1
EXHIBIT 10.04
KELLOGG COMPANY SUPPLEMENTAL
SAVINGS AND INVESTMENT PLAN
2
KELLOGG COMPANY
Supplemental
Savings and Investment Plan
October 17, 1994
3
KELLOGG COMPANY
SUPPLEMENTAL SAVINGS AND INVESTMENT PLAN
Article I
INTRODUCTION
1.1 THE PLAN AND ITS EFFECTIVE DATE. The Kellogg Company
Supplemental Savings and Investment Plan (the "Plan") is hereby established by
the Kellogg Company (the "Company") and certain commonly controlled entities
effective, November 1, 1994.
1.2 PURPOSE. The Company maintains the Kellogg Company Salaried
Savings and Investment Plan (the "Savings and Investment Plan"), which is
intended to meet the requirements of a "qualified plan" under the Code.
Section 401(a)(17) of the Code places limitations on the amount of annual
compensation of each employee which may be taken into account under a qualified
plan. For plan years beginning in the 1993 calendar year, the aforesaid
limitation on compensation was $235,840, and was scheduled to be indexed
annually (the "old compensation limit"). However, the Omnibus Budget
Reconciliation Act of 1993 reduced the aforesaid compensation limit to $150,000
for plan years beginning in the 1994 calendar year, and also modified the
procedure for indexing the new $150,000 limit (the "new compensation limit").
The purpose of the Plan is to allow employees to make contributions (and
receive matching contributions from the Company or another Employer hereunder)
which could have been made and accumulated under the Savings and Investment
Plan based on the "old compensation limit", but which now cannot be so made and
accumulated because of the "new compensation limit".
Kellogg Company
Supplemental Savings and Investment Plan - 1 -
4
Article II
PARTICIPATION AND BENEFITS
2.1 ELIGIBILITY TO PARTICIPATE. Subject to the conditions and
limitations of the Plan, if an employee of an Employer (as defined in Section
3.7) participates in the Savings and Investment Plan, and such employee has,
for any Plan Year beginning on or after November 1, 1994, compensation which
exceeds the limitations under Section 401(a)(17) of the Code, then such
employee shall be a participant hereunder.
2.2 COMPENSATION. For purposes of this Plan, the term
Compensation shall have the same meaning as given to this term in the Savings
and Investment Plan, without regard to the dollar limits contained in Section
401(a)(17) of the Code.
2.3 OLD COMPENSATION LIMIT. For any Plan Year, the Old
Compensation Limit shall be equal to $235,840 multiplied by the ratio of
Consumer Price Index for wage earners (CPI-W) for December of the calendar year
which immediately precedes the start of the applicable Plan Year over the value
of the CPI-W for December of 1992 (such latter value being 139.8). The value
determined by the foregoing procedure shall be rounded up to the next higher
multiple of $1,000. For the initial Plan Year of this Plan, beginning November
1, 1994, the Old Compensation Limit shall be equal to $241,744, which is
rounded up to $242,000.
2.4 EXCESS COMPENSATION. A participant's Excess Compensation for
any Plan Year shall be equal to the lesser of his Compensation for such year or
the Old Compensation Limit for such year, reduced by the compensation
limitation in effect for such Plan Year under Section 401(a)(17) of the Code.
For the initial Plan Year of this Plan, beginning November 1, 1994, the Excess
Compensation for any participant shall be no greater than $92,000 (the
difference between $242,000 and $150,000).
Kellogg Company
Supplemental Savings and Investment Plan - 2 -
5
2.5 CONTRIBUTIONS. Contributions to this Plan shall include both
Before-Tax Contributions and Employer Matching Contributions as defined below:
(a) A participant's Before-Tax Contribution for any Plan
Year shall be equal to the product of his Excess Compensation for such year,
multiplied by the percentage of compensation he has elected to contribute to
the Savings and Investment Plan as of the payroll period starting on (or
immediately before) the first day in which he earns one dollar of Excess
Compensation for such Plan Year.
(b) A participant's Employer Matching Contribution for
any Plan Year shall be equal to 80% of the product of his Excess Compensation
for such Plan Year, multiplied by the lesser of 5% or the percentage of
contributions elected for the payroll period starting on (or immediately
before) the first day in which he earns one dollar of Excess Compensation for
such Plan Year.
Notwithstanding anything in the Plan to the contrary, for any
Plan Year, the total Annual Additions to a participant's accounts in the
Savings and Investment Plan and the Plan shall not exceed $30,000. If
necessary, a participant's Before-Tax Contribution hereunder, which is in
excess of 5% of Excess Compensation, shall be limited in accordance with the
procedures adopted by the ERISA Administration Committee in order to ensure
compliance with the aforementioned $30,000 annual limitation. If reducing a
participant's Before-Tax Contribution hereunder to 5% of Excess Compensation
is not sufficient to achieve such compliance, the participant's Before-Tax
Contributions hereunder shall be limited to less than 5% of Excess Compensation
and the related 80% Employer Matching Contributions (on the amount of
Before-Tax contributions which are foregone) shall not be made hereunder. The
$30,000 annual limitation referenced in this Section 2.5 shall be increased to
reflect increases in the cost-
Kellogg Company
Supplemental Savings and Investment Plan - 3 -
6
of-living in the same manner as the $30,000 annual limitation set forth in
Section 415(c)(1)(A) of the Code.
In the event that the foregoing $30,000 limit is exceeded
in any Plan Year, for any reason, the Administrative Committee shall direct
that the portion of the excess attributable to Before-Tax Contributions
hereunder be refunded to the affected Employee, and that the portion of the
excess attributable to Employer Matching Contributions hereunder be forfeited
from the Employee's accounts. Any earnings credited on such excess
Contributions shall be refunded or forfeited in the same manner as the
related Contributions.
2.6 ACCOUNTS AND CREDITING OF EARNINGS. Two accounts shall be
maintained for each participant in this Plan; one to record accumulated
Before-Tax Contributions (and earnings thereon) and one to record accumulated
Employer Matching Contributions (and earnings thereon). Earnings on both
accounts shall be credited at the same time and in the same amount and manner
as credited to Savings and Investment Plan accounts which are invested in the
fixed income fund provided thereunder for investment of a participant's
accounts.
2.7 VESTING OF AMOUNTS. All accounts maintained hereunder shall
be 100% vested at all times and, except as provided in Section 3.3 or 3.4,
shall not be forfeitable for any reason.
2.8 PAYMENT OF BENEFITS. Payment of Plan benefits shall be
accomplished by means of payments directly from the Employer. Subject to the
last paragraph of this Section, distribution of any such benefits shall be made
in the same manner and form and subject to the same conditions, as the
distributions available under the Savings and Investment Plan, so long as an
election is made prior to the earliest date on which a distribution may be
made; except that the participant may elect, with the ERISA Administration
Committee's approval, to receive the distribution of his accounts in a form
other than as provided by the Savings and Investment Plan.
Kellogg Company
Supplemental Savings and Investment Plan - 4 -
7
Notwithstanding the foregoing, for any Employee who is a
"covered employee" within the meaning of Section 162(m) of the Code,
distribution of such Employee's participant accounts shall not commence before
the earliest date such distribution would be deductible, for income tax
purposes, by the Employer.
No in-service withdrawals or loans shall be available from
the Plan. No distributions may be made from the Plan until at least 30 days
after the earliest to occur of the Employee's retirement, death, disability (as
defined in the Savings and Investment Plan) or termination of employment with
all Employers hereunder.
2.9 FUNDING. Benefits payable under the Plan to any participant
(or beneficiary thereof) shall be paid directly by the Company. Neither the
Company nor any other Employer shall be required to fund, or otherwise
segregate assets, to be used for payment of benefits under the Plan.
2.10 PLAN YEAR. Each twelve-month period beginning on November 1
and ending on October 31 of the succeeding calendar year shall be considered a
Plan Year.
2.11 BENEFICIARY DESIGNATION. A participant may designate a
beneficiary or beneficiaries to receive benefits payable hereunder in the event
of a participant's death prior to distribution of the full value of his
accounts hereunder. Such designation shall be in writing, on a form acceptable
to the ERISA Administration Committee, and need not be the same designation
made under the Savings and Investment Plan. In the event no beneficiary is
named hereunder, the beneficiary designation under the Savings and Investment
Plan shall be applicable hereunder.
2.12 Annual Additions. For purposes of this Plan, a participant's
Annual Additions shall include his Before-Tax Contributions and Employer
Matching Contributions hereunder,
Kellogg Company
Supplemental Savings and Investment Plan - 5 -
8
plus any amounts credited to the participant's accounts under the Savings and
Investment Plan that would constitute annual additions within the meaning of
Section 415(c)(2) of the Code.
Kellogg Company
Supplemental Savings and Investment Plan - 6 -
9
Article III
GENERAL PROVISIONS
3.1 PLAN ADMINISTRATION. The Plan shall be administered by the
ERISA Administration Committee responsible for administration of the Savings
and Investment Plan. The Administration Committee shall have, to the extent
appropriate, the same powers, rights, duties and obligations with respect to
the Plan as it has with respect to the Savings and Investment Plan.
3.2 EMPLOYMENT RIGHTS. The establishment of the Plan shall not
be construed to give any Employee the right to be retained in an Employer's
service or to any benefits not specifically provided by the Plan, nor shall the
establishment of the Plan in any manner modify the Employers' rights to modify,
amend or terminate the Savings and Investment Plan.
3.3 INTERESTS NOT TRANSFERRABLE. Except as to withholding of any
tax under the laws of the United States or any State or locality, no benefit
payable at any time under the Plan shall be subject in any manner to
alienation, sale, transfer, assignment, pledge, attachment, or other legal
process, or encumbrance of any kind. Any attempt to alienate, sell, transfer,
assign, pledge or otherwise encumber any such benefits, whether currently or
thereafter payable, shall be void. No benefit shall, in any manner, be liable
for or subject to the debts or liabilities of any person entitled to such
benefits. If any participant or beneficiary thereof shall attempt to, or shall
alienate, sell, transfer, assign, pledge or otherwise encumber his benefits
under the Plan, or if by any reason of his bankruptcy or other event happening
at any time, such benefits would devolve upon any other person or would not be
enjoyed by the person entitled thereto under the Plan, then the Employer of
such participant, in its discretion, may terminate the interest in any such
benefits of the participant or beneficiary entitled thereto under the Plan and
hold or apply them
Kellogg Company
Supplemental Savings and Investment Plan - 7 -
10
to or for the benefit of any such person or his spouse, children or other
dependents, or any of them, in such manner as the Employer may deem proper.
3.4 UNCLAIMED AMOUNT. Unclaimed amounts shall consist of the
Plan accounts of a participant which cannot be distributed because of the ERISA
Administration Committee's inability, after a reasonable search, to locate the
participant or his beneficiary, as applicable, within a period of two (2) years
after the payment of benefits becomes due. Unclaimed amounts shall be
forfeited at the end of such two-year period. After an unclaimed amount has
been forfeited, the participant or beneficiary, as applicable, shall have no
further right to his Plan benefit.
3.5 CONTROLLING LAW. The law of Michigan, without regard to its
law with respect to choice of law, shall be controlling in all matters relating
to the Plan to the extent not pre-empted by the Employee Retirement Income
Security Act of 1974, as it may be amended from time-to-time.
3.6 GENDER AND NUMBER. Words in the masculine gender shall
include the feminine, and the plural shall include the singular and the
singular shall include the plural.
3.7 EMPLOYER. The term "Employer" shall be used throughout this
Plan to designate the respective Employer entities unless the context demands
otherwise and each entity covering its Employees hereunder shall be deemed to
be such only as to those participants who are on its payroll and, in each case
only to the extent of the Compensation which it pays to these participants.
3.8 CODE. As used in this Plan, "Code" means the Internal
Revenue Code of 1986, as it may be amended from time-to-time. Reference to any
section or subsection of the Code includes reference to any succeeding
provisions of any legislation that amends, supplements or replaces such section
or subsection.
Kellogg Company
Supplemental Savings and Investment Plan - 8 -
11
3.9 ACTION BY AN EMPLOYER. Subject to Article VI, any action
required of, or permitted by, an Employer under the Plan shall be by resolution
of the Board of Directors of such Employer, or if so authorized by resolution
of the Board of Directors of the Employer, by any member of the ERISA
Administration Committee or such other person(s) which the aforesaid Board of
Directors shall designate.
3.10 DEDUCTION OF TAXES FROM AMOUNTS PAYABLE. An Employer may
deduct from the amount to be distributed under the Plan such amount as the
Employer, in its sole discretion, deems proper for the payment of income,
employment, death, succession, inheritance or other taxes with respect to
benefits under the Plan.
Kellogg Company
Supplemental Savings and Investment Plan - 9 -
12
Article IV
CLAIMS PROCEDURE
4.1 INITIAL CLAIM FOR BENEFITS. Each participant or beneficiary
(a "Claimant") may submit his claim for benefits to the Administrative
Committee (or to such other person or persons as may be designated by the
Administrative Committee) in writing in such form as is provided or approved by
the Administrative Committee, which claim shall designate the date upon which
the Claimant desires his benefits to commence. A claimant shall have no right
to seek review of a denial of benefits, or to bring any action in any court to
enforce a claim for benefits prior to his filing a claim for benefits and
exhausting his rights to review under Sections 4.1 and 4.2.
When a claim for benefits has been filed properly, such claim
for benefits shall be evaluated and the Claimant shall be notified of the
approval or the denial within ninety (90) days after the receipt of such claim
unless special circumstances require an extension of time for processing the
claim. If such an extension of time for processing is required, written notice
of the extension shall be furnished to the Claimant prior to the termination of
the initial ninety (90) day period which shall specify the special
circumstances requiring an extension and the date by which a final decision
will be reached (which date shall not be later than one hundred and eighty
(180) days after the date on which the claim was filed). A Claimant shall be
given a written notice in which the Claimant shall be advised as to whether the
claim is granted or denied, in whole or in part. If a claim is denied, in
whole or in part, the Claimant shall be given written notice which shall
contain (1) the specific reasons for the denial, (2) references to pertinent
plan provisions upon which the denial is based, (3) a description of any
additional
Kellogg Company
Supplemental Savings and Investment Plan - 10 -
13
material or information necessary to perfect the claim and an explanation of
why such material or information is necessary, and (4) the Claimant's rights to
seek review of the denial.
4.2 REVIEW OF CLAIM DENIAL. If a claim is denied, in whole or in
part (or if within the time periods presented in Section 4.1 the Claimant has
not received an approval or a denial and the claim is, therefore, deemed
denied), the Claimant shall have the right to request that the Administrative
Committee review the denial, provided that the Claimant files a written request
for review with the Administrative Committee within sixty (60) days after the
date on which the Claimant received written notification of the denial. A
Claimant (or his duly authorized representative) may review pertinent documents
and submit issues and comments in writing to the Administrative Committee.
Within sixty (60) days after a request for review is received, the review shall
be made and the Claimant shall be advised in writing of the decision on review,
unless special circumstances require an extension of time for processing the
review, in which case the Claimant shall be given a written notification within
such initial sixty (60) day period specifying the reasons for the extension and
when such review shall be completed (provided that such review shall be
completed within one hundred and twenty (120) days after the date on which the
request for review was filed). The decision on review shall be forwarded to
the Claimant in writing and shall include specific reasons for the decision and
references to plan provisions upon which the decision is based. A decision on
review shall be final and binding on all persons for all purposes. If a
Claimant shall fail to file a request for review in accordance with the
procedures described in Sections 4.1 and 4.2, such Claimant shall have no right
to review and shall have no right to bring action in any court and the denial
of the claim shall become final and binding on all persons for all purposes.
Kellogg Company
Supplemental Savings and Investment Plan - 11 -
14
Article V
SUBSIDIARY PARTICIPATION
5.1 ADOPTION OF PLAN. Any commonly controlled entity with
respect to the Company which has adopted the Savings and Investment Plan may,
with the approval of the ERISA Administration Committee and under such terms
and conditions as the ERISA Administration Committee may prescribe, adopt the
Plan by resolution of its Board of Directors and thereby become an Employer
hereunder.
5.2 WITHDRAWAL FROM THE PLAN BY EMPLOYER. Any Employer other
than the Company shall have the right, at any time, upon the approval of and
under such conditions as may be prescribed by the ERISA Administration
Committee, to withdraw from the Plan by delivering to the ERISA Administration
Committee written notice of its election so to withdraw, provided however, that
if a participant in the Plan who is an employee of the withdrawing Employer, or
a beneficiary thereof, becomes entitled to a benefit under the Plan, such Plan
benefits shall constitute an irrevocable obligation of the withdrawing
Employer.
Kellogg Company
Supplemental Savings and Investment Plan - 12 -
15
Article VI
AMENDMENT AND TERMINATION
The Company by action of the Chairman of the Board, or resolution of
the Board of Directors, reserves the right at any time to modify, amend or
terminate the Plan, provided however, that no termination, amendment or
modification of or to the Plan may, without written approval of a participant,
reduce the total benefit payable under this Plan to an amount that is less than
the amount that would have been payable to the participant under the Plan,
assuming the participant retired, died or otherwise terminated employment as of
the date of such termination, amendment or modification. Such amount shall
constitute an irrevocable obligation of the Company or other applicable
Employer.
Executed this day of , 1994.
-------- ----------------
KELLOGG COMPANY
By:
----------------------------
ATTEST:
- -----------------------
Kellogg Company
Supplemental Savings and Investment Plan - 13 -