the date he completes one (1) Year of Credited
Service, and upon the completion of one (1) Year of Credited Service, such
Employee shall become a Participant. Notwithstanding the foregoing, the
following Employees are not eligible to participate in the Plan: (i) Employees
as of August 28, 1993 of Energizer Power Systems, a division of Eveready Battery
Company, Inc., (ii) Temporary Employees, (iii) Leased Employees, or (iv) any
worker retained by the Company or any Affiliated Company to perform services
for the Company or any Affiliated Company (for either a definite or indefinite
duration) who is characterized thereby as a fee-for-service worker or
independent contractor or in a similar capacity (rather than in the capacity of
an Employee), regardless of such individual's status under common law,
including, without limitation, 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, without limitation, 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.
A Cash Balance Account with zero value shall be established as of the first of
the calendar month coincident with or next following the date of hire for any
Employee eligible to become a Participant after taking into account Section 2.4
hereof, however, such Employee shall not become a Participant until the first
day of the month commencing with or next following the date he completes one (1)
Year of Credited Service.
Section 2.3 Re-employment -- Service Credit
A re-employed Participant who has prior Credited Service restored under Section
1.9J shall again become a Participant in the Plan on his Re-employment
Commencement Date.
Section 2.3A Re-employment -- Eligibility for Pension Benefit Provisions
A Participant who became a Vested Terminated Participant or Disabled Participant
prior to January 1, 1999 or who elected the Pension Equity Benefit as a Pension
Benefit as of January 1, 1999 and who has a Re-employment Commencement Date on
or after January 1, 1999 shall have his Pension Benefit determined as a Pension
Equity Benefit and shall be a Participant in the Cash Balance Benefit from the
Re-employment Commencement Date. A Pension Equity Benefit shall be established
for such a Participant based upon Average Annual Earnings as of the date of
termination and all Credited Service.
A Participant who became a Retiree prior to January 1, 1999 or who elected the
FAP Benefit as a Pension Benefit as of January 1, 1999 and who has a
Re-employment Commencement Date on or after January 1, 1999 will continue to
accrue a Pension Benefit under the FAP Benefit provisions of the Plan.
Any Participant who first becomes a Participant on or after January 1, 1999 and
who has a Re-employment Commencement Date thereafter shall have his entire
Pension Benefit determined as a Pension Equity Benefit and shall be a
Participant in the Cash Balance Benefit from the Re-employment Commencement
Date.
Section 2.3B Re-employment -- Calculation of Accrued Benefit and Suspension
of Benefit Payments Any Rehired Participant shall have annuity payments from
the Plan suspended upon his Re-employment Commencement Date, and the
provisions of Section 6.2A shall apply. Notwithstanding anything in the Plan
to the contrary, the value of all prior distributions from the Plan shall reduce
the Actuarial Equivalent value of the Accrued Benefit for a Rehired
Participant, and any of his FAP Benefit, Pension Equity Benefit, and any Cash
Balance Benefit under the Plan, according to the source of the prior
distribution.
In the calculation of the Accrued Benefit attributable to the Pension Benefit
for a Rehired Participant, all Credited Service shall be taken into account, and
all Periods of Service shall be taken into account in determining Average Annual
Earnings, subject at any future Annuity Starting Date to the offset described in
this Section 2.3B.
In the calculation of the Accrued Benefit attributable to the Cash Balance
Benefit for a Rehired Participant, the Cash Balance Account of such Rehired
Participant shall be restored, adjusted according to the Periodic Interest Rate
from any Annuity Starting Date, subject at any future Annuity Starting Date to
the offset described in this Section 2.3B.
Section 2.4 Employees Covered by a Collectively Bargained Plan
Except as provided by Appendix B on and after October 1, 1996, no Employee who
is covered by a collective bargaining agreement between the Company or an
Affiliated Company and any labor organization which requires the Company or an
Affiliated Company to contribute to a pension fund, or plan providing retirement
benefits other than those provided by this Plan, shall be eligible to become or
remain a Participant hereunder. If an Employee ceases to be a Participant
because of the provisions of this Section 2.4, his rights to the payment of
benefits credited to him as a Participant under this Plan shall be determined by
the terms of the collective bargaining agreement.
Section 2.5 Employees Covered by Merged Plans
Any Employee who was a participant in a plan qualified under Code Section 401(a)
which is merged with this Plan shall become a Participant in this Plan as of the
date of such merger, in accordance with the terms of this Plan as amended to
account for such merger. Except as may be provided in Appendix B hereto, any
other Employee eligible to become a participant in such merged plan but not such
a participant as of the merger date shall become a Participant in this Plan in
accordance with Section 2.2 computing Credited Service from his Employment
Commencement Date with the sponsor of the merged plan as defined in said
sponsor's plan.
Section 2.6 Participation in Pension Equity Benefit
Any Participant who is also an Admin Employee on December 31, 1998 may
irrevocably elect, effective January 1, 1999, to receive his Pension Benefit
calculated in accordance with Section 5.1(a) (the FAP Benefit) or in accordance
with Section 5.1(b) (the Pension Equity Benefit). Such election shall be made
in accordance with the forms and procedures prescribed by the Company. Such
election shall not be available to Production Employees.
Any Admin Employee who first becomes a Participant on or after January 1, 1999
shall be eligible to receive a Pension Equity Benefit and ineligible to receive
a FAP Benefit, and his Pension Benefit shall be calculated exclusively under the
Pension Equity Benefit provisions of the Plan.
A Participant who is an Admin Employee on December 31, 1998 and who fails to
make an election within the period required by the Plan Administrator to receive
his Pension Benefit either in the form of a FAP Benefit or Pension Equity
Benefit shall be deemed to have irrevocably elected to continue to receive such
Pension Benefit in the form of a FAP Benefit.
The election by a Participant who is on a Leave of Absence on December 31, 1998
to receive his Pension Benefit in the form of a Pension Equity Benefit shall not
be effective until the date such Participant returns to active employment as an
Admin Employee, as determined by the Plan Administrator.
Section 2.7 Participation in Cash Balance Benefit
Any Employee who is also a Participant on January 1, 1999 and any Employee who
becomes a Participant on or after January 1, 1999 shall be eligible to receive a
Cash Balance Benefit.
ARTICLE III - Contributions
Section 3.1 Employee Contributions
Subsequent to December 31, 1972, no contributions are required from any
Participant. No voluntary or rollover contributions shall be permitted.
Existing employee contribution account balances, if any, shall continue to be
separately accounted for and be nonforfeitable. For the period before January
1, 1976, interest at the rate specified in the Predecessor Plan shall be
credited. For the period commencing January 1, 1976 and ending December 31,
1987, interest at the rate of five percent (5%) compounded annually shall be
credited. For the period commencing January 1, 1988, interest at the rate of
one hundred twenty percent (120%) of the Federal mid-term rate (as in effect
under Section 1274 of the Code for the first month of the year) compounded
annually shall be credited. The rights of a Participant to the benefit derived
from his employee contributions shall be governed by the applicable sections of
this Plan.
Section 3.2 Affiliated Company Contributions
Each Affiliated Company participating in this Plan shall make the contributions
required by this Plan with respect to the Employees of such Affiliated Company.
Such payments shall be made by the appropriate Affiliated Company to the
Trustees or to any insurance company in such amounts and at such times as may be
determined by agreement between the Plan Administrator or its delegatee and the
Trustees or any insurance company. Such payments to any Trustee or insurance
company shall be made in such aggregate amount as the Affiliated Company shall
consider necessary on the basis of actuarial calculations to carry out the
purposes of this Plan.
ARTICLE IV - Vesting
Section 4.1 Vesting
(a) A Participant shall be fully vested in his FAP Benefit or Pension Equity
Benefit upon the earlier of:
(i) attainment of an Early Retirement Date while employed with the Company
or an Affiliated Company; or
(ii) Completion of five (5) Years of Credited Service; or
(iii) attainment of age sixty-five (65) while employed with the Company or
an Affiliated Company.
Accumulated employee contributions, including interest credited on
such contributions, shall be fully vested at all times and in all events.
(b) A Participant's vested interest in his Cash Balance Account shall be
determined by his Years of Credited Service in accordance with the following
schedule:
Years of Credited Service Vested Percentage
---------------------------- ------------------
fewer than 1 0%
at least 1 but fewer than 2 25%
at least 2 but fewer than 3 50%
at least 3 but fewer than 4 75%
4 or more 100%
Notwithstanding the foregoing, the Cash Balance Account of a Participant
shall be 100% vested and nonforfeitable upon Permanent and Total Disability,
Plan termination, or such Participant's death or attainment of his Normal
Retirement Date while still employed by the Company or an Affiliated Company.
Section 4.2 Years of Credited Service for Vesting
Notwithstanding the foregoing, Credited Service for vesting shall include the
number of whole Years of Credited Service earned by a Participant. All Years of
Credited Service shall be counted except:
(a) years relating to any period in which the Plan or the Predecessor
Plan was not maintained by the Company or any Affiliated Company, except
provided in Article XII, and
(b) years before January 1, 1976, if such years were disregarded under
the terms and conditions of the Plan or Predecessor Plan in effect at that time,
except as otherwise provided in Section 1.9 with regard to bridging of prior
Continuous Service.
Notwithstanding the provisions of Section 1.9 regarding Periods of Service,
Credited Service for vesting shall include the Years of Credited Service earned
by a Participant since the date of hire by the Golden Cat Company.
ARTICLE V - Amount Of Benefit
Section 5.1 Normal Retirement Benefit
The Normal Retirement Benefit of a Participant is a monthly annuity for the life
of the Participant which is the sum of the (a) the FAP Benefit or the Actuarial
Equivalent of the Pension Equity Benefit, as applicable to a Participant, and
(b) the Actuarial Equivalent of the Cash Balance Account as of the Annuity
Starting Date.
(a) FAP Benefit
(i) The FAP Benefit calculated in accordance with this Section 5.1(a) shall
be an annual benefit equal to one and one-half percent (1-1/2%) of Average
Annual Earnings multiplied by Credited Service up to forty (40) years reduced by
the Social Security Offset. If such Participant is an Eligible Participant as
defined in 5.1(d) below, his FAP Benefit shall also include his Supplemental FAP
Benefit, as determined in 5.1(d) below.
(ii) Such Participant's Normal Retirement Benefit shall not be less than an
annual benefit equal to one and one-quarter percent (1-1/4%) of Average Annual
Earnings not in excess of fifteen thousand dollars ($15,000) multiplied by his
Credited Service up to forty (40) years.
(b) Pension Equity Benefit.
For any eligible Participant, the Pension Equity Benefit is, the sum of the
amounts determined below at the date of termination of employment with the
Company, providing for an allocation in respect of each Year of Credited Service
according to the chart set forth below, but applying all such percentages to the
Average Annual Earnings at the date of such termination of employment:
Additional Percentage of
Average Annual Earnings
In Excess Of
Percentage of Average Social Security
Annual Earnings Covered Compensation
--------------- ----------------------
Each of the first 5 years of 4.0% 3.5%
Credited Service
Next 5 Years of Credited Service 5.0% 3.5%
Next 5 Years of Credited Service 6.5% 3.5%
Next 5 Years of Credited Service 8.0% 3.5%
All Subsequent Years of Credited 10.0% 3.5%
Service
Fractional Years of Credited Service shall be recognized by supplying an amount
equal to (a) the months of Credited Service divided by 12, times (b) each of the
applicable percentages in the above table, relating to the fractional Years of
Credited Service being included in the determination of the Accrued Benefit.
The value of the Pension Equity Benefit shall increase at an annual rate of 3%
from the date of termination of employment until the Annuity Starting Date.
If such Participant is an Eligible Participant as defined in 5.1(e) below, his
Pension Equity Benefit shall also include his Supplemental Pension Equity
Benefit, as determined in 5.1(e) below.
(c) Minimum Accrued Benefit. Notwithstanding subparagraphs (a) and (b), the
Accrued Benefit of a Participant who was an Employee on December 31, 1998,
derived from a Participant's FAP Benefit or Pension Equity Benefit shall not be
less than the Accrued Benefit determined as if such Participant had terminated
employment as of December 31, 1998, based on the provisions of the Plan in
effect for such Participant on such date.
(d) Supplemental FAP Benefit. An Eligible Participant's Supplemental FAP
Benefit, payable as of the Eligible Participant's Normal Retirement Date, shall
be an annuity benefit equal to the product of (i), (ii), and (iii), where:
(i) is the Eligible Participant's Average Annual Earnings;
(ii) is the Eligible Participant's Credited Service measured since the
Eligible Participant's Supplement Eligibility Date; and
(iii) is the Eligible Participant's Supplement Percentage.
Solely for purposes of this Section 5.1(d), "Eligible Participant" means those
Employees who participate in the Company's Supplemental Executive Retirement
Plan.
For purposes of this Section 5.1(d), "Supplement Eligibility Date" means:
(i) October 1, 1994 for an Employee who was an Eligible Participant as of
October 1, 1994;
or
(ii) The October 1 coincident with or following the date upon which an
Employee becomes an Eligible Participant after October 1, 1994.
For purposes of this Section 5.1(d), "Supplement Percentage" means a percentage
developed as the quotient of (I)/(II), where:
(I) is the excess of (i) the Eligible Participant's projected retirement
benefit without regard to the limits on Annual Earnings imposed by Code Section
401(a)(17) assuming the Eligible Participant's Early Retirement Date is age
sixty-two (62), over (ii) the Eligible Participant's projected Normal Retirement
Benefit assuming the Eligible Participant's Early Retirement Date is the first
day of the month nearest the date on which the Eligible Participant both attains
age sixty-two (62), and completes two (2) years of Credited Service. For
purposes of this projection, the Eligible Participant's Annual Earnings shall be
assumed to increase at a rate of five and one-half percent (5.5%) per year from
his level of Annual Earnings as of his Supplement Eligibility Date and the
limits on Annual Earnings imposed by Code Section 401(a)(17) shall be assumed to
increase after the Supplement Eligibility Date at an underlying rate of five
percent (5.0%) per year.
and
(II) is the product of (i) the Eligible Participant's Average Annual
Earnings projected to his age sixty-two (62) under the above assumptions and
limited by the provisions of the Code Section 401(a)(17), as projected to age
sixty-two (62) under the above assumptions, and (ii) the Eligible Participant's
projected Credited Service measured as the Period of Service beginning on his
Supplement Eligibility Date and ending on the Eligible Participant's Early
Retirement Date.
(e) Supplemental PEP Benefit. An Eligible Participant shall also receive a
Supplemental Pension Equity Benefit which is equal to the product of (i), (ii)
and (iii) determined below for each full year of Credited Service, completed by
such Participant.
(i) is the Eligible Participant's Average Annual Earnings;
(ii) is the Eligible Participant's Credited Service measured since the
Eligible Participant's Supplement Eligibility Date; and
(iii) is the Eligible Participant's Supplemental PEP Percentage.
Solely for purposes of this Section 5.1(e), "Eligible Participant" means those
Employees who participate in the Company's Supplemental Executive Retirement
Plan and who have elected the Pension Equity Benefit.
For purposes of this Section 5.1(e), "Supplement Eligibility Date" means:
(i) October 1, 1994 for an Employee who was an Eligible Participant as of
October 1, 1994;
or
(ii) The October 1 coincident with or following the date upon which an
Employee becomes an Eligible Participant after October 1, 1994.
For purposes of this Section 5.1(e), "Supplemental PEP Percentage" means a
percentage developed as the lesser of 10% and the quotient of (I)/(II), where:
(I) is the excess of (i) the Eligible Participant's projected Pension Equity
Benefit without regard to the limits on Annual Earnings imposed by Code Section
401(a)(17) assuming the Eligible Participant's Early Retirement Date is age
sixty-two (62), over (ii) the Eligible Participant's projected Pension Equity
Benefit assuming the Eligible Participant's Early Retirement Date is the first
day of the month nearest the date on which the Eligible Participant both attains
age sixty-two (62), and completes two (2) years of Credited Service. For
purposes of this projection, the Eligible Participant's Annual Earnings shall be
assumed to increase at a rate of five and one-half percent (5.5%) per year from
his level of Annual Earnings as of his Supplement Eligibility Date, the limits
on Annual Earnings imposed by Code Section 401(a)(17) shall be assumed to
increase after the Supplement Eligibility Date at an underlying rate of five
percent (5.0%) per year and the Social Security Maximum Taxable Wage Bases,
which serve as a basis for the Social Security Covered Compensation increases at
a rate of 4.5% per annum from the Social Security Maximum Taxable Wage Base in
effect on the Supplement Eligibility Date.
and
(II) is the product of (i) the Eligible Participant's Average Annual
Earnings projected to his age sixty-two (62) under the above assumptions and
limited by the provisions of the Code Section 401(a)(17), as projected to age
sixty-two (62) under the above assumptions, and (ii) the Eligible Participant's
projected Credited Service measured as the Period of Service beginning on his
Supplement Eligibility Date and ending on the Eligible Participant's Early
Retirement Date.
(f) Cash Balance Account. The Normal Retirement Benefit of a Participant who
is an Employee on or after January 1, 1999, shall include the Actuarial
Equivalent of his Cash Balance Account. A Participant's Cash Balance Account
shall equal the sum of hypothetical allocations or "regular credits" and
hypothetical earnings or "interest credits" allocated to the Participant's Cash
Balance Account as determined below:
(i) Regular Credits. A Participant's Cash Balance Account shall be
credited at the end of each payroll period with an amount equal to three hundred
percent (300%) of the Participant's after-tax Supplemental Contributions for
such payroll periods to the Company's Restated Savings Investment Plan (the
"SIP"), a plan and trust qualified under Code Section 401(a), or any successor
plan thereto, in accordance with Section 4.04 of the SIP; provided, however,
that such Regular Credit shall not exceed 5.25 percent of the compensation (as
defined in the SIP) for such payroll period that is eligible for after-tax
Supplemental Contributions.
(ii) Interest Credits. As of the last day of each calendar month beginning
after the later of December 31, 1998 or the establishment of the Account, and
ending prior to the Annuity Starting Date of a Participant on whose behalf an
Account is maintained, the Account, valued as of the beginning of each such
calendar month, of each such Participant shall be credited with an amount
calculated using an annual rate of interest equal to the Periodic Interest Rate,
as adjusted for monthly allocations. Furthermore, in the calendar year of the
Participant's Annuity Starting Date, Interest Credits shall be made as of the
Participant's Annuity Starting Date to reflect Interest Credits through that
date.
Section 5.2 Compliance With Code Section 401(a)(17)
Unless otherwise provided under the Plan, the benefit accrued under this Plan
for each "Section 401(a)(17) Employee" (as hereinafter defined) shall be the
greater of the accrued benefit determined for the Employee under (a) or (b)
below:
(a) the Employee's accrued benefit determined with respect to the benefit
formula applicable for the Plan Year beginning October 1, 1994, as applied to
the Employee's total years of Credited Service, or
(b) the sum of:
(i) the Employee's accrued benefit as of the last day of the Plan Year
beginning October 1, 1993, frozen in accordance with Treasury Regulation Section
1.401(a)(4)-13, and
(ii) the Employee's accrued benefit determined under the benefit formula
applicable for the Plan Year beginning October 1, 1994, as applied to the
Employee's years of Credited Service credited to the Employee for Plan years
beginning October 1, 1994.
For purposes of this Section 5.2, a "Section 401(a)(17) Employee"
means an Employee whose current accrued benefit as of October 1, 1994 is based
on Compensation for the Plan Year beginning October 1, 1993, that exceeded one
hundred fifty thousand dollars ($150,000).
Section 5.3 Intentionally Omitted
Section 5.4 Prior Service Guarantees
For Participants who were Participants in the Predecessor Plan on December 31,
1972, the Normal Retirement Benefit shall be computed in accordance with the
special Prior Service Guarantees provided in Section 5.6 of the Plan in effect
on December 31, 1984.
Section 5.5 Offset for Retirement Payments Required by Foreign Law
The retirement benefit calculated in this Article V shall be further reduced by
the Actuarial Equivalent Value of any lump sum payment, retirement benefit, old
age pension, severance pay benefit or other similar benefit which is paid by or
is determined to be attributable to direct or indirect contributions by the
Company or an Affiliated Company or a domestic or Foreign Affiliate of the
Company or an Affiliated Company, to which the Participant or a Beneficiary is,
or shall become eligible to receive, whether the payment is required by law,
decree or ruling of any nation (or political subdivision or agency thereof) or
pursuant to any individual contract or collective bargaining agreement, or
participation in another retirement plan.
The determination of whether, and to what extent, such other benefits are
in duplication of the retirement benefits payable under this Plan shall be made
by the Plan Administrator or its delegatee which shall make any such
determination on the basis of uniform, consistent and nondiscriminatory rules.
Section 5.6 Maximum Limitation on a Participant's Retirement Benefit
(a) Defined Benefit Limitation. The annual Retirement Benefit payable
---------------------------
under all defined benefit plans maintained by the Company or any Affiliated
Company to a Participant in any Plan Year shall not exceed the lesser of:
(i) Ninety thousand dollars ($90,000), or such other amount as may be
required by Code Section 415(b)(1)(A) effective on the first day of the Plan
Year, or
(ii) One hundred percent (100%) of the Participant's highest average Annual
Earnings during any three consecutive years of participation in the Plan.
(b) Adjustment For Form of Benefit. If the Participant's annual Retirement
-------------------------------
Benefit is not paid in the form of a single life annuity, a Qualified Joint and
Survivor Annuity or Option A (with the Participant's spouse designated as the
contingent annuitant and the percentage of the Participant's benefit to be
continued after his death not less than fifty (50) percent), such benefit shall
be adjusted so that it is the actuarial equivalent of a single life annuity.
Such actuarial adjustment shall use an interest rate of five percent (5%) or the
rate specified in Section 7.4, if greater.
(c) Adjustment For Early Distribution. If the retirement benefit of a
------------------------------------
Participant commences before the Participant's Social Security Retirement Age
but on or after age sixty-two (62), the dollar limitation shall be adjusted so
that it is the actuarial equivalent of an annual benefit of the amount required
by Code section 415(b)(1)(A) beginning at the Social Security Retirement Age.
The adjustment provided in the preceding sentence shall be made in such manner
as the Secretary of the Treasury may prescribe which is consistent with the
reduction for old-age insurance benefits commencing before the Social Security
Retirement Age under the Social Security Act.
If the retirement benefit of a Participant commences before the Participant's
Social Security Retirement Age and before age sixty-two (62), the dollar
limitation of (a)(1) shall be adjusted so that it is the actuarial equivalent of
an annual benefit that dollar amount beginning at the Social Security Retirement
Age. Such actuarial adjustment shall use an interest rate not less than the
greater of the interest rate specified in Section 7.4 or five percent (5%).
(d) Adjustment for Deferred Retirement. If the retirement benefit of a
----------------------------------
Participant commences after the Participant's Social Security Retirement Age,
the dollar limitation of paragraph (a)(1) above shall be adjusted so that it is
the actuarial equivalent of an annual benefit of the amount required by Code
section 415(b)(1)(A beginning at the Social Security Retirement Age. Such
actuarial adjustment shall use an interest rate not greater than the lesser of
five percent (5%) or the rate specified in Section 7.4.
(e) Adjustment for Years of Participation. If a Participant has
-----------------------------------------
completed less than ten (10) years of participation, the dollar limitation of
paragraph (a)(1), as adjusted by paragraph (c) or (d) above, shall be reduced by
a fraction, the numerator of which is the Participant's number of years (or part
thereof) of participation in the plan, and the denominator of which is ten.
(f) Adjustment for Years of Credited Service. If a Participant has
--------------------------------------------
completed less than ten (10) years of Credited Service, the compensation
limitation of (a)(2) above shall be adjusted by multiplying such amount by a
fraction, the numerator of which is the Participant's number of years of
Credited Service (or part thereof), and the denominator of which is ten.
(g) Limitations on Reductions. In no event shall paragraphs (e) or (f)
-------------------------
reduce the limitations provided under paragraph (a) or Section 415(b)(4) of the
Code to an amount less than one-tenth of the applicable limitation [as
determined without regard to paragraph (e) or (f)].
(h) Structure. To the extent provided by the Secretary of the
---------
Treasury, the limitations of paragraphs (e) and (f) shall be applied separately
with respect to each change in the benefit structure of the plan.
(i) Protection of Current Accrued Benefit. If an individual was a
-----------------------------------------
Participant on January 1, 1987 in one or more defined benefit plans maintained
by the Company or an Affiliated Company, which plan was in existence on May 6,
1986, and the sum of the annual benefits accrued by such Participant as of
December 31, 1986, disregarding any changes in the terms and conditions of the
Plan after May 5, 1986, exceeds the dollar limitation of sub-paragraph (a)(1) of
this Section as modified by paragraphs (a) through (f), then for purposes of
this Section 5.6(i) and Section 5.7 the dollar limitation of (a)(1) shall equal
the sum of such annual benefits.
Section 5.7 Maximum Benefit if Participant Covered Under Both the Plan and a
Defined Contribution Plan For Plan Years Beginning On Or Before December 31,
1999
(a) In the case of a Participant who also participates in a defined
contribution plan of the Company or the Affiliated Companies, the maximum
benefit to be accrued each Plan Year under the Plan shall be limited to an
amount determined as follows:
(i) First, there shall be computed under the Plan as of the close of each
Plan Year a fraction, the defined benefit fraction, in which the numerator is
the Participant's combined projected benefit at Normal Retirement Date for all
defined benefit plans maintained by the Company or an Affiliated Company, and
the denominator is the lesser of (A) the dollar limitation for the Plan Year in
5.6(a)(1)times 1.25 or (B) the compensation limit for the Plan Year in Section
5.6 (a)(2) times 1.4.
(ii) Second, there shall be computed under the defined contribution plan as
of the close of each Plan Year a fraction, the defined contribution fraction, in
which the numerator is the sum of all of the Annual Additions [as defined in
Section 5.7(b) below] to the Participant's account under all defined
contribution plans maintained by the Company or an Affiliated Company as of the
close of the Plan Year and the denominator is the sum of the Maximum Amount of
Annual Additions to the Participant's account as defined in (c) below which
could have been made for such Plan Year and all prior years of service.
(iii) Third, the fractions determined under (i) and (ii) shall be totalled
and if the resulting sum is more than 1.0, the Participant's accrued benefit
under the Plan for the Plan Year in question shall be limited to the amount
which will produce a fraction under (i) which when added to the fraction
determined under (ii) will not result in a sum in excess of 1.0.
(b) For purposes of the limitations contained in this Section 5.7, the
Annual Addition to the Participant's account under the defined contribution plan
for a Plan Year shall include to the extent applicable (1) Company or Affiliated
Company and employee contributions, including excess contributions as defined in
Section 401(k)(8)(B) of the Code, excess aggregate contributions as defined in
Section 401(m)(6)(B), and excess deferrals as defined in Section 402(g),
regardless of whether such amounts are distributed or forfeited, (2) forfeitures
for the Plan Year, and (3) amounts described in Sections 415(l)(1) and
419(A)(d)(2) of the Code. The Annual Addition for any Plan Year of a
Predecessor Plan beginning before January 1, 1987 shall not be recomputed to
treat all Employee Contributions as an Annual Addition.
(c) For purposes of the limitations contained in this Section 5.7(c),
the Maximum Amount of Annual Additions in any Plan Year shall be the lesser of
(1) the maximum dollar limit in effect under Code Section 415(c)(1)(A) for such
year times 1.25, or (2) the amount taken into account under Code Section
415(c)(1)(B) for that year times 1.4.
(d) If the defined benefit plans and defined contribution plans in
which a Participant participates were in existence on May 6, 1986, and satisfied
the applicable requirements of Section 415 of the Code as in effect for all Plan
Years beginning before January 1, 1987, an amount shall be subtracted from the
numerator of the defined contribution plan fraction (not exceeding such
numerator) as prescribed by the Secretary of the Treasury so that the sum of the
defined benefit plan fraction and defined contribution plan fraction computed
under Section 415(e)(1) of the Code does not exceed 1.0 for such Plan Year.
ARTICLE VI - Retirement Benefits
Section 6.1 Normal Retirement
A Participant shall be entitled to his full, unreduced Normal Retirement Benefit
upon attainment of his Normal Retirement Date payable in the Normal Form.
Section 6.2 Deferred Retirement
A Participant may defer his retirement to his Deferred Retirement Date. The
permission of the Company or Affiliated Company concerned, acting through or at
the direction of its Board of Directors is necessary in order to defer
retirement past attainment of age seventy (70). In those jurisdictions where
mandatory retirement is prohibited by law (including the United States), the
permission of the Company or the Affiliated Company is not required. The
retirement benefit payable upon actual retirement shall be the benefit computed
in accordance with the applicable provision of Article V on the basis of
aggregate Credited Service to the time of such actual retirement and actuarially
adjusted for any payments previously made; provided, however, that a Participant
who has not been credited with at least one Hour of Service with respect to a
Plan Year beginning after December 31, 1987 shall not be entitled to any
accruals of retirement benefits for employment past his Normal Retirement Date.
Unless the Participant otherwise elects, the payment of benefits under the
Plan to the Participant will begin not later than the 60th day after the latest
of the close of the Plan Year in which--
(A) the date on which the Participant attains the age 65,
(B) occurs the 10th anniversary of the year in which the Participant
commenced participation in the Plan, or
(C) the Participant terminated his service with the Employer.
Section 6.2A Suspension of Benefits
Subject to any requirements of early commencement of retirement benefits of
Section 6.5 below, a Participant who defers his retirement shall not be entitled
to any benefits from this Plan for any month in which he has been credited with
at least one Hour of Service in at least eight (8) days.
If a Participant who had retired is rehired as an Employee (and not as a
Temporary Employee) by the Company or an Affiliated Company, such Participant's
monthly benefit shall be withheld for any month in which he is employed at least
eight (8) days. The retirement benefit payable upon subsequent retirement of
such Participant shall be the benefit computed in accordance with the applicable
provisions of Article V on the basis of aggregate Credited Service to the time
of any such subsequent retirement, and adjusted on an Actuarial Equivalent basis
for any payments previously made under the form of benefit previously elected.
The Normal Retirement Benefit shall resume no later than the first day of the
third month after the month in which the Employee last worked in at least eight
days.
Section 6.3 Early Retirement -- FAP Benefit Only
A Participant who has a FAP Benefit and who attains his Early Retirement Date
may elect to terminate employment and commence the FAP Benefit immediately,
payable in the Normal Form. If a Participant had become vested in his FAP
Benefit in accordance with Section 4.1 prior to electing Early Retirement, he
may elect to defer commencement of his FAP Benefit until the first day of any
month beginning before his Normal Retirement Date. The amount of such a
Participant's FAP Benefit shall be the amount of his Normal Retirement Benefit
calculated up to his Early Retirement Date and reduced by five-twelfths of one
percent (5/12 of 1%) for each month by which the Participant's Early Retirement
Date precedes the first day of the month nearest the Participant's sixty-second
(62nd) birthday.
Section 6.4 Vested Deferred Retirement -- FAP Benefit Only
A Participant who separates from employment after having become vested in his
FAP Benefit in accordance with Section 4.1 shall be entitled to a Vested
Deferred FAP Benefit. Such Vested Deferred FAP Benefit shall be payable in the
Normal Form and shall commence, at the election of the Participant, on the first
day of any month after attaining eligibility for Early Retirement Date but not
later than Normal Retirement Date. If a Participant separates from service
before satisfying the age requirement for early retirement, but has satisfied
the service requirement, the Participant will be entitled to elect an early
retirement benefit upon satisfaction of such age requirement.
The amount of a Participant's Vested Deferred FAP Benefit shall be the amount of
his Normal Retirement Benefit calculated up to his Severance from Service Date
and reduced by five-twelfths of one percent (5/12 of 1%) for each month by which
his Vested Deferred FAP Benefit commences prior to his Normal Retirement Date.
Section 6.4A Vested Deferred Retirement -- Pension Equity Benefit and Cash
Balance Benefit
A Participant who has a Pension Equity Benefit or a Cash Balance Benefit that is
vested under Section 4.1 may, at any time on or after such Participant's
termination of employment, elect a Pension Equity Benefit or Cash Balance
Benefit to commence as of the first day of any month thereafter which is prior
to such Participant's Normal Retirement Date. In such case the Participant
shall receive a Pension Equity Benefit or Cash Balance Benefit which is the
Actuarial Equivalent of his Pension Equity Benefit or Cash Balance Benefit as of
such Annuity Starting Date, payable as provided in Section 7.
Section 6.5 Commencement of Retirement Benefits
The FAP Benefit shall commence at any Annuity Starting Date on or after such
Participant's Early Retirement Date. A Pension Equity Benefit or a Cash Balance
Benefit may become payable at any Annuity Starting Date on or after such
Participant's termination of employment, at the election of the Participant in
accordance with the Plan's forms and procedures.
Notwithstanding the foregoing, regardless of any election by the Participant for
any Participant who attained age seventy and one-half (70-1/2) years of age on
or after January 1, 1988, distribution of retirement benefits shall commence no
later than April 1 of the calendar year following the calendar year in which the
Participant who has terminated his employment attains seventy and one-half
(70-1/2) years of age.
The required beginning date of a Participant who attains age seventy
and one-half (70-1/2) before January 1, 1988 shall be no later than April 1 of
the calendar year following the later of the calendar year in which the
Participant attains seventy and one-half (70-1/2) years of age, or the calendar
year in which the Participant actually retires; provided that deferment on
account of continued employment after attaining seventy and one-half (70-1/2)
years of age shall not apply in the case of a Participant who is a five-percent
(5%) owner, as defined in section 416(i) of the Code, with respect to the Plan
Year ending in the calendar year in which the Participant attains seventy and
one-half (70-1/2) years of age.
Section 6.6 Withdrawal of Contributions
A Participant may withdraw the entire amount of his contributions and credited
interest at any time prior to his retirement. No Participant who has withdrawn
his contributions shall be permitted to restore his contributions to the Plan.
If any Participant withdraws his contributions and credited interest,
his annual Pension Benefit, prior to any adjustment for Early Retirement or for
optional forms of payment, shall be reduced by an amount equal to forty percent
(40%) of his contributions without interest.
Section 6.7 Inability to Locate Participants or Beneficiaries
In the event that all, or any portion of the distribution payable to a
Participant or his Beneficiary hereunder shall, at the expiration of five (5)
years after it becomes payable, remain unpaid solely because of the inability of
the Plan Administrator, after diligent effort, to ascertain the whereabouts of
such Participant or his Beneficiary, the amount so distributable shall be
retained as an asset of the Plan. In the event a Participant or Beneficiary is
subsequently located, such benefit shall be restored.
ARTICLE VII - Form Of Retirement Benefit
Section 7.1 Form of Benefit
Subject to the provisions of Section 7.2 below, the Normal Form of retirement
benefit payable to a Participant shall be a monthly amount equal to one-twelfth
(1/12) of the applicable annual benefit payable until the first day of the month
preceding his death. If a Participant dies before receiving sixty (60) monthly
payments, monthly retirement payments will be made after his death to his
Beneficiary until an aggregate of sixty (60) monthly payments have been made.
If the death of the Participant and the Beneficiary shall both occur before an
aggregate of sixty (60) monthly payments have been made, the commuted value
(based on the Actuarial Equivalent factors) of the remaining payments shall be
paid to the estate of the last to die. If a Participant dies on a monthly
payment date, the payment due shall be paid to the Beneficiary.
Section 7.2 Qualified Joint and Survivor Annuity
Unless an optional form of benefit is selected pursuant to a qualified election
within the ninety (90) day period ending on the Annuity Starting Date, a married
Participant shall receive his retirement benefit in the form of a Qualified
Joint and Survivor Annuity, and an unmarried participant shall receive his
retirement benefit in the form of an immediate life annuity. The Qualified
Joint and Survivor Annuity shall be a reduced monthly benefit for the life of
the Participant and, at his death, a survivor annuity for the life of his spouse
equal to fifty percent (50%) of the Participant's Benefit reduced according to
Actuarial Equivalent factors. The last payment of the Qualified Joint and
Survivor Annuity shall be paid as of the first day of the month in which the
death of the survivor occurs.
Section 7.2A Election Out of Qualified Joint and Survivor Annuity
Before each eligible Participant retires, he shall be given a reasonable period
in which to elect not to receive his retirement benefit in the form of a
Qualified Joint and Survivor Annuity. Any such election, except for an election
of Option A under Section 7.3A with the spouse named as the survivor and the
survivor annuity benefit not less than fifty percent (50%) nor greater than one
hundred percent (100%) of the Participant's benefit, shall be made in accordance
with the provisions as follows:
(a) The election shall be made to the Plan Administrator during the
ninety (90) day period ending on the day upon which retirement income payments
under the Plan commence;
(b) The election shall be in writing in a form acceptable to or on a
form furnished by the Plan Administrator, which clearly indicates that the
Participant is electing to receive his benefits in a form other than a Qualified
Joint and Survivor Annuity;
(c) The election must be consented to by the Spouse of the Participant
and the consent of the Spouse must be witnessed by a Plan representative or
notary public, unless the Participant establishes to the satisfaction of the
Plan Administrator that such written consent may not be obtained because there
is no Spouse or the Spouse cannot be located (any such consent shall be valid
only with respect to the Spouse who signs the consent, or the designated Spouse
whose consent cannot be so obtained); and
(d) Any such election may be revoked or changed by the Participant by a
subsequent election made in accordance with this subsection during the election
period of such Participant. Such an election may be revoked, but not changed,
without the consent of the Spouse.
The Plan Administrator shall furnish to such Participant, no less than
thirty (30) days and no more than ninety (90) days from the Annuity Starting
Date, a written notification that includes a general explanation of the terms
and conditions of the Qualified Joint and Survivor Annuity; the availability of
the election provided by this Section and the effect of making such an election;
the rights of the Spouse of the Participant; and the right to revoke a previous
election and an explanation of the effect of such a revocation and the relative
values of the various optional forms of retirement benefits under the Plan.
Each Participant entitled to receive benefits in the form of a Qualified Joint
and Survivor Annuity shall furnish proof satisfactory to the Plan Administrator
of the age of his Spouse, within a reasonable period before the commencement of
his retirement benefits.
Section 7.3 Optional Forms of Retirement Benefit
Subject to appropriate spousal consent, in lieu of the Normal Form of retirement
benefit payable, a Participant may elect one or more of the optional forms of
retirement benefit provided herein. Retirement benefits elected under these
options shall be actuarially adjusted. Subject to spousal consent, the right is
reserved to the Participant to modify or rescind the election at any time
without the consent of the survivor or Beneficiary. If the death of the
Participant occurs prior to the date benefits become payable, the option shall
be inoperative and the only payment shall be that provided in Article VIII. Any
election of an optional form of benefit shall be subject to the provisions of
Section 7.2A, to the extent applicable.
A Participant may elect different optional forms of benefit and different
Annuity Starting Dates for his Pension Benefit and his Cash Balance Benefit.
The FAP Benefit shall be payable in the Normal Form, Option 7.2, Option 7.2A,
Option 7.2B, Option 7.2C, Option 7.2D, or Option 7.2E, as elected by the
Participant, as of any proper Annuity Starting Date. The Pension Equity Benefit
and the Cash Balance Benefit shall be payable in the Normal Form, Option 7.2,
Option 7.2A, Option 7.2B, Option 7.2C, Option 7.2D, Option 7.2E or Option 7.2F,
as elected by the Participant, as of any proper Annuity Starting Date.
Section 7.3A Option A
Option A shall be a reduced retirement benefit payable for the life of the
Participant , and after his death, a designated amount, not to exceed such
reduced benefit payable to the survivor during his lifetime. If the death of
the Participant occurs on or after the date benefits commence, payments will be
made to any designated Beneficiary under this Option A. If the death of the
survivor occurs during the lifetime of the Participant, but prior to the Annuity
Starting Date, Option A shall be inoperative, and the Participant shall be
entitled to his retirement benefit otherwise payable. If the death of the
survivor occurs during the lifetime of the Participant, but after the Annuity
Starting Date, the Participant shall be entitled to receive only such reduced
amount of retirement benefit as is provided by the election of Option A.
The amount payable under this option is reduced, according to Actuarial
Equivalent factors.
If the designated amount to be payable to the survivor is other than one
hundred percent (100%) or fifty percent (50%), the reduction will be further
adjusted according to Actuarial Equivalent factors.
If the yearly amount of retirement benefit payable to the designated
survivor shall be less than one hundred twenty dollars ($120) or if the
Participant does not furnish satisfactory proof of the age of the survivor prior
to the Participant's actual retirement, Option A shall be inoperative.
Section 7.3B Option B
Option B shall be a reduced retirement benefit payable for the life of the
Participant with payments after his death payable to a Beneficiary until an
aggregate of 120 monthly payments have been made to the Participant and the
Beneficiary. If the death of the Participant and the Beneficiary shall occur
before an aggregate of 120 monthly payments shall have been made, the commuted
value of the remainder of such 120 monthly payments shall be paid to the estate
of the last to die.
The Option B Benefit payable to a Participant retiring on or after his
Normal Retirement Date will be ninety-four percent (94%) of the Normal Form.
This percentage will be increased by .035 percent (.035%) for each complete
month by which the Participant's actual retirement precedes his Normal
Retirement Date.
Section 7.3C Option C
Option C shall be an increased retirement benefit payable only for the life of
the Participant with no further payments after such Participant 's death. The
benefit payable to a Participant retiring on or after his Normal Retirement Date
will be one hundred two and one-half percent (102.5%) of the Normal Form. This
percentage will be decreased by .015 percent (.015%) for each complete month by
which the Participant's actual retirement precedes his Normal Retirement Date.
Section 7.3D Social Security Adjustment Option
At the timely written request of a Participant made prior to his elected Annuity
Starting Date, payments made under the Normal Form or any optional form may be
increased in the period prior to his attainment of his Social Security
Retirement Age and reduced thereafter so that the monthly payments hereunder
before attainment of his Social Security Retirement Age shall approximately
equal the total of the reduced monthly payments after attainment of his Social
Security Retirement Age and the monthly Social Security benefit then payable.
If this option is elected, a factor shall be determined by subtracting from
one (1.000), .006 times the number of complete months by which the Participant's
actual retirement precedes the first day of the month in which he attains his
Social Security Retirement Age. The benefit payable commencing on the
Participant's actual retirement shall be the benefit which would be payable if
this option had not been elected, plus the product of such factor and the
Participant's Social Security Benefit. The resulting increased benefit shall be
payable for all monthly payments prior to the first day of the month nearest the
Participant's sixty-second (62nd) birthday. Commencing on such date, and for
all monthly payments thereafter, the increased benefit shall be reduced by the
amount of the Participant's Social Security Benefit.
If the increased benefit computed as above is less than the Participant's
Social Security Benefit, the benefit payable under this option shall be
determined by dividing the benefit which would be payable if this option had not
been elected, by the factor determined as in the previous paragraph. The
resulting benefit shall be payable for each month prior to the first day of the
month in which the Participant attains his Social Security Retirement Age, and
no benefit shall be payable to the Participant thereafter.
Section 7.3E "Pop-up" Benefit
At the timely written request of a Participant made prior to his Annuity
Starting Date, a Participant may elect a benefit which shall be calculated in
accordance with the terms of this Section 7.3E. If a Beneficiary dies after the
Participant's Annuity Starting Date and the Participant has selected any of the
forms of benefit set forth in Section 7.2 or Section 7.3A, benefits payable to
the Participant shall be reduced by an Actuarial Equivalent factor of .99, and
any benefit payments made to the Participant after such death shall be payable
as if the Participant had elected, with spousal consent, the Normal Form as set
forth in Section 7.1, with the guarantee period commencing at the Annuity
Starting Date. Payments made to the Participant prior to such death shall not
be recalculated, and the Participant shall not receive any future adjustment in
respect of payments made prior to the Beneficiary's death.
Section 7.3F Single Sum Payment-- Pension Equity Benefit and Cash Balance
Benefit Only
Any Participant may elect a single sum payment as calculated in the manner
described in this Section 7.3F (a "Single Sum Payment") that is equal to the
Participant's Pension Equity Benefit or Cash Balance Account as of the Annuity
Starting Date.
Notwithstanding the above, for the Pension Equity Benefit, in no event shall the
Single Sum Payment be less than the actuarial present value, calculated as of
the Annuity Starting Date, of the Participant's Accrued Benefit attributable to
the Pension Equity Benefit as of the Annuity Starting Date. Such actuarial
present value shall be determined by assuming (a) for purposes of projecting the
Pension Equity benefit as of the Annuity Starting Date to the Participant's
Normal Retirement Date, in the aggregate, the 3% rate of increase is less than
or equal to the Applicable Interest Rate as of the Annuity Starting Date, and
(b) the Applicable Interest Rate at the Participant's Normal Retirement Date
equals the Applicable Interest Rate as of the Annuity Starting Date.
Notwithstanding the above, for the Cash Balance Benefit, in no event shall the
Single Sum Payment be less than the actuarial present value, calculated as of
the Annuity Starting Date, of the Participant's Accrued Benefit attributable to
the Cash Balance Benefit as of the Annuity Starting Date. Such actuarial
present value shall be determined by assuming (a) for purposes of projecting the
Account as of the Annuity Starting Date to the Participant's Normal Retirement
Date, in the aggregate, future Periodic Interest Rates are less than or equal to
the Applicable Interest Rate as of the Annuity Starting Date, and (b) the
Applicable Interest Rate at the Participant's Normal Retirement Date equals the
Applicable Interest Rate as of the Annuity Starting Date.
Section 7.4 Small Payments
If any benefit to which a Participant or Beneficiary would become entitled has a
present value of less than three thousand five hundred ($3,500), the Plan
Administrator shall make a Single Sum Payment of the entire amount of the
Actuarial Equivalent value of such vested Accrued Benefit.
In accordance with Treas. Reg. sec. 1.417(e)-1T(d)(10)(ii), any distribution for
which the Annuity Starting Date occurs in the one-year period beginning on
October 1, 1997 must use the Applicable Interest Rate for making the valuation
described in this Section, which would yield the larger distribution.
For purposes of this section, if the present value of an employee's vested
Accrued Benefit is zero, the employee shall be deemed to have received a
distribution of such vested accrued benefit.
In the event a Participant shall receive a Single Sum Payment described in
this Section 7.4, the Credited Service on which such a Single Sum Payment was
based shall count toward computing the benefit of the Participant on a
subsequent termination of employment or retirement, but such a subsequent
benefit shall be offset by the amount of retirement income previously paid to
the Participant in the form of the Single Sum Payment.
Section 7.5 Direct Rollovers
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 Distributee's Accrued Benefits 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).
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 Distributees
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 7.6 Restrictions on Benefits
Notwithstanding any provision in the Plan to the contrary, the distribution of a
Participant's benefit, whether under the Plan or through the purchase of an
annuity contract, shall be made in accordance with the requirements of Code
Section 401(a)(9) and the Regulations thereunder [including Proposed Regulation
Section 1.401(a)(9)-2]. For purposes of this Section, the life expectancy of
the Participant and his Beneficiary shall be made as of the Participant's
benefit commencement date and shall not be subject to recalculation.
Distributions to a Participant and his Beneficiaries shall only be made in
accordance with the incidental death benefit requirements of Code Section
401(a)(9)(G) and the Regulations thereunder.
ARTICLE VIII - Death Benefits
Section 8.1 Death Prior to Retirement/Employee Contributions
The Beneficiary of a Participant who dies while an Employee shall receive a
refund of his contributions made under the Plan, if any, plus credited interest.
Section 8.2 Death After Retirement
Benefit payments to a surviving Spouse or Beneficiary shall be made in
accordance with the form of benefit election made by the Participant under
Article VII.
Section 8.3 Election of Beneficiary
Each Participant shall elect a Beneficiary on forms provided by the Plan
Administrator for that purpose, and may change such Beneficiary from time to
time, but no change of Beneficiary shall be effective unless notice thereof
shall be given by the Participant to the Plan Administrator on forms provided by
the Plan Administrator. Any such election shall be made in accordance with
paragraphs (b), (c), and (d) of Section 7.2A. If any Participant shall fail to
designate a Beneficiary, then it shall be conclusively presumed that he did
designate as such Beneficiary the following persons in the order named: (a) his
spouse, (b) his children, per capita, (c) his parents, per capita, or (d) his
--- ------ --- ------
estate. Children by blood, marriage or adoption shall be considered children of
a Participant. Under no circumstances shall the Company, any of the Affiliated
Companies, or any insurance company be named as Beneficiary.
Section 8.4 Survivor Benefit
A Participant's Beneficiary shall be eligible for a Survivor Benefit if on the
date of his death he:
(a) was an Employee, and
(b) had five (5) Years of Credited Service, or was a disabled
Participant under the terms of the Plan.
Section 8.4A
If the Participant was not eligible for Early Retirement but had completed ten
(10) years of Credited Service at the time of his death, the monthly amount of
the Survivor Benefit payable to a Beneficiary shall be equal to forty percent
(40%) of the Participant's monthly Normal Retirement Benefit (based solely on
the FAP Benefit provisions) accrued at the date of his death, or twenty-five
dollars ($25), if greater.
Such Survivor Benefit shall be payable monthly to such eligible Beneficiary
commencing with the first day of the month following the death of the
Participant. The final monthly payment shall be made on the first day of the
month immediately preceding or coinciding with the date of the Beneficiary's
death.
Section 8.4B
If the Participant was eligible for Early Retirement on the date of his death,
the monthly amount of the Survivor Benefit payable to an eligible Beneficiary
shall be equal to fifty percent (50%) of the Participant's monthly Normal
Retirement Benefit (based solely on the FAP Benefit provisions) accrued at the
date of his death, or twenty-five dollars ($25), if greater. Such Survivor
Benefit shall be payable monthly to such Beneficiary commencing on the first day
of the month next following the Participant's date of death with the final
payment made on the first day of the month immediately preceding or coinciding
with the date of the Beneficiary's death.
Section 8.4C
If the Participant was not eligible for Early Retirement and had completed fewer
than ten (10) years of Credited Service at the time of his death, the monthly
amount of the Survivor Benefit payable to Beneficiary shall be equal to the
benefit the Beneficiary would have been entitled to receive (based solely on the
FAP Benefit provisions) if the Participant had terminated employment on the day
of his death, survived to the first day of the month following the date he would
have attained age fifty-five (55), retired on that date, and elected to receive
benefits in the form of a Joint and 50% Survivor Annuity.
Section 8.5 Pension Equity and Cash Balance Account Death Benefit
If a Participant dies before his Annuity Starting Date, a death benefit shall be
payable, solely based on the Accrued Benefit attributable to the Pension Equity
Benefit and Cash Balance Account, to his Beneficiary as follows:
(a) If the Participant's Beneficiary is any person other than his
Spouse, there shall be paid to such Beneficiary as soon as practicable after the
Participant's death occurs (but in no event later than the December 31 of the
Plan Year with contains the fifth anniversary of the Participant's death), a
Single Sum Payment equal to his Pension Equity Benefit and Cash Balance Account
as of the last day of the month in which the death of the Participant occurs.
(b) If the Participant's Beneficiary is his Spouse, such Spouse shall
be entitled to a single life annuity, payable monthly, calculated over her life
expectancy, where such annuity is the Actuarial Equivalent of the Pension Equity
Benefit and Cash Balance Account to which such Participant would have been
entitled had he terminated employment on his date of death, commencing on the
first day of any month on or after the date the Participant died. In the case
of a Participant who dies prior to attaining age 65, such annuity may commence
as of any date elected by the Spouse after the date of death and prior to the
date the Participant would have attained age 65. Alternatively, the Spouse may
request to receive, in lieu of any other benefits under the Plan to which she
would otherwise be entitled, a distribution of the value of the Participant's
Pension Equity Benefit and Cash Balance Account as of his date of death, payable
in a single sum as soon as practicable after the Participant's death.
(c) Notwithstanding subsections (a) and (b) above, if the Actuarial
Equivalent lump sum value of a Participant's vested Accrued Benefit (or, if
greater, the vested value of the Participant's Pension Equity Benefit and Cash
Balance Account) as of the date of such Participant's death does not exceed
$3,500, such Actuarial Equivalent lump sum value shall be paid to the
Beneficiary as soon as practicable thereafter in a single sum.
Section 8.6 Qualified Preretirement Survivor Annuity Provisions
The benefits payable to a Beneficiary who is a Spouse under Section 8.4, 8.4A,
8.4B, 8.4C and 8.5 must be paid to the Spouse in the form of a single life
annuity over the Spouse's lifetime (a "preretirement survivor annuity") unless
elected otherwise in accordance with this Section 8.6.
(a) No earlier than the first day of the Plan Year in which a
Participant attains age 32 and no later than the last day of the Plan Year in
which a Participant attains age 34 (or in the case of a person who becomes a
Participant who has terminated employment before age 35, with the year after
termination of employment), the Committee shall furnish to a Participant a
written explanation in non-technical language of (a) the terms and conditions of
the preretirement survivor annuity, (b) the Participant's right to make, and the
effect of, an election to waive the preretirement survivor annuity form of
benefit, (c) the rights of the Participant's Spouse to consent or withhold
consent in connection with the election, and (d) the Participant's right to
make, and the effect of, a revocation of an election.
(b) An election to waive the preretirement survivor annuity must be
made in writing by the Participant and the Participant's Spouse at any time in
the period beginning on the earlier of the first day of the Plan Year in which
the Participant attains age 35 or the date the Participant terminates his
employment with the Company and ending on the date of the Participant's death.
The Committee may permit a Participant and his Spouse to waive a preretirement
survivor annuity before the Plan Year in which the Participant attains age 35,
but such a waiver is not effective in or after the Plan Year in which the
Participant attains age 35. The election or the revocation of an election must
be signed by the Participant and the Participant's Spouse and the Spouse's
signature must be witnessed by a Plan representative or notary public. The
Participant must inform the Committee as to any change on his marital status and
until so informed the Committee shall be entitled to rely on the Participant's
assertion of marital status as originally established.
ARTICLE IX - Vested Benefits
Section 9.1 Return of Contributions
A non-vested Participant who terminates employment shall have his prior
contributions, if any, plus credited interest refunded. A vested Participant
who terminates employment may request a return of his entire amount of prior
contributions, if any, plus credited interest. Upon re-employment, repayment of
withdrawn contributions shall not be permitted. The benefit accrual of a
non-vested Participant shall be reduced to reflect such withdrawal in accordance
with Section 6.6. The amount of Vested Deferred Benefit of a vested Participant
shall be reduced to reflect any such withdrawal in accordance with Section 6.6.
Section 9.2 Form of Benefit
A Participant's Vested Deferred Benefit shall be payable pursuant to Sections
7.1 and 7.2. A Participant may request his Vested Deferred Benefit to be paid
in any of the optional forms pursuant to Section 7.3, in the manner provided for
therein.
Section 9.3 Survivor Benefit -- Vested Terminated Participant
A Participant's Beneficiary shall be eligible for a Survivor's Vested Deferred
Benefit (based solely on the FAP Benefit provisions) if on the date of his
death he:
(a) was not an Employee, and was vested pursuant to Article IV, or
(b) was an Employee who had more than five (5) years but less than ten
(10) years of Credited Service.
The monthly amount of the Survivor's Vested Deferred Benefit payable to a
Beneficiary (based solely on the FAP Benefit provisions) shall be equal to the
benefit the Beneficiary would have been entitled to receive if the Participant
had survived to the first day of the month following the date he would have
attained age fifty-five (55) (or, if later, the first day of the month following
the date of the Participant's death), retired on that date, and elected to
receive benefits in the form of a Joint and 50% Survivor Annuity.
Such survivor's Vested Deferred Benefit shall be payable monthly to such
spouse commencing on the first day of the month next following the date the
Participant would have attained age fifty-five (55), with the final payment made
on the first day of the month immediately preceding or coinciding with the date
of the Beneficiary's death.
Section 9.4 Pension Equity and Cash Balance Account Death Benefit
Any Participant with a Vested Deferred Benefit who is vested in any portion of
his Cash Balance Account as provided in Section 4.1(b) or who is vested in his
Pension Equity Benefit shall be eligible for a death benefit based on his
Pension Equity Benefit and/or Cash Balance Account in the manner provided under
Section 8.5 and Section 8.6.
ARTICLE X - Permanent And Total Disability Benefit
Section 10.1 Permanent and Total Disability Defined
"Permanent and Total Disability" means the inability of an Employee to carry on
the duties of his occupation, or another occupation for which he is or may
become qualified by education, training or experience, because of an illness or
injury of unavoidable cause for a period of at least six (6) consecutive months;
provided that such incapability has been determined to be permanent by a
physician selected by the Plan Administrator. Such incapability shall be deemed
to have resulted from unavoidable cause unless it resulted from (a) his having
engaged in a felony; (b) his habitual use of drugs, intoxicants, or narcotics;
(c) a deliberately self-induced sickness or injury; or (d) injury received or
disease contracted in service with the Armed Forces.
Section 10.2 Vesting and Benefit Accrual During Periods of Disability
A Permanent and Total Disability shall not constitute a severance from service.
A Participant who has had or has a Permanent and Total Disability shall be paid
an annual retirement benefit commencing on his Normal Retirement Date, in
accordance with the provisions of Article X hereof except that his Credited
Service shall include his period of Permanent and Total Disability. The
Participant's Social Security Offset shall be calculated as if he severed from
service on his date of disablement.
Section 10.3 Effect of Re-employment Upon Cessation of Disability
If a Participant with a Permanent and Total Disability is re-employed by any of
the Affiliated Companies, his period of absence from cessation of employment to
re-employment shall be included in his Credited Service; and such a Participant
shall resume active participation in this Plan as of the date of his
re-employment.
Section 10.4 Effect of Failure of Re-employment Upon Cessation of Disability
If prior to his Normal Retirement Date, a Participant no longer qualifies as one
with a Permanent and Total Disability and he does not elect to return to the
employ of the Company or one of the Affiliated Companies, such Participant's
rights to further benefits shall be determined in accordance with the terms and
conditions of this Plan as though he had terminated his employment with the
Company or one of the Affiliated Companies as of the date he no longer qualifies
as a Participant with a Permanent and Total Disability.
Section 10.5 Physical Examination Requirements
The Plan Administrator shall interpret and administer the provisions of this
Article X in a uniform manner so as to preclude any individual selection or
discrimination. Prior to what would have been his Normal Retirement Date, a
Participant with a Permanent and Total Disability shall submit to any medical
examination which may be requested from time to time by the Plan Administrator,
but not more often than annually. The physician or clinic making the medical
examination shall be selected by the Plan Administrator and expenses resulting
therefrom shall be borne by the Plan Administrator. On the basis of any such
medical examination or other fact from any source the Plan Administrator may
disqualify a Participant with a Permanent and Total Disability. In the event a
Participant with a Permanent and Total Disability refuses to submit to a medical
examination, the Plan Administrator shall in its sole discretion disqualify him
as a Participant with a Permanent and Total Disability until he submits to the
medical examination and it is determined in accordance with the terms of this
Section that he continues to qualify as a Participant with a Permanent and Total
Disability.
Section 10.6 Pension Equity Disability Benefit
Notwithstanding anything herein to the contrary, this Section 10.6 shall
determine the Pension Equity Benefit payable to any Participant who is an Admin
Employee and has a Permanent and Total Disability while an Employee. A
Permanent and Total Disability shall not constitute a severance from service,
and such a Participant shall continue to accrue a Pension Equity Benefit as if
his service while on Permanent and Total Disability was Credited Service. Such
a Participant who has had or has a Permanent and Total Disability shall be paid
an annual retirement benefit commencing on the later of his Normal Retirement
Date or the date benefits cease under the long-term disability plan of the
Company or an Affiliated Company, except that his Credited Service shall include
his period of Permanent and Total Disability, and that earnings remain constant
at the annual rate in effect on the date of disability. Such a Participant's
Social Security Covered Compensation shall be the same as that in effect on the
date of disability.
ARTICLE XI - Continental Baking Company Provisions
Section 11.1 Application
This Article applies to those Participants in the Plan who were participants in
the Continental Baking Company Retirement Plan for Salaried Employees (the CBC
Plan) prior to June 1, 1985 and who were covered under the provisions of the CBC
Plan which formed a part of this Plan prior to January 1, 1986 and who were
actively employed or accruing benefits on January 1, 1986. To the extent
provided in this Article, the special provisions of this Article shall supersede
the provisions in the other Articles of this Plan shall control the rights and
benefits of Participants.
Section 11.2 Definitions
With respect to the provisions of this Article, the following words and phrases
shall have the meanings set forth below.
(a) "CBC Social Security Early Retirement Factor" means the factor used to
reduce the CBC Transitional Offset Amount for payment before Normal Retirement
Date as determined under the provisions of the CBC Plan which factors are
incorporated by reference herein.
(b) "CBC Standard Grandfathered Benefit" means an amount equal to a
Participant's accrued benefit payable at Normal Retirement Date determined under
the provisions of the CBC Plan based on his salary and service under such plan
through December 31, 1985.
(c) "CBC Standard Grandfathered Early Retirement Benefit" means an amount
equal to the sum of
(i) the greater of
(A) the CBC Standard Grandfathered Benefit reduced by the early reduction
factors set forth in the CBC Plan which factors are incorporated by reference
herein, or
(B) the Ralston Purina Past Service Benefit reduced in accordance with
Section 6.3a; plus
(ii) the Ralston Purina Future Service Benefit reduced in accordance with
Section 6.3a.
(d) "CBC Standard Normal Retirement Benefit" means an amount equal to the
sum of
(i) the greater of
(A) the CBC Standard Grandfathered Benefit, or
(B) the Ralston Purina Past Service Benefit; plus
(ii) the Ralston Purina Future Service Benefit.
(e) "CBC Transitional Benefit Amount" means an amount equal to a
Participant's accrued benefit on December 31, 1985 payable at Normal Retirement
Date determined under the revisions of the CBC Plan prior to the application of
the Social Security Offset under such plan.
(f) "CBC Transitional Offset Amount" means an amount equal to the Social
Security offset applied at Normal Retirement Date computed under the terms of
the CBC Plan as of December 31, 1985 except that earnings after December 31,
1985 shall be assumed to remain level until a Participant attains age fifty-five
(55) after which earnings are assumed to equal zero (0) until age sixty-five
(65). If a Participant is age fifty-five (55) or over on January 1, 1986, zero
(0) future earnings shall be assumed to age sixty-five (65).
(g) "Prorated Early Retirement Factor" means the reduction factor which
equals the sum of
(i) the appropriate early retirement reduction under the CBC Plan for the
age of the Participant as of his Early Retirement Date multiplied by a fraction
the numerator of which is the amount of his Credited Service earned prior to
January 1, 1986 and the denominator of which is his total Credited Service; plus
(ii) the appropriate early retirement reduction under this Plan for the age
of the Participant as of his Early Retirement Date multiplied by a fraction the
numerator of which is the amount of his Credited Service earned after December
31, 1985 and the denominator of which is his total Credited Service.
(h) "Ralston Purina Future Service Benefit" means an amount equal to the
benefit determined in accordance with either Section 5.1 or Section 5.2, as
applicable, for Credited Service earned after December 31, 1985.
(i) "Ralston Purina Past Service Benefit" means an amount equal to the
benefit determined in accordance with either Section 5.1 or Section 5.2, as
applicable, based on the Participant's Average Annual Earnings as of the date
the benefit is determined and Credited Service determined under the CBC Plan
through December 31, 1985.
Section 11.3 Normal Retirement Benefit for Former Participants in the CBC
Plan
The Normal Retirement Benefit of any Participant who was a participant in the
CBC Plan shall equal the greater of
(a) the CBC Standard Normal Retirement Benefit, or
(b) the CBC Standard Grandfathered Early Retirement Benefit, or
(c) the CBC Transitional Benefit Amount.
Section 11.4 Early Retirement for Former Participants in the Continental
Baking Company Salaried Pension Plan
The Early Retirement Benefit of any Participant who was a participant in the CBC
Plan shall equal the CBC Standard Grandfathered Early Retirement Benefit except
for Participants eligible for the Transitional Early Retirement Benefit.
Section 11.5 Transitional Early Retirement Benefit
Any Participant who was a participant in the CBC Plan shall be entitled to an
Early Retirement Benefit determined in accordance with this Section provided
that on December 31, 1985 the sum of such Participant's age and Credited Service
equals or exceeds sixty (60), such Participant was in active service on January
1, 1986 and such Participant retires while eligible for Early Retirement.
(a) The Transitional Early Retirement Benefit which is payable prior to
attainment of age sixty-two (62) shall be an amount equal to the greater of
(i) the sum of
(A) the CBC Transitional Benefit Amount reduced by the Continental Baking
Company early retirement factor, but not less than the Ralston Purina Past
Service Benefit reduced in accordance with Section 6.3a, plus
(B) the Ralston Purina Future Service Benefit reduced in accordance with
Section 6.3a; or
(ii) the sum of
(A) the CBC Transitional Benefit Amount reduced by the Prorated Early
Retirement Factor; but not less than the Ralston Purina Past Service Benefit
reduced by the Prorated Early Retirement Factor, plus
(B) the Ralston Purina Future Service Benefit reduced by the Prorated Early
Retirement Factor.
(b) The Transitional Early Retirement Benefit payable upon attainment of age
sixty-two (62) shall be an amount equal to the greater of
(i) the sum of
(A) the product of the CBC Transitional Benefit Amount times the Continental
Baking Company Early Retirement Factor less the product of the CBC Transitional
Offset Amount times the CBC Social Security Early Retirement Factor; but not
less than the Ralston Purina Past Service Benefit reduced in accordance with
Section 6.3a, plus
(B) the Ralston Purina Future Service Benefit reduced in accordance with
Section 6.3c; or
(ii) the sum of
(A) the product of the CBC Transitional Benefit Amount times the Prorated
Early Retirement Factor less the product of the CBC Transitional Offset amount
times the CBC Social Security Early Retirement Factor; but not less than the
Ralston Purina Past Service Benefit reduced by the Prorated Early Retirement
Factor, plus
(B) the Ralston Purina Future Service Benefit reduced by the Prorated Early
Retirement Factor.
Section 11.6 Optional Benefit Amounts
(a) The amount of any optional retirement benefit payable at Normal
Retirement Date elected by a Participant who was a former participant in the CBC
Plan shall equal the greater of
(i) the CBC Standard Grandfathered Benefit multiplied by the appropriate
option factor set forth in the CBC Plan which factors are incorporated by
reference herein, or
(ii) the CBC Standard Normal Retirement Benefit multiplied by the
appropriate option factor set forth in Article VII.
(b) The amount of any optional retirement benefit payable at Early
Retirement Date elected by a Participant who was a participant in the CBC Plan
shall equal the greater of
(i) the amount in (a)(1) above reduced by the Continental Baking Company
early retirement reduction factors, or
(ii) the amount in (a)(2) above reduced in accordance with Section 6.3a.
(c) For a Participant eligible for the Transitional Early Retirement Benefit
the amount of any optional benefit payable after age sixty-two (62) shall be an
amount equal to the greater of
(i) the sum of
(A) the product of the CBC Transitional Benefit Amount times the Continental
Baking Company early retirement reduction factors less the product of the CBC
Transitional Offset Amount times the CBC Social Security Early Retirement Factor
such difference multiplied by the appropriate Continental Baking Company option
factor; but in no event shall such amount be less than the Ralston Purina Past
Service Benefit reduced in accordance with Section 6.3a and multiplied by the
option factors in Article VII; plus
(B) the Ralston Purina Future Service Benefit reduced in accordance with
Section 6.3a and multiplied by the option factors set forth in Article VII; or
(ii) the amount in (c)(1) above determined by replacing the Continental
Baking Company early retirement reduction factors and the Section 6.3a reduction
with the Prorated Early Retirement Reduction Factor.
(d) The optional form of the Transitional Early Retirement Benefit payable
prior to attainment of age sixty-two (62) shall be an amount equal to the sum of
(i) the benefit determined in (c)(1) or (c)(2) above whichever is
applicable; plus
(ii) the difference between
(A) the Transitional Early Retirement Benefit before attainment of age
sixty-two (62) without adjustment for any optional benefit; less
(B) the Transitional Early Retirement Benefit after attainment of age
sixty-two (62) without adjustment for any optional benefit.
Section 11.7 Change in Employment Status
If an employee is transferred to this Plan from another plan sponsored by the
Company or an Affiliated Company, for the time the Employee was covered under
this Plan, his benefit first shall be calculated pursuant to Section 5.1 or
11.3, whichever is applicable, using all Credited Service under both plans
multiplied by a fraction, the numerator of which is Credited Service the
Employee earned under the Plan and the denominator of which is the total
Credited Service under all plans. Once the Employee completes three (3) years of
Credited Service under this Plan, his benefit shall be calculated pursuant to
Section 5.1 or Section 11.3, whichever is applicable, using all Credited Service
with both plans less the amount of actual benefit payable under any other
defined benefit plans sponsored by the Company or an Affiliated Company. The
Participant's final Average Annual Earnings will be his actual Average Annual
Earnings regardless of which payroll he is paid under at the time of his
retirement or termination.
Section 11.8 Interstate Bakeries Corporation Provisions
Notwithstanding the foregoing, nonbargained administrative employees of
Continental Baking Company who, as of the effective date of the sale of the
Continental Baking Company to Interstate Bakeries Corporation, have either (a)
attained age 50 but have not attained age 56, or (b) have a number years in age
plus Credited Service at least equal to 65 shall be eligible for an enhanced
retirement benefit. Such enhancements are (a) changing the early retirement
reduction factor for terminated vested participants from 5% per year from age 65
to 5% per year from age 62, and (b) the applicable Social Security offset would
not include any estimate of future earnings after the effective date of the sale
of the Continental Baking Company to Interstate Bakeries Corporation.
ARTICLE XII - Eveready Battery Company Provisions
Section 12.1 Application
This Article applies to those Participants in the Plan who were either
participants in the Retirement Program Plan for Employees of Union Carbide
Corporation and its Participating Subsidiary Companies (the "Union Carbide
Plan") as of June 30, 1986 or Participants who, subsequent to June 30, 1986,
were employed by Eveready Battery Company; provided that:
(a) This Article applies only to Participants who were actively employed or
accruing benefits on December 31, 1992; and
(b) Any Participant who was initially employed by one of the Affiliated
Companies other than Eveready Battery Company and who is later employed by
Eveready Battery Company shall not be covered by this Article.
In the event of a conflict, the provisions contained in this Article shall
supersede other provisions of the Plan. Other Articles of this Plan shall
govern in the case of matters not specifically addressed in this Article XII.
Section 12.2 Definitions
For purposes of this Article XII, the following words and phrases shall have the
meanings set forth below:
(a) "Company Service Credit" means a Participant's years and completed
months of service through December 31, 1992. Such service shall include
Credited Service for periods prior to July 1, 1986 under the terms of the Union
Carbide Plan and Credited Service as defined in Section 1.9 for periods after
June 30, 1986.
Credited Service shall include Credited Service for periods prior to July 1,
1986 under the terms of the Union Carbide Plan.
(b) "Straight Time Earnings" mean the straight time portion of compensation
including, without limitation, shift differential or shift premium, such sales
commissions as the Company or the Affiliated Companies may from time to time
determine, amounts awarded pursuant to court order or in settlement of actions
arising under the Age Discrimination in Employment Act or Title VII of the Civil
Rights Act of 1964 (but only to the extent such awards or settlements are in
lieu of the straight time portion of compensation which the Participant would
otherwise have earned), and annual incentive compensation awards for the year
awarded (Incentive Compensation) received from the Company or the Affiliated
Companies for the established regular working schedule of the Participant,
determined prior to any reduction pursuant to any plan maintained by the Company
or one of the Affiliated Companies that meets the requirements of Sections
401(a) and 401(k) of the Code. The determination of the Benefits Policy Board
as to what constitutes compensation under this subparagraph shall be conclusive.
For periods prior to July 1, 1986, Straight Time Earnings shall refer to
Compensation under the terms of the Union Carbide Plan.
(c) "Average Straight Time Annual Earnings" means the average of Straight
Time Earnings for the three full calendar years in which Straight Time Earnings
was largest during the ten (10) full calendar years ending with 1992.
(d) "Frozen Social Security Benefit" means the annual Social Security
benefit used to determine the Frozen Accrued Benefit. The Frozen Social
Security Benefit shall be determined as follows:
(i) For a Participant who is eligible for EBC Early Retirement on December
31, 1992 and has attained age sixty-two (62) on or before that date, his Frozen
Social Security Benefit will be calculated assuming he will have zero
compensation in 1993 or later and that his Social Security benefit will commence
on January 1, 1993; provided that such calculation presumes that the Participant
has always had compensation at least equal to the Social Security Wage Base.
(ii) For a Participant who is eligible for EBC Early Retirement on December
31, 1992 but who has not attained age sixty-two (62) on or before that date, his
Frozen Social Security Benefit will be calculated assuming he will have zero
compensation in 1993 or later and that his Social Security benefit will commence
at age sixty-two (62); provided that such calculation presumes that the
Participant has always had compensation at least equal to the Social Security
Wage Base.
(iii) For a Participant who is not eligible for EBC Early Retirement on
December 31, 1992, his Frozen Social Security Benefit will be calculated as the
lesser of the following two amounts:
(A) his Social Security benefit calculated assuming he will have level
compensation from 1993 through attainment of age fifty (50) and zero
compensation thereafter, provided that his Social Security benefit will commence
at age sixty-two (62) and further provided that such calculation presumes that
the Participant has always had and will continue to have Compensation at least
equal to the Social Security Wage Base; and
(B) his Social Security benefit calculated assuming he will have level
compensation from 1993 through attainment of age fifty (50) and zero
compensation thereafter, provided that his Social Security benefit will commence
at his Normal Retirement Date.
(e) Maximum Rate of Social Security Offset equals the factor from Table 1
corresponding to a Participant's age on December 31, 1992. Participants whose
age was fifty-seven (57) or greater on December 31, 1992 shall be deemed to have
a Maximum Rate of Social Security Offset equal to fifty percent (50%).
(f) Transitional refers to eligibility for favorable transitional treatment
accorded to certain older and longer service Participants. Participants who were
(i) employed by Eveready Battery Company on January 1, 1988 and (ii) whose
attained age plus Credited Service on that date totaled fifty (50) or more are
referred to as Transitional.
(g) EBC Early Retirement refers to a Participant's entitlement to elect to
retire prior to his Normal Retirement Date. A Participant is not eligible to
retire until he has either (1) reached an Early Retirement Date as described in
Section 1.11 or (2) has both attained age fifty (50) and completed ten (10)
years of Credited Service.
If a Participant's employment is terminated by the Company or one of the
Affiliated Companies for any reason other than for cause, such Participant is
eligible to retire if he has both attained age forty-eight (48) and completed
eight (8) years of Credited Service.
A Participant is not eligible for EBC Early Retirement unless he has satisfied
the preceding requirements. Notwithstanding, a Participant who terminates
employment with a vested benefit pursuant to Section 6.4 before attaining EBC
Early Retirement eligibility may elect to commence benefits anytime after he has
attained age fifty (50).
(h) EBC Early Commencement Factor for a Participant eligible for EBC Early
Retirement equals the factor from Table 2 corresponding to a Participant's age
and Credited Service at retirement.
In the case of a Participant whose employment is terminated by the Company
one of the Affiliated Companies for any reason other than for cause and who is
eligible for EBC Early Retirement, the factors in Table 3 shall be used in lieu
of those in Table 2.
The EBC Early Commencement Factor for a Participant who is not eligible for
EBC Early Retirement but who is vested within the meaning of Section 6.4 shall
equal one hundred percent (100%) decreased by 5/9ths of one percent (5/9 of 1%)
for each of the first thirty-six (36) complete months by which the Participant's
actual retirement precedes his Normal Retirement Date and further decreased by
5/12ths of one percent (5/12 of 1%) for months in excess of thirty-six (36).
(i) RPC Early Commencement Factor equals the factor from Table 4
corresponding to a Participant's age when payments commence, Transitional status
and retirement eligibility. For Participants who retire at age fifty-five (55)
or later, Table 4 yields the same result as does Section 6.3a.
(j) Carbide Plan Benefit equals the annual benefit, if any, to which a
Participant is entitled under the terms of the Union Carbide Plan pursuant to
service rendered to Union Carbide Corporation before July 1, 1986. The Carbide
Plan Benefit shall be determined presuming commencement of payments on the same
date as under this Plan and that the Carbide Plan Benefit will be paid in the
form of a life annuity under the Union Carbide Plan.
(k) Future Service equals Credited Service for the period beginning January
1, 1993.
(l) Capped Future Service equals the lesser of (1) and (2):
(i) Future Service; and
(ii) The excess, if any, of forty (40) over Company Service Credit.
Section 12.3 Frozen Accrued Benefit
A Frozen Accrued Benefit will be determined for each Participant as of December
31, 1992 to be the greatest of (a), (b) and (c):
(a) Regular Formula. An annual benefit equal to one and one-half percent
(1-1/2%) times Average Straight Time Annual Earnings times Company Service
Credit, plus one hundred forty-four dollars ($144);
(b) Alternate Formula. An annual benefit equal to the excess of (1) over
(2), but not less than zero:
(i) One and one-half percent (1.5%) times Average Straight Time Annual
Earnings times Company Service Credit.
(ii) The Frozen Social Security Benefit multiplied by the lesser of (i) and
(ii), where (i) equals one and one-half percent (1.5%) times Company Service
Credit and (ii) equals the Maximum Rate of Social Security Offset; and
(c) Minimum Formula. An annual benefit equal to the sum of (1), (2) and
(3):
(i) Sixty dollars ($60) times the first ten (10) years of Company Service
Credit plus eighty-four dollars ($84) times the next ten (10) years of Company
Service Credit plus one hundred eight dollars ($108) times years of Company
Service Credit in excess of twenty (20).
(ii) Ten percent (10%) minus one percent (1%) for each year Company Service
Credit is less than eight (8) years; the resulting percentage is multiplied by
Average Straight Time Annual Earnings.
(iii) One hundred forty-four dollars ($144).
Section 12.4 Retirements After January 1, 1993
The benefit payable to a Participant who retires after January 1, 1993, prior to
adjustment for optional forms, shall equal (a) plus (b) minus the Carbide Plan
Benefit. This benefit is payable in the Normal Form as described in Section
7.1.
(a) Past Service Benefit. The annual Past Service Benefit equals the
greater of the Ralston Purina Company Past Service Benefit and the Frozen Past
Service Benefit as follows:
(i) Ralston Purina Company Past Service Benefit. The annual Ralston Purina
Company Past Service Benefit equals the greater of (A) and (B), multiplied by
the appropriate Ralston Purina Company Early Commencement Factor:
(A) The Normal Retirement Benefit as defined in Section 5.1, except that
Company Service Credit shall be substituted for Credited Service in applying the
provisions of Section 5.1 and in determining the numerator of the fraction
described in the determination of the Social Security Offset in Section 1.26
(the denominator of the fraction described in Section 1.26 is not affected).
The Social Security Benefit is determined in accordance with Section 1.25,
except that a Participant who is eligible for EBC Early Retirement, is not
Transitional and has not satisfied the requirements for Early Retirement
pursuant to Section 1.11 will be calculated in accordance with Section 1.25(d);
(B) The Minimum Normal Retirement Benefit as defined in Section 5.1(a)(ii)(,
except that Company Service Credit shall be substituted for Credited Service in
applying the provisions of Section 5.1.(a)(ii) and the maximum covered Average
Annual Earnings shall be thirty thousand dollars ($30,000) instead of fifteen
thousand dollars ($15,000).
(ii) Frozen Past Service Benefit. The annual Frozen Past Service Benefit
equals the Frozen Accrued Benefit multiplied by the appropriate EBC Early
Commencement Factor.
(b) Future Service Benefit. The annual Future Service Benefit equals the
greater of (i) and (ii), multiplied by the appropriate Early Commencement
Factor:
(i) The Normal Retirement Benefit as defined in Section 5.1, except that
Capped Future Service shall be substituted for Credited Service in applying the
provisions of Section 5.1 and Future Service shall be substituted for Credited
Service in determining the numerator of the fraction described in the
determination of the Social Security Offset in Section 1.26 (the denominator of
the fraction described in Section 1.26 is not affected).
The Social Security Benefit is determined in accordance with Section 1.25,
except that a Participant who is eligible for EBC Early Retirement, is not
Transitional and has not satisfied the requirements for Early Retirement
pursuant to Section 1.9 will be calculated in accordance with Section 1.25(d);
(ii) The Minimum Normal Retirement Benefit as defined in Section 5.1(a)(ii),
except that "Capped Future Service" shall be substituted for "Credited Service"
in applying the provisions of Section 5.1(a)(ii) and the maximum covered Average
Annual Earnings shall be thirty thousand dollars ($30,000) instead of fifteen
thousand dollars ($15,000).
Section 12.5 Optional Forms
All optional forms of retirement benefit to the extent provided in Article VII
are available to Eveready Battery Company employees, as modified by Article VII
and as modified below:
(a) Ten (10) Year Certain and Continuous. The Option B benefit payable to a
Participant retiring on or after his Normal Retirement Date, as described in
Section 7.3B, will equal ninety-four percent (94%) of the Normal Form. This
percentage will be increased by .035 percent (.035%) for each of the first 120
complete months by which the Participant's actual retirement precedes his Normal
Retirement Date and further increased by .015 percent (.015%) for months in
excess of 120.
(b) Life Annuity. The Option C benefit payable to a Participant retiring on
or after his Normal Retirement Date, as described in Section 7.3C, will equal
102.5 percent (102.5%) of the Normal Form. This percentage will be decreased by
.015 percent (.015%) for each of the first 120 complete months by which the
Participant's actual retirement precedes his Normal Retirement Date and further
decreased by .007 percent (.007%) for months in excess of 120.
(c) Social Security Adjustment Option. The factor used to determine
benefits payable under the Social Security Adjustment Option, as defined in
Section 7.3D, is modified as follows. The factor equals one hundred percent
(100%) reduced by .6 percent (.6%) for each of the first eighty-four (84) months
by which the Participant's actual retirement precedes the first day of the month
nearest his sixty-second (62nd) birthday, and further reduced by .3 percent
(.3%) for months in excess of eighty-four (84).
(d) Children's Benefit. An optional form of payment in addition to those
provided pursuant to Article VII provides a reduced benefit for the life of a
Participant plus, following the death of the Participant, fifty percent (50%) of
the amount payable during the life of the Participant will be paid to the
designated surviving child of the Participant; provided, however, that such
payments shall cease upon the earlier of the death of the child or the date the
child attains age twenty-three (23).
The following factors shall be used to determine the amount of applicable
reduction associated with this form; such factors shall be interpolated or
extrapolated as necessary but shall in no event exceed one hundred percent
(100%):
Retirement Age
--------------------
Age of Child 60 65
-------------- ------------------
5 95.9% 93.4%
15 99.1 98.5
Section 12.6 Surviving Spouse's Benefit of Active Participant
An active Participant's surviving spouse shall be eligible for a Surviving
Spouse's Benefit pursuant to Article VIII modified as follows:
(a) The Surviving Spouse's Benefit of a Participant who dies on or after
satisfying the requirements for Early Retirement as defined in Section 1.9 shall
be determined in accordance with Section 8.4B;
(b) The Surviving Spouse's Benefit of a Participant who dies on or after
becoming eligible for EBC Early Retirement and who is Transitional shall be
determined in accordance with Section 8.4B;
(c) The Surviving Spouse's Benefit of a Participant who dies on or after
becoming eligible for EBC Early Retirement and who is not Transitional shall be
determined in accordance with Section 8.4A;
(d) The Surviving Spouse's Benefit of a Participant who dies before becoming
eligible for EBC Early Retirement but after completing ten (10) years of
Credited Service shall be determined in accordance with Section 8.4A; and
(e) The Surviving Spouse's Benefit of a Participant who dies before
completing ten (10) years of Credited Service but after attaining vested status
as described in Section 6.4 shall be determined in accordance with Section 8.4C.
Section 12.7 Surviving Spouse's Benefit of Vested Terminated Participant
The provisions of Section 9.3 shall apply, except that age fifty (50) shall be
substituted for age fifty-five (55).
Section 12.8 Disability Benefit
Article X, which provides for continued accrual of pension benefits while
disabled, shall apply to Participants covered by this Article XII.
Section 12.9 Adjustment for Pension Equity Benefit Provisions
The Plan benefit of any Participant whose Plan benefit is determined with
reference to this Article XII and who elects a Pension Equity Benefit shall be
adjusted in accordance with Appendix C. Similar adjustments shall also apply
for calculating death benefits payable from the Pension Equity Benefit. The
disability benefit provided for by Section 10.6 shall be reduced by the Carbide
Plan Benefit payable at age 65.
ARTICLE XIII - Plan Administration
Section 13.1 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 13.2 Benefits Council
(a) The claims fiduciary for the Plan, in accordance with Article XVIII,
shall be the Benefits Council, to be comprised of no less than three persons
appointed by the Chairman of the Board 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 Chairman of the Board 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 13.3 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 two hundred fifty thousand dollars ($250,000). 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 13.4 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 13.5 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 or 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
Company shall have no power to direct or modify any interpreta-tions,
determinations, or decisions of the Plan Administrator. The Plan Administrator
may recommend amendments to the Board of Directors. 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 Plan Administrator and 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. 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; or
(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; or (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 Plan Administrator, the
EBAIC, the Trustee, 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 13.6 Named Fiduciaries
(a) The Board of Directors, the Plan Administrator, 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 13.7 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 13.8 Multiple Capacities
Any fiduciary may serve in more than one fiduciary capacity with respect to the
Plan.
Section 13.9 Standard of Review
The Plan Administrator shall perform its duties as the Plan Administrator in its
sole discretion as it shall determine as appropriate, in light of the reason and
purpose for which the Plan is established and maintained. In particular, the
interpretation of all Plan provisions and the determination of whether a
Participant or beneficiary is entitled to any benefit pursuant to the terms of
the Plan, shall be made by the Plan Administrator in its sole discretion. Any
construction of the terms of the Plan for which there is a rational basis that
is adopted by the Plan Administrator in good faith shall be final and legally
binding on all parties.
Any interpretation of the Plan or other action of the Plan Administrator
made in good faith shall be subject to review only if such an interpretation or
other action is without a rational basis. Any review of a final decision or
action of the Plan Administrator shall be based only on such evidence presented
to or considered by the Plan Administrator at the time it made the decision that
is the subject of the review. The Company and any Affiliated Company that
adopts and maintains this Plan, and any Participant who performs services for
the Company or an Affiliated Company who is or may be compensated for in part by
benefits payable pursuant to this Plan, hereby consent to actions of the Plan
Administrator made in good faith and agree to the narrow standard of review
prescribed in this Section.
ARTICLE XIV - Funding
Section 14.1 Funding.
The Company and Affiliated Companies have elected to fund their liabilities for
benefits credited under this Plan through contracts with one or more insurance
companies and Trust Funds administered by one or more Trustees pursuant to
separate trust agreements entered into with such Trustee or Trustees. The Board
of Directors shall have full power and authority to determine from time to time
the amount of contributions to be made on behalf of the Company and the
Affiliated Companies.
ARTICLE XV - Rights Of Affiliated Companies To Discontinue Or Amend
Section 15.1 Right to Terminate the Plan.
It is the expectation of the Company and Affiliated Companies that they will
continue this Plan and the payment of their contributions hereunder
indefinitely, but continuance of this Plan is not assumed as a contractual
obligation of the Affiliated Companies; and the right is reserved by each of the
Affiliated Companies with the approval of the Board of Directors of Ralston
Purina Company to terminate this Plan with respect to its employees or to
discontinue its contributions hereunder at any time by action of its board of
directors, without the necessity of obtaining the approval of its stockholders.
Section 15.2 Plan Amendment Procedure.
Except as herein limited, the Board of Directors shall have the right to amend
this Plan at any time to any extent that it deems advisable. Such amendment
shall be stated in an instrument in writing, executed by Ralston Purina Company.
A copy of any amendment shall be furnished to any insurance company or Trustee.
Any amendment shall be effective as specified in the Board resolution, provided,
however:
(a) That no amendment shall increase the duties or liabilities of the
Trustees or the EBAIC without their respective written consent;
(b) That no amendment shall have the effect of vesting in any or all of the
Affiliated Companies any interest in or control over any part of the Trust Fund;
(c) That except as provided in ERISA, Title I, Section 302(c)(8), no
amendment shall have any retroactive effect so as to deprive any Participant of
any benefit already accrued or his nonforfeitable percentage; provided, however,
that any amendment may be made retroactively which is necessary to bring this
Plan into conformity with governmental regulations or in order to qualify, or
continue the qualifications of, this Plan and the Trust Fund for tax exemptions
or the contributions of the Affiliated Companies to the Trust Fund for deduction
for tax purposes, or which does not decrease the benefits or nonforfeitable
percentage of the Participants.
(d) That no amendment changing any vesting schedule shall apply to any
Participant having three (3) years of vesting service or more unless the
Participant is permitted to elect, within a reasonable period after adoption of
such amendment, to have his nonforfeitable and vested percentage computed under
the Plan without regard to such amendment.
(e) That no amendment shall cause any reduction in the accrued benefit of
any Participant [except to the extent permitted under Code Section 412 (c)(1)].
For purposes of this subsection, a Plan amendment which has the effect of (1)
eliminating or reducing an early retirement benefit or a retirement-type
subsidy, (2) eliminating an optional form of benefit, with respect to benefit
attributable to service before the amendment, or (3) restricting, directly or
indirectly, the benefit provided to the Participant before the amendment shall
be treated as reducing accrued benefits, except that an amendment described in
clause (2) [other than an amendment having the effect described in clause (1)]
shall not be treated as reducing accrued benefits to the extent provided in
Regulations. In the case of a retirement-type subsidy, the preceding sentence
shall apply only with respect to a Participant who satisfies the preamendment
conditions for the subsidy.
(f) That no amendment shall have the effect of increasing current liability
[as defined in Code Section 401(a)(29)(E)] under the Plan for a Plan Year in
which the funded current liability for the Plan is less than sixty percent (60%)
(including the amount of the unfunded current liability attributable to the
amendment) unless the Affiliated Companies provide security to the Plan which
satisfies the requirements of Code Section 401(a)(29)(B) and (C).
ARTICLE XVI - Termination Of Plan
Section 16.1 Plan Termination.
Subject to the provisions of Section 15.2, this Plan shall terminate on the
happening of any of the following events:
(a) The date on which Ralston Purina Company, is legally adjudicated as
bankrupt, or effects a general assignment to or for the benefit of its
creditors.
(b) The date specified for discontinuance of the Plan by any of the
Affiliated Companies with respect to its Employees in the notice executed by
such Affiliated Company and delivered to the Trustees, as prescribed in Section
15.2.
(c) As to any Affiliated Company or Foreign Subsidiary, the date as of which
the stock ownership by another Affiliated Company or Foreign Subsidiary ceases
to be at least the amounts set forth in Sections 1.2 and 1.12, respectively. In
such cases the funds allocable to the former subsidiary shall be determined by
the actuary and then be distributed to the Participants of the former subsidiary
in accordance with Section 15.2, or in such other manner as may be acceptable to
the Plan Administrator, the former subsidiary, and appropriate governmental
agencies.
Section 16.2 Termination Restrictions.
(a) Any termination (other than a partial termination or an involuntary
termination pursuant to ERISA Section 4042) must satisfy the requirements and
follow the procedures outlined herein and in ERISA Section 4041 for a Standard
Termination or a Distress Termination. Upon any termination (full or partial),
all amounts shall be allocated in accordance with the provisions hereof and the
Accrued Benefit of each affected Participant shall become fully Vested and shall
not thereafter be subject to forfeiture to the extent funded.
(b) Standard Termination Procedure:
(i) The Plan Administrator shall first notify all "affected parties" [as
defined in ERISA Section 4001(a)(21)] of the Employer's intention to terminate
the Plan and the proposed date of termination. Such termination notice must be
provided at least sixty (60) days prior to the proposed termination date.
However, in the case of a standard termination, it shall not be necessary to
provide such notice to the Pension Benefit Guaranty Corporation (PBGC). As soon
as practicable after the termination notice is given, the Plan Administrator
shall provide a follow-up notice to the PBGC setting forth the following:
(A) a certification of an enrolled actuary of the projected amount of the
assets of the Plan as of the proposed date of final distribution of assets, the
actuarial present value of the "benefit liabilities" [as defined in ERISA
Section 4001(a)(16)] under the Plan as of the proposed termination date, and
confirmation that the Plan is projected to be sufficient for such "benefit
liabilities" as of the proposed date of final distribution;
(B) a certification by the Plan Administrator that the information provided
to the PBGC and upon which the enrolled actuary based his certification is
accurate and complete; and
(C) such other information as the PBGC may prescribe by regulation.
(ii) No later than the date on which the follow-up notice is sent to the
PBGC, the Plan Administrator shall provide all Participants and Beneficiaries
under the Plan with an explanatory statement specifying each such person's
"benefit liabilities", the benefit form on the basis of which such amount is
determined, and any addition information used in determining "benefit
liabilities" that may be required pursuant to regulations promulgated by the
PBGC.
(3) A standard termination may only take place if, at the time the final
distribution of assets occurs, the Plan is sufficient to meet all "benefit
liabilities" determined as of the termination date.
(c) Distress Termination Procedure:
(i) The Plan Administrator shall first notify all "affected parties" of the
Employer's intention to terminate the Plan and the proposed date of termination.
Such termination notice must be provided at least sixty (60) days prior to the
proposed termination date. As soon as practicable after the termination notice
is given, the Plan Administrator shall also provide a follow-up notice to the
PBGC setting forth the following:
(A) a certification of an enrolled actuary of the amount, as of the proposed
termination date, of the current value of the assets of the Plan, the actuarial
present value (as of such date) of the "benefit liabilities" under the Plan,
whether the Plan is sufficient for "benefit liabilities" as of such date, the
actuarial present value (as of such date) of benefits under the Plan guaranteed
under ERISA Section 4022, and whether the Plan is sufficient for guaranteed
benefits as of such date;
(B) in any case in which the Plan is not sufficient for "benefit
liabilities" as of such date, the name and address of each Participant and
Beneficiary under the Plan as of such date;
(C) a certification by the Plan Administrator that the information provided
to the PBGC and upon which the enrolled actuary based his certification is
accurate and complete; and
(D) such other information as the PBGC may prescribe by regulation;
(ii) A distress termination may only take place if:
(A) the Company or the Affiliated Company demonstrates to the PBGC that such
termination is necessary to enable the Affiliated Company to pay its debts while
staying in business, or to avoid unreasonably burdensome pension costs caused by
a decline in the Company or the Affiliated Company's work force;
(B) the Company or the Affiliated Company is the subject of a petition
seeking liquidation in a bankruptcy or insolvency proceeding which has not been
dismissed as of the proposed termination date; or
(C) the Company or the Affiliated Company is the subject of a petition
seeking reorganization in a bankruptcy or insolvency proceeding which has not
been dismissed as of the proposed termination date, and the bankruptcy court (or
such other appropriate court) approves the termination and determines that the
Company or the Affiliated Company will be unable to continue in business outside
a Chapter 11 reorganization process and that such termination is necessary to
enable the Company or the Affiliated Company to pay its debts pursuant to a plan
of reorganization.
(d) Priority and Payment of Benefits. In the case of a distress
termination, upon approval by the PBGC that the Plan is sufficient for "benefit
liabilities" or for "guaranteed benefits", or in the case of a standard
termination, a letter of non-compliance has not been issued within the sixty
(60) day period (as extended) following the receipt by the PBGC of the follow-up
notice, the Plan Administrator shall allocate the assets of the Plan among
Participants and Beneficiaries pursuant to ERISA Section 4044(a). As soon as
practicable thereafter, the assets of the trust fund shall be distributed to the
Participants and Beneficiaries, in cash, or in other assets, including immediate
or deferred annuity contracts, as the Plan Administrator in its sole discretion
shall determine.
(e) The termination of the Plan shall comply with such other requirements
and rules as may be promulgated by the PBGC under authority of Title IV of
ERISA, including any rules relating to time periods or deadlines for providing
notice for making a necessary filing.
Section 16.3 Rights of Affiliated Companies to Remaining Amounts.
Notwithstanding any provisions of this Plan to the contrary, upon termination of
this Plan, but only after all liabilities under the Plan shall have been
satisfied, the Company or the Affiliated Companies shall be entitled to any
balance of the net assets of the Trust Fund and the insurance company contracts
which shall remain.
ARTICLE XVII - Top-Heavy Provisions
Section 17.1 Top-Heavy Determination.
For purposes of this Article, the Plan will be determined to be Top-Heavy for a
Plan Year beginning on and after January 1, 1984, if, as of the Determination
Date for that Plan Year, the present value of the cumulative accrued benefits of
Key Employees under this Plan exceeds sixty percent (60%) of the present value
of the cumulative accrued benefits of all Participants under the Plan, as
determined pursuant to section 416(g) of the Code.
All Plans which are included in the Aggregation Group shall, for the
purposes of this Article, be aggregated and treated as one Plan (the "Plan").
The Aggregation Group shall include this Plan and all other Plans (including a
frozen plan) maintained by the Company or an Affiliated Company which cover a
Key Employee or his Beneficiary, and any other plan which enables a plan
covering a Key Employee or his Beneficiary to meet the qualification
requirements of Code Section 401(a)(4) or 410. A terminated plan shall be
included in the Aggregation Group if it was maintained by the Company or an
Affiliated Company within the 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.
The Determination Date, with respect to any Plan Year, shall be the last
day of the immediately preceding Plan Year.
Section 17.2 Valuation as of Determination Date.
The present value of the accrued benefit of the respective Participants as of a
Determination Date shall be determined as if the Participant terminated
employment on the Valuation Date used for computing plan costs for minimum
funding purposes for the Plan Year ending on such Determination Date, using the
Actuarial Equivalent. Distributions made within the Plan Year that include such
Determination Date and within the four (4) Plan Years immediately preceding such
Plan Year shall be added to the present value of accrued benefits. The accrued
benefit of a Participant who is not a Key Employee but who was a Key Employee in
a prior year shall be disregarded. The accrued benefit of a Participant who has
not received any compensation from a member of the Controlled Group during the
five (5) Plan Years immediately preceding such Plan Year shall be disregarded.
The accrued benefit derived from an unrelated rollover received by the Plan
after December 31, 1983, shall also be disregarded.
Section 17.3 Key Employee
"Key Employee" means an Employee, former Employee or Employee's Beneficiary who
at any time during the Plan Year or any of the four (4) preceding Plan Years is:
(a) An officer of a member of the Controlled Group having an annual
compensation greater than one-hundred fifty percent (150%) of the amount in
effect under section 415(c)(1)(A) of the Code for any such Plan Year (1.5 X
$30,000 for 1987);
(b) One of the ten (10) Employees having annual compensation from a member
of the Controlled Group of more than the limitation in effect under Section
415(c)(1)(A) of the Code and owning (or considered as owning within the meaning
of Section 318 of the Code) the largest interests in such an entity;
(c) A five-percent (5%) owner of a member of the Controlled Group; or
(d) A one-percent (1%) owner of a member of the Controlled Group having an
annual compensation of more than one hundred fifty thousand dollars ($150,000),
as defined in accordance with Section 416(i)(1) of the Code.
Section 17.4 Vesting Requirements.
If the Plan is determined to be Top-Heavy for a Plan Year, the vested percentage
of the accrued benefit of a Participant derived from employer contributions as
of such Plan Year shall be redetermined in accordance with the following
schedule:
After Two (2) Years of Service 20%
After Three (3) Years of Service 40%
After Four (4) Years of Service 60%
After Five (5) Years of Service 80%
After Six (6) Years of Service 100%
If the Plan is determined to be Top-Heavy for a Plan Year and subsequently
ceases to be Top-Heavy, the vesting provision in Article IV shall be applicable
in such subsequent year; provided that any portion of the accrued benefit that
was nonforfeitable before the Plan ceased to be Top-Heavy must remain so vested,
and that any Participant with five (5) or more Years of Credited Service shall
remain one hundred percent (100%) vested in his accrued benefit.
Section 17.5 Minimum Benefits
If the Plan is determined to be Top-Heavy for a Plan Year, the accrued benefit
derived from employer contributions of each Participant, calculated as of any
date from time to time, shall never be less than a monthly retirement income in
the form of a Single Life Annuity, or a benefit in another form as permitted in
Article VII that is actuarially equivalent to a Single Life Annuity, commencing
at the Normal Retirement Age of the Participant, the monthly amount of which is
equal to the Five-Year Average Compensation of the Participant multiplied by the
lesser of:
(a) Twenty percent (20%); and
(b) Two percent (2%) for each Includable Year of Participation, where:
(i) Five-Year Average Compensation means the Participant's average monthly
compensation for the five (5) consecutive Plan Years when the Participant had
the highest aggregate compensation (as defined in section 415 of the Code) from
a member of the Controlled Group; and
(ii) Includable Year of Participation means each year of Credited Service
for benefit accrual, excluding years of Credited Service completed in a Plan
Year beginning before January 1, 1984, and excluding Years of Credited Service
completed during a Plan Year when the Plan was not Top-Heavy.
Section 17.6 Adjustment to Combination Defined Benefit Plan and Defined
Contribution Plan Limitations
If the Plan is determined to be Top-Heavy for a Plan Year, Section 5.8 of the
Plan shall be applied by substituting "1.0" for "1.25" unless:
(a) Section 17.5 shall be applied by substituting "thirty percent (30%)" for
"twenty percent (20%)" and by substituting "three percent (3%)" for "two percent
(2%)"; and
(b) The present value of the accrued benefits of Key Employees does not
exceed ninety percent (90%) of the aggregate present value of the accrued
benefits of all Participants under the Plan.
ARTICLE XVIII - Provisions To Prevent Discrimination
Section 18.1 Restrictions of Benefits Upon Plan Termination
Notwithstanding any provision in this Plan to the contrary, in the event of plan
termination, the benefit of any Highly Compensated Employee ("HCE") as defined
in Section 414(q) of the Code (and any former HCE) is limited to a benefit that
is nondiscriminatory under Section 401(a)(4) of the Code.
Section 18.2 Restrictions on Distributions.
(a) General Rule. In any Plan Year, the payment of benefits to or on behalf
of a restricted employee, as defined below, shall not exceed an amount equal to
the payments that would be made to or on behalf of the restricted employee in
that year under:
(i) A straight life annuity that is the actuarial equivalent of the accrued
benefit and other benefits to which the restricted employee is entitled under
the plan (other than a social security supplement); and
(ii) A social security supplement, if any, that the restricted employee is
entitled to receive.
(b) Restricted Employee Defined. For purposes of this Section, the term
"restricted employee" generally means any HCE or former HCE. However, an HCE or
former HCE need not be treated as a restricted employee in the current Plan Year
if the HCE or former HCE is not one of the twenty-five (25) (or a larger number
chosen by the Employer) nonexcludable Employees and former Employees of the
Employer with the largest amount of compensation in the current or any prior
year.
(c) Benefit Defined. For purposes of this Section, the term "benefit"
includes, among other benefits, loans in excess of the amounts set forth in
Section 72(p)(2)(A) of the Code, any periodic income, any withdrawal values
payable to a living Employee or former Employee, and any death benefits not
provided for by insurance on the Employee's or former Employee's life.
(d) Nonapplicability in Certain Cases. The restrictions in this Section do
not apply, however, if any one of the following requirements is satisfied:
(i) After taking into account payment to or on behalf of the restricted
employee of all benefits payable to or on half of that restricted employee under
the Plan, the value of Plan assets equals or exceeds one hundred ten percent
(110%) of the value of current liabilities, as defined in Section 412(1)(7) of
the Code.
(ii) The value of the benefits payable to or on behalf of the restricted
employee is less than one percent (1%) of the value of current liabilities
before distribution.
(iii) The value of the benefits payable to or on behalf of the restricted
employee must not exceed the amount described in Section 411(a)(11)(A) of the
Code (restrictions on certain mandatory distributions).
(e) Determination of Current Liabilities. For purposes of this Section, any
reasonable and consistent method may be used for determining the value of
current liabilities and the value of current liabilities and the value of plan
assets.
Section 18.3 Purposes for Restriction
The restrictions imposed by the provisions of this Article XVIII are included
solely to meet the requirements of the amended Regulation Section
1.401(a)(4)-5(b). In the event that it should be determined by statute, court
decision, ruling by the Commissioner of Internal Revenue or otherwise, that the
provisions of this Article XVII are no longer necessary to qualify this Plan
under the Code, this Article XVIII shall become inoperative without the
necessity of further amendment.
ARTICLE XIX - Special Provisions
Section 19.1 No Right to Continued Employment
Nothing in this Plan shall be construed as an employment contract between the
Company or an Affiliated Company and any Employee. Participation in this Plan
shall not give any Employee the right to be retained in the employ of the
Company or any Affiliated Company, or Foreign Affiliate, or to have any right or
interest in this Plan, the insurance company contracts, or the Trust Fund other
than as herein provided.
Section 19.2 Payments and Liabilities Not Attributable to Affiliated
Companies
Any payment to any Participant, or his legal representatives, made in accordance
with the provisions of this Plan shall, to the extent thereof, be in full
satisfaction of all claims hereunder against any insurance company, any Trustee,
and the Affiliated Companies. To the extent permitted by ERISA, no Participant
shall have any claim arising hereunder against the Company or any of the
Affiliated Companies, their officers, directors, creditors or shareholders. The
Participants shall have only the right to look to any Trustee or insurance
company for benefits payable from the Trust Fund or the insurance company
contract.
Section 19.3 Interpretation of Agreement
Except to the extent preempted by ERISA, this Plan shall be construed,
administered and governed in all respects under and by the laws of the State of
Missouri.
Section 19.4 Required Participant Information
Participants must furnish to the Plan Administrator such documents, evidence or
information as it considers necessary or desirable for the purpose of
administering this Plan, or to protect the Company, any Trustee, or any
insurance company; and it shall be a condition of this Plan that each such
person must furnish such information promptly and sign such documents before any
benefits become payable under this Plan.
Section 19.5 Participants' Mailing Addresses
Each Participant entitled to benefits under the Plan must file with the Plan
Administrator in writing his post office address and each change of post office
address. Any communication, statement, or notice addressed to such a person at
his latest post office address as filed with the Plan Administrator will be
binding upon such person for all purposes of this Plan and no Trustee, insurance
company, or the Company or Affiliated Company shall be obliged to search for, or
ascertain the whereabouts of any such person.
Section 19.6 Change of Status
Except as may be provided in Appendix B, an Employee of the Company or an
Affiliated Company who is a Participant in another defined benefit plan
sponsored by the Company or an Affiliated Company and who later becomes eligible
for coverage under this Plan, or vice versa, shall receive credit under this
Plan, or vice versa, for all vesting Credited Services accrued under the other
plan, or vice versa. His benefit shall be calculated as follows:
(a) For the time the Employee was covered under the other plan, his benefit
will be calculated and accrued pursuant to the benefit formula contained in that
plan.
(b) For the time the Employee was covered under this Plan, his benefit will
be calculated pursuant to Section 5.1 using all Credited Service under both
plans multiplied by a fraction, the numerator of which is Credited Service the
Employee earned under the Plan and the denominator of which is the total
Credited Service under all plans. The Participant's final Average Annual
Earnings will be his actual Average Annual Earnings regardless of which payroll
he is paid under at the time of his retirement or termination.
(c) Each plan shall pay the benefit earned in accordance with its terms.
Section 19.7 Transfers From Controlled Corporations Which Are Not Affiliated
Companies
If a Participant is transferred to an Affiliated Company from a domestic or
foreign corporation in which Ralston Purina Company owns directly or indirectly
voting stock and which is not an Affiliated Company of this Plan, service with
that corporation during such time as it is a controlled corporation shall be
treated as Credited Service under this Plan in order to determine if the
Participant meets the vesting requirements of Article IV. The provisions of
this Section 19.7 shall in no event be administered to provide any Participant
with retirement benefits relating to the same period of employment under more
than one retirement plan. The provisions of this Section shall apply only with
respect to Credited Service earned up to the adoption date of this restatement.
No Credited Service shall be earned under this Section after such adoption date.
Section 19.8 Transferred Employees and Payment Source
In any case where a transfer of employment occurs in accordance with the
foregoing provisions of Sections 19.6 to 19.7, if the Plan Administrator
determines that it is desirable that a transferred Employee receive all his
retirement benefits from one source, the Plan Administrator may direct any
Trustee to accept any amounts transferred by an Affiliated Company or any
insurance company or trustee paying benefits under any other retirement plan of
such Affiliated Company in order to provide under this Plan the full retirement
benefit of an Employee who has earned any part of his retirement benefit under
any other retirement plan of an Affiliated Company.
Section 19.9 Plan Maintained for Exclusive Benefit of Participants
The Plan shall be maintained for the exclusive benefit of its Participants, and
it is intended that it shall qualify as a pension plan under the provisions of
Section 401 of the Internal Revenue Code. Except as provided in Section 15.3
(relating to remaining amounts after the satisfaction of all Plan liabilities in
the event of a termination) and except as provided in Section 19.10, Plan assets
shall never inure to the benefit of the Company or any Affiliated Company.
Section 19.10 Return of Employer Contributions
Notwithstanding the provisions of Section 19.9, a contribution may be returned
to the Company or the Affiliated Company making it to the extent permitted by
ERISA, Title I, Section 403(c)(2), to wit:
(a) if the contribution is made by a mistake of fact and is returned within
one year;
(b) if the contribution is conditioned upon initial qualification of the
Plan under Internal Revenue Code Section 401, a timely determination letter is
filed, and the Plan receives an adverse determination; or
(c) if the contribution is conditioned upon the deductibility of the
contribution under Internal Revenue Code Section 404 and the contribution is
returned within one year after the deduction is disallowed.
Section 19.11 Employer Withholding
If the Company or an Affiliated Company is required to and does withhold
federal, state, local or foreign taxes owing by a Participant on a retirement
benefit payment, the Plan Administrator shall withhold and remit such taxes to
the Company or the Affiliated Company as its agent.
Section 19.12 Spinoff or Merger of Assets or Liabilities
At the direction of the Board of Directors or its designee, any amount of the
assets of this Plan held by any Trustee and/or any amount of the liabilities of
this Plan may be transferred to any other plan qualified under Section 401(a) of
the Code. In a similar manner, the Board of Directors or its Designee may
direct that any assets and/or any liabilities of any other plan qualified under
Section 401(a) of the Code may be merged into this Plan.
Section 19.13 Merger, Consolidation or Transfer of Assets
Plan or any trust funding a part thereof shall not be merged or consolidated
with nor shall any of its assets or liabilities be transferred to any other
plan, unless the benefits payable to each Participant if the Plan was to
terminate immediately after such action would be equal to or greater than the
benefits to which such Participant would have been entitled had this Plan been
terminated immediately before such action. In the event that another plan is
merged into this Plan, and the Plan is subsequently terminated or spun off
within five (5) years of the date of such merger, Plan assets shall first be
allocated for the benefits of Participants to the extent of the present value of
such Participants' benefits as of the date of the merger.
Section 19.14 Agreement Binding Upon All Successors
This Plan shall be binding upon the Company, all the Affiliated Companies, their
successors and assigns; upon the Participants, their heirs, beneficiaries and
legal representatives; and upon the Plan Administrator, and Trustee, any
insurance company, Investment Manager, and other named fiduciaries, their
successors and assigns.
Section 19.15 Titles
The titles are for reference only. In the event of a conflict between a title
and the content of a section, the content of the section shall apply.
Section 19.16 Construction
Whenever appropriate, words used in this Plan in the singular may include the
plural, or the plural may be read in the singular, or the masculine may be read
as the feminine or neuter, or interchangeably.
Section 19.17 Severability
If any provision of the Plan is held by a court of competent jurisdiction to be
invalid, void, or unenforceable, the remaining provisions shall nevertheless
continue in full force and effect to the greatest extent possible and without
being impaired or invalidated in any way.
Section 19.18 Counterparts
This Plan may be executed in one or more counterparts, and each of such
counterparts shall, for all purposes, be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
Section 19.19 Non-Alienation of Retirement Benefits
The retirement benefits payable and/or the underlying interest of a Participant
and his Beneficiaries under this Plan shall not be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
charge, garnishment, execution, or levy of any kind, either voluntary or
involuntary. The Company or Affiliated Companies, the Plan Administrator, the
Trustee and any insurance company shall not in any manner be liable for, or
subject to, the debts, contracts, liabilities, engagements, or torts of any
person entitled to benefits hereunder.
Nothing in this Section 19.19 shall be construed so as to prohibit the Plan
Administrator from complying with the provisions of a domestic relations order
issued by a court of competent jurisdiction which the Committee finds to be a
Qualified Domestic Relations Order pursuant to Section 414(p) of the Code.
Section 19.20 Special Vesting of Participants who were Employees of
Foodservices, Inc.
Participants in this Plan who were employees of Foodservices, Inc. shall have a
fully vested interest in their accrued benefit earned through the closing date
of the Foodservices, Inc. Purchase Agreement.
Section 19.21 Special Provision for Female Employees with an Age Sixty (60)
Normal Retirement Date
If a female was a Participant prior to January 1, 1967 in a Predecessor Plan,
the amount of retirement benefit accrued prior to January 1, 1968 shall not be
reduced for Early Retirement for any months after such female Participant's
attainment of age sixty (60).
<PAGE>
IN WITNESS WHEREOF, the Ralston Purina Company has caused these presents to
be executed by a duly authorized officer of Ralston Purina Company as of January
1, 1999.
RALSTON PURINA COMPANY
/s/ C. S. Sommer
----------------------------------
C. S. Sommer
Vice President and Director,
Administration
ATTEST:
/s/ Renee Winter
--------------------------------
<PAGE>
APPENDIX A - TABLE OF ACTUARIAL ASSUMPTIONS
For Annuity Starting Dates on or after January 1, 1999:
1. Sections 1.1A, 2.3B, 5.1, 5.5, 6.2A, 6.4A, 7.1, 7.3F, 7.4, and 17.(unless
otherwise provided for therein:
Applicable Interest Rate and Applicable Mortality Table
2. Section 5.6 (Section 415 Limits): as provided for therein
3. Sections 7.2 and 7.3A-- See attached tables.
4. Plan Sections where actuarial equivalence not specified within such
Section or subsection or not specified above: GAM 83 mortality table, and 7%
interest rate.
<PAGE>
APPENDIX B - PRODUCTION PLAN PROVISIONS
Effective September 30, 1996, the Purina Retirement Plan for Production
Employees was merged into this Plan (the "Production Plan"). The terms of the
Plan applicable to the Participants covered by the Production Plan shall be
governed by this Appendix B on and after October 1, 1996, and not other
provisions of this Plan; provided however, that effective January 1, 1999, the
Cash Balance Benefit shall be available to Production Employees. Specifically,
no Participant in this Appendix B shall be eligible for the Pension Equity
Benefit or other terms not set forth in this Appendix B, except for those
provisions relating exclusively to the Cash Balance Benefit.
Furthermore, notwithstanding anything herein to the contrary, effective June 2,
1997, Fiber Sales production employees shall accrue benefits under the
Production Plan provisions and not under other Plan provisions.
<PAGE>
APPENDIX C - METHODOLOGY TO BE FOLLOWED IN DETERMINING BENEFIT PAYABLE UNDER
PENSION EQUITY PROVISIONS, CONSIDERING UNION CARBIDE OFFSET
1. Calculate value of Pension Equity Benefit, taking into account all
Credited Service and Average Annual Earnings as permitted under a FAP Benefit
calculated with reference to Article XII.
2. Convert such Pension Equity Benefit into an immediate annuity using
Actuarial Equivalent factors generally applicable under the Plan for such
conversions.
3. Determine the FAP Benefit accrued to January 1, 1999 payable at the
Annuity Starting Date. If the Participant is eligible for Early Retirement,
reduce the FAP Benefit accrued to January 1, 1999 for early commencement using
the Plan's early retirement reduction factors. If the Participant is younger
than age 55 apply the factors from the following table interpolated for
fractional ages:
AGE E.R. FACTOR AGE E.R. FACTOR
--- ----------- --- -----------
55 50.0% 40 15.3%
54 46.0% 39 14.2%
53 42.3% 38 13.2%
52 38.9% 37 12.3%
51 35.9% 36 11.4%
50 33.1% 35 10.6%
49 30.6% 34 9.9%
48 28.2% 33 9.2%
47 26.1% 32 8.6%
46 24.2% 31 8.0%
45 22.4% 30 7.4%
44 20.7% 29 6.9%
43 19.2% 28 6.4%
42 17.8% 27 6.0%
41 16.5% 26 5.6%
25 5.2%
24 4.9%
23 4.5%
22 4.2%
21 3.9%
<PAGE>
APPENDIX C - METHODOLOGY TO BE FOLLOWED IN DETERMINING BENEFIT PAYABLE UNDER
PENSION EQUITY PROVISIONS CONSIDERING UNION CARBIDE OFFSET
(continued)
4. The "gross annuity" (i.e., prior to reflecting the offset provided by
Article XII) would be the greater of (2) and (3).
5. Determine Carbide Plan Benefit payable as of the Annuity Starting Date.
- If participant is Early Retirement eligible under Article XII of the
Plan, apply UCC early retirement reduction factors under Section 12.2
to the Carbide Plan Benefit.
- If Participant is younger than age 50, apply the appropriate factor
from the following table - interpolate for fractional ages:
AGE E.R. FACTOR AGE E.R. FACTOR
--- ----------- --- -----------
50 20.0% 37 7.4%
49 18.5% 36 6.9%
48 17.1% 35 6.4%
47 15.8% 34 6.0%
46 14.6% 33 5.6%
45 13.5% 32 5.2%
44 12.5% 31 4.8%
43 11.6% 30 4.5%
42 10.8% 29 4.2%
41 10.0% 28 3.9%
40 9.3% 27 3.6%
39 8.6% 26 3.4%
38 8.0% 25 3.2%
24 2.9%
23 2.7%
22 2.6%
21 2.4%
6. Subtract (5) from (4) - this is the net annuity payable from the Plan as
a single life annuity with 60 monthly payments guaranteed.
7. To determine the single sum payable, multiply the Actuarial Equivalent
factor used in step (2) by the net annuity developed in step (6).
<PAGE>
APPENDIX E - VOLUNTARY ENHANCED RETIREMENT OPTION EVEREADY BATTERY COMPANY FIELD
SALES ORGANIZATION
Any other provision of the Plan to the contrary notwithstanding, the following
provisions of this Appendix E set forth the early retirement window program
effective as of January 19, 1993 for Eligible Participants as defined in this
Appendix E. To the extent of any inconsistency between the terms of the Plan
and the terms of this Appendix E, the provisions of this Appendix E shall
control.
1. Purpose and Intent.
--------------------
This program is intended to assist the Company in effecting a reduction in
force in a voluntary and amicable manner by providing financial assistance
and exit incentives to a limited group of employees most likely to be
contemplating a separation from service for reasons of earlyretirement.
This program is intended to constitute a "voluntary early retirement
incentive plan" within the meaning of the Age Discrimination in
Employment Act.
2. Definitions.
-----------
For purposes of this Appendix E, the following terms shall have the following
meanings:
(a) "Election Period" means that period commencing on January 19, 1993
and ending on March 3, 1993.
(b) "Eligible Participant" means:
(i) an active Employee of the Company as of January 19, 1993;
(ii) who is employed in the Eveready field sales and customer
service organization, excluding Employees in the job categories of supervisory
director and above as of January 19, 1993;
(iii) whose employment is not terminated for cause or death prior
to the Employee's Window Retirement Date; and
(iv) who will have attained age fifty and completed at least ten
years of Credited Service as of December 31, 1993.
(c) "Applicable Retirement Date" means such EBC Early Retirement Date
as may be elected by the Eligible Participant in accordance with procedures
prescribed by the Company.
3. Option.
------
In the case of an Eligible Participant who so elects during the period
prescribed by the Company, a retirement benefit shall be payable as
determined in accordance with Section 12.4 of the Plan, with the following
modifications: as of the Applicable Retirement Date, three years shall be added
to the Eligible Participant's age and three years shall be added to his
accumulated Future Service.
<PAGE>
APPENDIX F - ENHANCED RETIREMENT BENEFIT EVEREADY BATTERY COMPANY FREMONT
FACILITY
Any other provision of the Plan to the contrary notwithstanding, the following
provisions of this Appendix F set forth the enhanced retirement benefit program
for Eligible Participants as defined in this Appendix F. To the extent of any
inconsistency between the terms of the Plan and the terms of this Appendix F,
the provisions of this Appendix F shall control.
1. Purpose and Intent.
--------------------
This program is intended to assist the Company in effecting a reduction in
force by providing financial assistance to a limited group of employees
affected by the closing of the Fremont, Ohio facility of the Eveready
Battery Company.
2. Definitions.
-----------
For purposes of this Appendix F, an "Eligible Participant" means:
(a) an active Employee of the Company who is employed at the
Fremont, Ohio facility;
(b) who is employed continuously by the Company from June 3, 1997
through the closing of the Fremont, Ohio facility and immediately thereafter has
a retirement date under Section 12 of the Plan; and
(c) who will have attained age 48 and completed at least eight years
of Credited Service or had attained age 55 and completed at least two years of
Credited Service as of the date of the closing of the Fremont, Ohio facility.
3. Benefit.
-------
In the case of an Eligible Participant, a retirement benefit shall be payable
as determined in accordance with Section 12.4 of the Plan, with the following
modifications: as of the Eligible Participant's retirement date, three years
shall be added to the Eligible Participant's age and three years shall be
added to his accumulated Future Service; provided, however, that in no event
shall any Eligible Participant's service credit exceed 40 years.
<PAGE>
APPENDIX G - VOLUNTARY ENHANCED RETIREMENT OPTION EVEREADY BATTERY COMPANY
WESTLAKE AND ST. LOUIS
Any other provision of the Plan to the contrary notwithstanding, the following
provisions of this Appendix G set forth the early retirement window program
effective as of July, 1997 for Eligible Participants as defined in this Appendix
G. To the extent of any inconsistency between the terms of the Plan and the
terms of this Appendix G, the provisions of this Appendix G shall control.
1. Purpose and Intent.
--------------------
This program is intended to assist the Company in effecting a reduction in
force in a voluntary and amicable manner by providing financial assistance and
exit incentives to a limited group of employees most likely to be
contemplating a separation from service for reasons of early retirement.
This program is intended to constitute a "voluntary early retirement
incentive plan" within the meaning of the Age Discrimination in
Employment Act.
2. Definitions.
-----------
For purposes of this Appendix G, the following terms shall have the following
meanings:
(a) "Election Period" means the 45-day period following the date the
benefit offered under this Appendix is first offered to the Eligible
Participant.
(b) "Eligible Participant" means either:
(i) an active Employee of the Company as of February 1, 1998, who is a
Participant in the Plan, and who is either (A) employed as a regular Employee
with a job grade less than or equal to grade 17 in the financial and accounting,
human resource, logistics and purchasing departments of the Eveready Westlake
Facility who will have attained age 55 and completed at least 25 years of
Credited Service as of February 1, 1998; or (B) employed as a regular Employee
with a job grade less than or equal to grade 17 in the quality engineering
department of the Eveready Westlake Facility who will have attained age 55 and
completed at least 35 years of Credited Service as of February 1, 1998; or
(ii) financial, accounting and information systems employees who are
selected by the Company, who are Participants in the Plan, who are employed on
the St. Louis headquarters payroll and who will have attained age 50 and
completed ten years of Credited Service on or before the Employee's retirement
date.
(c) "Applicable Retirement Date" means such EBC Early Retirement Date
or other retirement date as may be elected by the Eligible Participant in
accordance with procedures prescribed by the Company.
3. Option. In the case of an Eligible Participant who so elects during the
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Election Period, a retirement benefit shall be payable as determined in
accordance with Section 12.4 of the Plan, with the following modifications: as
of the Applicable Retirement Date, three years shall be added to the Eligible
Participant's age and three years shall be added to his accumulated Future
Service; provided, however, that in no event shall any Eligible Participant's
service credit exceed 40 years.
<PAGE>
APPENDIX H - ENHANCED RETIREMENT BENEFIT EVEREADY BATTERY COMPANY CUSTOMER
SERVICE EMPLOYEES
Any other provision of the Plan to the contrary notwithstanding, the following
provisions of this Appendix H set forth the enhanced retirement benefit program
for Eligible Participants as defined in this Appendix H. To the extent of any
inconsistency between the terms of the Plan and the terms of this Appendix H,
the provisions of this Appendix H shall control.
1. Purpose and Intent.
--------------------
This program is intended to assist the Company in effecting a reduction in
force by providing financial assistance to a limited group of customer
service employees of the Eveready Battery Company, in connection with
the closing of selected offices of the Company.
2. Definitions.
-----------
For purposes of this Appendix H, an "Eligible Participant" means:
(a) an active regular Employee of the Company who is employed at the
Eveready customer service offices in San Francisco, Saddlebrook and Duluth as of
February 19, 1998;
(b) who was a Participant in the Plan as of December 31, 1992 and who
will have attained age 48 and completed at least eight years of Credited Service
as of the individual's termination date; or became a Participant in the Plan
after December 31, 1992 and who will have attained age 55 and completed at least
two years of Credited Service as of the individual's termination date.
3. Benefit.
-------
In the case of an Eligible Participant, a retirement benefit shall be payable
as determined in accordance with Section 12.4 of the Plan, with the following
modifications: as of the Eligible Participant's retirement date, three years
shall be added to the Eligible Participant's age and three years shall be
added to his accumulated Future Service; provided, however, that in no event
shall any Eligible Participant's service credit exceed 40 years, and
provided that actual age shall be used to determine eligibility for
benefit commencement under the Plan.
<PAGE>
APPENDIX I - VOLUNTARY ENHANCED RETIREMENT OPTION EVEREADY BATTERY COMPANY
Any other provision of the Plan to the contrary notwithstanding, the following
provisions of this Appendix I set forth the early retirement window program
effective as of January 31, 1998 for Eligible Participants as defined in this
Appendix I. To the extent of any inconsistency between the terms of the Plan
and the terms of this Appendix I, the provisions of this Appendix G shall
control.
1. Purpose and Intent.
--------------------
This program is intended to assist the Company in effecting a reduction in
force in a voluntary and amicable manner by providing financial assistance and
exit incentives to a limited group of employees most likely to be contemplating
a separation from service for reasons of early retirement. This program is
intended to constitute a "voluntary early retirement incentive plan"
within the meaning of the Age Discrimination in Employment Act.
2. Definitions.
-----------
For purposes of this Appendix I, the following terms shall have the
Following meanings:
(a) "Election Period" means the 45-day period following the date the
benefit offered under this Appendix is first offered to the Eligible
Participant.
(b) "Eligible Participant" means an active Employee of the Company who
is on Eveready's payroll as of January 31, 1998 (other than the Chief Executive
officer of Eveready) and who will have attained age 50 and completed 10 years of
Credited Service as of July 1, 1998, except regular Employees who (i) elected
the voluntary early retirement option offered in May, 1997, (ii) is on the
payroll or is receiving pay under the terms of a signed separation agreement at
the time the benefit described in this Appendix is offered, (iii) is an Employee
in the Edgewater Facilities Service Group or Edgewater Battery Testing Group, or
(iv) is eligible for the Plan enhancement offered to the Eveready customer
service employees in San Francisco, Saddlebrook and Duluth.
(c) "Applicable Retirement Date" means such EBC Early Retirement Date
as may be elected by the Eligible Participant in accordance with procedures
prescribed by the Company no later than September 30, 1998, or in exceptional
cases, thereafter based on the reasonable business needs of the Company.
3. Option. In the case of an Eligible Participant who so elects during the
------
period prescribed by the Company, a retirement benefit shall be payable as
determined in accordance with Section 12.4 of the Plan, with the following
modifications: as of the Applicable Retirement Date, three years shall be added
to the Eligible Participant's age and three years shall be added to his
accumulated Future Service; provided, however, that in no event shall any
Eligible Participant's service credit exceed 40 years.
