MEAD JOHNSON & COMPANY BENEFIT EQUALIZATION PLAN?RETIREMENT SAVINGS PLAN

Exhibit 10.32

MEAD JOHNSON & COMPANY

BENEFIT EQUALIZATION PLAN—RETIREMENT SAVINGS PLAN

(Effective as of February 9, 2009)

TABLE OF CONTENTS

 

 

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MEAD JOHNSON & COMPANY

BENEFIT EQUALIZATION PLAN—RETIREMENT SAVINGS PLAN

(Effective as of February 9, 2009)

 

I.	Definitions.

Unless the context or subject matter otherwise requires, the definitions set forth in this Section I shall govern in this Plan (as herein defined). Notwithstanding anything herein to the contrary, to the extent capitalized terms in this Plan conflict with such terms in the Savings Plan (as herein defined), the terms of the Savings Plan shall control.

A. “Account Balance” shall mean the sum of the Transferred Credits, Deferral Credits and Employer Credits made to a Participant’s Plan Account in accordance Article IV and/or any BEP-Retirement Plan Credits made to such Plan Account, as adjusted to reflect Investment Adjustments, less all prior withdrawals and/or distributions.

B. “Administrative Agent” shall mean the administrative agent of the Benefits Committee.

C. “Annual Benefit Salary or Wages” shall have the meaning set forth for such term in the Savings Plan, any amendments thereto or modifications thereof.

D. “Beneficiary” shall mean the person or persons entitled to receive payment of the unpaid portion of a Participant’s Benefits in the event of the Participant’s death, determined in accordance with Section VI.D.

E. “Benefits Committee” shall mean the committee appointed by the Board of Directors to administer this Plan. The Benefits Committee shall serve as Plan Administrator of the Plan.

F. “BEP—Retirement Plan” shall mean the Mead Johnson & Company Benefit Equalization Plan—Retirement Plan, and as amended from time to time.

G. “BEP-RIP Credits” shall mean amounts credited to a Participant’s Plan Account pursuant to the Participant’s distribution election, if any, under the BEP—Retirement Plan.

H. “Board of Directors” shall mean the Board of Directors of the Company.

I. “Claims Appeal Guidelines” shall mean the Claims Appeal Guidelines for the Mead Johnson & Company Retirement Savings Plan and the Mead Johnson & Company Benefit Equalization Plan—Retirement Savings Plan, attached hereto as Exhibit A, and as amended from time to time.

J. “Code” shall mean the Internal Revenue Code of 1986, as amended.

K. “Company” shall mean Mead Johnson & Company and any successor or successors thereof.

L. “Company Stock Fund” shall have the meaning set forth for such term in the Savings Plan, and as amended from time to time.

M. “Compensation Committee” shall mean the Compensation Committee of the Board of Directors.

N. “Deferral Credits” means amounts credited to a Participant’s Plan Account pursuant to Sections IV.B. and IV.C.

O. “Effective Date” shall mean February 9, 2009,

P. “Employee” shall have the meaning set forth for such term in the Savings Plan, and as amended from time to time.

Q. “Employer Credits” shall mean amounts credited to a Participant’s Plan Account pursuant to Section IV.D.

 

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R. “Employing Company Contributions” shall have the meaning set forth for such term in the Savings Plan, and as amended from time to time.

S. “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.

T. “Fixed Income Fund” shall have the meaning set forth for such term in the Savings Plan, and as amended from time to time.

U. “Investment Adjustments” shall mean increases or reductions to a Participant’s Account Balance to reflect the performance of the investment funds in which the Participant’s Plan Account is hypothetically deemed invested in accordance with Section IV.F.

V. “Participant” shall mean each participant in this Plan as determined in accordance with Article III.

W. “Participating Employer” means any corporation participating in the Savings Plan.

X. “Plan” shall mean the Mead Johnson & Company Benefit Equalization Plan— Retirement Savings Plan, as set forth herein, as amended from time to time.

Y. “Plan Account” shall mean the unfunded notional bookkeeping account or accounts reflecting (1) amounts credited to this Plan on behalf of a Participant, (2) amounts credited to this Plan on behalf of such Participant from the BEP—Retirement Plan and (3) Investment Adjustments.

Z. “Plan Year” shall mean the calendar year.

AA. “Prior BMS Plan” shall mean the Bristol-Myers Squibb Company Benefit Equalization Plan—Savings and Investment Program, as amended and restated effective January 1, 2008, as in effect on the day immediately preceding the Effective Date, which is attached hereto as Exhibit B.

 

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BB. “Rule of 70 Treatment” shall occur upon a Participant’s eligibility for Rule of 70 benefits under the terms and conditions of the Mead Johnson & Company Retirement Income Plan, as amended from time to time.

CC. “Savings Plan” shall mean the Mead Johnson & Company Retirement Savings Plan, as amended from time to time.

DD. “Savings Plan Account” shall mean a Participant’s separate account, and each sub-account, under the Savings Plan.

EE. “Separation From Service” shall mean a Participant’s voluntary or involuntary severance of employment with the Company, except by reason of temporary absence, death or transfer to an affiliate or subsidiary of the Company; provided , however , that for purposes of the Plan, a Separation From Service shall not occur until the date that a Participant experiences a “separation from service” from the Company or other Participating Employer, as applicable, within the meaning of Code Section 409A(a)(2)(A)(i) and Treas. Reg. Section 1.409A-1(h).

FF. “Specified Employee” shall mean a “specified employee” within the meaning of Code Section 409A(a)(2)(B)(i) and U.S. Treasury regulation Section 1.409A-1(h), as determined annually under the Company’s administrative procedure for such determinations for purposes of all plans subject to Code Section 409A.

GG. “Transferred Credits” shall mean amounts credited to a Participant’s Plan Account, in accordance with Section IV.A., reflecting the Participant’s account balance, if any, under the Prior BMS Plan as of the close of business on the day immediately preceding the Effective Date, which was assigned to and assumed by the Company under this Plan as of the Effective Date.

 

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HH. “Unforeseeable Emergency” shall mean a severe financial hardship to a participant resulting from (1) an illness or accident of the Participant or the Participant’s spouse, Beneficiary or dependent (as defined in Section 152 of the Code, without regard to section 152(b)(1), (b)(2) and (d)(1)(b)), (ii) loss of the Participant’s property due to casualty, or (iii) such other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant, all as determined in the sole discretion of the Benefits Plan Committee. Any determination by the Benefits Committee as to whether a Participant is faced with an Unforeseeable Emergency shall be made in accordance with the requirements of Treasury Regulation Section 1.409A-3(i)(3).

II. “Year of Service” shall have the meaning set forth for such term in the Savings Plan, and as amended from time to time.

 

II.	Purpose and History of the Plan.

The purpose of this Plan is to provide benefits for certain Employees participating in the Savings Plan whose funded benefits are or will be limited by application of ERISA and the Code. The Plan is intended to be an unfunded “excess benefit plan” as that term is defined in Section 3(36) of ERISA with respect to those Participants whose benefits under the Savings Plan have been limited by Section 415 of the Code, and a “top hat” plan meeting the requirements of Sections 201(2), 301(a)(3), 401(a)(1) and 4021(b)(6) of ERISA with respect to those Participants whose benefits under the Savings Plan have been limited by Section 401(a)(17) of the Code.

The obligation to pay liabilities and obligations of the Prior BMS Plan with respect to Employees who were active participants in the Prior BMS Plan as of the day immediately preceding the Effective Date were assigned to and assumed by the Company under this Plan as of the Effective Date, and all amounts credited under the Prior BMS Plan with respect to such Employees continue to be credited under this Plan.

 

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III.	Eligibility and Participation in the Plan.

A. Eligible Participants . Each Employee who was an active participant in the Prior BMS Plan as of the day immediately preceding the Effective Date shall be a Participant in the Plan as of the Effective Date. Each other Employee who is a participant in the Savings Plan and who is employed by a Participating Employer shall be eligible to participate in this Plan and shall become a Participant in this Plan when (1) the allocation to his Savings Plan Account would exceed the limitations on benefits and contributions imposed by Section 415 of the Code, or (2) amounts of his compensation would be excluded from his Annual Benefit Salary or Wages determined under the Savings Plan by reason of the application of Section 401(a)(17) of the Code.

B. Cessation of Participation . Participation in the Plan shall terminate upon the Participant’s Separation From Service with the Company or other Participating Employer, as applicable, except, however, that an individual who has a vested Account Balance under the Plan after his or her Separation From Service will continue to be treated as a Participant (other than for purposes of receiving Deferral Credits and Employer Credits under Article IV) until his or her entire Account Balance has been distributed or forfeited.

 

IV.	Calculation of Benefits.

A. Credits to Plan Accounts . The Company shall establish and maintain a Plan Account in the name of each Participant. As of the Effective Date, the Plan Account of each Participant who was an active participant in the Prior BMS Plan on the day immediately

 

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preceding the Effective Date shall be credited with an amount of Transferred Credits equal to the Participant’s final account balance under the Prior BMS Plan. Thereafter, Deferral Credits and Employer Credits shall be made to the Plan Account of each Participant as provided in this Article IV only for those Plan Years in which (1) he has elected to have a percentage of his Annual Benefit Salary or Wages contributed on his behalf to the Savings Plan and (2) he also has in effect an irrevocable election, made prior to the Plan Year with respect to which such deferral relates, to defer a like percentage of his Annual Benefit Salary or Wages under this Plan (or under the Prior BMS Plan, with respect to deferrals of 2009 Annual Benefit Salary or Wages), to be credited to his Plan Account in the manner described in Sections IV.B. and IV.C. Notwithstanding the forgoing, (1) a Participant’s deferral election under this Plan (or the Prior BMS Plan) for a Plan Year may not be modified or terminated after the start of such Plan Year to reflect changes, if any, that the Participant makes to his contribution elections under the Savings Plan and (2) a Participant’s Plan Account may not be credited with Deferral Credits under both Section IV.B. and Section IV.C. for the same pay period. To the extent that, for any pay period, a Participant meets the requirements for Deferral Credits under both Section IV.B. and IV.C., Deferral Credits for such pay period shall be provided under Section IV.B. only. Deferral Credits and Employer Credits to Participant’s Plan Accounts shall be made on a payroll period basis, (at the same time Savings Plan contributions are allocated to the Participant’s Savings Plan Account), based on the proportionate amount of such Participant’s Annual Benefit Salary or Wages attributable to each such payroll period. The Participant’s Annual Benefit or Salary Wages shall be reduced by the amount of Deferral Credits for any pay period a Participant meets the requirements for Deferral Credits under Section IV.B. and/or IV.C.

 

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B. Code Section 415 Deferral Credits . The Plan Account of each Participant who (1) meets the requirements of Section IV.A. for a Plan Year and (2) is precluded from making additional pre-tax or after-tax elective deferrals, or from receiving additional employer contributions, to his Savings Plan Account due to the limitations of Section 415 of the Code for such Plan Year, shall be credited with an amount equal to the percentage of his Annual Benefit Salary or Wages that he elected to defer under the Plan (or Prior BMS Plan) for such Plan Year for the period commencing as of the first payroll period that the Participant is precluded from making or receiving any additional contributions to his Savings Plan Account due to the application of Code Section 415, through the last payroll period of the Plan Year.

C. Code Section 401(a)(17) Deferral Credits . The Plan Account of each Participant who (1) meets the requirements of Section IV.A. for a Plan Year and (2) is precluded from making additional pre-tax or after-tax elective deferrals to his Savings Plan Account because such Participant’s Annual Benefit Salary or Wages exceed the limitations of Section 401(a)(17) of the Code, shall be credited with an amount equal to the percentage of his Annual Benefit Salary or Wages that he elected to defer under the Plan (or Prior BMS Plan) for such Plan Year for the period commencing as of the first payroll period that the Participant is precluded from making any additional contributions to his Savings Plan Account due to the application of Code Section 401(a)(17), through the last payroll period of the Plan Year or, if sooner, through the first payroll period for which amounts begin to be credited to the Participant’s Plan Account pursuant to Section IV.B. for such Plan Year.

D. Employer Credits . The Plan Account of each Participant who receives Deferral Credits under Section IV.B. or IV.C. shall also be credited with an amount equal to the amount of Employing Company Contributions, if any, that would have been contributed to the Savings Plan on such Participant’s behalf for such Plan Year (without regard to the limitations imposed under Section 415 or

 

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401(a)(17) of the Code, which would limit the amount of such Employing Company Contributions that may be contributed to the Savings Plan on the Participant’s behalf for such Plan Year) if an amount equal to the Deferral Credits determined under Section IV.B. and/or Section IV.C., as the case may be, had been contributed to the Savings Plan.

E. Suspension of Deferrals . A Participant may petition the Benefits Committee or its designee to cancel his deferrals under this Plan during any period of time that the Participant establishes to the satisfaction of the Benefits Committee that he is facing an Unforeseeable Emergency. If the petition for suspension is approved, such cancellation shall take effect as of the first payroll period following the date of approval. Notwithstanding the foregoing, a Participant’s deferrals under the Plan shall be automatically cancelled during a Plan Year if the Participant applies for and receives a hardship withdrawal under the Savings Plan in accordance with Treas. Reg. Section 1.401(k)-1(d)(3), but only to the extent that the Participant’s elective deferrals under the Savings Plan are suspended on account of such hardship withdrawal. If deferrals by a Participant have been cancelled during a Plan Year due to an Unforeseeable Emergency or on account of his receiving a hardship withdrawal under the Savings Plan, the Participant will not be eligible to make any further deferrals in respect of that Plan Year. The Participant may be eligible to elect to make deferrals for subsequent Plan Years provided that such elections are made prior to the Plan Year with respect to which such deferral relates.

F. Investment Adjustments to Plan Accounts . While a Participant’s Plan Account does not represent the Participant’s ownership of, or ownership interest in, any particular assets, the amounts credited to the Participant’s Plan Account shall be adjusted as of the close of each business day, or at such other times as may be determined by the Benefits Committee, to reflect the performance of the

 

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investment funds in which such credited amounts are hypothetically deemed invested in accordance with this Section IV.F. The investment funds in which a Participant’s Plan Account credits are hypothetically deemed invested shall be determined as follows:

1. On any business day the Participant may, pursuant to telephonic notification with the Administrative Agent, (a) elect to have Plan Account credits deemed to be invested, in 1% increments, among such funds established under the Savings Plan, other than the Company Stock Fund, effective as of the first day of the next payroll period (or as soon as practicable thereafter) and (b) elect that the credits to his Plan Account under this Article IV representing any type of investment under the Plan be deemed to be reduced to cash (in 1% increments) and that such deemed cash be invested in such other funds which the Participant shall designate in such election, effective as of the next business day (or as soon as practicable thereafter).

2. Any investment election given by a Participant under this Plan or the Prior BMS Plan shall continue in effect until changed by the Participant. To the extent a Participant makes no election, all such credits shall be deemed to have been invested in the default investment fund established under the Savings Plan.

3. For purposes of this Plan, “telephonic notification” shall include any form of communication acceptable to the Administrative Agent, including, telephone, telegraph, satellite or other wireless communication. A “business day” shall mean any day the New York Stock Exchange is open for business.

 

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V.

Vesting.

A Participant shall at all times be 100% vested in his Transferred Credits, Deferral Credits and BEP-RIP Credits (and any Investment Adjustments attributable thereto). A Participant shall become vested in Employer Credits (and any Investment Adjustments attributable thereto) at the same time that the corresponding Employing Company Contributions allocated to the Participant’s Savings Plan Account become vested under the Savings Plan (or upon becoming a Participant in this Plan, if the Participant’s Employing Company Contribution are already vested under the Savings Plan at such time).

 

VI.	Time and Form of Payment of Account Balance.

A. Plan Payments . A Participant’s vested Account Balance shall be payable to the Participant (or his Beneficiary) in the default form of payment set forth in Section VI.A.1. herein, unless a timely election for an alternative form of payment is made in accordance with Section VI.A.2. herein.

1. Default Form of Payment . A Participant who, as of the date his Separation From Service occurs, either (A) is not eligible to retire under the Savings Plan, (B) does not satisfy the eligibility requirements of Rule of 70 Treatment or (C) is eligible to retire under the Savings Plan or satisfies the eligibility requirements for Rule of 70 Treatment but does not make a timely election pursuant to Section VI.A.2. herein shall receive his accrued and vested Account Balance, subject to Section VI.C. herein, in a cash lump sum payment within 60 days following such Participant’s Separation From Service.

2. Alternative Form of Payment . A Participant who, as of the date his Separation From Service occurs, is either eligible to retire under the Savings Plan or satisfies the eligibility requirements for Rule of 70 Treatment shall be permitted to elect to

 

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receive his vested Account Balance at a deferred date (as set forth below), provided that such election is made under this Plan or the Prior BMS Plan no later than 12 months prior to the date of such Participant’s Separation From Service. A Participant who elects to receive his Account Balance in accordance with this Section VI.A.2. must also elect (a) when payments will commence, and (b) whether the payment will be made in a lump sum or in annual installments of two to 15 years. Any such elections under this Section VI.A.2. must comply with the subsequent deferral election requirements set out in Section VI.A.4. below. A Participant electing the alternative form of payment under this Section VI.A.2. may not make any subsequent elections, except for a subsequent election made in accordance with the requirements set out in Section VI.A.4.

3. Prior Elections . In the case of a Participant who, at the time of his Separation From Service, is eligible to retire under the Savings Plan or satisfied the eligibility requirements for Rule of 70 Treatment and who, prior to January 1, 2007, made a timely election under the Prior BMS Plan regarding the form of payment of his vested Account Balance ( i.e. , such election was made at least twelve months prior to Separation From Service), such election shall continue to apply to such Participant’s accrued and vested Account Balance under this Plan and may not be changed.

4. Subsequent Deferral Elections . Any election under Section VI.A.2 to change from the default form of payment to an alternate form of payment must satisfy each of the following requirements:

a. Such election must be made no later than 12 months prior to the date such Participant’s Separation From Service occurs;

 

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b. Such election will not be valid and effective until 12 months after it is received by the Plan Administrator; and

c. Such election must provide for a payment commencement date that is at least five years later than the date the distribution otherwise would have been made under the default payment terms or prior payment election.

B. De Minimis Lump Sum . Notwithstanding any provision of the Plan or payment election of a Participant to the contrary, if the value of the vested Account Balance of a Participant is less than $10,000 as of the date of his Separation From Service, such vested Account Balance shall be paid to or in respect of the Participant in a single lump sum on the first day of the month following such Participant’s Separation From Service.

C. Specified Employees . Notwithstanding any provision of the Plan or payment election of a Participant to the contrary, if a Participant is a Specified Employee at his Separation From Service, payment of the portion of his Account Balance that was credited or vested under this Plan or the Prior BMS Plan on or after January 1, 2005 shall occur no earlier than the date that is six-months after the Participant’s Separation From Service (unless such Participant dies, in which event the vested Account Balance shall be payable in accordance with Section VI.D. hereof). Any portion of the vested Account Balance that would otherwise be paid to a Specified Employee prior to the end of such six-month period shall be paid on the last day of the payroll period that begins coincident with or next following the six-month anniversary of the Participant’s Separation From Service.

D. Payment of Account Balances in the Event of the Participant’s Death . A Participant may designate a Beneficiary to receive payment of all or part of the value of his vested Account Balance in the event of his death, if such Beneficiary shall be living at the

 

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time of his death; provided , however , that if the Participant has elected to have his benefit under the Savings Plan paid in the form of a “qualified joint and survivor annuity,” then the Participant’s Beneficiary shall be his spouse. A Participant may, subject to the preceding sentence, change or revoke a designation of Beneficiary and such designation, change or revocation shall be on a form to be provided for this purpose and shall be signed by the Participant shall be valid only if delivered to his Participating Employer prior to his death. In the event of the death of the Participant prior to the Participant’s attainment of age 55 with 10 or more Years of Service with the Participating Employer or satisfaction of the eligibility requirements for Rule of 70 Treatment, the value of his vested Account Balance with respect to which a designation of Beneficiary has been made (to the extent it is valid and enforceable under applicable law) shall be distributed to the surviving designated Beneficiary in a cash lump sum payment within 90 days after the Participant’s death . In the event of the death of the Participant after the Participant has attained age 55 with 10 or more Years of Service with the Participating Employer or has satisfied the eligibility requirements for Rule of 70 Treatment, the value of his vested Account Balance with respect to which a designation of Beneficiary has been made (to the extent it is valid and enforceable under applicable law) shall be distributed to the surviving designated Beneficiary at the same time and in the same form of payment that would have been made to the Participant had he survived. In the event of the Beneficiary’s death after payments have commenced to the Beneficiary, but prior to the complete distribution of the Participant’s vested Account Balance, the remaining value of the Participant’s Account Balance shall be distributed to the Beneficiary’s estate in a cash lump sum payment within 90 days following his death. If the Participant has not designated a Beneficiary, or if no Beneficiary shall be living at the time of the Participant’s death,

the value of the Participant’s vested Account Balance shall be distributed in a cash lump sum payment within 90 days following his death to the person or persons in the first of the following classes of successive preference:

 

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The Participant’s surviving spouse.

 

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2.

Equally among the Participant’s surviving children.

 

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Equally among the Participant’s surviving parent.

 

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Equally among the Participant’s surviving brothers and sisters.

 

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The Participant’s executors or administrators.

Payment to one or more of such persons shall completely discharge the Plan with respect to the amount so paid. Notwithstanding the above, if the Participant has designated a Beneficiary under the Savings Plan, such designation shall be deemed a designation for purposes of this Plan unless a separate beneficiary designation is made under this Plan in accordance with the foregoing.

E. Distribution for Unforeseeable Emergency . If a Participant shall establish to the satisfaction of the Benefits Committee or its designee in accordance with principles and procedures established by the Benefits Committee which are applicable to all persons similarly situated that a withdrawal to be made by him pursuant to this Section VI.E. is to be made by reason of an Unforeseeable Emergency, the Participating Employer shall distribute to the Participant the amount reasonably necessary to meet such Unforeseeable Emergency but not more than the value of his vested Account Balance.

F. Other Permissible Payment Events . All or a portion of the value of the vested Account Benefits may be paid if and to the extent reasonably necessary to permit the Participant to avoid the violation of an applicable Federal, state, local or foreign ethics law or conflicts of interest law within the meaning of final Treas. Reg. Section. 1.409A-3(j)(4)(iii)(B).

 

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G. No Post-Separation Elections . Notwithstanding anything herein to the contrary, a Participant may not make any election(s) regarding the time and form of the payment of the value of his vested Account Balance subsequent to the occurrence of his Separation From Service.

 

VII.	Administration of the Plan.

A. Administration . The Benefits Committee shall administer this Plan. As Plan Administrator, the Benefits Committee shall have full discretionary authority to determine all questions arising in connection with the Plan, including its interpretation, application and administration, may adopt procedural rules, and may employ and rely on such legal counsel, such actuaries, such accountants and such agents as it may deem advisable to assist in the administration of the Plan. Any and all decisions of the Benefits Committee as to interpretation or application of this Plan shall be conclusive and binding on all person, shall be given full force and effect, and shall be reviewed by any court or arbitrator on an arbitrary and capricious standard, rather than a de novo standard.

B. Delegation . The Benefits Committee may (1) designate a person or persons and/or appoint an administrative committee to carry out the day-to-day administration of the Plan, and (2) authorize any agent to execute or deliver any instrument or make any payment on the Benefits Committee’s behalf or provide such services as the Benefits Committee may require in carrying out the provisions of the Plan.

C. Limitation of Liability . Neither the Benefits Committee nor any member of the Board of Directors nor any officer, employee or agent of the Company shall incur any liability individually or on behalf of any other individuals or on behalf of the Company for

 

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any act, or failure to act, in relation to the Plan or the funds of the Plan unless such action or inaction is adjudged to be due to fraud. The Benefits Committee and each member of the Board of Directors shall be entitled, in good faith, to rely or act upon any report or other information furnished to him by any other officer or other employee of the Company, the Company’s independent certified public accountants, or any executive compensation consultant, legal counsel or other professional retained by the Company. None of the Benefits Committee, the Compensation Committee or any member of the Board of Directors shall be entitled to act on or decide any matter relating solely to himself or any of his rights or benefits under the Plan.

D. Indemnification . The Benefits Committee, each member of the Board of Directors and their delegates, and the officers, employees and agents of the Company shall be indemnified by the Company against any and all liabilities arising by reason of any act, or failure to act, in relation to the Plan or the funds of the Plan, including, without limitation, expenses incurred in the defense of any claim relating to the Plan or the funds of the Plan, and amounts paid in any compromise or settlement relating to the Plan or the funds of the Plan, unless such action or inaction is adjudged to be due to fraud.

E. Claims Procedure . All claims for benefits under the Plan shall be submitted and reviewed in accordance with the Claims Appeal Guidelines. No claimant shall institute any action or proceeding in any state or federal court of law or equity or before any administrative tribunal or arbitrator for a claim of benefits under the Plan until the claimant has first exhausted the Plan’s review procedures set forth in the Claims Appeal Guidelines. Any and all decisions of the Company pursuant to the Claims Appeal Guidelines shall be conclusive and binding on all persons, shall be given full force and effect, and shall be reviewed by any court or arbitrator on an arbitrary and capricious standard, rather than a de novo standard.

 

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F. Expense . Expenses of the Benefits Committee attributable to the administration of the Plan shall be paid directly by the Company.

 

VIII.

General Provisions.

A. Termination of the Plan . The Board of Directors reserves the right to terminate the Plan at any time, and the Company or any other Participating Employer may terminate this Plan with respect to its Employees who participate in the Savings Plan; provided , however , that no such termination shall be effective retroactively. As of the effective date of termination of the Plan:

1. The rights of a Participant to his Plan Account established under this Plan shall become non-forfeitable.

2. The Account Balance of any Participant (or his Beneficiary) whose Account Balance payments have commenced shall continue to be paid;

3. No further amounts may be credited to the Plan Accounts of Participant whose Account Balance payments have not commenced and such Participant (or his Beneficiary) shall retain the right to an Account Balance hereunder; and

4. Account Balance payments that have not commenced as of the Plan termination date may be accelerated provided that (a) the Company’s termination and liquidation of the Plan does not occur proximate to a downturn in the financial health of the Company, (b) no payment of Account Balances are made earlier than 12 months after all action necessary to irrevocably terminate and liquidate the Plan has been completed other than payments that would be payable under the terms of the Plan if the action to terminate and liquidate the Plan had not occurred, (c) all payment of Account Balances are completed within 24 months thereafter, (d) all other nonqualified account balance plans maintained by the Company are terminated with respect to all

 

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participants in such plans and such plans would be aggregated under final Treas. Reg. Section 1.409A-1(c), (e) the Company does not adopt a new plan that would be aggregated with any terminated plan under final Treas. Reg. Section 1.409A-1(c) if the Participant participated in both plans, at any time within three years following the date the Company takes all necessary action to irrevocably terminate and liquidate the Plan, and (f) the conditions of final Treas. Reg. Section 1.409A-3(j)(ix)(C) are satisfied.

B. Plan Not a Contract of Employment . Nothing in this Plan shall be construed as giving any Employee the right to be retained in the employ of any Participating Employer. Each Participating Employer in the Plan expressly reserves the right to dismiss any Employee at any time without regard to the effect which such dismissal might have upon him under the Plan.

C. Amendment . This Plan may be amended at any time by the Compensation Committee or by the Benefits Committee at any time in accordance with the materiality guidelines regarding modifications to employee benefit plans established by the Compensation Committee, except that no such amendment shall deprive any Participant of the amount then credited to his Plan Account and vested at the time of such amendment.

D. Funding . All amounts payable in accordance with this Plan shall constitute a general unsecured obligation of the Company and the other Participating Employers. Benefits payable under this Plan, as well as any administrative costs related to the Plan, shall not be funded and shall be made out of the general assets of the Company and the other Participating Employers or any grantor trust established for this purpose.

 

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The Company may, in its discretion, establish a grantor trust for the benefit of the Participants of the Plan. The assets placed in such trust shall be held separate and apart from other Company funds and shall be used exclusively for the purposes set forth in the Plan and the applicable trust agreement, subject to the following conditions:

1. the creation of said trust shall not cause the Plan to be other than “unfunded” for purposes of Title I of ERISA;

2. the Company shall be treated as “grantor” of said trust for purposes of Section 677 of the Code;

3. the agreement of such trust shall provide that its assets may