EXHIBIT 10.5
GENENTECH, INC.
TAX REDUCTION INVESTMENT PLAN
TABLE OF CONTENTS | |||
Page | |||
PREAMBLE | 1 | ||
SECTION 1 | DEFINITIONS | 2 | |
SECTION 2 | ELIGIBILITY AND MEMBERSHIP | 12 | |
2.1 | Initial Eligibility | 12 | |
2.2 | Employer Aggregation | 12 | |
2.3 | Membership | 12 | |
2.4 | Voluntary Suspension | 13 | |
2.5 | Mandatory Suspension | 14 | |
2.6 | Termination of Membership | 14 | |
SECTION 3 | SALARY DEFERRALS AND FLEX CREDITS | 14 | |
3.1 | Salary Deferrals and Flex Credits | 14 | |
3.1.7 Catch-Up Contributions | 18 | ||
3.2 | Salary Deferral and Flex Credit Elections | 18 | |
3.3 | Payment of Salary Deferrals and Excess Flex Credits | 22 | |
SECTION 4 | MATCHING CONTRIBUTIONS | 22 | |
4.1 | Amount of Matching Contributions | 22 | |
4.2 | Timing | 26 | |
4.3 | Periodic Contributions | 26 | |
4.4 | Profits Not Required | 27 | |
4.5 | After-Tax Contributions | 27 | |
SECTION 5 | ALLOCATIONS AND INVESTMENT | 27 | |
5.1 | Salary Deferrals, Catch-Up Contributions and Flex Credits | 27 | |
5.2 | Matching Contributions | 27 | |
5.3 | Investment | 28 | |
5.4 | Limitations on Allocations | 29 | |
SECTION 6 | ACCOUNTS AND COMMINGLED FUNDS | 32 | |
6.1 | Members' Accounts | 32 | |
6.2 | Trust Fund Assets | 33 | |
6.3 | Commingled Funds | 33 | |
6.4 | Valuation of Members' Accounts | 35 | |
6.5 | Valuation of Shares | 35 |
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TABLE OF CONTENTS | |||
(continued) | |||
Page | |||
6.6 | Statements of Members' Accounts | 36 | |
6.7 | Accounts Nonforfeitable | 36 | |
SECTION 7 | DISTRIBUTIONS | 36 | |
7.1 | Events Permitting Distribution | 36 | |
7.2 | Times for Distribution | 37 | |
7.3 | Consent Requirement | 38 | |
7.4 | Form of Distribution | 38 | |
7.5 | Common Stock Restrictions | 40 | |
7.6 | Beneficiary Designations | 40 | |
7.7 | Payments to Minors or Incompetents | 42 | |
7.8 | Undistributable Accounts | 42 | |
SECTION 8 | WITHDRAWALS, LOANS AND DOMESTIC RELATIONS ORDERS | 43 | |
8.1 | General Rules | 43 | |
8.2 | Hardship Withdrawal | 44 | |
8.3 | Age 59 1/2 Withdrawal | 46 | |
8.4 | Loans to Members | 46 | |
8.5 | Qualified Domestic Relations Orders | 49 | |
SECTION 9 | ADMINISTRATION OF THE PLAN | 50 | |
9.1 | Plan Administrator | 50 | |
9.2 | Committee | 51 | |
9.3 | Actions by Committee | 51 | |
9.4 | Powers of Committee | 51 | |
9.5 | Fiduciary Responsibilities | 53 | |
9.6 | Investment Responsibilities | 53 | |
9.7 | Voting and Tender Offer Rights in Common Stock | 54 | |
9.8 | Decisions of Committee | 58 | |
9.9 | Administrative Expenses | 58 | |
9.10 | Eligibility to Participate | 58 | |
9.11 | Indemnification | 59 | |
SECTION 10 | TRUST FUND AND ROLLOVER CONTRIBUTIONS | 59 |
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TABLE OF CONTENTS | |||
(continued) | |||
Page | |||
10.1 | Trust Fund | 59 | |
10.2 | No Diversion of Assets | 60 | |
10.3 | Continuing Conditions | 60 | |
10.4 | Change of Investment Alternatives | 61 | |
10.5 | Rollover Contributions | 61 | |
SECTION 11 | MODIFICATION OR TERMINATION OF PLAN | 62 | |
11.1 | Employers' Obligations Limited | 62 | |
11.2 | Right to Amend or Terminate | 62 | |
11.3 | Effect of Termination | 63 | |
SECTION 12 | TOP-HEAVY PLAN | 63 | |
12.1 | Top-Heavy Plan Status | 63 | |
12.2 | Top-Heavy Plan Provisions | 64 | |
SECTION 13 | GENERAL PROVISIONS | 65 | |
13.1 | Plan Information | 65 | |
13.2 | Inalienability | 65 | |
13.3 | Rights and Duties | 66 | |
13.4 | No Enlargement of Employment Rights | 66 | |
13.5 | Apportionment of Duties | 66 | |
13.6 | Merger, Consolidation or Transfer | 67 | |
13.7 | Military Service | 67 | |
13.8 | Applicable Law | 67 | |
13.9 | Severability | 67 | |
13.10 | Captions | 67 | |
EXECUTION | 68 | ||
APPENDIX A: EFFECTIVE DATES | A-1 |
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GENENTECH, INC.
TAX REDUCTION INVESTMENT PLAN
(January 1, 2002 Restatement)
PREAMBLE
GENENTECH, INC. (the "Company") having established the Genentech, Inc. Tax Reduction Investment Plan (the "Plan") effective as of January 1, 1985, amended and restated the Plan effective (most recently) as of January 1, 2000, and amended the restated Plan on several occasions, hereby again amends and restates the Plan in its entirety effective (generally) as of January 1, 2002, except as otherwise indicated herein or in the attached Appendix A.
The Plan is maintained for the benefit of Eligible Employees of the Company and its participating Affiliates, in order (1) to provide Eligible Employees with a means of supplementing their retirement income on a tax-favored basis, (2) to provide Eligible Employees with an incentive to continue and increase their efforts to contribute to the success of the Company, and (3) to enable Eligible Employees to acquire an equity ownership interest in the Company. The Plan is designed to constitute a qualified profit-sharing plan, as described in section 401(a) of the Code, which includes a qualified cash or deferred arrangement, as described in section 401(k) of the Code. The Plan is also designed to qualify as a 404(c) plan (within the meaning of section 404(c) of ERISA).
With respect to any period during which GenenFlex does not permit an option to contribute to the Plan excess Flex Credits awarded thereunder, the provisions of the Plan related to the deferral of excess Flex Credits shall be suspended.
DEFINITIONS
The following capitalized words and phrases shall have the following meanings unless a different meaning is plainly required by the context:
1.3 "Beneficiary" shall mean the person or persons entitled to receive benefits under the Plan upon the death of a Member in accordance with Section 7.6.
1.4 "Board of Directors" shall mean the Board of Directors of the Company, as from time to time constituted.
1.6 "Commingled Funds" shall mean (collectively) the commingled funds described in Section 6.3.
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1.7 "Committee" shall mean the administrative committee appointed by the Board of Directors (as provided in Section 9.2) and charged with the general administration of the Plan pursuant to Section 9.
1.8 "Common Stock" shall mean the common stock of the Company, par value $0.02, as from time to time constituted.
1.9 "Company" shall mean Genentech, Inc., a Delaware corporation, and any successor by merger, consolidation or otherwise that assumes (in writing) the obligations of the Company under the Plan.
1.10 "Compensation" shall mean all salary, wages, annual cash bonuses, sales bonuses, and commissions paid by any Employer with respect to services performed during any period by an Employee, including Salary Deferrals and "catch-up contributions" made under Section 3.1.7 but excluding (a) contributions made by any Employer (other than Salary Deferrals and "catch-up contributions") under this Plan or any other employee benefit plan (within the meaning of section 3(3) of ERISA), and (b) other items,even if reported as income on an Employee's IRS Form W-2,such as income from the exercise of stock options, proceeds from the redemption of Common Stock, tuition reimbursements, reimbursements of health club dues, Genenchecks, referral bonuses, severance payments (if paid on a payroll-by-payroll basis after termination), and relocation expenses;provided,however, that the amount of an Employee's Compensation shall not be increased or decreased by (i) compensation reductions effected or Flex Credits awarded under GenenFlex, or (ii) amounts that are otherwise not includible in the gross income of the Employee by reason of section 132(f)(4) of the Code. No portion of the Compensation of any Member for a Plan Year which exceeds the Compensation Limit (as defined below) shall be taken into account for any purpose under the Plan for any Plan Year. "Compensation Limit"
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shall mean $200,000 (as adjusted periodically pursuant to sections 401(a)(17) and 415(d) of the Code).
1.11 "Disability" shall mean the mental or physical inability of a Member to perform his or her normal job as evidenced by the certificate of a medical examiner satisfactory to the Committee (in its discretion) certifying that the Member is disabled under the standards of the Company's long-term disability plan.
1.12 "Eligible Annual Bonus" shall mean (a) any annual discretionary bonus paid by an Employer to an Employee under the Company's Corporate Bonus Program (or an Employer's similar bonus program), or (b) any fourth calendar quarter payout under any of the Bonus Plans that comprise the Company's Field Sales Incentive Compensation Program. All Eligible Annual Bonus amounts shall be determined net of employee stock purchase plan and mandatory deductions including, without limitation, Employee-paid FICA and SDI withholdings;provided,however, that the term "Eligible Annual Bonus" shall not include any other sales incentive bonus or any special, extraordinary or GenenCheck bonus.
1.13 "Eligible Employee" shall mean every Employee of an Employer except:
(c) An Employee who is a member of a collective bargaining unit and who is covered by a collective bargaining agreement where retirement benefits were the subject of good faith bargaining, unless the agreement specifically provides for coverage of such Employee under this Plan;
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(e) An Employee whose Compensation is not paid from any Employer's U.S. payroll; and
For purposes of this Section 1.13, "date of hire" shall mean the date on which an Employee first completes an Hour of Service.
1.14 "Employee" shall mean an individual who is a (a) employed by an Employer or Affiliate as a common-law employee, or (b) a Leased Employee. However, if Leased Employees constitute less than 20% of the nonhighly compensated work force (within the meaning of section 414(n)(5)(C)(ii) of the Code), the term "Employee" shall not include those Leased Employees who are covered by a plan described in section 414(n)(5) of the Code.
1.15 "Employer" shall mean the Company and each Affiliate that adopts this Plan with the approval of the Board of Directors.
1.16 "Entry Date" shall mean the first day of each payroll period.
1.17 "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as amended. Reference to a specific section of ERISA shall include such section, any valid regulation promulgated thereunder, and any comparable provision of any future legislation amending, supplementing or superseding such section.
1.18 "Flex Credit" shall have the meaning set forth in GenenFlex.
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1.19 "GenenFlex" shall mean the cafeteria plan (within the meaning of section 125 of the Code) pursuant to which Flex Credits are awarded to any Employee of an Employer.
1.20 "Highly Compensated Employee" shall mean a Highly Compensated Active Employee or a Highly Compensated Former Employee, as defined below:
(c) The determination of who is a Highly Compensated Employee shall be made in accordance with section 414(q) of the Code.
(d) For purposes of applying this Section 1.20:
(2) "Determination Year" shall mean the Plan Year for which the determination is being made; and
(3) "Look-Back Year" shall mean the Plan Year immediately preceding the Determination Year.
1.21 "Hour of Service" shall mean an hour credited to an Employee under this Section 1.21:
(a) Paid Hours. An "Hour of Service" includes each hour for which:
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(c) Crediting Rules. Hours of Service shall be credited under this Section 1.21 in accordance with U.S. Department of Labor Regulation Section 2530.200b-2(b) and (c).
(d) Family-Related Absences. In the case of an Employee who is absent from active employment with an Employer or Affiliate for any period,
(1) By reason of her pregnancy or the birth of his or her child,
"Hour of Service" shall mean any hour that is not credited as an Hour of Service (because the Employee is not paid or entitled to payment therefor) but which would otherwise normally have been credited to the Employee (but for the absence) under paragraphs (a) through (c) above. In any case in which the Committee is unable to determine the number of hours that would otherwise normally have been credited to an Employee (but for the absence) under this paragraph (d), the Employee shall be credited with eight Hours of Service for each day of the absence. Notwithstanding the foregoing, (A) no more than 501 Hours of Service shall be credited under this paragraph (d) to any individual on account of any single pregnancy, birth, placement or other FMLA leave,
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and (B) the hours described in this paragraph (d) shall be treated as Hours of Service (i) for the Plan Year in which the absence begins, to the extent required to credit the Employee with 1,000 Hours of Service for that Plan Year, and (ii) with respect to the remainder of the 501 Hours of Service maximum, for the next following Plan Year.
1.22 "Investment Manager" shall mean any investment manager appointed by the Committee in accordance with Section 9.6.
1.23 "Leased Employee" shall mean any person (other than a common-law employee of the Employer or Affiliate) who, pursuant to an agreement between the Employer or Affiliate and any other person ("leasing organization"), has performed services for the Employer or Affiliate on a substantially full time basis for a period of at least one year, and such services are performed under primary direction or control by the Employer or Affiliate. Contributions or benefits provided a Leased Employee by the leasing organization which are attributable to services performed for the Employer or Affiliate shall be treated as provided by the Employer or Affiliate. A Leased Employee shall not be considered an Employee of the Employer or Affiliate if:
(a) Such Leased Employee is covered by a money purchase pension plan providing (i) a nonintegrated employer contribution rate of at least 10 percent of compensation, as defined in Code Section 415(c)(3), but including amounts contributed pursuant to a salary reduction agreement which are excludable from the Leased Employee's gross income under Code Sections 125, 402(e)(3), 402(h)(1)(B) or 403(b), and Code Section 132(f), and (ii) immediate participation, and (iii) full and immediate vesting; and
(b) Leased Employees do not constitute more than 20% of the Employers' nonhighly compensated work force.
1.24 "Leave of Absence" shall mean the period of an Employee's absence from active employment (a) authorized by any Employer in accordance with its established and uniformly administered personnel policies,provided that the Employee returns to active employment after the authorized absence period expires, unless the Employee's failure to return is attributable to his or her retirement or death; or (b) because of military service in the armed forces of the United
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States,provided that the Employee returns to active employment following discharge within the period during which he or she retains reemployment rights under federal law.
1.25 "Matching Contributions" shall mean as to each Member the amounts contributed under the Plan by the Employers, excluding Salary Deferrals, "catch-up contributions" made under Section 3.1.7 and excess Flex Credits, in accordance with Section 4.1.
1.26 "Member" shall mean an Eligible Employee who has become a Member of the Plan pursuant to Section 2.1 and has not ceased to be a Member pursuant to Section 2.6.
(a) For each Plan Year a Member shall be classified as an "Active Member" (1) if he or she has (A) enrolled in the Plan for any portion of the Plan Year by authorizing the required Salary Deferrals in accordance with Sections 2.3, 3.1 and 3.2, and/or (B) elected under GenenFlex (subject to the rules in effect under GenenFlex) to have at least five dollars ($5.00) worth of excess Flex Credits contributed to his or her GenenFlex Account; or (2) his or her active membership is resumed during the Plan Year after the end of a suspension period in accordance with Section 2.4 or 2.5.
(b) A Member who is not an Active Member shall be classified as an "Inactive Member."
1.27 "Member's Accounts" or "Accounts" shall mean as to any Member the one or more separate accounts maintained in order to reflect his or her interest in the Plan. Each Member's Accounts shall be comprised of up to five separate subaccounts, as follows:
1.27.1 "GenenFlex Account" shall mean the subaccount maintained to record any excess Flex Credits that the Member has elected under GenenFlex (subject to the rules in effect under GenenFlex and Section 2.3.1) to have contributed to his or her GenenFlex Account pursuant to Sections 3.1 and 3.2 and any adjustments relating thereto.
1.27.2 "Loan Account" shall mean the subaccount maintained to record any loans made to the Member from his or her Accounts pursuant to Sections 5.3.3 and 8.4.
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1.27.3 "Matching Account" shall mean the subaccount maintained to record any Matching Contributions made on behalf of the Member pursuant to Sections 4.1 and 4.1 and any adjustments relating thereto.
1.27.4 "Rollover Account" shall mean the subaccount maintained to record any transfers to the Plan made by or on behalf of a Member pursuant to Section 10.5 and any adjustments relating thereto.
1.27.5 "Salary Deferral Account" shall mean the subaccount maintained to record any Salary Deferrals and "catch-up" contributions made under Section 3.1.7 (which may be maintained as a separate subaccount within the Salary Deferral Account) that the Member has elected to have contributed to his or her Salary Deferral Account pursuant to Sections 3.1 and 3.2 and any adjustments relating thereto.
1.28 "1934 Act" shall mean the Securities Exchange Act of 1934, as amended from time to time. Reference to a specific section of the 1934 Act shall include any section, any valid regulation promulgated thereunder, and any comparable provision of any future legislation amending, supplementing or superseding such section.
1.29 "Normal Retirement Age" shall mean age 55.
1.30 "Plan" shall mean the Genentech, Inc. Tax Reduction Investment Plan, formerly the Genentech, Inc. Tax Incentive Savings Plan, as set forth in this instrument and as heretofore or hereafter amended from time to time in accordance with Section 11.2.
1.31 "Plan Year" shall mean the calendar year.
1.32 "Salary Deferrals" shall mean as to each Member the amounts contributed under the Plan by the Employers in accordance with Section 3.3, pursuant to the salary deferral election made by the Member in accordance with Sections 3.1 and 3.2. A Member's Salary Deferrals
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shall (a)include amounts contributed in respect of his or her regular periodic Compensation and/or Eligible Annual Bonus payments pursuant to Section 3.1(a), but (b)exclude "catch-up contributions" made under Section 3.1.7 and excess Flex Credits contributed pursuant to Section 3.1(b).
1.33 "Trust Agreement" shall mean the trust agreement entered into by and between the Company and the Trustee, as validly amended from time to time.
1.34 "Trust Fund" shall mean the trust fund established by and maintained under the Trust Agreement for the purpose of funding the benefits provided by the Plan, as provided in Section 10.
1.35 "Trustee" shall mean Fidelity Management Trust Company, a Massachusetts trust company, and any additional, successor or substitute trustee or trustees from time to time acting as Trustee of the Trust Fund.
1.36 "Valuation Date" shall mean:
(a) For purposes of valuing Plan assets and Members' Accounts for periodic reports and statements, the date as of which such reports or statements are made; and
(b) For purposes of determining the amount of assets actually distributed to the Member, his or her Beneficiary or an Alternate Payee (or available for loan or withdrawal), the date on which occur the relevant transactions required to liquidate to cash the assets allocated to the Member's Accounts,provided that when such transactions occur on more than one date, there shall be several Valuation Dates, as appropriate.
In any other case, the Valuation Date shall be the date designated by the Committee (in its discretion) or the date otherwise set out in this Plan. In all cases, the Committee (in its discretion) may change the Valuation Date, on a uniform and nondiscriminatory basis, as is necessary or appropriate. Notwithstanding the foregoing, the Valuation Date shall occur at least annually.
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SECTION 2
2.1 Initial Eligibility. An Employee shall become a Member of the Plan on the date he or she becomes an Eligible Employee.
2.2 Employer Aggregation. The status of an Employee as an Eligible Employee shall not be adversely affected merely by reason of his or her employment by more than one Employer during any Plan Year. The transfer of a Member from employment with an Employer to employment with an Affiliate which is not an Employer shall not be an event entitling the Member to a distribution under Section 7.
2.3 Membership. Each Member's decision to become an Active Member shall be entirely voluntary.
2.3.1 Active Membership. An Employee who has become a Member under Section 2.1 may elect to become an Active Member, effective as of any Entry Date,provided that he or she enrolls in the Plan and elects to make Salary Deferrals, and/or to contribute excess Flex Credits (subject to the rules in effect under GenenFlex), in such manner and within such advance notice period as the Committee (in its discretion) shall specify. Notwithstanding any contrary Plan provision, all Plan provisions relating to the contribution of excess Flex Credits after that date shall be inoperative until such time as the Committee (acting in a non-fiduciary capacity on behalf of the Company) shall determine otherwise in a writing setting forth the date on which such provisions shall again be operative.
2.3.2 Inactive Membership. A Member who does not elect to become an Active Member when eligible to do so shall be at all times treated as an Inactive Member until the Entry Date as of which he or she elects to become an Active Member.
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2.4 Voluntary Suspension. An Active Member may voluntarily suspend his or her Salary Deferrals and "catch-up contributions" and/or contributions of excess Flex Credits (subject to the rules in effect under GenenFlex), for future payroll periods, by giving notice to such person, in such manner and within such advance notice period as the Committee (in its discretion) shall specify.
2.4.1 Effect. With respect to the period for which a Member's Salary Deferrals are suspended, he or she shall not make any Salary Deferrals or "catch-up contributions" under Section 3.1.7 nor share in the allocation of Matching Contributions, and he or she may not later make the Salary Deferrals or "catch-up contributions" that he or she might otherwise have made during the suspension period. With respect to the period for which a Member's contributions of excess Flex Credits are suspended, he or she shall not contribute any excess Flex Credits, and he or she may not later contribute the excess Flex Credits that he or she might otherwise have contributed during the suspension period. No distribution shall be made to a Member solely as the result of any suspension of his or her active membership.
2.4.2 Resuming Salary Deferrals and/or Excess Flex Credit Contributions. A Member who voluntarily suspended his or her Salary Deferrals or "catch-up contributions" under Section 3.1.7 and/or contributions of excess Flex Credits (subject to the rules in effect under GenenFlex) may voluntarily resume his or her Salary Deferrals or "catch-up contributions" and/or contributions of excess Flex Credits (subject to the rules in effect under GenenFlex), effective with respect to Compensation paid for the payroll period beginning on any Entry Date, by giving notice to such person, in such manner and within such advance notice period as the Committee (in its discretion) shall specify.
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2.5 Mandatory Suspension. If a Member (1) ceases to be an Eligible Employee because he or she ceases to meet the requirements of Section 1.13, (2) is transferred to employment with an Affiliate which is not an Employer, (3) is granted a Leave of Absence without pay, (4) has been approved for a Hardship Withdrawal pursuant to Section 8.2, (5) is on long-term disability, or (6) is placed on layoff or furlough status, then:
(a) His or her status as an Active Member shall be suspended (in accordance with Section 2.4.1) for each payroll period beginning during the continuation of such ineligible status, and
(b) After he or she again becomes an Eligible Employee and the conditions described in clauses (1) through (5) above cease to apply, his or her status as an Active Member may be resumed only in accordance with Section 2.4.2.
Notwithstanding any contrary Plan provision, a Member's Compensation which is paid for any portion of a payroll period that includes a period of mandatory suspension shall not be subject to any salary deferral election nor contributed under the Plan as Salary Deferrals or "catch-up contributions," nor shall such Member contribute any Flex Credits to his or her GenenFlex Account during such mandatory suspension period.
2.6 Termination of Membership. An Eligible Employee who has become a Member shall remain a Member until his or her employment with all Employers and Affiliates terminates or, if he or she remains alive, until his or her entire Account balance is distributed (whichever is later).
SECTION 3
SALARY DEFERRALS AND FLEX CREDITS
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(a) Salary Deferrals. An Active Member may elect under this Plan to defer:
(1) A portion of each payment of Compensation (including any Eligible Annual Bonus) that would otherwise be made to him or her, after the election becomes and while it remains effective, equal to any whole percentage from 1% to 25% (inclusive) of the Compensation payment; and
(2) In addition to any election made under paragraph (a)(1) above, a portion of any payment of Eligible Annual Bonus that would otherwise be made to him or her, after the election becomes and while it remains effective, equal to any whole percentage that exceeds the deferral election percentage then in effect under paragraph (a)(1) above but does not exceed 100% (or such lesser percentage as is determined by the Company to comply with mandatory tax withholding and required payroll deductions) of the Eligible Annual Bonus. Any remaining balance attributable to the Eligible Annual Bonus payment shall be immediately payable to the Member.
(b) Excess Flex Credits. Instead or in addition, an Active Member may elect under GenenFlex (subject to the rules in effect under GenenFlex) to have at least five dollars ($5.00) worth of excess Flex Credits contributed to his or her GenenFlex Account. Notwithstanding any contrary Plan provision, all Plan provisions relating to the contribution of excess Flex Credits shall be inoperative until such time as the Committee (acting in a non-fiduciary capacity on behalf of the Company) shall determine otherwise in a writing setting forth the date on which such provisions shall again be operative.
3.1.1 Section 401(k) Ceiling. Notwithstanding the foregoing, the Committee:
(a) May suspend or limit any Member's salary deferral election, and/or election under GenenFlex to have any excess Flex Credits contributed to his or her GenenFlex Account, at any time in order to prevent the cumulative amount of the Salary Deferrals and excess Flex Credits contributed on behalf of the Member for any calendar year from exceeding the Section 401(k) Ceiling;
(b) Shall cause any amount allocated to the Plan as an excess deferral (calculated by taking into account only amounts deferred under this and any other cash or deferred arrangement maintained by any Employer or Affiliate and qualified under section 401(k) of the Code), together with any income allocable thereto for the calendar year to which the excess deferral relates, to be distributed to the Member no later than the April 15 that next follows the year of deferral in accordance with section 402(g)(2)(A) of the Code; and
(c) May cause any other amount allocated to the Member's Salary Deferral and/or GenenFlex Account(s) and designated by the Member as an excess deferral, together with any income allocable thereto for the calendar year to which the excess deferral relates, to be distributed to the Member in accordance with section 402(g)(2)(A) of the Code;provided, however, that any such designation shall be applied last to any
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contributions of excess Flex Credits that any HCE Member (as defined in Section 3.1.3) has elected under GenenFlex to have contributed to his or her GenenFlex Account.
(d) Any Matching Contributions allocated to the Member's Matching Account by reason of any excess deferral distributed pursuant to paragraph (b) or (c), together with any income allocable thereto for the calendar year to which the excess deferral relates, shall be forfeited at the time such distribution is made and applied to reduce the next succeeding Matching Contribution to the Plan, without regard to the extent of the Member's vested interest in his or her Matching Account.
(e) The "Section 401(k) Ceiling" is a dollar amount equal to the dollar limit prescribed in section 402(g)(1) of the Code (as adjusted periodically pursuant to sections 402(g)(5) and 415(d) of the Code).
3.1.2 Limitations on HCE Members. For any Plan Year, the Committee (in its discretion) may limit (a) the period for which, and/or specify a lesser maximum percentage at which, Salary Deferrals may be elected by HCE Members (as defined in Section 3.1.3) and/or (b) the period for which or the value of the excess Flex Credits that may be contributed to HCE Members' GenenFlex Accounts, in such manner as may be necessary or appropriate in order to assure that the limitation described in Section 3.1.4 will be satisfied.
3.1.3 HCE and Non-HCE Members. All Members who are Eligible Employees at any time during the Plan Year (whether or not they are Active Members), and who are Highly Compensated Employees with respect to the Plan Year, shall be "HCE Members" for the Plan Year. All other Members who were Eligible Employees at any time during the immediately preceding Plan Year (whether or not they were Active Members), and who were not Highly Compensated Employees with respect to that Plan Year, shall be"Non-HCE Members" for that Plan Year.
3.1.4 Deferral Percentage Limitation. In no event shall the actual deferral percentage, determined in accordance with Section 3.1.5 (the "ADP"), for the HCE Members for a Plan Year exceed the maximum ADP, as determined by reference to the preceding Plan Year's ADP for the preceding Plan Year's Non-HCE Members, in accordance with the following table:
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If the ADP for Non-HCE | Then the Maximum ADP for |
Members ("NHCEs' ADP") is: | HCE Members is: |
Less than 2% | 2.0 x NHCEs' ADP |
2% to 8% | NHCEs' ADP + 2% |
More than 8% | 1.25 x NHCEs' ADP |
3.1.5 Actual Deferral Percentage. The actual deferral percentage for the HCE or Non-HCE Members for a Plan Year shall be calculated by computing the average of the percentages (calculated separately for each HCE or Non-HCE Member) (the "Deferral Rates") determined by dividing (1) the total for the Plan Year of (i) all Salary Deferrals made by the Member and credited to his or her Salary Deferral Account, and (ii) all excess Flex Credits contributed by the Member (subject to the rules in effect under GenenFlex) and credited to his or her GenenFlex Account, by (2) the Member's Testing Compensation (as defined in Section 3.1.6) for the Plan Year. In computing a Member's Deferral Rate, the following special rules shall apply:
(a) If any Employer or Affiliate maintains any other cash or deferred arrangement which is aggregated by the Company with this Plan for purposes of applying section 401(a)(4) or 410(b) of the Code, then all such cash or deferred arrangements shall be treated as one plan for purposes of applying Section 3.1.4.
(b) If an HCE Member is a participant in any other cash or deferred arrangement maintained by any Employer or Affiliate, the separate Deferral Rates determined for the Member under all such cash or deferred arrangements shall be aggregated with the separate Deferral Rate determined for the Member under this Section 3.1.5 for purposes of applying Section 3.1.4.
(b) The amount of his or her compensation calculated by the Committee in a manner which satisfies applicable requirements of Treas. Reg. Section 1.401(k)-1(g)(2)(i).
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(d) Compensation for periods prior to the time that an Employee became a Member shall not be taken into account.
3.1.6 Catch-Up Contributions. Notwithstanding any contrary Plan provision:
(b) Certain Code Limitations Inapplicable. A Member's "catch-up contributions" shall not be taken into account for purposes of applying Plan provisions implementing required limitations of sections 402(g) and 415 of the Code. The Plan shall not be treated as failing to satisfy Plan provisions implementing the requirements of section 401(k)(3), 401(k)(11), 401(k)(12), 410(b) or 416 of the Code, as applicable, by reason of "catch-up contributions" being or having been made under the Plan.
3.2 Salary Deferral and Flex Credit Elections. Each Active Member shall determine the percentage(s) of his or her regular and/or Eligible Annual Bonus Compensation payments that shall be deferred and contributed to the Trust Fund as his or her Salary Deferrals, in accordance with Section 3.1(a), at the time he or she becomes an Active Member and thereafter may redetermine such percentage(s) from time to time as of any Entry Date. Subject to paragraph (c) below, each Active Member who is also a participant in GenenFlex may also elect under GenenFlex (subject to the rules in effect under GenenFlex) to have at least five dollars ($5.00) worth of excess Flex Credits contributed to his or her GenenFlex Account in accordance with Section 3.1(b). In either event -
(a) The Active Member shall make his or her (1) salary deferral election with respect to his or her Compensation (including or excluding Eligible Annual Bonus payments), in such manner and within such advance notice period as the Committee (in its discretion) shall specify, and/or (2) election under GenenFlex (subject to the rules in effect under GenenFlex) to have any such excess Flex Credits contributed to his or her GenenFlex Account;
18
(b) No Salary Deferrals or "catch-up contributions" under Section 3.1.7 shall be made by any Active Member except in accordance with his or her salary deferral election and the limitations of Section 3.1; and
3.2.1 Amounts. The amount of Salary Deferrals or "catch-up contributions" under Section 3.1.7 that may be made by each Active Member for each payroll period shall be the amount in dollars and cents that is nearest to the amount of Compensation subject to the salary deferral election multiplied by the percentage elected by the Active Member pursuant to Section 3.1. In addition, each Active Member may elect under GenenFlex (subject to the rules in effect under GenenFlex) to have contributed to his or her GenenFlex Account all or any portion of those Flex Credits which the Member has not used to purchase benefits under GenenFlex,provided that such Member elects to contribute at least five dollars ($5.00) worth of excess Flex Credits to his or her GenenFlex Account.
3.2.2 Changes. An Active Member may change the percentage determined under the first sentence of this Section 3.2, effective with respect to Compensation paid for the payroll period beginning on any Entry Date, or such other date as the Committee (in its discretion) may specify, by giving notice in such manner and within such advance notice period as the Committee (in its discretion) shall specify. The salary deferral election made by an Active Member shall remain in effect until his or her active membership in the Plan is terminated, except to the extent that the election is suspended in accordance with Section 2.4, 2.5 or 8.1, changed in accordance with this Section 3.2.2, or reduced pursuant to Section 3.1.1 or 3.1.2.
19
However, changes in an Active Member's election to have excess Flex Credits contributed to his or her GenenFlex Account shall be permitted only in accordance with the rules in effect under GenenFlex.
3.2.3 Potential Excess ADP. In the event that (but for the application of this Section 3.2.3) the Committee determines that the ADP for HCE Members would exceed the maximum permitted under Section 3.1.4 for a Plan Year (the "ADP Maximum"), then the Committee (in its discretion) may reduce, in accordance with Section 3.1.2, the percentages or amounts of Salary Deferrals and excess Flex Credits subsequently to be contributed on behalf of the HCE Members by such percentages or amounts as, and for as long as, the Committee (in its discretion) may determine is necessary or appropriate in the circumstances then prevailing. If the Committee determines that it is no longer necessary to reduce the Salary Deferrals and/or excess Flex Credits contributed on behalf of the HCE Members, the Committee (in its discretion) may permit some or all HCE Members, on a uniform and nondiscriminatory basis, to make (a) new salary deferral elections with respect to their subsequent Compensation payments, and/or (b) new elections under GenenFlex (subject to the rules in effect under GenenFlex) to have excess Flex Credits contributed to their GenenFlex Accounts, and shall establish a policy as to the deferral percentages and/or limitations on the contribution of excess Flex Credits that shall apply with respect to those HCE Members who do not make new elections.
3.2.4 Actual Excess ADP. In the event that the Committee determines that the ADP for the HCE Members exceeds the ADP Maximum for any Plan Year, then the amount of any excess contributions (within the meaning of section 401(k)(8)(B) of the Code) contributed on behalf of any HCE Member shall be distributed, together with any income allocable thereto
20
for the Plan Year to which the excess contributions relate, to the HCE Member before the close of the Plan Year that next follows that Plan Year.
(a) Determination and Allocation of Excess Contributions. The amount of excess contributions for HCE Members for the Plan Year shall be determined and allocated among HCE Members in the following manner:
(b) Determination of Allocable Income. The income allocable to any excess contributions for the Plan Year, excluding income for the period between the end of the Plan Year and the date of distribution, shall be determined in accordance with section 401(k)(8)(A)(i) of the Code.
(c) Forfeiture of Related Matching Contributions. Any Matching Contributions allocated to the Member's Matching Account by reason of any excess contributions distributed pursuant to this Section 3.2.4, together with any income allocable thereto for the Plan Year to which the excess contributions relate, shall be
21
forfeited and applied to reduce the next succeeding Matching Contribution to the Plan, without regard to the extent of the Member's vested interest in his or her Matching Account.
(d) Incorporation By Reference. The foregoing provisions of this Section 3 are intended to satisfy the requirements of section 401(k)(3) of the Code and, to the extent not otherwise stated above, the provisions of section 401(k)(3) of the Code, Treas. Reg. Section 1.401(k)-1(b) (to the extent not inconsistent with amendments to the Code), and subsequent IRS guidance under section 401(k)(3) of the Code are incorporated herein by reference.
SECTION 4
MATCHING CONTRIBUTIONS
22
Sections 3.1 and 3.2) as does not exceed the Matching Ceiling (determined pursuant to Section 4.1.3) shall be taken into account in calculating the amount of the Matching Contribution (if any) to be made in respect of the Member's Salary Deferrals for any payroll period. For purposes of this Section 4 (including Section 4.1.2), the only Compensation taken into account for such purpose is Compensation paid (or payable if deferred under Section 3) to the eligible Active Member (a) for payroll periods for which he or she made Salary Deferrals or after which the Section 401(k) Ceiling took effect, and (b) as an Eligible Annual Bonus. In no event shall the amount of any (1) excess Flex Credits contributed to any Member's GenenFlex Account, or (2) "catch-up contributions" contributed to any Member's Salary Deferral Account, be taken into account in determining the amount of Matching Contributions to made to the Trust Fund and/or allocated to his or her Matching Account.
If the Salary Deferral | |
Contribution Rate for an Eligible | Then the Matching Amount for the |
Active Member is | Member shall be: |
Less than or equal to 3% | Equal to 100% of Salary Deferrals |
Greater than 3% | Equal to 100% of Salary Deferrals up to 3% |
plus one-half (1/2) of Salary Deferrals | |
greater than 3% and less than or equal to 5% |
The "Salary Deferral Contribution Rate" for an Active Member is (Salary Deferrals) divided by (Compensation), expressed as a percentage, and determined on a Plan Year basis in accordance with Section 4.1.1. Subject to the limitations of Section 5.4 and as provided in this Section 4.1.2, the Matching Amount may be changed for any Plan Year to such extent (if any) as the Board of Directors (in its discretion) may determine by resolution and without amending the Plan pursuant
23
to Section 11.2;provided, however, that no decrease in the Matching Amount applicable to any Salary Deferral Contribution Rate shall take effect before the first payroll period that begins after the decrease is announced to eligible Active Members.
24
HCE Members (as defined in Section 3.1.3) in such manner as may be necessary or appropriate in order to assure that the limitation described in Section 4.1.6 will be satisfied.
If the ACP for Non-HCE | Then the Maximum ACP for |
Members ("NHCEs' ACP") is: | HCE Members is |
Less than 2% | 2.0 x NHCEs' ACP |
2% to 8% | NHCEs' ACP + 2% |
More than 8% | 1.25 x NHCEs' ACP |
25
such percentages or amounts as, and for as long as, the Committee (in its discretion) may determine is necessary or appropriate in the circumstances then prevailing.
(c) Incorporation By Reference. The foregoing provisions of this Section 4.1 are intended to satisfy the requirements of section 401(m) of the Code and, to the extent not otherwise stated above, the provisions of section 401(m)(2) of the Code, Treas. Reg. Section 1.401(m)-1(b) (to the extent not inconsistent with amendments to the Code), and subsequent IRS guidance under section 401(m)(2) of the Code are incorporated herein by reference.
26
payment relates. The Employers intend the Plan to be permanent, but the Employers do not obligate themselves to make any Matching Contributions under the Plan whatsoever
SECTION 5
27
28
made to the Loan Account to reflect such payments, shall be reallocated to the Commingled Funds in the same percentages as specified by the Member pursuant to the introductory paragraph of this Section 5.3, or if there is no such designation currently in force, as the Committee (in its discretion) shall determine.
5.4 Limitations on Allocations.
5.4.2 Definitions. For purposes of this Section 5.4, the following definitions shall apply:
29
(d) "Total Compensation" shall mean the amount of an Employee's:
(A) Including the aggregate of any Salary Deferrals, "catch-up contributions" and excess Flex Credits credited to his or her Salary Deferral Account and GenenFlex Account and any other amounts that are (i) contributed by any Employer or Affiliate on his or her behalf to an employee benefit plan by reason of the Employee's elective deferrals (within the meaning of section 402(g)(3) of the Code), or (ii) otherwise not includible in the gross income of the Employee by reason of section 132(f)(4) of the Code or pursuant to the Employee's compensation reduction agreement under section 125 of the Code; but
(B) Excluding amounts paid or reimbursed by the Employer or Affiliate for moving expenses incurred by the Member, to the extent that at the time of payment it is reasonable to believe that such amounts qualify as a "qualified moving expense reimbursement" (within the meaning of section 132(a)(6) of the Code); and
(C) Determined without regard to any rules that limit the remuneration included in wages based on the nature or location of the employment or the services performed (such as the agricultural labor exception); or
5.4.3 Other Defined Contribution Plans. All defined contribution plans (terminated or not) maintained by any Employer or Affiliate shall be aggregated with this Plan, and all plans so aggregated shall be considered as one plan in applying the limitations of this Section 5.4,provided that the special limitation applicable to employee stock ownership plans under section 415(c)(6) of the Code shall be taken into account with respect to a Member who participates in any such plan.
5.4.4 Adjustments. If, as a result of (1) a reasonable error in estimating a Member's Total Compensation, allocating forfeitures under any Aggregated Plan or other circumstances which permit the application of the rules stated in this Section 5.4.4, or (2) a
30
reasonable error in determining the amount of Salary Deferrals and excess Flex Credits that may be made or contributed under the limits of this Section 5.4, any of the limitations of this Section 5.4 otherwise would be exceeded with respect to any Member for any Plan Year, then the following actions, but only to the extent necessary to avoid exceeding such limitations, shall be taken in the following order:
(c) Any Matching Contributions allocated to the Member's Matching Account under this Plan and/or any employer matching contributions allocated to his or her account under any Aggregated Plan shall be reallocated to a suspense account, and the balance credited to that account shall be applied to reduce the Matching Contributions or other employer matching contributions (of the same class) otherwise to be made for and allocated to all eligible Members or participants in the Aggregated Plan for succeeding Plan Years in order of time;
(d) The Member's Salary Deferrals, excess Flex Credits contributed and any salary reduction contributions made at the Member's election pursuant to section 401(k) of the Code under any Aggregated Plan shall be reallocated to a suspense account and applied to reduce such Salary Deferrals, excess Flex Credits or other salary reduction contributions as otherwise are to be made thereafter at his or her election under this or any Aggregated Plan; and
(e) Any employer contributions otherwise to be allocated to the Member's account under any Aggregated Plan shall be reallocated to a suspense account, and the balance credited to that account shall be applied to reduce other employer contributions (of the same class) otherwise to be made for and allocated to all eligible participants in the Aggregated Plan for succeeding Plan Years in order of time.
5.4.4 Suspense Accounts. If a suspense account is created under Section 5.4.4(c), (d) and/or (e) and exists in a later Plan Year, the amount allocated to the suspense account shall be reallocated to the Member's Accounts before any amount may be contributed to
31
this or any Aggregated Plan on behalf of the Member for that Plan Year. If the Member for whom a suspense account is maintained terminates employment with all Employers and Affiliates before the suspense account balance has been reallocated pursuant to Section 5.4.4, that balance shall be reallocated among the Accounts of all Members who remain Employees on the first day of the next following Plan Year, in direct proportion to each such Member's share of the aggregate Total Compensation paid to all such Members for the Plan Year of termination (subject to the limitations of this Section 5.4), before any amount may be contributed to this or any Aggregated Plan for the Plan Year of reallocation. Suspense accounts shall not share in allocations of earnings and gains (or losses) of the Trust Fund. The balances credited to all suspense accounts shall be returned to the Employers upon termination of the Plan.
SECTION 6
ACCOUNTS AND COMMINGLED FUNDS
6.1 Members' Accounts. At the direction of the Committee, there shall be established and maintained for each Member, as appropriate:
(b) A Matching Account, to which shall be credited all Matching Contributions paid to the Trust Fund on his or her behalf under Section 4;
(c) A Rollover Account, to which shall be credited all transfers made to the Trust Fund by or on behalf of the Member under Section 10.5;
(d) A Loan Account, to which shall be credited (pursuant to Section 5.3.3) any amounts loaned to the Member in accordance with Section 8.4; and
(e) A GenenFlex Account, to which shall be credited all excess Flex Credits paid to the Trust Fund at his or her election under GenenFlex in accordance with Section 3.
32
Each of a Member's Accounts shall also reflect the value of such Account's proportionate interest in each of the Commingled Funds as of each Valuation Date. The maintenance of one or more separate Accounts for each Member shall not be deemed to segregate for the Member, nor to give the Member any ownership interest in, any specific assets of the Trust Fund.
6.3 Commingled Funds. All assets of the Trust Fund shall be invested in the following Commingled Funds:
(a) The Common Stock Fund shall be invested in Common Stock.
(b) The Trustee may purchase shares of Common Stock for the Common Stock Fund in the open market.
6.3.2 Short-Term Fund. The Trustee shall establish or maintain a Short-Term Fund which shall be a commingled fund maintained for the purpose of investing such portions of
33
Members' Accounts as are, pursuant to Members' investment instructions made in accordance with Section 5.3, properly allocable to the Short-Term Fund. The Short-Term Fund shall be invested by the Trustee in units, shares or other interests in one or more common, pooled or other collective short-term investment funds which are either (a) maintained by the Trustee or any other bank (within the meaning of section 581 of the Code), the trustee of or investment advisor to any such fund in which any other Commingled Fund is invested or an affiliate of such trustee or investment advisor, or (b) registered under the Investment Company Act of 1940.
34
collective investment funds in which the Commingled Funds (other than the Common Stock Fund) shall be invested. The Committee (in its discretion) may from time to time change the number, identity or composition of the Commingled Funds made available under this Section 6.3 and redesignate the collective investment funds in which any Commingled Fund shall be invested. All interest, dividends or other income realized from the investments of any of the Commingled Funds shall be reinvested in the Commingled Fund that realized such income. Temporary cash balances arising in any of the Commingled Funds shall be invested where feasible in any collective investment fund which would qualify as an investment medium for the Short-Term Fund.
35
below) the closing price of the Common Stock on the New York Stock Exchange on that date, as published inThe Wall Street Journal or, if no report is available for that date, on the next preceding date for which a report is available, except that in the case of a transaction involving the purchase or sale of share(s) of Common Stock, the fair market value of any share of Common Stock shall be the purchase or sale price of such share on the New York Stock Exchange.
SECTION 7
(a) Upon termination of the Member's employment at or after Normal Retirement Age;
(b) Upon termination of the Member's active employment by reason of Disability or death;
36
7.2.2 For purposes of applying this Section 7.2, "Deadline Date" means:
37
38
discretion) shall specify, to have such portion of the Accounts distributed in the form of the unliquidated assets credited to such portion of the Accounts as of that Valuation Date.
7.4.5 Direct Rollovers. Notwithstanding any contrary Plan provision:
39
theDistributee is clearly informed that he or she has a right to consider, for a period of at least 30 days after receiving the notice, a decision on whether to elect a distribution (and, if applicable, a particular distribution option), and (2) the Distributee, after receiving the notice, affirmatively elects a distribution.
(3) Any hardship distribution described in Section 410(k)(2)(B)(i)(IV) of the Code; and
40
No such designation shall become effective until its receipt by the Company (as the Committee's delegate under Section 9.4(t)) in the manner specified.
41
surviving spouse or, if the Member is not survived by his or her spouse, the Accounts shall be paid to one or more of the following persons in the following priority order:
(c) The executors and/or administrators of his or her estate.
42
unable to locate the Member or Beneficiary to whom a Member's Accounts are payable under this Section 7, (a) the Member's Accounts may be closed after 24 months have passed since the date the Account first became distributable to such Member or Beneficiary, and (b) the balance credited to any Accounts so closed shall be credited as an offset against the Employers' future Matching Contribution payment obligations. If the Member or Beneficiary whose Accounts were closed under the preceding sentence subsequently files a claim for distribution of his or her Accounts, and if the Committee (in its discretion) determines that such claim is valid, then the balance previously removed upon closure of the Accounts shall be restored to the Accounts by means of a special contribution which shall be made to the Trust Fund by the Employers.
SECTION 8
WITHDRAWALS, LOANS AND DOMESTIC RELATIONS ORDERS
43
44
8.2.4 Limit on Withdrawal. No withdrawal under this Section 8.2 shall exceed the lesser of:
45
46
during the one-year period ending on the day before the date the loan is to be made, over (2) the aggregate outstanding balance on all such loans on the date the loan is made.
47
over the agreed term of the loan in accordance with the provisions of this Section 8.4. A Member may prepay at any time the entire amount remaining due under the loan, but no partial prepayments shall be permitted.
48
49
SECTION 9
50
(c) To cause one or more separate Accounts to be maintained for each Member;
51
(f) To grant or deny withdrawal and loan applications under Section 8;
(h) To instruct the Trustee with respect to matters within the jurisdiction of the Committee;
52
Section 9.6, and in accordance with such funding policy, to coordinate the Plan's investment policy with the Plan's requirements for funds to pay expenses and benefits as they become due;
53
designated portions of the Trust Fund (other than the Common Stock Fund). In the event of any such appointment, the Trustee shall follow the instructions of the Investment Manager in investing and administering Trust Fund assets managed by the Investment Manager. Alternatively, the Committee (in its discretion) may delegate investment authority and responsibility with respect to any Commingled Fund (other than the Common Stock Fund) directly to any Investment Manager which has investment management responsibility for any collective investment fund in which the Commingled Fund is invested.
9.7 Voting and Tender Offer Rights in Common Stock.
(c) Any proposal by a shareholder pursuant to Rule 14a-8 under the 1934 Act;
54
(d) Any election contest governed by Rule 14a-11 under the 1934 Act;
55
9.7.5 Directed Voting and Consents.
56
9.7.6 Tender or Exchange Offers.
57
actions under this Section 9.7 with respect to such Allocable Shares on the Pass-Through Issue qualifying as such under Section 9.7.1(b).
58
Plan, but he or she, as a member of the Committee, shall not act or pass upon any matters pertaining specifically to his or her own Accounts under the Plan.
SECTION 10
TRUST FUND AND ROLLOVER CONTRIBUTIONS
59
shareholders, directors or Employees. The Trust Fund shall continue for such time as may be necessary to accomplish the purposes for which it is created.
60
to avoid a reduction in the balance of any Member's Accounts below the balance that would have resulted if the mistake had not been made.
61
that are to be invested in each of the Commingled Funds. In all other respects Rollover Account investments shall be subject to Section 5.3.
SECTION 11
MODIFICATION OR TERMINATION OF PLAN
11.2 Right to Amend or Terminate. The Company reserves the right to alter, amend or terminate the Plan, or any part thereof, in such manner as it may determine. Amendments which do not add materially to the Company's cost under the Plan and which are (i) necessary to comply with the Code, ERISA or other applicable law, (ii) technical, or (iii) intended to ease administration may be adopted if approved in writing by any two members of the Committee, acting in their capacities as officers of the Company rather than as fiduciaries with respect to the
62
Plan. All other amendments shall be approved by the Board of Directors. Any such alteration, amendment or termination shall take effect upon the date indicated in the document embodying such alteration, amendment or termination;provided, however, that:
TOP-HEAVY PLAN
63
for key employees (within the meaning of sections 416(i)(1) and (5) of the Code) exceeds 60% of the value of the aggregate of the Accounts under the Plan for all Members. For purposes of determining the value of the Accounts, the provisions of section 416(g)(4)(E) of the Code and Treas. Reg. Section 1.416-1 (Q&A T-1) are incorporated herein by reference.
(a) "Determination Date" shall mean the last day of the immediately preceding Plan Year;
64
paragraph (a) below) is less than 3%, then the percentage rate at which that additional Employer contribution shall be made for that Plan Year shall be reduced from 3% to the Key Employee Percentage.
SECTION 13
65
of the Code, in no event may any Member, former Member or his or her spouse, Beneficiary or estate sell, transfer, anticipate, assign, hypothecate, or otherwise dispose of any right or interest under the Plan; and such rights and interests shall not at any time be subject to the claims of creditors nor be liable to attachment, execution or other legal process.
66
shall be done and performed by any officer or Employee of the Employer who is thereunto duly authorized by the board of directors of the Employer.
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EXECUTION
In Witness Whereof, Genentech, Inc., by its duly authorized officers, has executed this January 1, 2002 Restatement of the Plan on the date indicated below.
GENENTECH, INC. | ||
By | /s/ LOUIS J. LAVIGNE | |
Louis J. Lavigne | ||
Title | Executive Vice President and | |
Dated | December 18, 2002 | |
And by | /s/ THOMAS T. THOMAS | |
Thomas T. Thomas | ||
Title | Treasurer | |
Dated | December 18, 2002 |
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APPENDIX A: EFFECTIVE DATES
This Appendix A lists those provisions of the January 1, 2002 Restatement of the Genentech, Inc. Tax Reduction Investment Plan (the "Plan") that have an effective date that is neither January 1, 2002 nor specified in the Plan text.
Effective Date | Plan Provision |
January 1, 1985 | Section 1.13 - Definition of eligible employee |
January 1, 1985 | Section 8.5.4 - Hold procedures relating to QDRO's |
December 12, 1994(1) | Section 13.7 - Addition of provision to comply with USERRA |
January 1, 1995 | Section 5.4.1 - Change in determination of $30,000 Annual Addition Limitation |
January 1, 1997 | Section 1.10 - Change in definition of "Compensation" to eliminate family aggregation rule |
Section 1.20 - Change in definition of "Highly Compensated Employee" including elimination of the family aggregation rule | |
Section 3.1.4 - Change in determination of deferral percentage limitation | |
Section 3.1.5 - Elimination of application of family aggregation rule in determination of actual deferral percentage | |
Section 3.2.4 - Change in the manner of allocation of excess contributions among HCE Members | |
Section 4.1.5 - Change in determination of contribution percentage limitation | |
Section 4.1.6 - Elimination of application of family aggregation rule in determination of actual contribution percentage | |
Section 4.1.8 - Change in the manner of allocation of excess aggregate contributions among HCE Members |
(1) For Employers who return to service with an Employer or Affiliate on or after December 12, 1994.
A-1
Effective Date | Plan Provision |
Sections 7.1.(d) and 7.2.2 - Limit application of required distributions to Members while in-service on or after attainment of age 70 1/2 to only a Member who is a 5-percent owner | |
February 3, 1997 | Section 3.3 - Change to the deadline for payment of Salary Deferrals and contributions of excess Flex Credits to the Trust Fund |
August 5, 1997 | Section 13.2 - Addition of section 401(a)(13)(C) exception to non-alienation rule |
January 1, 1998 | Section 5.4.2(d) - Change in definition of "Total Compensation" |
January 1, 2001 | Section 1.10 - Change in definition of "Compensation" to reflect section 132(f)(4) with regards to the amount of compensation reduction elected from qualified transportation fringes not includable in gross income |
Sections 2.3.1, 3.1(b) and 3.2(c) - Addition of language rendering provisions permitting contribution of excess Flex Credits inoperative pending future Committee action |
A-2