TYSON FOODS, INC. EMPLOYEE STOCK OWNERSHIP PLAN
(Restated Effective April 1, 1993)
TABLE OF CONTENTS Page
ARTICLE I DEFINITIONS
1.1 Basic Compensation. . . . . . . . . . 2
1.2 Beneficiary.. . . . . . . . . . . . . 4
1.3 Break in Service. . . . . . . . . . . 4
1.4 Disability. . . . . . . . . . . . . . 4
1.5 Early Retirement Date . . . . . . . . 5
1.6 Effective Date . . . . . . . . . . . 5
1.7 Employee. . . . . . . . . . . . . . . 5
1.8 Employer. . . . . . . . . . . . . . . 5
1.9 Employer Stock . . . . . . . . . . . 6
1.10 Employment Commencement Date. . . . . 6
1.11 Entry Date. . . . . . . . . . . . . . 6
1.12 Highly Compensated Employee . . . . . 6
1.13 Hour of Service . . . . . . . . . . . 8
1.14 Leave of Absence and Termination
of Service . . . . . . . . . . . . 9
1.15 Maternity or Paternity Absences . . . 9
1.16 Member . . . . . . . . . . . . . . . 10
1.17 Name of Plan . . . . . . . . . . . . 10
1.18 Normal Retirement Date or Age . . . . 10
1.19 Plan . . . . . . . . . . . . . . . 10
1.20 Rollover Contribution . . . . . . . . 10
1.21 Taxable Year, Fiscal Year, Plan
Year and Limitation . . . . . . . . 11
1.22 Trust . . . . . . . . . . . . . . . . 11
1.23 Trust Fund . . . . . . . . . . . . . 11
1.24 Years of Service. . . . . . . . . . . 12
ARTICLE II ELIGIBILITY FOR MEMBERSHIP
2.1 Requirements for Participation. . . . 13
2.2 Effect of Break in Service
on Eligibility. . . . . . . . . . . 13
2.3 Designation of Beneficiary. . . . . . 14
ARTICLE III CONTRIBUTIONS BY EMPLOYER
3.1 Annual Contribution of Employer . . . 15
3.2 Time of Payment of Contributing
Employer. . . . . . . . . . . . . . 15
3.3 Adjustment of Erroneous Contribution. 15
ARTICLE IV PAYSOP ACCOUNTS
4.1 Establishment of Accounts .. . . . . . 17
4.2 PAYSOP Accounts . . . . . . .. . . . . 17
ARTICLE V ALLOCATION OF TRUST FUND AMONG MEMBERS
5.1 Account of Members. . . . . . .. 19
5.2 Valuation of Fund and Allocation of
Profits or Losses of Trust Fund .. . 19
5.3 Allocation of Forfeitures . . . . . . 20
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5.4 Allocation of Employer Contribution 20
5.5 Special Accounting Date . . . . . 21
5.6 Basis of Valuation. . . . . . . . . 22
5.7 Limit on Contributions. . . . . . .. 22
5.8 Reporting for Employer Contribution
Account . . . . . . . . . . . . . . 24
5.9 Suspense Account. . . . . . . . . .. 25
5.10 Withdrawal from Suspense Account. .. 25
5.11 Exempt Loan . . . . . . . . . . . .. 26
5.12 Dividends . . . . . . . . . . . . .. 26
5.13 Other Limitations . . . . . . . . .. 26
ARTICLE VI VESTING
6.1 Vesting of Employer Contribution
Account . . . . . . . . . . . . . . 27
6.2 Vesting on Death, Disability or
Normal Retirement . . . . . . . . . 27
6.3 Vesting if Plan Terminated or
Employer Contributions Discontinued.27
6.4 Rollover Account . . . . . . . . .. 28
6.5 Effect of Break in Service on
Vesting . . . . . . . . . . . . . . 28
6.6 Disposition of Forfeited Amounts. .. 28
6.7 Change in Vesting Schedule. . . . .. 29
ARTICLE VII DISTRIBUTIONS
7.1 Initial Distribution Date . . . . .. 30
7.2 Establishment of Distribution Account 30
7.3 Date of Distribution. . . . . . . . .30
7.4 Methods of Distribution . . . . . .. 32
7.5 Deferred Retirement . . . . . . . . . 33
7.6 Cash-Out Distribution . . . . . . . . 33
7.7 Payments of Benefits Upon Death
of Member . . . . . . . . . . . . . 34
7.8 Spousal Consent . . . . . . . . . .. 34
7.9 Death Before Commencement of
Benefits. . . . . . . . . . . . . . 34
7.10 Distributions to be Made in
Employer Stock. . . . . . . . . . . 35
7.11 Benefits Payable to Minors and
Incompetents . . . . . . . . . . . 37
7.12 Notification of Mailing Address . .. 38
7.13 Lost Payee . . . . . . . . . . . . . 39
7.14 Eligible Rollover Distributions . . . 39
ARTICLE VIII AMENDMENT AND TERMINATION OF PLAN
8.1 Amendment of Plan . . . . . . . . . . 41
8.2 Suspension of Contributions
by Employer . . . . . . . . . . . . 41
8.3 Termination of Plan . . . . . . . . . 42
8.4 Distribution on Termination . . . . . 42
8.5 Termination of Trust. . . . . . . . . 42
8.6 Merger, Consolidation or
Transfer of Assets. . . . . . . . . 43
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ARTICLE IX TRUST FUND AND TRUSTEE
9.1 Trustee . . . . . . . . . . . . . . . 44
9.2 Purpose of the Trust Fund . . . . . . 44
9.3 Benefits Supported only by the Trust 44
9.4 Trust Fund Applicable Only to
Payment of Benefits . . . . . . . . 44
9.5 Diversification of Investments. . . . 45
ARTICLE X ADMINISTRATION
10.1 Fiduciary . . . . . . . . . . . . . . 47
10.2 Powers and Duties . . . . . . . . . . 47
10.3 Records and Reports . . . . . . . . . 48
10.4 Claims Procedure. . . . . . . . . . . 48
10.5 Indemnification . . . . . . . . . . . 49
10.6 Administrative Procedures . . . . . . 49
ARTICLE XI MISCELLANEOUS PROVISIONS
11.1 Rights of or to Employment. . . . . . 51
11.2 Benefits Payable Solely from
Trust Fund. . . . . . . . . . . 51
11.3 Restrictions on Transfer and Claim
of Creditors. . . . . . . . . . 51
11.4 No Interference by Members in
Administration of Trust . . . . 52
11.5 Members to Furnish Required
Information . . . . . . . . . . 53
11.6 Employer's Contributions Irrevocable 53
11.7 Applicable Law. . . . . . . . . . .. 53
11.8 Titles to Articles and Paragraphs . . 53
11.9 Gender. . . . . . . . . . . . . . . . 53
11.10 Nonterminable Provisions. . . . . . . 54
11.11 Valuation . . . . . . . . . . . . . . 54
ARTICLE XII TOP HEAVY PROVISIONS
12.1 Definitions . . . . . . . . . . . . . 56
12.2 Provisions Applicable During
Top Heavy Years . . . . . . . . . . 59
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TYSON FOODS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
TYSON FOODS, INC., a corporation organized and existing under the laws
of the State of Delaware (hereinafter called "Employer") hereby restates
the "Tyson Foods, Inc. Employee Stock Ownership Plan" effective April 1,
1993 to reflect all amendments made through such date, with the intention
that the Plan (and the related Tyson Foods, Inc. Employee Stock Ownership
Trust) should continue to qualify as a stock bonus plan and an "employee
stock ownership plan" ("ESOP") pursuant to 401, 409 and 4975(e)(7) of the
Internal Revenue Code of 1986 (the "Code"). The Plan is designed to invest
primarily in qualifying employer securities.
Prior to 1987, the Plan had been administered so as to permit certain
Employer contributions pursuant to the Plan to qualify for the ("PAYSOP")
Employee Stock Ownership Credit permitted by 41 of the Internal Revenue
Code of 1954. Section 41 was repealed by the Tax Reform Act of 1986
effective for compensation paid after December 31, 1986. All benefits
accrued hereunder prior to January 1, 1987, shall continue to be maintained
in separate accounts pursuant to Article IV hereof, which accounts shall be
administered like Employer Contribution Accounts under the Plan except
where specifically set forth to the contrary in Article IV or elsewhere in
the Plan.
ARTICLE I
Definitions
The following definitions shall be used in this Plan unless the
context of the Plan clearly indicates another meaning:
1.1 Basic Compensation. "Basic Compensation" means an employee's
wages, salaries, fees for professional services, and other amounts received
(without regard to whether or not an amount is paid in cash) for personal
services actually rendered in the course of employment with the Employer
maintaining the plan to the extent that the amounts are includable in gross
income (including, but not limited to, commissions paid salesmen,
compensation for services on the basis of a percentage of profits,
commissions on insurance premiums, tips, bonuses, fringe benefits, and
reimbursements or other expense allowances under a nonaccountable plan).
Any amounts that would have been includable in the employee's Basic
Compensation as described above if they had not received special tax
treatment because they were deferred by the employee through a salary
reduction contribution shall be added to the amount described above and
included in the employee's Basic Compensation for purposes of the Plan.
However, Basic Compensation shall not include the following:
(a) Other Employer contributions to a plan of deferred compensation
which are not includable in the employee's gross income for a taxable year
in which contributed; or any distributions from a plan of deferred
compensation;
(b) Amounts realized from the exercise of a non-qualified stock
option, or when restricted stock (or property) held by the employee either
becomes freely transferable or is no longer subject to a substantial risk
of forfeiture;
(c) Amounts realized from the sale, exchange or other disposition of
stock acquired under a qualified stock option; and
(d) Other amounts which receive special tax benefits, such as premiums
for group-term life insurance (but only to the extent that the premiums are
not includable in gross income).
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The annual Compensation of each Employee taken into account under the
Plan shall not exceed $200,000 or such other amount as may be specified
annually by the Secretary of the Treasury pursuant to his duties under
401(a)(17) of the Code. In addition to other applicable limitations set
forth in the Plan, and notwithstanding any other provision of the Plan to
the contrary, for plan years beginning on or after January 1, 1994, the
annual compensation of each Employee taken into account under the Plan
shall not exceed the OBRA '93 annual compensation limit. The OBRA '93
annual compensation limit is $150,000, as adjusted by the Commissioner for
increases in the cost of living in accordance with section 401(a)(17)(B) of
the Internal Revenue Code. The cost-of-living adjustment in effect for a
calendar year applies to any period, not exceeding 12 months, over which
Compensation is determined (determination period) beginning in such
calendar year. If a determination period consists of fewer than 12 months,
the OBRA '93 annual compensation limit will be multiplied by a fraction,
the numerator of which is the number of months in the determination period,
and the denominator of which is 12.
For plan years beginning on or after January 1, 1994, any reference in
this Plan to the limitations under section 401(a)(17) of the Code shall
mean the OBRA '93 annual compensation limit set forth in this provision. If
Compensation for any prior determination period is taken into account in
determining an Employee's benefits accruing in the current plan year, the
Compensation for that prior determination period is subject to the OBRA '93
annual compensation limit in effect for that prior determination period.
For this purpose, for determination periods beginning before the first day
of the first plan year beginning on or after January 1, 1994, the OBRA '93
annual compensation limit is $150,000.
For purposes of applying the above limit to Highly Compensated
Employees who are 5% owners or one of the ten highest paid Highly
Compensated Employees, such Highly Compensated Employee's family shall be
treated as a single employee with one Compensation and the limit shall be
allocated among the family members in proportion to each member's
Compensation. For purposes of this paragraph, a Highly Compensated
Employee's family shall include his or her spouse and his or her lineal
descendants who have not reached the age of 19 before the end of the year.
1.2 Beneficiary. "Beneficiary" means such person or persons or legal
entity as may be designated by a Member to receive benefits hereunder after
his death, or the personal or legal representative of the Member as
hereinafter provided in Section 2.3.
1.3 Break In Service. A "Break in Service" shall mean the failure of
an Employee to complete more than 500 hours of service during a Plan Year.
1.4 Disability. "Disability" means the total incapacity of a Member
when so declared by the Employer in its judgment and discretion, supported
by the written opinion of at least two disinterested physicians, after the
expiration of at least thirty (30) days from the date of the inception of
such incapacity.
1.5 Early Retirement Date. "Early retirement date" shall mean the date
on which a Member or former Member has completed fifteen (15) years of
service and has attained the age of fifty-five (55).
1.6 Effective Date. The original effective date of the Plan was April
1, 1977. The Plan has been restated effective April 1, 1993, to reflect all
amendments thereto, which, except as provided below, were effective as of
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April 1, 1993. However, Section 1.7 was amended effective April 1, 1988;
and Sections 1.1, 1.12, 2.1, 5.4, 6.1, 6.7, 7.1, 7.3, 7.4, 12.1(b)(v) and
12.2 were amended effective April 1, 1989.
1.7 Employee. "Employee" means any person employed by Employer but
does not include leased employees within the meaning of 414(n) and 414(o)
of the Code.
1.8 Employer. "Employer" means TYSON FOODS, INC. and any corporation
that may hereafter accept and adopt the terms of this Indenture with the
approval of the Board of Directors of Tyson Foods, Inc. Such other adopting
corporations, together with Tyson Foods, Inc., hereafter occasionally may
be referred to as Participating Employers. For determining an Employee's
length of service for purposes of determiningeligibility, vesting and
contributions, "Employer" also includes any corporation which is a member
of a controlled group of corporations (as defined in 414(b) of the Code)
and all trades or businesses (whether or not incorporated) which are under
common control (as defined in 414(c) of the Code). Provided, however, that
service with an incorporated or unincorporated employer which has not
expressly adopted this Plan shall not give employees of such employer the
right to share in any contributions made by Employers which expressly have
adopted this Plan.
1.9 Employer Stock. "Employer stock" initially shall mean the Class A
common stock of Tyson Foods, Inc. However, at all times "Employer stock"
shall have that meaning set forth in 409(l) of the Code.
1.10 Employment Commencement Date. "Employment Commencement Date"
means the first date on which an Employee completes an "hour of service",
provided that in the case of a "break in service", an Employee's employment
commencement date shall be the first day thereafter on which he completes
an "hour of service."
1.11 Entry Date. "Entry Date" shall mean April 1 and October 1 of each
year.
1.12 Highly Compensated Employee. "Highly Compensated Employee" shall
mean any Employee who, during the Determination Year or the Look Back Year
(A) was at any time a "5-percent owner" (as defined in 416(q)(3) of the
Code,
(B) received compensation in excess of $75,000.
(C) received compensation in excess of $50,000 and was in the Top-
Paid Group of employees for such year, or
(D) was at any time an officer and received compensation greater than
50 percent of the amount in effect under 415(b)(1)(A) of the Code for such
year.
The Secretary shall adjust the $75,000 and $50,000 amounts under this
Section at the same time and in the same manner as under 415(d) of the
Code. For purposes of this Section 1.12, the term "compensation" shall have
the meaning given such term by 414(q)(7) of the Code. An Employee not
described in (B), (C) or (D) above for the Look-Back Year (without regard
to this paragraph) shall not be treated as described in (B), (C) or (D) for
the Determination Year unless such Employee is a member of the group
consisting of the 100 employees paid the greatest compensation during the
Determination Year. Determination Year means the Plan Year for which the
determination of Highly Compensation Employee is being made. Look Back Year
means the twelve (12) month period immediately preceding the Determination
Year.
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An Employee is in the Top-Paid Group of employees for any year if such
Employee is in the group consisting of the top 20 percent of the employees
when ranked on the basis of compensation paid during such year. For
purposes of (D), no more than 50 employees (or, if lesser, the greater of 3
employees or 10 percent of the employees) shall be treated as officers. If
for any year no officer of the Employer is described in (D), the highest
paid officer of the Employer for such year shall be treated as described in
(D).
If an Employee is a Family Member of a 5-percent owner (as described
in subsection (A)) or of a Highly Compensated Employee in the group
consisting of the 10 most highly compensated Employees who are Members in
this Plan for the Plan Year, then such Employee will not be considered to
be a separate Employee, and any compensation paid to such Employee and any
contributions made to such Employee's Accounts shall be treated as if made
to or on behalf of such Employee's Family Member who is a 5-percent owner
or is one of the 10 most highly compensated Employees. For purposes of this
section, the term 'Family Member' shall mean with respect to an Employee,
(1) the Employee's spouse; (2) the Employee's lineal ascendants and
descendants; and (3) the spouses of such lineal ascendants and descendants.
"Non-Highly Compensated Employee" shall mean an Employee who is neither a
Highly Compensated Employee nor a Family Member (as defined above) of a
Highly Compensated Employee.
1.13 Hour of Service. An "hour of service" means:
(a) Each hour for which an Employee is paid, or entitled to payment,
for the performance of duties for the Employer. These hours shall be
credited to the Employee for the computation period in which the duties are
performed;
(b) Each hour for which an Employee is paid, or entitled to payment,
by the Employer on account of a period of time during which no duties are
performed (irrespective of whether the employment relationship has
terminated) due to vacation, holiday, illness, incapacity (including
disability), layoff, jury duty, military duty or leave of absence. Except
as otherwise required by applicable federal or state law, no more than 501
hours of service shall be credited under this paragraph for any single
continuous period (whether or not such period occurs in a single
computation period). Hours under this paragraph shall be calculated and
credited pursuant to 2530.200(b)-2 of the Department of Labor Regulations
which are incorporated herein by this reference;
(c) Each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by the Employer. The same hours of
service shall not be credited both under paragraph (a) or (b), as the case
may be, and under this paragraph (c). These hours shall be credited to the
Employee for the computation period or periods to which the award or
agreement pertains rather than the computation period in which the award,
agreement or payment is made; and
(d) Hours of service credited to Employees whose compensation is not
determined on the basis of certain amounts for each hour worked during a
given period and whose hours are not required to be counted and recorded by
a separate federal statute such as the Fair Labor Standards Act shall be at
the rate of 45 hours of service for each week that the Employee is entitled
to be credited with at least one "hour of service" under the provisions of
this Section.
1.14 Leave of Absence and Termination of Service. The Employer, under
a uniform policy applied without discrimination, may grant a Leave of
Absence without pay to any Employee because of (a) service in any of the
114
Armed Forces of the United States or other governmental service, (b)
temporary incapacity, or (c) a temporary lay-off by the Employer. To
determine vested percentages and whether a Break in Service has occurred
(but not to determine entitlement to share in contributions and forfeitures
for the year), an Employee will be credited with Hours of Service during a
Leave of Absence as if he had been actively employed and had performed his
customary duties, provided he returns to work at or before the end of the
Leave of Absence or when so requested by the Employer after being
temporarily laid off by the Employer; otherwise his service will be
considered terminated as of the date on which his leave began. Any other
absence from active employment not deemed a Leave of Absence shall
terminate an Employee's service as of the date the Employer considers the
Employee to have been dropped from its employment rolls.
1.15 Maternity or Paternity Absences. For any Employee who is absent
from work by reason of (i) the pregnancy of the Employee; (ii) the birth of
a child of the Employee; (iii) the placement of a child with the Employee
in connection with the adoption of such child by the Employee; or (iv) for
purposes of caring for a child for a period beginning immediately following
the birth or placement of such child, the Plan shall treat as Hours of
Service for determining a Break in Service for purposes of eligibility and
vesting, the Hours of Service which otherwise would have been normally
credited to the Employee but for such absence or, in the event the Plan is
unable to determine the Hours of Service normally to be credited, eight (8)
Hours of Service per day of such absence.
Except as otherwise required by applicable federal and state law, the
total number of hours treated as Hours of Service under this Section shall
not exceed 501 hours. The Hours of Service attributable to an Employee
shall be credited to the Employee in the Plan Year in which begins the
absence from work if the Employee would be prevented from incurring a Break
in Service. In any other case, such Hours of Service shall be credited in
the immediately following year.
In the discretion of the Trustee, an Employee may be required to furnish
information that the absence from work qualifies under this Section and/or
the number of days of such absence.
1.16 Member. "Member" means any Employee who has qualified for
participation as provided in Article II of the Plan.
1.17 Name of Plan. The name of the Plan shall be the "Tyson Foods,
Inc. Employee Stock Ownership Plan".
1.18 Normal Retirement Age. "Normal retirement age" shall mean the
65th birthday of a Member.
1.19 Plan. "Plan" means the stock bonus employee stock ownership plan
set forth in this document and all subsequent amendments thereof.
1.20 Rollover Contribution. "Rollover Contribution" means anamount
transferred to the Trust by or on behalf of an Employee that qualifies as
an "Eligible Rollover Distribution" as described in 402(c)(4), 403(a)(4)
and 408(d)(3) of the Code. The Trustee shall accept such Rollover
Contributions from the Employee or directly from another Eligible
Retirement Plan as defined in Code Sec. 402(c)(8). The rollover of all or
any part of an Eligible Rollover Distribution shall be in accordance with
the provisions of Code Sec. 402(c) and the regulations thereunder, and the
Employer may require the Employee to furnish such evidence or information
115
it deems necessary to comply with said laws and regulations. However, the
Trustee shall not accept any part of an Eligible Rollover Distribution
which consists of assets which are other than (i) cash or equivalents, or
(ii) assets which are identical to those which Members may direct the
Trustee to purchase under the terms of the Plan, if applicable. In the
event a Rollover Contribution is accepted on behalf of a Member, an account
called the "Rollover Account" shall be established for such Member and
administered pursuant to the terms of the Plan as if such account (except
for the provisions of Section 6.4 below) were an Employer Contribution
Account of the Member.
1.21 Taxable Year, Fiscal Year, Plan Year and Limitation Year.
"Taxable Year", "Fiscal Year", "Plan Year", or "Limitation Year" means the
annual accounting period ending March 31, which Tyson Foods, Inc. has
adopted for federal income tax purposes.
1.22 Trust. "Trust" refers to the "Trust Agreement" between Tyson
Foods, Inc. and the Trustee or Trustees who have executed the Trust
Agreement ("Trustee") through which the Trust Funds shall be received,
held, invested and distributed to or for the benefit of Members or
beneficiaries hereunder.
1.23 Trust Fund. "Trust Fund" means all funds received hereunder by
the Trustee and any and all securities and other property purchased or
otherwise acquired out of such funds, together with all income, profits and
increments thereon.
1.24 Years of Service. A "year of service" means each twelve
consecutive month period during which an Employee has at least one thousand
(1,000) "hours of service". For determining an Employee's eligibility under
the Plan, his "eligibility computation period" shall begin on the
"employment commencement date" (as defined in Section 1.10 above) for such
Employee. Thereafter, the eligibility computation period shall be the "Plan
Year" beginning with the Plan Year which includes the first anniversary of
a Member's Employment Commencement Date. For determining a Member's vested
and nonforfeitable interest in his Employer Contribution Account, the
"vesting computation period" shall be the Plan Year.
ARTICLE II
Eligibility for Membership
2.1 Requirements for Participation. Each Employee shall become a
Member in the Plan on the first Entry Date (as defined above) following the
date the Employee becomes an "Eligible Employee," as defined hereafter. For
purposes of this Plan, an "Eligible Employee" shall mean an Employee who
(i) has attained the age of 21; (ii) for Plan Years ending prior to April
1, 1993, is classified as an Executive, professional, supervisory,
technical or office clerical employee; (iii) for Plan Years following March
31, 1993, is classified as a salaried employee; and (iv) has completed a
Year of Service (as defined above); provided, however, that any Employee
who is a Highly Compensated Employee, or who is a member of a collective
bargaining unit and is covered by a collective bargaining agreement which
does not provide for coverage of such Employee under this Plan, shall be
excluded.
2.2 Effect of Break in Service on Eligibility. In the event an
Employee has a Break in Service (as defined above), the Employee's Years of
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Service before such break shall not be required to be taken into account
for eligibility purposes until the Employee has completed a new Year of
Service following such break; provided, that if such Employee was a Member
at the time of such Break in Service, then upon completion of the new Year
of Service he will be treated as a Member retroactively from his date of
re-employment, but not for purposes of sharing in any Employer contributions
or forfeitures for any Plan Year ending prior to the date he completes such
new Year of Service.
2.3 Designation of Beneficiary. The provisions of this Plan shall
apply to all Members uniformly. Each Employee on becoming a Member shall:
(a) Agree in writing to be bound by the terms and conditions of this
Plan.
(b) Designate in writing one or more beneficiaries to receive his
benefits in the event of his death. If no such designation be made, or if
such beneficiary be deceased without a successor beneficiary being
designated in writing, then the death benefits shall be paid in a lump sum
to the surviving spouse of said Member, if any, otherwise to the personal
representative or estate of the deceased Member. Should a beneficiary of a
deceased Member die after he has started receiving payment under the Plan
and if there is no living successor beneficiary named by the deceased
Member, then the remainingbenefits shall be paid in a lump sum to the
surviving spouse of said beneficiary, if any, otherwise to the personal
representative or estate of the beneficiary receiving payment at the time
of his death.
Each Member shall be entitled to change his designated beneficiaries
from time to time by filing with the Trustee a new Designation of
Beneficiary Form, and each change so made shall revoke all prior
designations by the Member.
ARTICLE III
Contributions by Employer
3.1 Annual Contribution of Employer.
Formula for Contribution. Subject to the limitations of Section 5.7
below, the Participating Employers shall contribute as a whole with respect
to each Plan Year a total amount determined by the Board of Directors of
Tyson Foods, Inc. and authorized by written resolution. Contributions under
the Plan may be in cash or in the form of Employer stock. Total
contributions made by any Participating Employers to the Trust Fund for any
fiscal year shall not exceed fifteen percent (15%) of the aggregate Basic
Compensation of all Members who are entitled to share in that Participating
Employer's contribution for such year; provided, however, that to the
extent that Employer contributions are applied to the payment of principal
and/or interest on an "exempt loan" (defined in 5.11 below), such
contributions may exceed the limitations set forth above in this Section
3.1 to the extent permitted in 404(a)(9) and 404(k) of the Code.
3.2 Time of Payment of Contribution by Employer. The full amount of an
Employer's contribution for any taxable year shall be paid not later than
the time prescribed by law for filing the Federal income tax return of the
Employer for such taxable year.
3.3 Adjustment of Erroneous Contribution. If for a taxable year there
is an underpayment or overpayment of the contribution of an Employer, the
following acts shall be performed, to-wit:
(a) If an underpayment is made, the deficiency shall be paid in the
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taxable year in which it is disclosed, and for the purpose of allocation
shall be added to the contribution made in such taxable year of disclosure
and allocated in the same manner and among the same Members as though it
were part of the contribution for such taxable year of disclosure.
(b) If an overpayment is made, the Employer shall not be entitled to
recoup any part of such excess, and the same shall remain to the credit of
the accounts of the Members to whom it was allocated for the taxable year
of contribution, but the contribution of the Employer for the year during
which the overpayment is disclosed may, at the election of the Board of
Directors of the Employer, be reduced by the amount of the overpayment for
the prior year.
ARTICLE IV
PAYSOP Accounts
4.1 Establishment of Accounts. Prior to April 1, 1987, the accounts of
all Members in the Plan were administered so as to permit certain Employer
contributions to the Plan to qualify for the ("PAYSOP") Employee Stock
Ownership Credit permitted by 41 of the Code, which section was repealed by
the Tax Reform Act of 1986 effective for compensation paid after December
31, 1986. All of these accounts existing on March 31, 1987, are now
referred to as the "PAYSOP Accounts." As reflected in Article V hereof,
said PAYSOP Accounts shall continue under the Plan, and in all respects
shall be considered as accounts under the Plan and administered pursuant to
the terms and conditions of the Plan, except as specifically provided
otherwise below in Section 4.2.
4.2 PAYSOP Accounts. Notwithstanding any other provisions of this
Plan, all PAYSOP Accounts shall be subject to the following additional
requirement:
Employer stock allocated to a Member's PAYSOP Account shall not be
distributed from that account before the end of the 84th month beginning
after the month in which the Employer stock actually was allocated to such
Account, except when the Member separates from service with Employer, dies,
becomes disabled, is transferred to the employment of an acquiring employer
in the case of a sale to the acquiring corporation of substantially all of
the assets used by the selling corporation in a trade or business conducted
by the selling corporation, or, with respect to the stock of a selling
corporation, when there is a disposition of such selling corporation's
interest in the subsidiary when the Member continues employment with such
subsidiary. Furthermore, the 84 month distribution restriction shall not
apply to any distribution required under 401(a)(9) of the Code, to any
distribution or reinvestment required under 401(a)(28) of the Code, or in
the case of termination of the Plan.
ARTICLE V
Allocation of Trust Fund Among Members
5.1 Accounts of Members. The Committee shall establish and maintain
for each Member until his initial distribution date (defined in Section
7.1) separate accounts, to be called the "Employer Contribution Account",
and a "Rollover Account" (if applicable) and, pursuant to Article IV (if
applicable) a "PAYSOP Account." Each such account shall be credited or
debited to the extent required by the following Sections. As of the
Member's initial distribution date, an account called the "Distribution
Account" shall be set up for the Member until his benefits have been fully
paid.
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5.2 Valuation of Fund and Allocation of Profits or Losses of Trust
Fund. As of the last day of each taxable year, the total sum of all
accounts (Employer Contribution Accounts, Rollover Accounts, PAYSOP
Accounts and Distribution Accounts) shall be compared with the fair market
value of the Trust Fund as determined by the Trustee, excluding from such
appraised value an amount equal to the sum of (a) the aggregate amounts
forfeited during the taxable year in question and (b) the Employer's
contribution for such year. The difference between the total of all
accounts and the adjudged fair market value of the Trust Fund shall be
allocated and credited to the Employer Contribution Account, Rollover
Account, PAYSOP Account or Distribution Account of each Member, in the same
proportion that the total of each separate account of each Member prior to
the apportionment bears to the total sum of all accounts of all Members or
former Members prior to the apportionment. (The term "amount forfeited"
means that portion of a terminated Member's account to which he is not
entitled by reason of the provisions of Article VI.)
5.3 Allocation of Forfeitures.
After making the adjustment of Members' accounts required by Section 5.2,
the aggregate amount forfeited during the taxable year in question from
Employer Contribution Accounts shall be allocated and credited to the
Employer Contribution Accounts of only those Members (as of the close of
business on the last day of the taxable year in question) of the
Participating Employer with whom the terminated Member was last employed
who are entitled to share in the Employer contribution for that year, in
the same proportions in which the Employer contributions are allocated, in
accordance with Section 5.4 below.
5.4 Allocation of Employer Contribution. The Employer contributions of
all Participating Employers for each taxable year shall be allocated and
credited to the Employer Contribution Accounts (or Distribution Accounts)
of each of their Active Members entitled to share in such contributions for
such year in the same proportion that each such Member's Basic Compensation
for the taxable year while a Member under the Plan bears to the Basic
Compensation of all such Members for such year while Members under the
Plan. Each Active Member who both (i) is employed by the Participating
Employer at the end of the Plan Year, and (ii) has completed one thousand
(1,000) hours of service in such Plan Year shall be entitled to share in
the Employer's contribution for such year. Active Member means a Member who
meets the definition of "Eligible Employee" in Section 2.1 as of the end of
the Plan Year in question. If an Employer contribution is made with
Employer stock, fractional shares of such stock may be allocated to the
accounts of Members, but no allocation shall be made in fractions of less
than one-tenth (1/10) of a share. Unallocated shares in the hands of the
Trustee shall be carried over to and shall be allocated with the next
contribution of such stock.
5.5 Special Accounting Date. If the Trustee is of the opinion that a
substantial change in the value of the Trust Fund has occurred since the
last prior accounting date, the Trustee, if it deems it advisable and prior
to the next regular accounting date, may establish a special accounting
date and adjust the Members' accounts in accordance with the method
described in Section 5.2 to make the total net credit balance in the
accounts of all Members equal to the then market value of the assets of the
Trust Fund (excluding from such market value an amount equal to the sum of
the aggregate amounts forfeited and any Employer contributions since the
last prior accounting date). All distributions which are to be made as of
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or after such special accounting date but prior to the next accounting date
shall be made as if the net credit balance in all Distribution Accounts had
actually been credited or debited to reflect the required adjustment
described in Section 5.2.
5.6 Basis of Valuation. The value of the Trust Fund as of the last day
of each taxable year or any other special accounting date established by
the Trustee shall be determined on the basis of the fair market value of
the assets of the Trust Fund as appraised by the Trustee, less any accrued
expense to be paid from the Trust Fund.
5.7 Limit on Contributions. Except as provided below, notwithstanding
any other provisions of this Plan or any other qualified defined
contribution plan of Employer, no Employer contributions or allocations
with respect to a Member's Account in a Limitation Year shall be made to
the extent it would cause the Annual Addition to a Member's account to
exceed the lesser of:
(a) Twenty-five percent (25%) of the Member's compensation for the
Limitation Year; or
(b) $30,000 or, if greater, one-fourth (1/4) of the defined
benefit dollar limitation in effect under 415(b)(1)(A) of the Code.
For purposes of this Section 5.7, "compensation" shall have the same
meaning as "Basic Compensation" defined in Section 1.1 above except that
there shall be excluded any amounts that would have been includable in the
Employee's gross income if they had not received special tax treatment
because they were deferred by the Employee through salary reduction
contributions.
"Annual Addition" means the sum for any Limitation Year of the
following amounts allocated on behalf of a Member under this Plan and any
other qualified defined contribution plan of Employer:
(a) Employer contributions;
(b) Employee contributions; and
(c) all forfeitures.
Employee contributions, for purposes of the preceding sentence, do not
include "rollover contributions" (as defined in Section 1.20 above) and
without regard to Employee contributions to a simplified employee pension
which are excludable from gross income under 408(k)(6) of the Code.
Provided, however, that in the event no more than one-third (1/3) of
Employer contributions for the fiscal year are allocated to Highly
Compensated Employees, then the following special limitation rules shall
apply, notwithstanding any other provision in this Section 5.7:
(i) In the event that the Trust remains liable for any part of an
"Exempt Loan" (defined in Section 5.11 below), Employer contributions, to
the extent such amounts are applied to the payment of interest on such
Exempt Loan and are charged against the Member's account, shall not be
included in the definition of "annual addition" set forth above; and
(ii) Forfeitures of Employer stock which was acquired with the proceeds
of any Exempt Loan shall not be included in the definition of "annual
additions" set forth above.
Also, dividends from Employer stock (whether or not allocated under
Sections 5.4 and 5.10) which are used to repay principal or interest on an
Exempt Loan pursuant to Section 5.9 below shall not constitute annual
additions.
If a Member's "Annual Addition" would exceed the limit stated in this
Section notwithstanding these provisions, then:
(a) First, his Employee contributions, to the extent that the return would
reduce the amount by which the Annual Addition exceeds the limit stated in
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this Section, shall be returned to the Member; (b) Any remaining part of a
Member's Annual Addition which would exceed the limit stated in this
Section shall be reallocated among the accounts of other Members in the
same proportion as each Member's compensation bears to the total
compensation of all other Members whose Annual Additions, including such
reallocations, do not exceed the limit stated herein; and (c) To the extent
that such excess Annual Additions cannot be allocated further under
subparagraph (b) above due to the limitations contained in this Section
5.7, then such excess amounts shall be allocated to a suspense account and
held therein until the next succeeding date on which allocations are made
under this Plan at which time they shall be allocated and reallocated in
accordance with subsection (b) before any contributions which would
constitute Annual Additions may be made. In the event of termination of the
Plan, the suspense account shall revert to the Employer to the extent it
may not then be allocated to any Member's account. (If a suspense account
is in existence at any time during the Limitation Year pursuant to this
Section, it will not participate in the allocation of the Trust's
investment gains and losses for such year.)
5.8 Reporting for Employer Contribution Account.
Notwithstanding Section 5.1, for purposes of reporting to Members and
beneficiaries the value of their Employer Contribution Account and PAYSOP
Account (or Distribution Account), the Committee shall establish a separate
Cash Account and Stock Account for each Member or beneficiary. Cash
Accounts shall be kept in dollars and cents and shall reflect the value of
the Member's or beneficiary's interest in all assets of the Trust other
than Employer stock. The Stock Account shall be kept in number of shares of
Employer stock to the nearest onetenth (1/10) of a share. At any time the
value of a Member's or a beneficiary's "Stock Account" is reported for a
Plan Year, the Trustee also shall set forth the latest price publicly
quoted (if applicable) for Employer stock during such Plan Year.
5.9 Suspense Account. All shares of Employer stock acquired by the
Trustee with the proceeds of an Exempt Loan shall be held by the Trustee in
a separate "Suspense Account" until withdrawn and allocated to Members'
accounts as provided in Section 5.10 below. Any dividends received by the
Trustee attributable to shares held in the Suspense Account shall first be
applied towards the reduction of any such Exempt Loan, and any excess
dividends shall be allocated as income of the Plan pursuant to Section 5.2
above.
5.10 Withdrawal from Suspense Account. All shares held in the Suspense
Account shall be withdrawn at the same rate that such shares are released
as collateral for the Exempt Loan (or, as if such shares were encumbered to
secure the Exempt Loan), the proceeds of which were used to acquire such
shares. In any event, such shares shall be withdrawn in accordance with
regulation 54.497511(c). On the last day of each Plan Year, the Trustee
shall allocate all shares withdrawn during such year to the Members'
Employer Contribution Accounts in the same proportions in which Employer
contributions are allocated in accordance with Section 5.4 above,
accounting for such allocated shares at their "cost" basis to the Trust.
Such allocations of withdrawn shares shall be made in number of shares to
the nearest one-tenth (1/10) of a share. For purposes of determining the
amount of the Employer's contribution to be allocated (under Section 5.4)
in assets other than shares of stock withdrawn from the suspense account,
the Employer's contribution shall first be reduced by the amount of the
Employer's contribution applied towards the reduction of the Exempt Loan
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(rather than the current fair market value of such withdrawn shares). For
purposes of Section 5.7 above, "Annual Additions" shall be calculated with
respect to Employer contributions used to repay the Exempt Loan rather than
with respect to the value of shares allocated to Members' accounts.
5.11 Exempt Loan. For purposes of this Article V, "Exempt Loan" shall
mean a loan exempt under 4975(d)(3) of the Code and conforming with the
requirements of regulation 54.4975-7, and all future amendments thereto.
5.12 Dividends. All dividends paid on Employer stock allocated to
Members' accounts and received by the Trustee in a taxable year shall be
distributed to such Members on or before the 90th day following the end of
such year.
5.13 Other Limitations. Subject to the special rules and definitions
of 409(n) of the Code, no portion of the assets of the Plan attributable to
(or allocable in lieu of) Employer stock acquired by the Plan in a sale to
which 1042 or 2057 of the Code applies may be allocated (directly or
indirectly) to the account of:
(a) any person who makes an election under 1042 with respect to
Employer stock, any decedent if the executor of the estate of such decedent
makes a "qualified sale" to which 2057 applies, or any individual who is
related to such person or decedent (within the meaning of 267(b)) of the
Code; or
(b) any other person who owns (after application of 318(a)) more
than 25 percent of the outstanding Employer stock.
ARTICLE VI
Vesting
6.1 Vesting of Employer Contribution Account. Except as hereinafter
provided, the amount credited to the Employer Contribution Account of a
Member shall become vested and nonforfeitable based upon his number of
Years of Service (as defined in Section 1.24 above) in the percentage
indicated as follows:
Years of Service Percentage Vested
Less than 3 years 0%
3 years 20%
4 years 40%
5 years 60%
6 years 80%
7 years 100%
6.2 Vesting on Death, Disability or Normal Retirement. Upon a
Member's death, severance of employment due to Disability (defined in
Section 1.4 above) or attainment of his Normal Retirement Age, the full
amount of his Employer Contribution Account shall become vested and
nonforfeitable.
6.3 Vesting if Plan Terminated or Employer Contributions Discontinued.
Notwithstanding any other provisions of this Article VI, if the Plan is
terminated, or Employer contributions to the Trust Fund are permanently
discontinued, the full amount of each Member's Employer Contribution
Account shall become fully vested and nonforfeitable. If the Plan is
partially terminated, then the accounts of those Members as to whom partial
termination occurred shall be fully vested and nonforfeitable.
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6.4 Rollover Account and PAYSOP Account. Amounts credited to a
Member's Rollover Account and PAYSOP Account always shall be 100% vested
and nonforfeitable.
6.5 Effect of Break in Service on Vesting. A former Member who had a
nonforfeitable right to all or a portion of his Employer Contribution
Account at the time of a Break in Service shall receive credit for all
Years of Service prior to his Break in Service upon completing a Year of
Service after such break. A former Member who did not have a nonforfeitable
right to any portion of his Employer Contribution Account at the time of a
Break in Service shall receive credit for all Years of Service before such
break if (i) he completes a Year of Service after such break, and (ii) the
number of consecutive one-year Breaks in Service is less than the greater
of five (5) years or the aggregate number of the Member's Years of Service
before such break. All Years of Service occurring after five (5)
consecutive one-year Breaks in Service shall be disregarded for purposes of
determining the Member's vested percentage in contributions that occurred
before such five-year break. Separate accounts shall be maintained for the
pre-break and post-break contributions.
6.6 Disposition of Forfeited Amounts. If a Member incurs five
consecutive one-year Breaks in Service or if a Member receives a Cash-Out
Distribution pursuant to Sections 7.3 and 7.6, then, in either event, that
part, if any, of his Employer Contribution Account which is not vested in
accordance with the foregoing provisions of this Article VI shall be
forfeited and shall be reallocated as provided in Sections 5.3. Provided,
however, that if a portion of a Member's account is so forfeited, any
interest in any shares of Employer stock that have been allocated to such
Member's account may be forfeited and reallocated only after other assets
of the Member's account. Any former Member receiving a Cash-Out
Distribution as defined in Section 7.6 who returns to the employ of the
Employer prior to incurring five consecutive one-year Breaks in Service and
repays the amount of his previous distribution pursuant to Section 7.6
shall have restored to his Employer Contribution Account any amount
previously forfeited. Such forfeiture shall be restored first from any
forfeitures during the Plan Year of his return to employment and next from
the Employer Contribution next occurring after his return.
6.7 Change in Vesting Schedule. As to each Employee who had no less
than 3 Years of Service on the date a Plan amendment which directly or
indirectly changes the vesting schedule becomes effective, such Employee
may elect to have his vesting percentage computed without regard to such
amendment. Such election will be irrevocable and must be made in writing to
Employer not later than the latest of the following dates:
(1) 60 days after the amendment is adopted;
(2) 60 days after the effective date of the amendment;
(3) 60 days after the date the Employee is given written notice of the
amendment by the Employer.
ARTICLE VII
Distributions
7.1 Initial Distribution Date. The initial distribution date of a
Member shall be the earlier of:
(a) The date of termination of his employment; or
(b) The end of the taxable year in which he attains age 70.
7.2 Establishment of Distribution Account. On a Member's initial
distribution date, the Trustee shall determine the amount of each separate
account of the Member to which such Member may be entitled on such date in
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accordance with the vesting provisions of Article VI, and shall credit such
amount or amounts to a new account for the former Member to be called the
"Distribution Account." The balance of the Member's Employer Contribution
Account (representing his forfeitable amount) shall continue to be held
therein, until forfeited in accordance with Section 6.6. The net credit
balance in each Distribution Account shall be subject on each accounting
date to the adjustments specified in Section 5.2.
7.3 Date of Distribution.
(A) Not Greater than $3,500. Disbursement of a Member's
Distribution Account shall be made without his consent within the sixty
(60) day period following the close of the Plan Year in which the Member
terminates employment if the vested amount of his account does not exceed
$3,500.
(B) Greater than $3,500. If the vested amount of a Member's
Distribution Account exceeds $3,500 upon termination of employment,
disbursement of the Distribution Account shall be made, or begun if in
periodic payments, subject to the provisions of Section 7.14 below, if
applicable, as follows:
(1) If the Member consents by the end of the Plan Year in which
termination occurs, within the sixty (60) day period following the close of
such Plan Year; or
(2) If the Member does not consent within the period described
in (1) above, within the sixty (60) day period following the close of the
earliest Plan Year in which:
(a) the Member dies;
(b) the Member incurs a Disability (as defined in Section 1.4
above);
(c) the Member reaches his Early Retirement Date and elects to
begin receiving distributions on or after such date; or
(d) the Member reaches his Normal Retirement Age (as defined in Section
1.18 above).
(C) Pre-Retirement Distributions. A Member may elect to begin
distributions of any amount of his account once the Member attains his
Normal Retirement Age, even though the Member does not terminate his
employment with the Employer.
The distribution provisions of this Section 7.3 shall be subject to
the following additional restrictions, requirements and exceptions:
(i) The disbursement of the Distribution Account of a Member shall
in any event be made or begun by April 1 of the calendar year following the
calendar year in which the Member turns age 70 years.
(ii) No portion of a Member or former Member's Distribution Account
which consists of Employer stock acquired with the proceeds of an Exempt
Loan is required to be distributed until the last day of the Plan Year in
which such Exempt Loan is repaid in full.
(iii) Distributions from PAYSOP Accounts shall be subject to the
limitations specified in Article IV above.
7.4 Methods of Distribution. All distributions made to a Member or his
or her beneficiaries shall be made by the Trustee in one of the four
following methods:
(a) Mandatory Installments. Unless the Member affirmatively elects
in writing not to receive payments under this subparagraph (a),
distribution shall be in equal annual installments over a period of not
exceeding the greater of (i) five (5) years or (ii) in the case of a Member
with an account balance in excess of $500,000, five (5) years plus one (1)
additional year (but not more than five (5) additional years) for each
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$100,000 or fraction thereof by which such balance exceeds $500,000.
(b) Lump Sum. By payment in a lump sum.
(c) Elective Installments. By payment in equal annual installments
over a period certain which does not extend beyond the lesser of twenty
(20) years or the life expectancy of the Member or the joint life
expectancies of such Member and the Member's beneficiary determined as of
the date that payment of benefits commences, subject to the following
requirements:
1. Fifty Percent (50%) Present Value Test. The present value of
payments to be made to the Member must be more than fifty percent (50%) of
the present value of the total payments to be made to the Member and the
Member's beneficiaries, all as determined as of the later of such Member's
normal retirement age or the Member's termination of employment; and
2. Equal Installments. Payments must be in the form of annual or
more frequent installments provided the present value of all such periodic
payments payable to the Member or his or her beneficiary must be equal to
the immediate lump sum otherwise distributable to the Member had a lump sum
settlement been made.
(d) Combination. By any combination of (b) and (c). The method of
distribution to the Member or his beneficiaries shall be implemented by the
Committee, in accordance with the directions of the Member in effect at the
time the Member's employment is terminated. Notwithstanding any other Plan
provision to the contrary, all Plan distributions shall comply with the
requirements of 401(a)(9) of the Code and the regulations thereunder,
including 1.401(a)(9)-2.
7.5 Deferred Retirement. If such Member elects to continue in the
employment of the Employer beyond his Early or Normal Retirement Date, he
shall continue to be treated in all respects as a Member under the Plan
until his actual retirement.
7.6 Cash-Out Distributions.
If a Member terminates service with the Employer and receives an immediate
distribution of the vested portion of his accounts under the Plan pursuant
to Section 7.3 (a "Cash-Out Distribution"), the nonvested portion of the
Member's accounts under the Plan immediately will be forfeited and
reallocated to other Members' accounts in accordance with Section 5.3. If
the Member resumes or continues employment covered under the Plan and
repays during the employment with the Employer the amount distributed
pursuant to this Section within the time limit stated below, then the
Trustee shall credit to his accounts under the Plan the amount standing to
his credit in each account immediately prior to the distribution,
unadjusted by any subsequent gains or losses of the Trust Fund. Such
repayment must occur before the Member incurs five (5) consecutive one-year
Breaks in Service.
7.7 Payment of Benefits Upon Death of Member. Upon the death of a
Member the portion of the Member's account balance, if any, not yet paid to
the Member shall be paid to the Member's surviving spouse; provided,
however, that if the Member is not survived by a spouse or if such spouse
consents to an election out of such payment as set forth in paragraph 7.8,
such benefits shall be paid to the Member's designated beneficiary.
7.8 Spousal Consent. Any election by a Member to pay benefits upon the
Member's death to a beneficiary other than the Member's spouse under
paragraph 7.7 shall not be effective unless (i) the spouse of the Member
consents in writing to such election and the spouse's consent acknowledges
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the effect of such election and is witnessed by the Employer or a notary
public, or (ii) it is established to the satisfaction of the Employer that
the consent required from the spouse may not be obtained because there is
no spouse, because a spouse cannot be located or because of such other
circumstances as may be established by the Secretary of Treasury under
prescribed regulations.
7.9 Death Before Commencement of Benefits. If a Member dies before the
distribution of his interest has commenced, the Member's entire interest
shall be distributed within five (5) years after his death to his
designated beneficiary; provided, however, that such benefits may be paid
to the designated beneficiary over the life of the beneficiary or over a
period not exceeding the life expectancy of the beneficiary if such
benefits commence within one year of the Member's death. Notwithstanding
the foregoing, if the Member's designated beneficiary is his or her spouse,
such payments need not begin earlier than the date on which the Member
would have attained age 70r years. If the spouse dies before distributions
to such spouse begin, this Section shall be applied as if the surviving
spouse was the Member. If distributions have commenced prior to the
Member's death, the remaining portion of the Member's account shall be
distributed to such Member's beneficiary at least as rapidly as under the
method of distribution being used at the time of the Member's death.
7.10 Distributions to be Made in Employer Stock. Except as set forth
below in this Section, Employer shall have the option of making all
distributions to a Member or his beneficiary either in cash or in the form
of shares of Employer stock. Provided, however, the following additional
restrictions shall apply:
(a) The distributee shall have the right to demand that his
benefits be distributed in the form of Employer stock. Employer must advise
the distributee in writing of this right at least 30 days before making any
election to distribute cash;
(b) If the distributee elects to receive any shares of Employer
stock and at the time of distribution such shares are not "readily tradable
on an established market" (as defined in regulation 54.4975-7(b)(l)(iv) and
54.4975-7(b)(10), then, only as to those shares, the distributee shall have
the right to require Employer to repurchase such shares under the following
terms:
(i) Upon receipt of such restricted shares, the distributed
shall have up to 60 days to give Employer written notice requiring Employer
to repurchase all or any part of the shares at "fair market value" (as
defined in Section 11.11). If such notice is not timely made, the
distributee's put option will lapse temporarily;
(ii) After the close of Employer's taxable year in which the
temporary lapse occurs, and following a determination of the fair market
value of the restricted shares as of that same year, Employer shall notify
each distributee whose put option lapsed temporarily of such value
determination. Following receipt of this notice of the value of the
restricted shares, the distributee shall have an additional 60 days to give
Employer written notice requiring Employer to purchase all or part of such
shares, or else the option shall permanently expire;
(iii) In the event Employer repurchases restricted shares pursuant
to this Section 7.10 (or if the Trust elects to repurchase such shares,
which it may do but is not required to do), such repurchasing party shall
have the option to pay for such shares on an equal annual installment basis
beginning not later than 30 days after the exercise of the put option
described in (ii) above and not exceeding a five year period. If an
126
installment repurchase is elected, the distributee must give the
repurchasing party a promissory note, the full payment of which may be
required by the seller if the repurchaser defaults on the scheduled
payments of the note. In addition, such promissory note must be adequately
secured and bear a reasonable interest rate; and
(iv) If the Member has elected an installment distribution under
Section 7.4 above, the provisions of subparagraph (b) of this Section shall
be satisfied if the amount to be paid for the stock is paid not later than
30 days after the exercise of the put option described in subparagraph (b)
of this Section. (c) Except as provided in this Section 7.10 and except as
permitted by subparagraphs (b)(9) and (10) of Regulation 54.4975- 7(b), no
Employer stock acquired with the proceeds of an Exempt Loan (defined in
Section 5.11) may be subject to a put, call, or other option or buy-sell or
similar arrangement while held by and when distributed from the Plan. (d)
If securities to be distributed were acquired with the proceeds of an
Exempt Loan (defined in Section 5.11) and such securities consist of more
than one class, the distributee must receive substantially the same
proportion of each such class. 7.11 Benefits Payable to Minors and
Incompetents.
(A) Whenever any person entitled to payments under this Plan
shall be a minor or under other legal disability or in the sole judgment of
the Committee shall otherwise be unable to apply such payments to his own
best interest and advantage (as in the case of mental or physical illness
or where the person not under legal disability is unable to preserve his
estate for his own best interest), the Committee may in the exercise of its
discretion direct all or any portion of such payments to be made in any one
or more of the following ways, unless claim shall have been made therefore
by an existing and duly appointed guardian or other legal representative in
which event payment shall be made to such representative:
(1) Directly to such person unless such person shall be a minor or
shall have been legally adjudicated incompetent at the time of the payment.
(2) To the spouse, child, parent or other blood relative to be
expended on behalf of the person entitled or on behalf of those dependents
as to whom the person entitled has the duty to support.
(3) To a recognized charity to be expended for the benefit of the
person entitled or for the benefit of those dependents as to whom the
person has the duty to support. (4) By the Committee itself receiving and
expending or directing the expenditures of the same for the benefit of
those dependents as to whom the person has the duty of support.
(B) The decision of the Committee will, in each case, be final and
binding upon all persons and, except in the case of Section 7.11(A)(4)
above, the Committee will not be obligated to see to the proper allocation
or expenditure of any payments so made. Any payment made pursuant to the
power herein conferred upon the Committee shall operate as a complete
discharge of the obligations of the Trustee and of the Committee.
7.12 Notification of Mailing Address. (A) Each Member and other person
entitled to benefits hereunder shall file with the Committee, from time to
time, in writing, his post office address and each change of post office
address, and any check representing payment hereunder and any communication
addressed to a Member or a beneficiary hereunder at his last address filed
with the Committee (or, if no such address has been filed, then at his last
address as indicated on the records of the Employer) shall be binding on
such person for all purposes of the Plan, and neither the Committee nor the
Trustee shall be obliged to search for or ascertain the location of any
such person. (B) If the Committee, for any reason, is in doubt as to
whether payments are being received by the person entitled thereto, it may
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by registered mail addressed to the person concerned at his address last
known to the Committee, notify such person that all unmailed and future
payments shall be henceforth withheld until he provides the Committee with
evidence of his continued life and his proper mailing address or his
beneficiary provides the Committee with evidence of his death. In the event
that (I) such notification is mailed to such person and his designated
beneficiary, (ii) the Committee is not furnished with evidence of such
person's continued life and proper mailing address or with evidence of his
death, all payments shall be withheld until a claim is subsequently made by
any such person to whom payment is due under the provisions of the Plan.
7.13 Lost Payee. In the event the Administrator is unable, within five
years after payment of a benefit is due to a Member or beneficiary, to make
such payment because it cannot ascertain the whereabouts of the Member or
the identity and whereabouts of his beneficiary or personal representative
by mailing to the last known address shown on the Administrator's records,
and neither the Member, his beneficiary or personal representative has made
written claim therefore before the expiration of such five years, then, and
in such case, the Administrator shall direct that such amount shall be
forfeited to the Plan; provided, however, that such amount shall be
reinstated if and in the event the said Member or his beneficiary or
personal representative shall make a valid claim therefore upon
presentation of proper identification.
7.14 Eligible Rollover Distributions. This section applies to
distributions made on or after January 1, 1993. Notwithstanding any
provision of the Plan to the contrary that would otherwise limit a
distributee's election under this section, a distributee may elect, at the
time and in the manner prescribed by the plan administrator, to have any
portion of an eligible rollover distribution paid directly to an eligible
retirement plan specified by the distributee in a direct rollover.
(a) Eligible Rollover Distribution. An eligible rollover
distribution is any distribution of all or any portion of the balance to
the credit of the distributee, except that an eligible rollover
distribution does not include: any distribution that is one of a series of
substantially equal periodic payments (not less frequently than annually)
made for the life (or life expectancy) of the distributee or the joint
lives (or joint life expectancies) of the distributee and the distributee's
designated beneficiary, or for a specified period of ten years or more; any
distribution to the extent such distribution is required under 401(a)(9) of
the Code; and the portion of any distribution that is not includable in
gross income (determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities).
(b) Eligible Retirement Plan. An eligible retirement plan is an
individual retirement account described in 408(a) of the code, an
individual retirement annuity described in 408(b) of the Code, an annuity
plan described in 403(a) of the Code, or a qualified trust described in
401(a) of the Code, that accepts the distributee's eligible rollover
distribution. However, in the case of an eligible rollover distribution to
the surviving spouse, an eligible retirement plan is an individual
retirement account or individual retirement annuity.
(c) Distributee. A distributee includes an employee or former
employee. In addition, the employee's or former employee's surviving spouse
and the employee's or former employee's spouse or former spouse who is the
alternate payee under a qualified domestic relations order, as defined in
414(p) of the Code, are distributees with regard to the interest of the
spouse or former spouse.
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(d) Direct Rollover. A direct rollover is a payment by the Plan to
the eligible retirement plan specified by the distributee.
ARTICLE VIII
Amendment and Termination of Plan
8.1 Amendment of Plan. This Plan may be amended at any time and from
time to time by the Board of Directors of Tyson Foods, Inc. However, no
change may be made in the Plan which will vest in any Participating
Employer, directly or indirectly, any interest, ownership or control in any
of the present or subsequent funds set aside for Members pursuant to the
Plan. No part of the funds shall, by reason of any amendment or under any
other circumstances, be used for or diverted to purposes other than for the
exclusive benefit of Members and their beneficiaries or for administration
expenses of the Plan. Nor shall any amendment reduce any then vested
interest of a Member or eliminate an optional form of benefits under the
Plan.
8.2 Suspension of Contributions by Employer. Tyson Foods, Inc. has
established the Plan with the bona fide intention and expectation that from
year to year the Participating Employers will be able to and will deem it
advisable to make contributions as herein provided. However, Tyson Foods,
Inc. realizes that circumstances not now foreseen or circumstances beyond
its control may make it either impossible or inadvisable for all
Participating Employers to continue to make such contributions. If Tyson
Foods, Inc. or any of the Participating Employers decides it is impossible
or inadvisable to make its contributions as herein provided, the Board of
Directors of Tyson Foods, Inc. shall have the power to suspend any
Participating Employer's liability for contributions for a fixed or
indeterminate period. However, all other provisions of the Plan shall
remain in force, other than the provisions for contributions by the
Participating Employer during the period its contributions are suspended.
8.3 Termination of Plan. The Plan may be terminated at any time by
delivering to the Trustee in writing a resolution of the Board of Directors
of Tyson Foods, Inc. duly certified by one of its officers specifying that
the Plan is being terminated. Such termination may be so made without any
consent being obtained from the Trustee, the Participating Employers,
Members, or their beneficiaries or any interested or other persons.
8.4 Distribution on Termination. Upon termination as provided in
Section 8.3 above, the Committee shall direct the Trustee, as soon as
practicable, to pay the expenses of distribution and other expenses and
liquidation costs of the Plan and trust and upon completion of such
liquidation and the payment of all expenses and costs, the Trustee shall
proportionately adjust the Members' accounts to reflect such expenses and
the fund profits or losses and reallocations to the date of termination,
and thereafter disburse to each Member the amount then standing to his
credit in his account, in accordance with Article VII above.
8.5 Termination of Trust. When all assets of the Trust have been
distributed as herein provided, the Trust shall terminate and the Trustee
shall be discharged. Unless sooner terminated under the provisions of this
Indenture, the Trust shall terminate upon the expiration of such period as
may be provided by any applicable Rule Against Perpetuities under Arkansas
law.
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8.6 Merger, Consolidation, or Transfer of Assets. This Plan and Trust
shall not be merged or consolidated with, nor shall any assets or
liabilities be transferred to, any other plan, unless the benefits payable
to each Member if the Plan was terminated immediately after such action
would be equal to or greater than the benefits to which such Member would
have been entitled if this Plan had been terminated immediately before such
action.
ARTICLE IX
Trust Fund and Trustee
9.1 Trustee. The term "Trustee" shall mean the Trustee or Trustees
appointed by Employer under the terms of the stock ownership trust executed
in connection with the Plan to administer the trust fund created for the
purpose of the Plan, or such other Trustee or Trustees as may be designated
from time to time under the terms of said trust. The Trustee's obligations,
duties and responsibilities are governed solely by the terms of such trust
instrument, reference to which is here made for all purposes.
9.2 Purpose of the Trust Fund. A trust fund will be created and
maintained for the purposes of the Plan, and the money thereof will be
invested in accordance with the terms of the agreement and declaration of
trust which forms a part of the Plan. All contributions will be paid into
the trust fund, and, except as permitted by Section 9.5 below, all benefits
under the Plan will be paid from the trust fund. To the fullest extent
practicable, assets of the trust fund shall be invested in Employer stock.
9.3 Benefits Supported Only by the Trust. Except as provided in
Section 9.5 below, any person having any claim under the Plan will look
solely to the assets of the trust fund for satisfaction.
9.4 Trust Fund Applicable Only to Payment of Benefits. The trust fund
will be used and applied only in accordance with the provisions of the
Plan, to provide the benefits thereof, and no part of the principal or
income of the trust fund will be used for, or diverted to, purposes other
than for the exclusive benefit of Members and other persons thereunder
entitled to benefits.
9.5 Diversification of Investments. Notwithstanding the provisions of
Sections 9.2 and 9.3 above, any Member who has completed at least ten (10)
years of participation in the Plan and has attained age 55 may elect within
90 days after the close of each Plan Year in the "qualified election
period" (defined below) to direct the Plan as to the investment of at least
25 percent of the cumulative total of his accounts (to the extent such
portion exceeds the amount to which a prior election under this Section 9.5
applies). In the sixth year of such "qualified election period," the Member
may direct the investment of at least 50 percent of his accounts. Provided,
this diversification election shall not apply to a Member's PAYSOP Account,
except to the extent of dividends paid with respect to Employer stock in
such Account as of December 31, 1986, if such dividends are either paid in
the form of Employer stock or paid in cash or other property that later is
used to acquire Employer stock. The "qualified election period" is the six
Plan Year period beginning with the Plan Year in which the Member attains
age 55 (or, if later, beginning with the first Plan Year in which the
Member completes his tenth year of participation in the Plan). If such a
diversification election is made, the Committee, in its sole discretion,
may satisfy the election in either of the following methods:
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(a) distribute to the Member within 90 days after the relevant
election period that portion of his accounts covered by the election either
(i) in Employer stock, or
(ii) in cash in lieu of Employer stock; or
(b) transfer that portion of his accounts covered by the election
to another qualified plan of Employer which provides for Employee-directed
investments in at least three investment options other than in Employer
stock.
ARTICLE X
Administration
10.1 Fiduciary. The Board of Directors of Tyson Foods, Inc. shall
appoint a committee to be known as the "Administrative Committee" (the
"Committee") to administer the Plan. The Committee will serve as the named
fiduciary of the Plan. The Committee shall consist of officers and
Employees of the Tyson Foods, Inc. or other individuals or entities, all of
whom shall serve at the pleasure of the Board and without compensation, and
whose number shall not be less than three (3) nor more than seven (7). A
member of the Committee may resign at any time upon delivery of a written
resignation of the Board. Vacancies created by resignation, death, or other
cause may be filled by the Board or the assigned responsibilities may be
reabsorbed or redelegated by the Board. Any person or entity may serve in
more than one fiduciary capacity as respects the Plan.
10.2 Powers and Duties. The Committee shall administer the Plan in
accordance with its terms and shall have all powers necessary to carry out
its terms. The Committee shall act for and on behalf of the Participating
Employers in taking any action or furnishing any information required of
the Participating Employers with respect to the Plan. All interpretations
of the Plan, and questions concerning its administration and application,
shall be determined by the Committee, and such determinations shall be
binding on all persons except as otherwise expressly provided herein. The
Committee may employ one or more persons to render advice with regard to
any responsibility under the Plan. In the event the members of the
Committee are unable to act for any reason, any actions required of the
Committee shall be by the Board. A Committee member who is a Member under
the Plan will not vote or act on any matter relating only to himself. The
Committee shall have the power to delegate specific fiduciary
responsibilities (other than those of the Trustee with respect to
controlling assets of the Plan) by written action. Such delegations may be
officers or Employees of the Participating Employers or to other
individuals or entities, all of whom shall serve at the pleasure of the
Committee, and, if full-time Employees of a Participating Employer, without
compensation. Any responsibility allocated or delegated shall be the sole
and several responsibility of the person or entity to whom allocated or
delegated. Any person or entity may serve in more than one fiduciary
capacity as respects the Plan.
10.3 Records and Reports. The Committee shall keep a record of all
their proceedings and actions, and other data as shall be necessary for the
proper administration of the Plan and meet the disclosure and reporting
requirements of the law.
10.4 Claims Procedure. If a claim for benefit made by a Member or his
beneficiary is denied, the Committee will give to the Member or beneficiary
written notice of the denial and the specific reasons therefore. The notice
shall be written in a manner calculated to be understood by the Member or
131
beneficiary. The Member and beneficiary shall be given sixty (60) days
after such notice to obtain by request to the Committee member designated
in the notice a full and fair review by Committee of the decision denying
the claim.
10.5 Indemnification. The Participating Employers shall indemnify each
member of the Committee and any officer, director, or Employee of the
Participating Employers against any and all claims and causes of action by
or on behalf of any and all parties whomsoever, and all losses therefrom,
including without limitation costs of defense and attorney's fees, based
upon or arising out of any act or omission relating to or in connection
with the Plan and Trust Agreement, other than losses resulting from any
such person's fraud or willful misconduct. The indemnity provided herein
shall not be available to the extent that it would deprive the person
indemnified of the benefit of any insurance payment otherwise available.
10.6 Administrative Procedures.
(a) The Committee shall establish a set of accounting records
(including a general ledger) separate from the accounting records of the
Trustee. The Committee shall designate one person to be responsible for the
recording of transactions pertaining to the Plan and to prepare financial
statements each calendar quarter for
presentation to the Committee.
(b) On the last day of March and September of each year a physical
count of all securities owned by the Trust Fund shall be performed, with
the results being reconciled to the assets per the accounting records.
(c) A complete and organized file of all correspondence regarding
the Plan shall be maintained in one location.
(d) A separate accounting shall be maintained for all securities and
other assets that are to be distributed to terminated Employees.
(e) All matters concerning the Plan shall be transacted separately
and distinctly from any other plan administered by a Participating
Employer. In no event shall any assets of this Plan be distributed to
members or beneficiaries of any other plan administered by a Participating
Employer.
(f) All distributions of benefits shall be checked and verified by
the Committee prior to the actual distribution.
(g) All buy and sell transactions of the shares of Employer stock
shall be coordinated between the Committee and the Trustee.
(h) All shares of Employer stock owned by the Trust Fund shall be
issued in the name of the Trustee under the Plan and Trust, and such shares
shall not be commingled with other accounts held by the Trustee.
(i) The Committee shall meet at least once each Plan Year and at
such meeting the following matters shall be discussed:
(i) Investment policies and decisions;
(ii) The determination of the market value of investments for
financial statement presentation; and
(iii) Approval of transactions with parties- ininterest. The
Committee shall designate one member of the Committee to be responsible
for recording minutes of each Committee meeting.
ARTICLE XI
Miscellaneous Provisions
11.1 Rights of or to Employment. The adoption and maintenance of
the Plan shall not be deemed to constitute a contract between the
Participating Employers and any Employee, and shall not be deemed to be a
consideration for, or an inducement or condition of, the employment of any
132
person. Nothing herein contained shall be deemed to give to any Employee
the right to be retained in the employ of a Participating Employer or to
interfere with the right of a Participating Employer to discharge its
Employee at any time. Nor shall any provision of the Plan be deemed to give
to a Participating Employer the right to require any Employee to remain in
its employ; nor shall it interfere with any Employee's right to terminate
his employment at any time.
11.2 Benefits Payable Solely from Trust Fund. All benefits payable
under the Plan shall be paid or provided for solely from the Trust Fund,
and the Participating Employers assume no liability or responsibility
therefore.
11.3 Restrictions on Transfer and Claims of Creditors.
(A) Subject to the exceptions set forth in 401(a)(13) and 414(p)
of the Code, no benefits, rights or accounts shall exist under the Plan
which are subject in any manner to voluntary or involuntary anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance or charge, and
any attempt so to anticipate, alienate, transfer, assign, pledge, encumber
or charge the same shall be void. Nor shall any such benefit, right or
account be in any manner liable for or subject to the debts, contracts,
liabilities, engagements, torts or other obligations of the person entitled
to such benefit, right or account except as specifically provided in the
Plan. Nor shall any benefit, right or account under the Plan constitute an
asset in case of the bankruptcy, receivership or divorce of any person
entitled under the Plan.
(B) If a Member or any other person entitled under the Plan becomes
bankrupt or makes an assignment for the benefit of creditors or in any way
suffers a lien or judgment against his personal assets or in any way
attempts to anticipate, alienate, sell, assign, pledge, encumber or charge
a benefit, right or account, except as specifically provided in the Plan,
then such benefit, right or account in the discretion of the Committee may
cease and terminate and in that event the Trustee shall at the direction of
the Committee hold or apply funds equal in value to such terminated account
to the best interest of such Member or his dependents as the Committee
shall determine.
11.4 No Interference by Members in Administration of Trust. Nothing
contained herein shall grant to any Member the right to question the types
of investments made by the Trustee of Trust Funds nor to interfere in any
manner with the Trustee's administration of the Trust. Neither the Trustee
nor the Employee shall be obligated to disclose to any Member the
compensation being paid to any other Member or to provide any Member with
financial statements or operational data of the Employer.
11.5 Members to Furnish Required Information. Each Member will furnish
to the Committee such information in writing as the Committee considers
necessary or desirable for purposes of administering the Plan, and the
provisions of the Plan respecting any payments thereunder are conditional
upon the Member's furnishing promptly such true, full and complete
information as the Committee may request. Any notice or information which,
according to the terms of the Plan or the rules of the Committee, must be
filed with the Committee, shall be deemed so filed at the time that it is
actually received by the Committee.
11.6 Employer's Contributions Irrevocable. No Participating Employer
shall have any right, title or interest in the Trust fund or in any part
133
thereof, and no contributions made thereto shall revert to a Participating
Employer.
11.7 Applicable Law. All legal questions pertaining to the Plan shall
be determined in accordance with the laws of the State of Arkansas, and all
contributions made hereunder shall be deemed to have been made in that
State.
11.8 Titles to Articles and Paragraphs. The titles to articles and
paragraphs are included solely for convenience of reference, and if there
is any conflict between the titles and the text of this Plan the text shall
control.
11.9 Gender. The masculine gender shall include the feminine where
applicable, and the singular shall include the plural unless the context
clearly indicates otherwise.
11.10 Nonterminable Provisions. Any shares of Employer stock acquired
with proceeds of an Exempt Loan (as defined in Section 5.11 above) will
continue, after the loan is paid, and in the event that the Plan ever fails
to qualify as an Employee stock ownership plan for failure to meet the
requirements of 4975(e)(7) of the Code and regulation 54.4975-11, to be
subject to regulation 54.4975-7(b)(4), (10), (11) and (12), relating to
put, call or other options and to buy- sell or similar arrangements.
11.11 Valuation. For purposes of making valuations under the Plan,
valuations of such securities shall be made in good faith, and based on all
relevant factors for determining the fair market value of securities.
However, at any time the Employer stock is not readily tradeable on an
established securities market, all valuations of Employer stock with
respect to activities carried on by the Plan shall be made by an
independent appraiser (as defined in 401(a)(28)(C) of the Code). In the
case of a transaction between the Plan and a disqualified person, value
must be determined as of the date of the transaction. For all other
purposes, value must be determined as of the most recent valuation date
under the Plan. An independent appraisal will not in itself be a good faith
determination of value in the case of a transaction between the Plan and a
disqualified person. However, in all other cases, a determination of fair
market value based on at least an annual appraisal independently arrived at
by a person who customarily makes such appraisals and who is independent of
any party to the transaction will be deemed to be a good faith
determination of value. For purposes of this Section and all other Sections
of the Plan, "readily tradeable on an established securities market" shall
have the meanings set forth in regulation 54.4975-7(b)(1)(iv) and 54.4975-
7(b)(10).
ARTICLE XII
Top Heavy Provisions
12.1 Definitions. For purposes of this Article XII, the following
definitions shall apply:
(a) "Determination Date". "Determination Date" means, with
respect to any Plan Year -
(i) the last day of the preceding Plan Year, or
(ii) in the case of the first Plan Year of any plan,
the last day of such Plan Year.
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(b) "Key Employee". A "Key Employee" means an Employee, a former
Employee (or the beneficiary of either), who, at any time during the Plan
Year or any of the four preceding Plan Years, is -
(i) an officer of the Employer having an annual compensation
greater than 50% of the amount in effect under 415(b)(1)(A) of the Code for
any Plan Year,
(ii) one of the 10 Employees having annual compensation from
the Employer of more than the limitation in effect under 415(c)(1)(A) of
the Code and owning (or considered as owning within the meaning of 318) the
largest interests in the Employer,
(iii) a 5-percent owner of the Employer, or
(iv) a 1-percent owner of the Employer having an annual
compensation from the Employer of more than $150,000.
For purposes of clause (i), no more than 50 Employees (or, if lesser, the
greater of 3 or 10 percent of the Employees) shall be treated as officers.
For purposes of clause (ii), if 2 Employees have the same interest in the
Employer, the Employee having greater annual compensation from the Employer
shall be treated as having a larger interest. Percentage Owners:
(i) 5-Percent Owner. For purposes of this paragraph, the term "5-
percent owner" means:
(A) If the Employer is a corporation, any person who owns
(or is considered as owning within the meaning of 318) more than 5 percent
of the outstanding stock of the corporation or stock possessing more than 5
percent of the total combined voting power of all stock of the corporation;
or
(B) If the Employer is not a corporation, any person who owns more
than 5 percent of the capital or profits interest in the Employer.
(ii) 1-Percent Owner. For purposes of this paragraph, the term "1-percent
owner" means any person who would be described in clause (i) if "1-percent"
were substituted for "5 percent" each place it appears in clause (i).
(iii) Constructive Ownership Rules. For purposes
of this Article XII:
(A) Subparagraph (C) of 318(a)(2) shall be applied by
substituting "5 percent" for "50 percent," and
(B) In the case of any Employer which is not a corporation, ownership
in such Employer shall be determined in accordance with regulations
prescribed by the Secretary which shall be based on principles similar to
the principles of 318 (as modified by subclause (A)).
(iv) Aggregation rules do not apply for purposes of determining
ownership in the Employer. The rules of subsections (b), (c) and (m) of
414 shall not apply for purposes of determining ownership in the Employer.
(v) Compensation. For purposes of this Section, the term "compensation"
has the meaning given such term by 414(q)(7) of the Code.
(c) "Non-Key Employee". The term "Non-Key Employee" means any Employee who
is not a Key Employee.
(d) "Top Heavy Plan". An Employer's plan shall be a Top Heavy Plan if, as
of the Determination Date, the aggregate of the accounts of Key Employees
under the Plan exceeds 60% of the aggregate of the accounts of all
Employees under the Plan.
(e) "Aggregated Plans". Each plan of an Employer required to be included
in an Aggregation Group shall be treated as a Top Heavy Plan if such group
is a Top Heavy Group.
(f) "Aggregation Group". Aggregation Group means:
(i) "Required Aggregation":
(A) each plan of the Employer in which a Key Employee is a participant (in
the Plan Year containing the Determination Date or any of the four
preceding Plan Years), and
135
(B) each other plan of the Employer which enables any plan described in
subclause (A) to meet the requirements of 401(a)(4) or 410 of the Code, or
(ii) "Permissive Aggregation": any other plan not required to be
aggregated may be included by the Employer if such group would continue to
meet the requirements of 401(a)(4) and 410 with such plan being taken into
account.
(iii) In determining the Aggregation Group, plans terminated within the
five-year period ending on the Determination Date also shall be taken into
consideration.
(g) "Top Heavy Group". The term "Top Heavy Group" means any Aggregation
Group if, as of the Determination Date, the sum of
(i) the present value of the cumulative accrued benefits for Key
Employees under all defined benefit plans included in such group, and
(ii) the aggregate of the accounts of Key Employees under all defined
contribution plans included in such group exceeds 60% of a similar sum
determined for all Employees.
(h) "Rollover Contributions". Any rollover
contribution, or similar transfer, initiated by an
Employee and made after December 31, 1983, shall not be taken into
account with respect to the Plan for purposes of determining whether such
Plan is a Top Heavy Plan or whether any Aggregation Group which includes
such Plan is a Top Heavy Group.
(i) For purposes of this Article XII, the amount of the
account of any Employee shall include the aggregate distributions made with
respect to such Employee under the Plan during the five year period ending
on the Determination Date, including distributions under a terminated plan
which if it had not been terminated would have been required to be included
in an aggregation group. If any participant is a NonKey Employee with
respect to any Plan Year, the balance in the accounts of such Employee
shall be considered the account balance of a Non-Key Employee for such Plan
Year. In addition, the account balance of any Member who has not performed
services for Employer during the five year period ending on the
Determination Date also shall be disregarded.
(j) "Valuation Date". The "Valuation Date" shall be the most recent
valuation date described in either Section 5.2 or Section 5.5 above within
the twelve-month period ending on the Determination Date.
12.2 Provisions Applicable During Top Heavy Years. For any year in
which the Plan is considered a Top Heavy Plan, the following provisions
shall apply notwithstanding any other provision of this Plan to the
contrary:
(a) "Vesting". The vesting schedule applicable to Employer
contributions which shall apply during Top Heavy Years shall be as follows:
Years of Service Percentage Vested
Less than 2 years 0%
2 years 20%
3 years 40%
4 years 60%
5 years 80%
6 years 100%
(b) "Minimum Benefits". Notwithstanding the language of Section 5.4
above or any other provision in this Plan to the contrary, during any year
the Employer's Plan is a Top Heavy Plan, the minimum contribution made by
the Employer to the account of each Active Member (as defined in Section
136
5.4 above) of the Plan who is a NonKey Employee shall not be less than the
lesser of:
(i) 3% of such Non-Key Employee's compensation (as defined in Section 5.7
above), or
(ii) the highest percentage of compensation contributed to the account for
any Key Employee for the year.
Notwithstanding the above, any Employer who maintains this Plan plus
one or more additional qualified employee benefit plans may choose to fund
any required minimum benefit through such other plan(s) but must notify the
Trustee of this Plan of such election.
To provide for the minimum allocation, the Employer contribution shall
be allocated as follows:
(a) An amount of the Employer contribution equal to theminimum
benefit determined above (or the total Employer contribution if less than
the minimum benefit determined above) shall be allocated to the Employer
Contribution Accounts of each Active Member of the Plan who is a Non-Key
Employee; and
(b) The balance, if any, of Employer's Contribution shall be
allocated as set forth in Article V of the Plan.
A minimum benefit allocation shall be provided to any Active Member
who is a Non-Key Employee who is employed as of the last day of the Plan
Year regardless of such Member's Hours of Service.
IN WITNESS WHEREOF, TYSON FOODS, INC. has caused this Indenture to be
executed by its duly authorized officers as of the 1st day of April, 1993.
TYSON FOODS, INC.
By:__________________________
President
ATTEST:
_________________________
Secretary
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RESOLUTION REGARDING TERMINATION OF TYSON FOODS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
RESOLVED, that effective March 31, 1996, the ESOP will be terminated
and its assets shall be distributed pursuant to the plan's terms on or
before March 31, 1997, and as required by Section 8.3 of said plan, the
administrator of the plan shall deliver to the plan's trustees a certified
copy of this resolution informing them of such termination.
138