-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, UAohVSmnEn+cdOcxDPVa5eAhgpY13nfyGOiHhkyXuoI2t2Oueqt7Pefb/FdmFXsc 0+H2UlF6DdNVL8OJTfxblQ== 0000005187-03-000013.txt : 20030515 0000005187-03-000013.hdr.sgml : 20030515 20030515163218 ACCESSION NUMBER: 0000005187-03-000013 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 9 CONFORMED PERIOD OF REPORT: 20030331 FILED AS OF DATE: 20030515 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WYETH CENTRAL INDEX KEY: 0000005187 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 132526821 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-01225 FILM NUMBER: 03705217 BUSINESS ADDRESS: STREET 1: 5 GIRALDA FARMS CITY: MADISON STATE: NJ ZIP: 07940 BUSINESS PHONE: 9736605000 MAIL ADDRESS: STREET 1: 5 GIRALDA FARMS CITY: MADISON STATE: NJ ZIP: 07940 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN HOME PRODUCTS CORP DATE OF NAME CHANGE: 20020308 FORMER COMPANY: FORMER CONFORMED NAME: AMERICAN HOME PRODUCTS CORP DATE OF NAME CHANGE: 19920703 10-Q 1 qfirst03.txt QUARTERLY REPORT ON FORM 10-Q =============================================================================== UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended Commission file number 1-1225 March 31, 2003 Wyeth ----- (Exact name of registrant as specified in its charter) Delaware 13-2526821 -------- ---------- (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) Five Giralda Farms, Madison, N.J. 07940 --------------------------------- ----- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code (973) 660-5000 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ----- -- Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes X No ----- -- The number of shares of Common Stock outstanding as of the close of business on April 30, 2003: Number of Class Shares Outstanding --------------------------------- ------------------ Common Stock, $0.33-1/3 par value 1,327,966,729 ================================================================================ WYETH INDEX Page No. Part I - Financial Information 2 Item 1. Consolidated Condensed Financial Statements: Consolidated Condensed Balance Sheets - March 31, 2003 and December 31, 2002 3 Consolidated Condensed Statements of Operations - Three Months Ended March 31, 2003 and 2002 4 Consolidated Condensed Statements of Changes in Stockholders' Equity - Three Months Ended March 31, 2003 and 2002 5 Consolidated Condensed Statements of Cash Flows - Three Months Ended March 31, 2003 and 2002 6 Notes to Consolidated Condensed Financial Statements 7-14 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 15-25 Item 3. Quantitative and Qualitative Disclosures About Market Risk 26 Item 4. Controls and Procedures 26-27 Part II - Other Information 28 Item 1. Legal Proceedings 28-29 Item 6. Exhibits and Reports on Form 8-K 30 Signature 31 Certifications 32-35 Exhibit Index EX-1 Items other than those listed above have been omitted because they are not applicable. 1 Part I - Financial Information ------------------------------ WYETH The consolidated condensed financial statements included herein have been prepared by Wyeth (the Company), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to such rules and regulations; however, the Company believes that the disclosures are adequate to make the information presented not misleading. In the opinion of management, the consolidated condensed financial statements include all adjustments, all of which are of a normal recurring nature, necessary to present fairly the financial position of the Company as of March 31, 2003 and December 31, 2002, and the results of its operations, cash flows and changes in stockholders' equity for the three months ended March 31, 2003 and 2002. It is suggested that these consolidated condensed financial statements and management's discussion and analysis of financial condition and results of operations be read in conjunction with the financial statements and the notes thereto included in the Company's 2002 Annual Report on Form 10-K. 2 WYETH CONSOLIDATED CONDENSED BALANCE SHEETS (In Thousands Except Per Share Amounts) (Unaudited)
March 31, December 31, 2003 2002 ----------- ------------ ASSETS Cash and cash equivalents $2,748,939 $2,943,604 Marketable securities 1,034,911 1,003,275 Amgen investment - 1,509,947 Accounts receivable less allowances 2,104,355 2,379,819 Inventories: Finished goods 827,727 736,360 Work in progress 923,509 808,711 Materials and supplies 431,634 447,653 ----------- ------------ 2,182,870 1,992,724 Other current assets including deferred taxes 2,261,313 1,766,483 ----------- ------------ Total Current Assets 10,332,388 11,595,852 Property, plant and equipment 10,229,820 9,834,985 Less accumulated depreciation 2,706,895 2,599,293 ----------- ------------ 7,522,925 7,235,692 Goodwill 3,764,648 3,745,749 Other intangibles, net of accumulated amortization (March 31, 2003-$102,892 and December 31, 2002-$95,223) 141,953 145,915 Other assets including deferred taxes 3,802,643 3,271,741 ----------- ------------ Total Assets $25,564,557 $25,994,949 =========== ============ LIABILITIES Loans payable $513,993 $804,894 Trade accounts payable 600,146 672,633 Accrued expenses 3,762,811 3,788,653 Accrued federal and foreign taxes 815,072 209,479 ----------- ------------ Total Current Liabilities 5,692,022 5,475,659 Long-term debt 6,409,250 7,546,041 Accrued postretirement benefit obligations other than pensions 983,205 965,081 Other noncurrent liabilities 3,734,351 3,852,256 Contingencies and commitments (Note 3) STOCKHOLDERS' EQUITY $2.00 convertible preferred stock, par value $2.50 per share 45 46 Common stock, par value $0.33-1/3 per share 442,345 442,019 Additional paid-in capital 4,604,372 4,582,773 Retained earnings 4,259,120 3,286,645 Accumulated other comprehensive loss (560,153) (155,571) ----------- ------------ Total Stockholders' Equity 8,745,729 8,155,912 ----------- ------------ Total Liabilities and Stockholders' Equity $25,564,557 $25,994,949 =========== ============ The accompanying notes are an integral part of these consolidated condensed financial statements.
3 WYETH CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (In Thousands Except Per Share Amounts) (Unaudited) Three Months Ended March 31, --------------------------- 2003 2002 ---------- ---------- Net revenue $3,689,057 $3,643,521 ---------- ---------- Cost of goods sold 928,304 802,179 Selling, general and administrative expenses 1,291,470 1,270,284 Research and development expenses 513,514 480,206 Interest expense, net 27,000 53,338 Other expense (income), net 6,735 (84,648) Gain on sale of Amgen shares (860,554) - ---------- ---------- Income before federal and foreign taxes 1,782,588 1,122,162 Provision for federal and foreign taxes 504,706 250,242 ---------- ---------- Net income $1,277,882 $871,920 ========== ========== Basic earnings per share $0.96 $0.66 ========== ========== Diluted earnings per share $0.96 $0.65 ========== ========== Dividends paid per share of common stock $0.23 $0.23 ========== ========== The accompanying notes are an integral part of these consolidated condensed financial statements. 4 WYETH CONSOLIDATED CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (In Thousands Except Per Share Amounts) (Unaudited)
Three Months Ended March 31, 2003: $2.00 Accumulated Convertible Additional Other Total Preferred Common Paid-in Retained Comprehensive Stockholders' Stock Stock Capital Earnings Loss Equity ----------- -------- ---------- ---------- ------------- ------------- Balance at January 1, 2003 $46 $442,019 $4,582,773 $3,286,645 $(155,571) $8,155,912 Net income 1,277,882 1,277,882 Currency translation adjustments 115,342 115,342 Unrealized losses on derivative contracts (7,210) (7,210) Unrealized gains on marketable securities 2,400 2,400 Realized gain reclassified to net income (515,114) (515,114) ------------- Comprehensive income, net of tax 873,300 ============= Cash dividends declared (1) (305,101) (305,101) Common stock issued for stock options 294 19,016 19,310 Other exchanges (1) 32 2,583 (306) 2,308 ----------- -------- ---------- ---------- ------------- ------------- Balance at March 31, 2003 $45 $442,345 $4,604,372 $4,259,120 $(560,153) $8,745,729 =========== ======== ========== ========== ============= ============= Three Months Ended March 31, 2002: $2.00 Accumulated Convertible Additional Other Total Preferred Common Paid-in Retained Comprehensive Stockholders' Stock Stock Capital Earnings Loss Equity ----------- -------- ---------- ---------- ------------- ------------- Balance at January 1, 2002 $51 $440,190 $4,295,051 $170,309 $(833,028) $4,072,573 Net income 871,920 871,920 Currency translation adjustments (33,711) (33,711) Unrealized gains on derivative contracts 274 274 Unrealized losses on marketable securities (8,679) (8,679) ------------- Comprehensive income, net of tax 829,804 ------------- Cash dividends declared (304,377) (304,377) Common stock issued for stock options 1,541 136,739 138,280 Other exchanges (1) 109 26,950 (1,960) 25,098 ----------- -------- ---------- ---------- ------------- ------------- Balance at March 31, 2002 $50 $441,840 $4,458,740 $735,892 $(875,144) $4,761,378 =========== ======== ========== ========== ============= ============= (1) Includes the preferred stock cash dividend of $0.50 per share ($9 in the aggregate) declared March 5, 2003 and payable on April 1, 2003. The accompanying notes are an integral part of these consolidated condensed financial statements.
5 WYETH CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (In Thousands) (Unaudited)
Three Months Ended March 31, --------------------------- 2003 2002 ---------- ---------- Operating Activities - -------------------- Net income $1,277,882 $871,920 Adjustments to reconcile net income to net cash provided by (used for) operating activities: Gain on sale of Amgen shares (860,554) - Gains on sales of assets (2,697) (47,191) Depreciation and amortization 131,100 120,602 Deferred income taxes (1,871) 221,787 Diet drug litigation payments (134,627) (712,176) Security fund deposit (535,200) (370,000) Changes in working capital, net 445,184 (522,248) Other items, net 9,216 (24,235) ---------- ---------- Net cash provided by (used for) operating activities 328,433 (461,541) ---------- ---------- Investing Activities - -------------------- Purchases of property, plant and equipment (344,614) (341,689) Proceeds from sales of Amgen common stock 1,579,917 - Proceeds from sales of assets 7,860 348,315 Proceeds from sales and maturities of marketable securities 176,242 1,287,860 Purchases of marketable securities (203,333) (701,086) ---------- ---------- Net cash provided by investing activities 1,216,072 593,400 ---------- ---------- Financing Activities - -------------------- Net proceeds from (repayments of) debt (1,456,650) 632,309 Dividends paid (305,092) (304,377) Exercises of stock options 19,310 138,280 ---------- ---------- Net cash provided by (used for) financing activities (1,742,432) 466,212 ---------- ---------- Effects of exchange rate changes on cash balances 3,262 (1,881) ---------- ---------- Increase (decrease) in cash and cash equivalents (194,665) 596,190 Cash and cash equivalents, beginning of period 2,943,604 1,744,734 ---------- ---------- Cash and cash equivalents, end of period $2,748,939 $2,340,924 ========== ========== Supplemental Information - ------------------------ Interest payments $155,240 $162,362 Income tax payments, net of refunds 112,800 126,053 The accompanying notes are an integral part of these consolidated condensed financial statements.
6 WYETH NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) Note 1. Summary of Significant Accounting Policies ------------------------------------------ The following policies are required interim updates to those disclosed in Footnote 1 of the 2002 Annual Report on Form 10-K: Stock-Based Compensation: The Company has five Stock Incentive Plans which it accounts for using the intrinsic value method in accordance with APB Opinion No. 25, Accounting for Stock Issued to Employees. No stock-based employee compensation cost is reflected in net income, as all options granted under those plans had an exercise price equal to the market value of the underlying common stock on the date of grant. The following table illustrates the effect on net income and earnings per share if the Company had applied the fair value recognition provisions of SFAS No. 123, Accounting for Stock-Based Compensation, to stock-based employee compensation:
Three Months Ended March 31, ------------------------- (In thousands except per share amounts) 2003 2002 ----------------------------------------------- ---------- -------- Net income, as reported $1,277,882 $871,920 Deduct: total stock-based employee compensation expense determined under fair value-based method for all awards, net of tax 82,375 61,965 ---------- -------- Pro forma net income $1,195,507 $809,955 ========== ======== Earnings per share: Basic - as reported $0.96 $0.66 ========== ======== Basic - pro forma $0.90 $0.61 ========== ======== Diluted - as reported $0.96 $0.65 ========== ======== Diluted - pro forma $0.90 $0.61 ========== ========
Goodwill and Other Intangibles: On January 1, 2002, the Company adopted SFAS No. 142, Goodwill and Other Intangible Assets. With the adoption of SFAS No. 142, goodwill is no longer being amortized but is subject to at least an annual assessment for impairment by applying a fair value-based test. The same applies to other intangibles that have been determined to have indefinite useful lives. However, other intangibles with finite lives will continue to be amortized. The Company's other intangibles, which all have finite lives, are being amortized over their estimated useful lives ranging from three to 10 years. 7 WYETH NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) The changes in the carrying amount of goodwill by segment for the three months ended March 31, 2003, are as follows:
Consumer (In thousands) Pharmaceuticals Healthcare Total -------------------------------- --------------- ---------- ---------- Balance at January 1, 2003 $3,155,403 $590,346 $3,745,749 Currency translation adjustments 18,426 473 18,899 ---------- -------- ---------- Balance at March 31, 2003 $3,173,829 $590,819 $3,764,648 ========== ======== ==========
Note 2. Issuance of Notes and Credit Facilities --------------------------------------- Issuance of $1,800.0 Million of Notes: On February 11, 2003, the Company issued $1,800.0 million of Notes. The issuance consisted of two tranches of Notes, each of which pays interest semiannually, as follows: o $300.0 million 4.125% Notes due March 1, 2008 with interest payments due on March 1 and September 1 o $1,500.0 million 5.25% Notes due March 15, 2013 with interest payments due on March 15 and September 15 The interest rate payable on each of these tranches of Notes is subject to an increase of 0.25 percentage points per level of downgrade in the Company's credit rating by Moody's or S&P. There is no adjustment to the interest rate payable on either series of Notes for the first single-level downgrade in the Company's credit rating by S&P. If Moody's or S&P subsequently were to increase the Company's credit rating, the interest rate payable on each series of Notes is subject to a decrease of 0.25 percentage points for each level of credit rating increase. The interest rate payable for both series of Notes cannot be reduced below the original coupon rate of either series of Notes. However, the total adjustment to the interest rate for either series of Notes cannot exceed two percentage points and the interest rate in effect on March 15, 2006, for both series of Notes, will become the effective interest rate until maturity. The Company would incur a total of approximately $4.5 million of additional annual interest expense for every 0.25 percentage point increase in the interest rate. The Company entered into two interest rate swaps with an aggregate notional amount of $300.0 million relating to the $300.0 million 4.125% Notes and two interest rate swaps with an aggregate notional amount of $1,500.0 million relating to the $1,500.0 million 5.25% Notes whereby the Company effectively converted the fixed rate of interest on these Notes to a floating rate, which is based on LIBOR. 8 WYETH NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) New Credit Facility: In March 2003, the Company's $3,000.0 million credit facility matured. Concurrent with this maturity, the Company entered into new credit facilities totaling $2,700.0 million. These credit facilities are composed of a $1,350.0 million, 364-day facility and a $1,350.0 million three-year facility. The maturity date of any borrowings under the $1,350.0 million, 364-day credit facility that are outstanding upon its termination in February 2004 is extendible by the Company for an additional year. The credit facilities contain substantially identical financial and other covenants, representations, warranties, conditions and default provisions as the maturing facility. At March 31, 2003, the Company had commercial paper outstanding of $557.7 million which is supported by the credit facilities identified above and was classified as long-term debt. Note 3. Contingencies and Commitments ----------------------------- The Company is involved in various legal proceedings, including product liability and environmental matters of a nature considered normal to its business. It is the Company's policy to accrue for amounts related to these legal matters if it is probable that a liability has been incurred and an amount is reasonably estimable. The nationwide class action settlement to resolve litigation brought against the Company regarding use of the diet drugs PONDIMIN (which in combination with phentermine, a product that was not manufactured, distributed or sold by the Company, was commonly referred to as "fen-phen") or REDUX received final judicial approval effective January 3, 2002. In connection with the REDUX and PONDIMIN diet drug matter, the Company has recorded litigation charges totaling $14,600.0 million. These charges are intended to cover the total amount required to resolve all diet drug litigation, including anticipated funding requirements for the nationwide class action settlement, anticipated costs to resolve the claims of any members of the settlement class who in the future may exercise an intermediate or back-end opt out right, costs to resolve the claims of primary pulmonary hypertension (PPH) claimants and initial opt out claimants, and administrative and litigation expenses. During the 2003 first three months, individual settlement payments, legal fees and other costs totaling $134.6 million were paid and applied against the litigation accrual. At March 31, 2003, $1,816.1 million of the litigation accrual remained. In December 2002, following a joint motion by the Company and plaintiffs' counsel, the Court approved an amendment to the settlement agreement which provided for the merger of Funds A and B into a combined fund which will now cover all expenses and injury claims in connection with the settlement. The effect of the merger is to accelerate the spillover of the expected remainder in Fund A, which will now be available to pay 9 WYETH NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) Fund B claims. The merger of the two funds took place in January 2003. In February 2003, as required by the amendment to the settlement agreement merging the two settlement funds, an additional $535.2 million was added by the Company to the security fund. The Company established the security fund as collateral for the Company's financial obligations under the settlement. The amounts in the security fund are owned by the Company and will earn interest income for the Company while residing in the security fund. The Company continuously reviews its diet drug litigation reserve as additional information becomes available with respect to claims both inside and outside of the nationwide class action settlement. Within the settlement, the number of individuals who have filed claims that allege significant heart valve disease (known as matrix claims) has been higher than had been anticipated. While the Company does not have precise current information, the settlement trust has recorded in excess of 61,000 matrix-level claim forms to date and it is likely that a substantial number of forms have been received but not yet logged in. Only half of these forms have been processed to date, and only a very small percentage of that half have been found valid and been paid. In addition, in light of substantial questions that have been raised concerning the validity of many of these matrix claims, the federal court overseeing the nationwide settlement has ordered that 100% of the matrix claims be audited for eligibility for awards under the settlement. That 100% audit process is just now beginning and the Company expects that, as a result of the audit process, only a fraction of the actual claim forms submitted will result in a payment. With respect to claims outside of the settlement, the Company has resolved the claims of all but a small percentage of the "initial" opt outs (i.e., those individuals who exercised their right to opt out of the settlement class) and continues to work toward resolving the rest. In regard to those class members who seek to exercise a "downstream" opt out right provided by the settlement, based on preliminary estimates, approximately 70,000 intermediate opt out forms were submitted by May 3, 2003, the applicable deadline for most class members (other than qualified class members receiving echocardiograms through the settlement trust after January 3, 2003, who may exercise intermediate opt out rights within 120 days after the date of their echocardiogram). The number of class members who have purported to exercise a back-end opt out right is estimated to be 20,000 and certain additional class members will be entitled to exercise back-end opt out rights in the future. However, the Company expects that the number of valid opt outs will be substantially less than the number of forms submitted. First, there is no estimate at this time of the percentage of those purported exercise forms that are valid, i.e., forms that are not duplicative of other filings, that are not filed on behalf of individuals who have already either received payments from the settlement trust or settlements from the Company, and are otherwise not invalid on their face. Second, there is no estimate at this time of the percentage of the purported opt outs that satisfy the settlement's medical eligibility requirements. The Company is vigorously challenging all intermediate and back-end opt out claims of disputed validity or questionable medical eligibility and the number of such claims that meet the settlement criteria will not be known for some time. 10 WYETH NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) Intermediate and back-end opt outs who meet the settlement's criteria may pursue lawsuits against the Company, but must prove their cases without relying on verdicts, judgments or factual findings made in other lawsuits. They also may not seek or recover punitive, exemplary or multiple damages and may sue only for the valvular condition giving rise to their opt out right. The Company plans to vigorously defend such lawsuits. Based upon the information currently available, the Company believes that there is no basis to change its reserves to cover the remaining obligations relating to the diet drug litigation. However, in light of the inherent uncertainty in estimating litigation exposure and the fact that substantial additional information will become available in the future, it is possible that additional reserves may be required. In the opinion of the Company, although the outcome of any legal proceedings cannot be predicted with certainty, the ultimate liability of the Company in connection with its legal proceedings will not have a material adverse effect on the Company's financial position but could be material to the results of operations or cash flows in any one accounting period. Note 4. Restructuring Program --------------------- In December 2002, the Company recorded a special charge for restructuring and related asset impairments of $340.8 million to recognize the costs of closing certain manufacturing facilities and two research facilities, as well as the elimination of certain positions at the Company's facilities. The Company recorded its asset impairments in accordance with SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets and its restructuring charges, including personnel and other costs, in accordance with EITF No. 94-3, Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring). The restructuring will ultimately result in the elimination of approximately 3,150 positions worldwide. The reductions in workforce are permanent and affected all of the Company's segments, including Corporate. As of March 31, 2003, the Company has initiated the process of closing certain manufacturing facilities and had eliminated approximately 2,565 positions. The activity in the restructuring accruals was as follows:
Personnel Other Closure/ (In thousands) Costs Exit Costs Total ------------------------------------------- --------- -------------- -------- Restructuring accruals at December 31, 2002 $163,700 $73,000 $236,700 Cash expenditures (55,900) (5,400) (61,300) --------- -------------- -------- Restructuring accruals at March 31, 2003 $107,800 $67,600 $175,400 ========= ============== ========
11 WYETH NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) Note 5. Company Data by Segment ----------------------- The Company has three segments: Pharmaceuticals, Consumer Healthcare and Corporate. The Company's Pharmaceuticals and Consumer Healthcare operating segments are strategic business units that are managed separately because they manufacture, distribute and sell distinct products and provide services, which require various technologies and marketing strategies.
Net Revenue Income before Taxes (*) --------------------------- --------------------------- Three Months Three Months Ended March 31, Ended March 31, (In thousands) --------------------------- --------------------------- Segment 2003 2002 2003 2002 ------------------- ---------- ---------- ---------- ---------- Pharmaceuticals $3,157,053 $3,149,044 $943,882 $1,073,208 Consumer Healthcare 532,004 494,477 80,204 159,479 ---------- ---------- ---------- ---------- 3,689,057 3,643,521 1,024,086 1,232,687 Corporate - - 758,502 (110,525) ---------- ---------- ---------- ---------- Total $3,689,057 $3,643,521 $1,782,588 $1,122,162 ========== ========== ========== ==========
(*) Corporate for the 2003 first quarter included a gain of $860,554 relating to the sale of Amgen shares. Note 6. Earnings per Share ------------------ The following table sets forth the computations of basic earnings per share and diluted earnings per share:
Three Months Ended March 31, ----------------------------- (In thousands except per share amounts) 2003 2002 ------------------------------------------------------ ---------- --------- Net income less preferred dividends $1,277,873 $871,910 Denominator: Weighted average number of common shares outstanding 1,327,131 1,323,940 ---------- --------- Basic earnings per share $0.96 $0.66 ========== ========= Net income $1,277,882 $871,920 Denominator: Weighted average number of common shares outstanding 1,327,131 1,323,940 Common stock equivalents of outstanding stock options and deferred common stock awards 4,282 14,567 ---------- --------- Total shares 1,331,413 1,338,507 ---------- --------- Diluted earnings per share $0.96 $0.65 ========== =========
At March 31, 2003 and 2002, the equivalent of 88.9 million and 0.9 million common shares, respectively, issuable under the Company's Stock Incentive Plans, were excluded from the computation of diluted earnings per share because the effect would have been antidilutive. 12 WYETH NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) Note 7. Marketable Securities --------------------- The cost, gross unrealized gains and (losses), and fair value of available-for-sale and held-to-maturity securities by major security type at March 31, 2003 and December 31, 2002, were as follows:
Gross Gross (In thousands) Unrealized Unrealized Fair At March 31, 2003 Cost Gains (Losses) Value ---------------------------------- ---------- ---------- ---------- ---------- Available-for-sale: U.S. Treasury securities $147,654 $642 $(132) $148,164 Commercial paper 33,930 - - 33,930 Certificates of deposit 30,544 18 (4) 30,558 Corporate debt securities 187,406 693 (114) 187,985 Other debt securities 9,625 209 - 9,834 Institutional fixed income fund 513,277 19,116 - 532,393 ---------- ---------- ---------- ---------- Total available-for-sale 922,436 20,678 (250) 942,864 ---------- ---------- ---------- ---------- Held-to-maturity: Time / term deposits 25,000 - - 25,000 Commercial paper 58,521 - - 58,521 Certificates of deposit 250 - - 250 Other debt securities 8,276 - - 8,276 ---------- ---------- ---------- ---------- Total held-to-maturity 92,047 - - 92,047 ---------- ---------- ---------- ---------- $1,014,483 $20,678 $(250) $1,034,911 ========== ========== ========== ========== Gross Gross (In thousands) Unrealized Unrealized Fair At December 31, 2002 Cost Gains (Losses) Value ---------------------------------- ---------- ---------- ---------- ---------- Available-for-sale: U.S. Treasury securities $105,583 $615 $(15) $106,183 Commercial paper 57,397 - - 57,397 Certificates of deposit 29,218 77 - 29,295 Corporate debt securities 214,127 1,202 (388) 214,941 Other debt securities 9,702 150 - 9,852 Institutional fixed income fund 510,574 16,312 - 526,886 ---------- ---------- ---------- ---------- Total available-for-sale 926,601 18,356 (403) 944,554 ---------- ---------- ---------- ---------- Held-to-maturity: Time / term deposits 30,002 - - 30,002 U.S. Treasury securities 1,996 - - 1,996 Commercial paper 10,473 - - 10,473 Certificates of deposit 15,251 - - 15,251 Other debt securities 999 - - 999 ---------- ---------- ---------- ---------- Total held-to-maturity 58,721 - - 58,721 ---------- ---------- ---------- ---------- $985,322 $18,356 $(403) $1,003,275 ========== ========== ========== ==========
13 WYETH NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (Unaudited) The contractual maturities of debt securities classified as available-for-sale and held-to-maturity as of March 31, 2003 were as follows: Fair (In thousands) Cost Value ---------------------------------------- -------- -------- Available-for-sale: Due within one year $174,400 $174,370 Due after one year through five years 234,759 236,101 Due after five years through 10 years - - Due after 10 years - - -------- -------- $409,159 $410,471 ======== ======== All held-to-maturity debt securities are due within one year and had aggregate fair values of $92.0 million. Note 8. Sale of Amgen Common Stock Investment ------------------------------------- During the first quarter of 2003, the Company completed the sale of the remaining 31,235,958 shares of Amgen common stock held by the Company at December 31, 2002. These remaining shares netted proceeds of $1,579.9 million and resulted in a gain of $860.6 million ($558.7 million after-tax or $0.42 per share-diluted). 14 Management's Discussion and Analysis of Financial Condition and Results of Operations Three Months Ended March 31, 2003 Item 2. Results of Operations --------------------- Worldwide net revenue for the 2003 first quarter was 1% higher compared with prior year levels. The increase in worldwide net revenue for the 2003 first quarter was due primarily to higher worldwide net revenue of consumer healthcare. Excluding the impact of foreign exchange, worldwide net revenue decreased 2% for the 2003 first quarter. The following table sets forth worldwide net revenue results by operating segment together with the percentage changes from the comparable period in the prior year: Net Revenue ------------------------- Three Months Ended March 31, ($ in millions) ------------------------- Operating Segment 2003 2002 % Increase ------------------------ -------- -------- ---------- Pharmaceuticals $3,157.1 $3,149.0 - Consumer Healthcare 532.0 494.5 8% -------- -------- ---------- Total $3,689.1 $3,643.5 1% ======== ======== ========== Pharmaceuticals --------------- Worldwide pharmaceutical net revenue was flat for the 2003 first quarter. Excluding the impact of foreign exchange, worldwide pharmaceutical net revenue decreased 3% for the 2003 first quarter. Worldwide human pharmaceutical net revenue was flat as higher sales of EFFEXOR XR (substantial global growth), PROTONIX (strong prescription volume growth) and PREVNAR (reflecting consistent increased manufacturing capability) were offset by lower sales of the PREMARIN family of products and CORDARONE I.V. (market exclusivity ended October 2002). Excluding the impact of foreign exchange, worldwide human pharmaceutical net revenue decreased 3% for the 2003 first quarter. Worldwide animal health product net revenue increased 13% for the 2003 first quarter. The increase in sales of animal health products was due primarily to higher U.S. sales of the Company's WEST NILE - INNOVATOR biological vaccine for horses. Excluding the impact of foreign exchange, worldwide animal health product net revenue increased 11% for the 2003 first quarter. 15 Management's Discussion and Analysis of Financial Condition and Results of Operations Three Months Ended March 31, 2003 The following table sets forth the significant worldwide human pharmaceutical and animal health net revenue by product for the three months ended March 31, 2003 compared with the same period in the prior year: Three Months Ended March 31, (In millions) ----------------------------- Products 2003 2002 --------------------------- -------- -------- EFFEXOR $593.5 $422.1 PREMARIN family 402.7 675.6 PROTONIX 360.0 247.1 PREVNAR 228.8 148.2 Nutritionals 202.8 204.0 Oral Contraceptives 154.3 186.7 ZOSYN/TAZOCIN 140.1 102.2 ZOTON 72.5 67.5 BENEFIX 58.6 46.4 ATIVAN 55.0 53.3 ReFacto 52.3 38.4 SYNVISC 49.1 45.0 RAPAMUNE 44.7 23.6 ENBREL 42.8 33.6 Alliance revenue 94.7 77.2 Other 423.2 616.6 -------- -------- Total human pharmaceuticals 2,975.1 2,987.5 -------- -------- WEST NILE - INNOVATOR 20.9 5.8 Other 161.1 155.7 -------- -------- Total animal health 182.0 161.5 -------- -------- Total pharmaceuticals $3,157.1 $3,149.0 ======== ======== Consumer Healthcare ------------------- Worldwide consumer healthcare net revenue increased 8% for the 2003 first quarter due primarily to sales of ALAVERT (introduced in the 2002 fourth quarter) and higher sales of cough/cold/allergy products offset, in part, by lower sales of CENTRUM products. Excluding the impact of foreign exchange, worldwide consumer healthcare net revenue increased 5% for the 2003 first quarter. 16 Management's Discussion and Analysis of Financial Condition and Results of Operations Three Months Ended March 31, 2003 The following table sets forth the significant worldwide consumer healthcare net revenue by product for the three months ended March 31, 2003 compared with the same period in the prior year: Three Months Ended March 31, (In millions) --------------------------- Products 2003 2002 --------------------------- ------ ------ CENTRUM $119.7 $129.9 ADVIL (*) 108.9 110.1 Cough/cold/allergy products 105.4 84.0 CALTRATE 30.2 27.4 SOLGAR 28.5 28.3 CHAP STICK 23.4 24.0 ALAVERT 21.0 - Other 94.9 90.8 ------ ------ Total consumer healthcare $532.0 $494.5 ====== ====== (*) ADVIL COLD & SINUS family is included within the cough/cold/allergy product line. The following table sets forth the percentage changes in worldwide net revenue by operating segment compared with the prior year, including the effect volume, price and foreign exchange had on these percentage changes:
% Increase (Decrease) Three Months Ended March 31, 2003 --------------------------------------------- Foreign Total Volume Price Exchange Net Revenue ------ ----- -------- ----------- Pharmaceuticals ------------------------ United States (8%) 4% - (4%) International (3%) 3% 9% 9% --- --- --- --- Total (7%) 4% 3% - === === === === Consumer Healthcare ------------------------ United States 1% 3% - 4% International 4% 2% 8% 14% --- --- --- --- Total 2% 3% 3% 8% === === === === Total ------------------------ United States (7%) 4% - (3%) International (2%) 2% 9% 9% --- --- --- --- Total (6%) 4% 3% 1% === === === ===
17 Management's Discussion and Analysis of Financial Condition and Results of Operations Three Months Ended March 31, 2003 Cost of goods sold, as a percentage of net revenue, increased to 25.2% for the 2003 first quarter compared with 22.0% for the 2002 first quarter due primarily to higher manufacturing costs and a less profitable product mix related to lower sales of higher margin products. This increase was partially offset as a result of increased alliance revenue recorded in the 2003 first quarter net revenue as compared with the 2002 first quarter net revenue. There are no costs of goods sold relating to alliance revenue, and therefore any net revenue fluctuations impacted by alliance revenue will also impact gross margins. Selling, general and administrative expenses, as a percentage of net revenue, remained flat for the 2003 first quarter as compared with the same period in the prior year at approximately 35.0% due primarily to lower selling and marketing expenditures offset by higher general expenses associated with increased insurance and pension and other employee benefit costs. Research and development expenses increased 7% for the 2003 first quarter due primarily to higher clinical grant spending, cost sharing and licensing expenditures from pharmaceutical collaborations offset, in part, by reduced spending for operating expenses, including lower chemical and material costs. Interest expense, net decreased 49% in the 2003 first quarter due primarily to lower weighted average debt outstanding, as compared with the 2002 first quarter. Weighted average debt outstanding during the 2003 and 2002 first quarters was $7,152.6 million and $9,932.2 million, respectively. The decrease in interest expense was also affected by higher capitalized interest resulting from spending for capital projects. Other income, net decreased significantly for the 2003 first quarter due in part to lower gains on sales of non-strategic assets and the non-recurrence of income received in 2002 in connection with a class action settlement gain relating to price fixing by certain vitamin suppliers. 18 Management's Discussion and Analysis of Financial Condition and Results of Operations Three Months Ended March 31, 2003 The following table sets forth worldwide income before taxes by segment together with the percentage changes from the comparable period in the prior year: Income before Taxes --------------------------- Three Months Ended March 31, ($ in millions) --------------------------- % Increase Segment 2003 2002 (Decrease) ------------------- -------- -------- ----------- Pharmaceuticals $943.9 $1,073.2 (12%) Consumer Healthcare 80.2 159.5 (50%) -------- -------- ---- 1,024.1 1,232.7 (17%) Corporate (*) 758.5 (110.5) - -------- -------- ---- Total $1,782.6 $1,122.2 59% ======== ======== ==== (*) Corporate for the 2003 first quarter included a gain of $860.6 relating to the sale of Amgen shares. Excluding the gain on the sale of Amgen shares from the 2003 first quarter results, Corporate expenses, net decreased 8%. Worldwide pharmaceutical income before taxes decreased 12% for the 2003 first quarter due primarily to lower gross profit margins earned on worldwide sales of human pharmaceuticals combined with higher research and development expenses and lower other income, net (primarily lower gains on sales of non-strategic assets and the non-recurrence of equity income received in 2002) offset, in part, by lower selling, general and administrative expenses. Worldwide consumer healthcare income before taxes decreased 50% for the 2003 first quarter while consumer healthcare sales increased 8%. This difference is primarily attributable to the non-recurrence of income received in 2002 in connection with a class action settlement gain relating to price fixing by certain vitamin suppliers, lower asset sale gains, and higher selling, general and administrative expenses as a percentage of sales primarily due to increased marketing and selling expenses associated with the launch of ALAVERT. Corporate expenses, net, decreased 8% for the 2003 first quarter, excluding the 2003 first quarter gain of $860.6 million from the sale of the Company's remaining Amgen shares. The decrease in corporate expenses, net is due primarily to lower interest expense resulting from lower weighted average debt outstanding as compared with the 2002 first quarter and higher other income, net relating to gains on the Company's foreign exchange hedging programs. These items were partially offset by higher general expenses related to increased group and general insurance expenses. 19 Management's Discussion and Analysis of Financial Condition and Results of Operations Three Months Ended March 31, 2003 Excluding the 2003 first quarter gain on the sale of the Company's remaining Amgen shares, the effective tax rate remained flat at 22.0% for the 2003 first quarter compared with 22.3% for the 2002 first quarter. Consolidated Net Income and Diluted Earnings Per Share Results -------------------------------------------------------------- Net income and diluted earnings per share for the 2003 first quarter increased to $1,277.9 million and $0.96 compared with $871.9 million and $0.65 in the prior year. The 2003 first quarter net income and diluted earnings per share included a gain of $860.6 million ($558.7 million after-tax or $0.42 per share-diluted) related to the sale of the remaining 31,235,958 shares of the Company's Amgen common stock holdings. Excluding the gain on the sale of Amgen shares from the 2003 first quarter results, net income and diluted earnings per share for the 2003 first quarter decreased 18% and 17%, respectively, to $719.2 million and $0.54 compared with the 2002 first quarter. The decreases in net income and diluted earnings per share for the 2003 first quarter were impacted by higher costs of goods sold as a percentage of net revenue, higher research and development expenses and lower other income. Liquidity, Financial Condition and Capital Resources ---------------------------------------------------- Cash flows provided by operating activities totaling $328.4 million during the 2003 first quarter were generated primarily by earnings of $1,277.9 million and proceeds of $213.4 million relating to improved collections on outstanding accounts receivable. Driving the cash outflows were payments of $134.6 million relating to the diet drug litigation and a payment of $535.2 million to the security fund as collateral for the Company's financial obligations under the diet drug settlement (see Note 3 to the consolidated condensed financial statements). Additionally, payments made on outstanding payables and accrued expenses totaling $123.6 million and an increase in inventories of $160.9 million due primarily to production planning impacted cash outflows. The Company generated $1,216.1 million of cash from investing activities during the 2003 first quarter due primarily to proceeds received of $1,579.9 million relating to the sale of the Company's remaining 31,235,958 shares of Amgen common stock. The Company used $547.9 million for investments in property, plant and equipment and marketable securities. The capital expenditures made during the 2003 first quarter were consistent with the Company's commitment to expand existing manufacturing and research and development facilities worldwide, and build new biotechnology facilities. The Company also used cash for financing activities relating to repayments of net debt totaling $1,456.7 million and dividend payments of $305.1 million. At March 31, 2003, the Company had outstanding $6,923.2 million in total debt. The Company's total debt consisted of commercial paper of $557.7 million, and notes payable 20 Management's Discussion and Analysis of Financial Condition and Results of Operations Three Months Ended March 31, 2003 and other debt of $6,365.5 million. The Company offers its commercial paper in a very liquid market commensurate with its short-term credit ratings from Moody's (P2), S&P (A1) and Fitch (F1). Current debt at March 31, 2003, classified as loans payable, consisted of $514.0 million of notes payable and other debt that is due within one year. All of the commercial paper outstanding at March 31, 2003 was supported by the Company's new credit facilities, totaling $2,700.0 million, and is classified as long-term debt. Management remains confident that cash flows from operating activities and existing and prospective financing resources will be adequate to fund the Company's operations, pay opt out settlement payments and fund the nationwide class action settlement relating to the REDUX and PONDIMIN diet drug litigation, pay dividends, maintain the ongoing programs of capital expenditures, and repay both the principal and interest on its outstanding obligations, without requiring the disposition of any significant strategic core assets or businesses. Certain Factors that May Affect Future Results ---------------------------------------------- Prempro / Premarin - HRT Studies Two subsets of the Women's Health Initiative (WHI) enrolled a total of 27,000 predominantly healthy postmenopausal women to assess the risks and benefits of either long-term estrogen replacement therapy (ERT) or long-term hormone replacement therapy (HRT). The primary endpoint of the WHI study was coronary heart disease, with invasive breast cancer as the primary adverse outcome studied. The HRT subset of the WHI study, involving women who received a combination of conjugated estrogens and medroxyprogesterone acetate (PREMPRO), was stopped early (after the patients were followed in the study for an average of 5.2 years) because, according to the predefined stopping rule, increased risks of breast cancer and cardiovascular events exceeded the specified long-term benefits. The study observed an increased incidence of cardiovascular disease and, over time, breast cancer among women on HRT compared to those on placebo. The study also observed a reduction in the incidence of hip, vertebral and other osteoporotic fractures and of colon cancer among women on HRT compared to those on placebo. The study did not evaluate the use of HRT for the treatment of menopausal symptoms, the main indications of the product. These findings provide additional information about the risks of breast cancer and cardiovascular disease which were identified as potential adverse events in the labeling for the Company's HRT products. Additional analyses of data from the HRT subset of the WHI study are expected to be released over the next several months. Sales of PREMPRO and other PREMARIN family products have been and will continue to be adversely affected by the WHI results. Based on the most recent available market data, average weekly prescriptions written for PREMPRO and PREMARIN decreased approximately 67% and 33%, respectively, compared to the average weekly 21 Management's Discussion and Analysis of Financial Condition and Results of Operations Three Months Ended March 31, 2003 prescriptions written during the eight-week period preceding the termination of the study subset. PREMPRO sales (including PREMPHASE) for the three months ended March 31, 2003 represented approximately 4% of consolidated net revenue. Set forth below are individual product operating results for both PREMPRO/PREMPHASE and PREMARIN for the three months ended March 31, 2003 and 2002. Prempro/Premphase ------------------------- Three Months Ended March 31, ------------------------- (In millions) 2003 2002 ----------------- ------ ------ Net revenue $142.9 $216.1 Gross profit 123.5 182.7 Premarin ------------------------- Three Months Ended March 31, ------------------------- (In millions) 2003 2002 ----------------- ------ ------ Net revenue $259.8 $459.5 Gross profit 233.2 425.7 Competition The Company operates in the highly competitive pharmaceutical and consumer health care industries. PREMARIN, the Company's principal conjugated estrogens product manufactured from pregnant mare's urine, and related products PREMPRO and PREMPHASE (which are single tablet combinations of the conjugated estrogens in PREMARIN and the progestin medroxyprogesterone acetate), are the leaders in their categories and contribute significantly to the Company's net revenue and results of operations. PREMARIN's natural composition is not subject to patent protection (although PREMPRO has patent protection). The principal indications of PREMARIN, PREMPRO and PREMPHASE are to manage the symptoms of menopause and to prevent osteoporosis, a condition involving a loss of bone mass in postmenopausal women. Estrogen-containing products manufactured by other companies have been marketed for many years for the treatment of menopausal symptoms. During the past several years, other manufacturers have introduced products for the treatment and/or prevention of osteoporosis. New products containing different estrogens and/or different progestins than those found in PREMPRO and PREMPHASE, utilizing various forms of delivery and having one or more of the same indications have also been introduced. Some companies have attempted to obtain approval for generic versions of PREMARIN. These products, if approved, would be routinely substitutable for PREMARIN and related products under many state laws and third-party insurance payer plans. In May 1997, the FDA announced that it would not approve certain synthetic estrogen products 22 Management's Discussion and Analysis of Financial Condition and Results of Operations Three Months Ended March 31, 2003 as generic equivalents of PREMARIN given known compositional differences between the active ingredient of these products and PREMARIN. Although the FDA has not approved any generic equivalent to PREMARIN to date, PREMARIN will continue to be subject to competition from existing and new competing estrogen and other products for its approved indications and may be subject to generic competition from either synthetic or natural conjugated estrogens products in the future. At least one other company has announced that it is in the process of developing a generic version of PREMARIN from the same natural source, and the Company currently cannot predict the timing or outcome of these or any other efforts. Product Supply Market demand for ENBREL is strong; however the sales growth had been constrained by limits on the existing source of supply. In December 2002, the retrofitted Rhode Island facility owned by Amgen was completed, and manufacturing production was approved by the FDA. Consequently, manufacturing capacity for ENBREL will significantly increase in 2003. Market demand is expected to continue to grow, and additional manufacturing supply is projected to be required. In April 2002, Immunex (prior to being acquired by Amgen) announced it entered into a manufacturing agreement with Genentech, Inc. to produce ENBREL beginning in 2004, subject to FDA approval. The current plan for the longer term includes an additional manufacturing facility, which is being constructed by the Company in Ireland and expansion of the Rhode Island facility, both of which are expected to be completed during 2005. Litigation and Contingent Liabilities The Company is involved in various legal proceedings, including product liability and environmental matters that arise from time to time in the ordinary course of business, the most significant of which are described in the Company's Annual Report on Form 10-K for the year ended December 31, 2002 and this Quarterly Report on Form 10-Q. These include allegations of injuries caused by drugs, vaccines and over-the-counter products, including PONDIMIN (which in combination with phentermine, a product that was not manufactured, distributed or sold by the Company, was commonly referred to as "fen-phen"), REDUX, DIMETAPP, ROBITUSSIN and PREMPRO. In addition, the Company has responsibility for environmental, safety and cleanup obligations under various local, state and federal laws, including the Comprehensive Environmental Response, Compensation and Liability Act, commonly known as Superfund. The estimated costs that the Company expects to pay in these cases are accrued when the liability is considered probable and the amount can be reasonably estimated. In many cases, future environmental-related expenditures cannot be quantified with a reasonable degree of accuracy. As investigations and cleanups proceed, environmental-related liabilities are reviewed and adjusted as additional information becomes available. In 23 Management's Discussion and Analysis of Financial Condition and Results of Operations Three Months Ended March 31, 2003 addition, the Company is self-insured against ordinary product liability risks and has liability coverage, in excess of certain limits and subject to certain policy ceilings, from various insurance carriers. It is the opinion of the Company that any potential liability that might exceed amounts already accrued will not have a material adverse effect on the Company's financial position but could be material to the results of operations or cash flows in any one accounting period. Cautionary Statements Regarding Forward-Looking Information ----------------------------------------------------------- The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for forward-looking statements. This quarterly report, including management's discussion and analysis set forth herein, as well as our annual, quarterly and special reports, proxy statements and other information filed with the Securities and Exchange Commission and other written or oral statements made by us or on our behalf may include forward-looking statements reflecting our current views at the time these statements were made with respect to future events and financial performance. These forward-looking statements can be identified by the use of words such as "anticipates," "expects," "is confident," "plans," "could," "will," "believes," "estimates," "forecasts," "projects" and other words of similar meaning. These forward-looking statements address various matters, including: o our anticipated results of operations, liquidity position, financial condition and capital resources; o the benefits that we expect will result from our business activities and certain transactions we announced or completed, such as increased revenues, decreased expenses, and avoided expenses and expenditures; o statements of our expectations, beliefs, future plans and strategies, anticipated developments and other matters that are not historical facts; o the future impact of presently known trends, including those with respect to product performance and competition; o anticipated developments related to PREMPRO/PREMARIN performance and ENBREL product supply, and o expectations regarding the impact of potential litigation relating to PREMPRO; the nationwide class action settlement relating to REDUX and PONDIMIN; and additional litigation charges related to REDUX and PONDIMIN, including those for opt outs from the national settlement. All forward-looking statements address matters involving numerous assumptions, risks and uncertainties, which may cause actual results to differ materially from those expressed or implied by us in those statements. Accordingly, we caution you not to place undue reliance on these forward-looking statements, which speak only as of the date on which they were made. From time to time, we also may provide oral or written forward-looking statements in other materials we release to the public. Additionally, we undertake no obligation to publicly update or revise any forward-looking statements, 24 Management's Discussion and Analysis of Financial Condition and Results of Operations Three Months Ended March 31, 2003 whether as a result of new information, future developments or otherwise. Certain factors which could cause the Company's actual results to differ materially from expected and historical results are discussed herein and others have been identified by the Company in Exhibit 99 to the Company's 2002 Annual Report on Form 10-K, which exhibit is incorporated herein by reference. 25 Item 3. Quantitative and Qualitative Disclosures About Market Risk ---------------------------------------------------------- The market risk disclosures appearing on page 65 of the Company's 2002 Annual Report as incorporated by reference on Form 10-K have not materially changed from December 31, 2002. At March 31, 2003, the fair values of the Company's financial instruments were as follows: Carrying Fair Notional/ Value Value (In millions) Contract ---------------------- Description Amount Assets (Liabilities) --------------------- ------------------------------------ Forward contracts (1) $826.3 $8.8 $8.8 Option contracts (1) 883.0 (22.1) (22.1) Interest rate swaps 3,300.0 216.7 216.7 Outstanding debt (2) 6,721.9 (6,923.2) (7,194.7) (1) If the value of the U.S. dollar were to increase or decrease by 10%, in relation to all hedged foreign currencies, the net payable on the forward and option contracts would decrease or increase by approximately $70.3. (2) If the interest rates were to increase or decrease by one percentage point, the fair value of the outstanding debt would increase or decrease by approximately $325.1. The estimated fair values approximate amounts at which these financial instruments could be exchanged in a current transaction between willing parties. Therefore, fair values are based on estimates using present value and other valuation techniques that are significantly affected by the assumptions used concerning the amount and timing of estimated future cash flows and discount rates that reflect varying degrees of risk. Specifically, the fair value of outstanding debt instruments reflects a current yield valuation based on observed market prices as of March 31, 2003; the fair value of interest rate swaps and forward contracts reflects the present value of the future potential gain or (loss) if settlement were to take place on March 31, 2003; and the fair value of option contracts reflects the present value of future cash flows if the contracts were settled on March 31, 2003. Item 4. Controls and Procedures ----------------------- Within the 90 days prior to the date of filing this Quarterly Report on Form 10-Q, the Company carried out an evaluation, under the supervision and with the participation of the Company's management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures pursuant to Exchange Act Rule 13a-14. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures are reasonably effective in design and practice to alert them, in a timely manner, to material information relating to the Company (including its consolidated subsidiaries) required to be included in the 26 Company's periodic SEC filings. Subsequent to the date of that evaluation, there have been no significant changes in the Company's internal controls or in other factors that could significantly affect internal controls, nor were any corrective actions required with regard to significant deficiencies or material weaknesses. 27 Part II - Other Information --------------------------- Item 1. Legal Proceedings ----------------- The Company and its subsidiaries are parties to numerous lawsuits and claims arising out of the conduct of its business, including product liability and other tort claims, the most significant of which are described in the Company's Annual Report on Form 10-K for the year ended December 31, 2002. In the litigation involving PREMPRO, the Company's estrogen and progestin replacement therapy, three additional putative class action lawsuits have been filed. Brown, et al. v. Wyeth, No. CV03-0138S, U.S.D.C., W.D. La; Slater, et al. v. Wyeth, No. 03-4016-CV-C-NKL, U.S.D.C., W.D. Mo; and Phillips, et al. v. Wyeth, No. CV03-5, Cir. Ct., Jefferson Cty., AL. Slater seeks to represent a nationwide class of women who have ever ingested PREMPRO and seeks on behalf of the putative class: 1) purchase price refunds; 2) personal injury damages; 3) medical monitoring expenses and 4) an order requiring the Company to inform the public of the reported risks of PREMPRO. Brown and Phillips seek similar relief on behalf of putative classes of Louisiana and Alabama users of the product, respectively. In addition to the 16 class actions, the Company is defending approximately 40 individual actions and 13 multi-plaintiff actions (with a total of approximately 130 named plaintiffs) in various courts for personal injuries including breast cancer, stroke and heart disease. The Company intends to continue to defend all of the foregoing litigation vigorously. In the litigation involving allegations that the Company violated federal and state antitrust laws through alleged exclusionary practices regarding PREMARIN and the Company's contracts with managed care organizations and pharmacy benefit managers, United States District Judge Sandra S. Beckwith has granted the direct-purchasers' motion for class certification. J.B.D.L. Corp. d/b/a/ Beckett Apothecary, et al. v. Wyeth-Ayerst Laboratories, Inc., et al., No. C-1-01-704, U.S.D.C., S.D. Oh. Three putative indirect-purchaser class actions with allegations similar to those contained in the J.B.D.L. complaint are presently pending against the Company. One putative indirect-purchaser class action is pending in Ohio federal district court, and two putative indirect-purchaser class actions are pending in California state courts. The complaints seek injunctive relief, damages, and disgorgement of profits. The Company believes that its contracts involving PREMARIN do not violate state or federal laws. On April 11, 2003, the U.K. Competition Commission report on its investigation into the supply of prescription-only veterinary medicines in the U.K. concluded that three monopoly situations exist in the U.K. market for such medicines. According to the report, one such monopoly situation arises from the failure of eight animal-health manufacturers, including Fort Dodge Animal Health U.K., to enable pharmacies to obtain supplies of prescription-only veterinary medicines on terms that would enable them to compete with veterinary surgeons. The report recommended two remedies for the situation, applicable to all of the relevant manufacturers, which are designed to allow the pharmacies to obtain prescription-only veterinary medicines on competitive terms with the veterinary surgeons. The U.K. Office of Fair Trading will consult with the relevant 28 parties on the terms of orders to implement the Commission's remedies during the next three months. In the opinion of the Company, although the outcome of any legal proceedings cannot be predicted with certainty, the ultimate liability of the Company in connection with its legal proceedings will not have a material adverse effect on the Company's financial position but could be material to the results of operations in any one accounting period. 29 Item 6. Exhibits and Reports on Form 8-K -------------------------------- (a) Exhibits -------- Exhibit No. Description ----------- ----------- (3.2) By-laws, as amended to date. (10.1) Savings Plan, as amended to date. (10.2) Supplemental Employee Retirement Plan, as amended to date. (10.3) Supplemental Employee Savings Plan, as amended to date. (10.4) Union Savings Plan, as amended to date. (12) Computation of Ratio of Earnings to Fixed Charges. (99.1) Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (99.2) Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (b) Reports on Form 8-K ------------------- The following Current Reports on Form 8-K were filed by the Company: o January 28, 2003 relating to the exchange of Immunex shares for Amgen common stock in the acquisition of Immunex by Amgen and the subsequent sales of the Company's remaining Amgen common stock holdings (including disclosure on Item 2). o January 28, 2003 to furnish the Company's 2002 Fourth Quarter and Full Year Press Release. o March 13, 2003 to furnish the Company's 2002 Annual Report to Stockholders. o April 23, 2003 to furnish the Press Release reporting the Company's earnings results for the 2003 First Quarter. 30 Signature --------- Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Wyeth ----- (Registrant) By /s/ Paul J. Jones ----------------- Paul J. Jones Vice President and Controller (Duly Authorized Signatory and Chief Accounting Officer) Date: May 15, 2003 31 Certifications -------------- I, Robert Essner, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Wyeth (the registrant); 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have: a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 32 6. The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. By /s/ Robert Essner ----------------- Robert Essner Chairman, President and Chief Executive Officer Date: May 15, 2003 33 Certifications -------------- I, Kenneth J. Martin, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Wyeth (the registrant); 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have: a) designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; b) evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and c) presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date; 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): a) all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and 34 6. The registrant's other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. By /s/ Kenneth J. Martin --------------------- Kenneth J. Martin Executive Vice President and Chief Financial Officer Date: May 15, 2003 35 Exhibit Index ------------- Exhibit No. Description ----------- ----------- (3.2) By-laws, as amended to date. (10.1) Savings Plan, as amended to date. (10.2) Supplemental Employee Retirement Plan, as amended to date. (10.3) Supplemental Employee Savings Plan, as amended to date. (10.4) Union Savings Plan, as amended to date. (12) Computation of Ratio of Earnings to Fixed Charges. (99.1) Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (99.2) Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. EX-1 EX-3.2 3 bylaws.txt - ------------------------------------------------------------------------------- *************************************************************************** - ------------------------------------------------------------------------------- BY-LAWS OF WYETH AS AMENDED THROUGH APRIL 24, 2003 - ------------------------------------------------------------------------------- *************************************************************************** - ------------------------------------------------------------------------------- BY-LAWS of WYETH * * * * * * * * * * * * * * * * * * * * * STOCKHOLDERS MEETINGS 1. Annual Meeting. An annual meeting of stockholders for election of directors and transaction of other business properly before the meeting shall be held on the fourth Wednesday of April in each year, or on such other date and at such time as the Board of Directors may designate. Any business properly brought before an annual meeting of stockholders may be transacted at such meeting. To be properly brought before an annual meeting, business must be (i) specified in the written notice of the meeting (or any supplement thereto) given by or at the direction of the Board of Directors, (ii) otherwise brought before the meeting by or at the direction of the Board of Directors, or (iii) otherwise properly brought before the meeting by a stockholder. For matters to be properly brought before an annual meeting by a stockholder (other than nominations for the election of directors), the stockholder must give written notice of the proposed matter, either by personal delivery or by United States mail, postage prepaid, to the Secretary of the corporation, not later than ninety days prior to the anniversary date of the immediately preceding annual meeting or not later than ten days after notice or public disclosure of the date of the annual meeting shall be given or made to stockholders, whichever date shall be earlier. Any such notice shall set forth as to each item of business the stockholder shall propose to bring before the meeting (i) the name and address of the stockholder proposing such item of business, (ii) a description of such item of business and the reasons for conducting it at such meeting and, in the event that such item of business shall include a proposal to amend either the Certificate of Incorporation or these by-laws, the text of the proposed amendment, (iii) a representation that the stockholder is a holder of record of stock of the corporation entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to propose such item of business and (iv) any material interest of the stockholder in such item of business. Only matters which shall have been properly brought before an annual meeting of stockholders in accordance with these by-laws shall be conducted at such meeting, and the presiding officer may refuse to permit any matters to be brought before such meeting which shall not have been properly brought before it in accordance with the foregoing procedure. 2. Special Meetings. Except as provided in paragraph VII (g) (v) of Article FOURTH of the Certificate of Incorporation respecting rights of holders of Preferred Stock to call meetings of such holders in certain dividend default situations, special meetings of stockholders, unless otherwise provided by law, may be called by the Chairman or Vice Chairman of the Board of Directors or the President or by the Secretary on the written request of a majority of all the directors, such request to state the purpose of the proposed meeting, which meeting shall thereupon be called by the Secretary. Business at special meetings shall be confined to the matters stated in the notice. 3. Notice. Written notice of each meeting of stockholders shall be mailed, not less than ten days prior to the meeting, to each stockholder entitled to vote at such address as appears on the stock books of the corporation. The notice shall specify the time and place of the meeting and, as to special meetings, the matter or matters to be acted upon at such meeting. 4. Place. Meetings of stockholders shall be held at the office of the corporation in Wilmington, Delaware, or at such other place, within or without the State of Delaware, as the Board of Directors may designate. 5. Quorum. Except as provided in paragraph VII (g) (v) of Article FOURTH of the Certificate of Incorporation respecting meetings of stockholders during certain dividend default situations, at which meetings holders of Preferred Stock have special voting rights, the holders of a majority of the outstanding stock having voting power, present in person or by proxy, shall constitute a quorum at all meetings of stockholders for the transaction of business unless otherwise provided by law. Except as provided in such paragraph VII (g) (v) of Article FOURTH of the Certificate of Incorporation, if a quorum shall not be present at any meeting of stockholders, the stockholders entitled to vote, present in person or by proxy, may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present; and at such adjourned meeting at which a quorum shall be present any business may be transacted which might have been transacted at the meeting originally called. 6. Voting; Proxies. At each meeting of stockholders every stockholder entitled to vote may vote in person or by proxy appointed by an instrument in writing subscribed by such stockholder or his duly appointed attorney-in-fact or in any other manner prescribed by the General Corporation Law of the State of Delaware. Except as provided in paragraphs VII (g) (i) and VII (g) (v) of Article FOURTH of the Certificate of Incorporation respecting holders of Preferred Stock voting in certain situations, each holder of Common Stock shall have one vote and each holder of Preferred Stock shall have thirty-six (36) votes on each matter submitted to a vote at a meeting of stockholders for each share of, respectively, Common and Preferred Stock having voting power, registered in his name on the stock books of the corporation. The vote for directors and, upon the demand of any stockholder, the vote upon any other matter before the meeting, shall be by ballot. Elections shall be decided by a plurality of the votes cast and other matters shall be decided by a majority of the votes cast on such matters. BOARD OF DIRECTORS 7. Powers; Number; Election; Term; Vacancies. The property and business of the corporation shall be managed by its Board of Directors, which shall be not less than eight nor more than fifteen in number as determined from time to time by the Board, except as provided in paragraph VII (g) (ii) of Article FOURTH of the Certificate of Incorporation respecting additional directors in certain dividend default situations. Directors shall be elected at the annual meeting of stockholders and each director shall continue in office until his successor shall be elected or until his earlier removal or resignation. Except as provided in paragraph VII (g) (ii) of Article FOURTH of the Certificate of Incorporation respecting additional directors in certain dividend default situations, nominations for the election of directors may be made by the Board of Directors or a committee appointed by the Board of Directors or by any stockholder entitled to vote in the election of directors generally. However, any stockholder entitled to vote in the election of directors generally may nominate one or more persons for election as directors only if written notice of such stockholder's intent to make such nomination or nominations has been given, either by personal delivery or by United States mail, postage prepaid, to the Secretary of the corporation not later than (i) with respect to an election to be held at an annual meeting of stockholders, ninety days prior to the anniversary date of the immediately preceding annual meeting, and (ii) with respect to an election to be held at a special meeting of stockholders for the election of directors, the close of business on the tenth day following the date on which notice of such meeting is first given to stockholders. Each such notice shall set forth: (a) the name and address of the stockholder who intends to make the nomination and of the person or persons to be nominated; (b) a representation that the stockholder is a holder of record of stock of the corporation entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice; (c) a description of all arrangements or understandings between the stockholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the stockholder; (d) such other information regarding each nominee proposed by such stockholder as would be required to be included in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission; and (e) the consent of each nominee to serve as a director of the corporation if so elected. The presiding officer of the meeting may refuse to acknowledge the nomination of any person not made in compliance with the foregoing procedure. Except as provided in Paragraph VII (g) (v) of Article FOURTH of the Certificate of Incorporation respecting the additional directors in certain dividend default situations, vacancies in the membership of the Board, whether or not caused by an increase in the number of directors, will be filled solely by the affirmative vote of a majority of the remaining directors then in office, even though less than a quorum of the Board of Directors. Any director elected in accordance with the preceding sentence shall hold office only until the next succeeding annual meeting of stockholders. 8. Regular Meetings. Regular meetings of the Board may be held without notice at such time and place as the Board shall from time to time determine. 9. Special Meetings. Special Meetings of the Board may be called by direction of the Chairman, the Vice Chairman, the President or two directors on two days notice to each director specifying the time and place of meeting. 10. Quorum; Voting. At all meetings of the Board a majority of all the directors then in office, or if the number of directors is then an even number, one-half such number shall constitute a quorum for the transaction of business and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the Board unless otherwise provided by law, the Certificate of Incorporation or these by-laws. 11. Compensation. Directors shall be paid such fees for their services as directors and for attending meetings of the Board and committees appointed thereby as shall be determined from time to time by the Board. The Board may also provide for compensation to a director for expenses he may incur in attending such meetings. Nothing herein shall be construed to preclude any director from serving the corporation in any other capacity and receiving compensation therefor. 12. Residual Powers of Board. In addition to the powers conferred by these by-laws upon the Board, the Board may exercise all such powers of the corporation and do all such lawful acts and things as are not by law, the Certificate of Incorporation or these by-laws directed or required to be exercised or done by the stockholders. Nothing contained in these by-laws shall restrict the Board or any committee thereof from taking any action in any manner permitted by law, including unanimous written consent and conference communication by means of telephone or similar communications equipment by which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this by-law shall constitute presence in person at such meeting. EXECUTIVE COMMITTEE 13. Appointment. The Board may by vote of a majority of all the directors appoint three or more members to constitute an Executive Committee which shall serve at the pleasure of the Board. Vacancies in the membership of the Executive Committee shall be filled by the Board by vote of a majority of all the directors. 14. Duties and Powers. During the intervals between meetings of the Board, the Executive Committee shall perform all the duties and exercise all the powers of the Board in the management of the property and business of the corporation except such duties and powers as are by law, the Certificate of Incorporation or these by-laws directed or required to be performed or exercised specifically by the Board as such or by any proportion thereof. The Chairman of the Executive Committee shall assist the Chairman of the Board, shall perform such of the duties and exercise such of the powers of the Chairman as the latter may delegate to him and shall, in the absence or disability of the President, perform the duties and exercise the powers of the President. He shall perform such other duties and exercise such other powers as the Board shall from time to time prescribe. 15. Meetings. The Executive Committee may meet at stated times without notice, or on two days notice to all by one of its members. 16. Quorum; Voting. A majority of the Executive Committee shall constitute a quorum for the transaction of business and the act of a majority of those present at any meeting at which there is a quorum shall be the act of the Committee. 17. Minutes. The Executive Committee shall keep regular minutes of its proceedings and report its actions to the Board when it so requests. 18 -22 REMOVED AND RESERVED AUDIT COMMITTEE 23. Appointment. The Board shall appoint three or more directors of the corporation, none of whom is presently employed by the corporation or any of its subsidiaries, to constitute an Audit Committee, which shall serve at the pleasure of the Board. Vacancies in the membership of the Audit Committee shall be filled by the Board. 24. Duties and Powers. The Audit Committee shall appoint a firm of independent public accountants to be engaged as the principal auditor for each year's annual audit and to provide other appropriate services for the corporation, subject to ratification by the stockholders. The Audit Committee shall undertake such other financial reviews as it or the Board deems appropriate or which are required by law or applicable stock exchange listing requirements. 25. Meetings. The Audit Committee may meet at stated times without notice, or on notice to all by the Chairman or Vice Chairman of the Board, the President, an Executive Vice President or a Senior Vice President, or by one of the members of the Audit Committee. 26. Quorum; Voting. A majority of the Audit Committee shall constitute a quorum for the transaction of business and the act of a majority of those present at any meeting at which there is a quorum shall be the act of the Committee. 27. Minutes. The Audit Committee shall keep regular minutes of its proceedings and make copies thereof available to the Board at its meetings. OTHER COMMITTEES 28. Appointment. The Board may from time to time appoint further standing or special committees of directors, officers or employees of the corporation or its subsidiaries to serve at the pleasure of the Board and confer upon such committees such powers and duties as the Board may deem expedient within the limits permitted by law. 29. Organization and Operation. Unless otherwise provided in the resolutions appointing any such committee and determining its powers and duties, the committee may establish procedures for calling and conducting meetings, provided that no less than a majority of its members shall constitute a quorum for the transaction of business and the act of no less than a majority of those present at a meeting at which there is a quorum shall be the act of the committee, and the committee shall keep regular minutes of its proceedings and report its actions to the Board when it so requests. OFFICERS 30. Principal Officers. The principal officers shall be chosen annually by the Board and shall be a Chairman of the Board of Directors, a President, one or more Vice Presidents, a Secretary, a Treasurer and a Controller and, in the discretion of the Board, a Vice Chairman of the Board of Directors, one or more Executive Vice Presidents and one or more Senior Vice Presidents. The Chairman or Vice Chairman and President may be the same person; the Secretary and Treasurer may be the same person and an Executive Vice President, Senior Vice President or Vice President may hold at the same time the office of Secretary, Treasurer or Controller. The Chairman and Vice Chairman, if any, and the President shall be chosen from the members of the Board; the other principal officers need not be directors. 31. Other Officers. The Board may choose such other officers and agents as it shall deem necessary, who shall hold their offices for such terms and shall perform such duties and exercise such powers as are delegated to them pursuant to these by-laws or as the Board shall from time to time prescribe. In addition, the Chief Executive Officer may choose such Vice Presidents or assistant officers as he or she deems necessary, who shall hold their offices for such terms and shall perform such duties and exercise such powers as the Chief Executive Officer shall from time to time prescribe, provided, however, that officers so chosen by the Chief Executive Officer shall not be deemed to be principal officers of the Corporation unless and until they are so designated by the Board. 32. Salaries. The salaries of all principal officers shall be fixed by the Board. 33. Term of Office; Removal. Each officer shall hold office until his successor is chosen or until his earlier removal or resignation. The Board may remove any officer or agent provided that removal of a principal officer be by vote of a majority of all the directors. 34. Vacancies. Vacancies in any office may be filled by the Board. 35. Chairman. The Chairman of the Board of Directors shall preside at all meetings of stockholders and of the Board. In the discretion of the Board, he may be designated as the Chief Executive Officer of the corporation. If the Chairman of the Board of Directors is designated as the Chief Executive Officer, in such capacity, he shall (i) have all powers and perform all duties incident to such chief executive office, (ii) subject to the direction of the Board, have general and active supervision of the property and business of the corporation, (iii) be the officer through whom the Board delegates authority to corporate management, (iv) be the medium of communication to the Board of information as to the affairs of the corporation and of all matters presented for the Board's consideration, and (v) be responsible to see that all orders and resolutions of the Board are carried into effect by the proper officers. The Chairman of the Board shall perform such other duties and exercise such other powers as the Board shall from time to time prescribe. 36. Vice Chairman. The Vice Chairman of the Board of Directors shall assist the Chairman of the Board, shall perform such of the duties and exercise such of the powers of the Chairman as the latter may delegate to him and shall, in the absence or disability of the Chairman, perform the duties and exercise the powers of the Chairman. He shall perform such other duties and exercise such other powers as the Board or the Chairman shall from time to time prescribe. 37. President. The President shall assist the Chairman and Vice Chairman of the Board, shall perform such of the duties and exercise such of the powers of the Chairman as the latter may delegate to him and shall, in the absence or disability of the Vice Chairman, perform the duties and exercise the powers of the Vice Chairman. In addition, in the discretion of the Board, he may be designated as the Chief Executive Officer. If the President is designated as the Chief Executive Officer, in such capacity, he shall (i) have all powers and perform all duties incident to such chief executive office, (ii) subject to the direction of the Board, have general and active supervision of the property and business of the corporation, (iii) be the officer through whom the Board delegates authority to corporate management, (iv) be the medium of communication to the Board of information as to the affairs of the corporation and of all matters presented for the Board's consideration and (v) be responsible to see that all orders and resolutions of the Board are carried into effect by the proper officers. The President shall perform such other duties and exercise such other powers as the Board shall from time to time prescribe. 38. Executive Vice Presidents. Each Executive Vice President shall serve in a general executive capacity, more particularly as general assistant to the President. In the absence or disability of the President, and in the event the Chairman of the Executive Committee is absent or disabled, an Executive Vice President shall, in the order of seniority in that office, perform the duties and exercise the powers of the President. Executive Vice Presidents shall perform such other duties and exercise such other powers as the Board, the Chief Executive Officer or the President shall from time to time prescribe. 39. Senior Vice Presidents. Each Senior Vice President shall serve in a general executive capacity, more particularly as general assistant to the President or to one or more Executive Vice Presidents. In the absence or disability of the President, and in the event the Chairman of the Executive Committee and all Executive Vice Presidents are absent or disabled, a Senior Vice President shall, in the order of seniority in that office, perform the duties and exercise the powers of the President. Senior Vice Presidents shall perform such other duties and exercise such other powers as the Board, the Chief Executive Officer or the President shall from time to time prescribe. 40. Vice Presidents. In the absence or disability of the Executive Vice Presidents and Senior Vice Presidents, a Vice President shall, in the order of seniority in that office, perform the duties and exercise the powers of the Executive Vice Presidents and Senior Vice Presidents. Vice Presidents shall perform such other duties and exercise such other powers as the Board, the Chief Executive Officer or the President shall from time to time prescribe. 41. Principal Financial Officer. The Board may designate an Executive Vice President, a Senior Vice President, a Vice President or the Treasurer as the Principal Financial Officer of the corporation. 42. Secretary. The Secretary shall attend all meetings of stockholders and of the Board and shall record the minutes of all proceedings of such meetings in books to be kept for that purpose, and shall perform like duties for the standing committees appointed by the Board unless the Board directs otherwise. He shall have custody of the seal of the corporation and shall affix it or cause it to be affixed to all instruments requiring it. He shall give or cause to be given the notice required of all meetings of stockholders and of the Board. He shall perform such other duties and exercise such other powers as the Board, the Chief Executive Officer or the President shall from time to time prescribe. 43. Treasurer. The Treasurer shall have general charge of and responsibility for the corporate funds and securities. He shall deposit or cause to be deposited in the name of the corporation all moneys and other valuable effects of the corporation in such depositories as may be designated in accordance with these by-laws. He shall disburse the funds of the corporation as directed by the Board or by any other principal officer, taking proper vouchers for such disbursements. He shall advise upon all terms of credit granted by the corporation. He shall render to the Board, when the Board so requests, an accounting of all his transactions as Treasurer and of the financial condition of the corporation. He shall perform such other duties and exercise such other powers as the Board, the Chief Executive Officer or the President shall from time to time prescribe. 44. Controller. The Controller shall have general supervision of the accounting practices of the corporation and its subsidiaries and the preparation of statements and other reports respecting financial aspects of the corporation's or its subsidiaries' operations. He shall establish, through appropriate channels, recording and reporting procedures and standards pertaining to such matters. He shall be responsible for collection of all corporation accounts. He shall perform such other duties and exercise such other powers as the Board, the Chief Executive Officer or the President shall from time to time prescribe. 45. Delegation of Officer's Duties by Board. In the absence or disability of any principal officer, or for any other reason that the Board may deem sufficient, the Board may by vote of a majority of all the directors delegate any or all of the powers or duties of such officer to any other officer. 46. Delegation of Officer's Duties by Officer. Any principal officer may delegate portions of his powers and duties to any assistant officer chosen by the Board and acting under the principal officer's supervision. 47. Indemnification of Directors, Officers and Employees. Each person (and heirs and legal representatives of such person) who serves or has served as a director, officer or employee of the corporation or of any other corporation or entity when requested by this corporation, and of which this corporation is or was a stockholder, a creditor or otherwise interested, shall be indemnified by this corporation against all liability and reasonable expense, including but not limited to counsel fees and disbursements and amounts of judgments, fines or penalties, incurred by or imposed upon him in connection with any claim, action, suit or proceeding, actual or threatened, whether civil, criminal, administrative or investigative, and appeals in which he may become involved as a party or otherwise by reason of acts or omissions in his capacity as and while a director, officer or employee of this corporation or such other corporation or entity, provided that such person is wholly successful with respect thereto and unless the Board in its absolute discretion shall determine that such person did not meet the standard of conduct required herein. The term "wholly successful" shall mean termination of any claim, action, suit or proceeding against such person without any finding of liability or guilt against him and without any settlement by payment, promise or undertaking by or for such person or the expiration of a reasonable period of time after the making of any claim or threat without action, suit or proceeding having been brought and without any settlement by payment, promise, or undertaking by or for such person. The standard of conduct required shall be that such person acted in good faith for a purpose which he reasonably believed to be in or not opposed to the best interests of the corporation, and, in addition, in any criminal action or proceeding, had no reasonable cause to believe that his conduct was unlawful. Should indemnification be requested hereunder in respect to any claim, action, suit or other proceeding where the person seeking indemnification has not been wholly successful, such indemnification may be made only upon the prior determination by a resolution of a majority of those members of the Board who are not involved in the claim, action, suit or other proceeding, that such person met the standards of conduct required herein, or, in the discretion of the Board, upon the prior determination by non-employee legal counsel, in written opinion, that such person has met such standards, and where a settlement is involved, that the amount thereof is reasonable. Indemnification under this by-law shall not include any amount payable by such person to the corporation or entity in satisfaction of any judgment or settlement, or any amount payable on account of profits realized by him in the purchase or sale of securities of the corporation, and shall be reduced by the amount of any other indemnification or reimbursement of such liability and expense to such person. The termination of any claim, action, suit or other proceeding, by judgment, order, settlement (whether with or without court approval) or conviction or upon a plea of guilty or of nolo contendere, or its equivalent, shall not of itself create a presumption that such person did not meet the standard of conduct required herein. Expenses incurred which are subject to indemnification hereunder may be advanced by the corporation prior to final disposition of the claim, action, suit or other proceeding upon receipt of an undertaking acceptable to the corporation by or on behalf of the recipient to repay such amount unless it shall ultimately be determined that he is entitled to indemnification. The right of indemnification herein provided shall be in addition to other rights to which those to be indemnified may otherwise be entitled by agreement, vote of stockholders, operation of law or otherwise, and shall be available whether or not the claim asserted against such person is based upon matters which antedate the adoption of this by-law. If any word, clause or provision of this by-law or any indemnification made hereunder shall for any reason be determined to be invalid, the provisions hereof shall not otherwise be affected thereby but shall remain in full force and effect. AUTHORITY TO ACT AND SIGN 48. Instrument Execution. Unless otherwise provided by law or by the Board, all instruments to be executed on behalf of the corporation, whether or not requiring the seal of the corporation, may be executed by the Chairman, the Vice Chairman, the President, any Executive Vice President, any Senior Vice President or any Vice President and attested by the Secretary or an Assistant Secretary. 49. Bank Accounts. Unless otherwise provided by the Board, any two of the following officers: the Chairman, the Vice Chairman, the President, any Executive Vice President, any Senior Vice President, any Vice President and the Treasurer, may from time to time (1) open and maintain in the name of the corporation, and terminate, general and special bank accounts for the funds of the corporation with such banks, trust companies or other depositories as they may designate and (2) designate, and revoke the designation of, the officers or employees of the corporation who may sign, manually or by facsimile, checks, drafts or orders on such bank accounts. Any such action, designation or revocation shall be by written instrument, signed by the officers taking the action or making or revoking the designation and filed with the bank, trust company or other depository. 50. Voting of Stock in Other Corporations. Unless otherwise directed by the Board, Chairman, the Vice Chairman, the President, any Executive Vice President, any Senior Vice President, the Treasurer or the Secretary may, on behalf of the corporation, attend, act and vote at any meeting of stockholders of any corporation in which this corporation may hold stock and at any such meeting shall possess and may exercise all rights of this corporation incident to ownership of such stock or may give a proxy or proxies in the name of this corporation to any other person or persons who may vote such stock and exercise any and all other rights in regard to it as are here accorded to the officers mentioned. 51. Sale and Transfer of Securities. Unless otherwise directed by the Board, any two of the following officers: the Chairman, the Vice Chairman, the President, any Executive Vice President, any Senior Vice President and the Treasurer may, on behalf of the corporation, transfer, convert, endorse, sell, assign, set over and deliver, or take action appropriate to the encumbrance by the corporation of any bonds, shares of stock, warrants or other securities owned by or standing in the name of the corporation, and may execute and deliver in the name of the corporation all written instruments necessary or proper to implement the authority herein contained. STOCK 52. Stock Certificates; Uncertificated Shares. The shares of the corporation shall be represented by certificates, provided that the Board of Directors of the corporation may provide by resolution or resolutions that some or all of any or all classes or series of its stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the corporation. Notwithstanding the adoption of such a resolution by the Board of Directors, every holder of stock represented by certificates and upon request every holder of uncertificated shares shall be entitled to have a certificate signed by, or in the name of the corporation by the Chairman or Vice Chairman of the Board of Directors, or the President or Vice President, and by the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary of such corporation representing the number of shares registered in certificate form. Any or all of the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if he or she were such officer, transfer agent or registrar at the date of issue. 53. Transfer. Transfer of stock shall be made on the books of the corporation only upon surrender of the certificate therefor, endorsed by the person named in the certificate or accompanied by proper written evidence of succession, assignment or authority to transfer such stock or upon receipt of proper transfer instructions from the owner of uncertificated shares. 54. Transfer Agent and Registrar. The Board may appoint one or more Transfer Agents to record transfers of shares of stock and to keep the stock certificate books, transfer books and stock ledgers of the corporation. The Board may also appoint one or more Registrars to register certificates of stock. The Board may require all certificates of stock to bear the signatures of either or both a Transfer Agent and a Registrar. Where any such certificate is manually signed by the Registrar, the signature of any Transfer Agent may be facsimile engraved or printed. 55. Record Date. The Board may fix in advance a date, not less than ten nor more than sixty days preceding the date of any meeting of stockholders or the date for the payment of any dividend or the date for the allotment of rights or the date when any change, conversion or exchange of stock shall go into effect or the date in connection with obtaining consent of stockholders or any class thereof for any purpose, as a record date for the determination of stockholders entitled to notice of and to vote at any such meeting or to receive payment of any such dividend or to receive any allotment of rights or to exercise the rights or to give such consent, as the case may be, notwithstanding any transfer of any stock on the books of the corporation after any such record date fixed as aforesaid. The Board may direct that the stock books of the corporation be closed against transfers during such period. 56. Registered Stockholders. The corporation shall be entitled to treat the holder of record of any share of stock as the holder in fact thereof and accordingly shall not be bound to recognize any equitable or other claim to or interest in such share on the part of any other person, whether or not it shall have express or other notice thereof, except as provided by law. 57. Lost Certificates. The Board may direct a new certificate of stock to be issued in place of any certificate theretofore issued and claimed to have been lost, stolen or destroyed, provided that any person claiming a certificate to be lost, stolen or destroyed shall make an affidavit of ownership and of the facts of such loss, theft or destruction and, if the Board so requires, shall advertise the same, and provided further that the Board may require the owner of the certificate claimed to be lost, stolen or destroyed, or his legal representative, to deliver to the corporation for itself, its officers Transfer Agents and Registrars, a bond of indemnity in such amount or unlimited in amount, upon such terms and secured by such surety as the Board may require. MISCELLANEOUS 58. Notices. Whenever under the provisions of these by-laws notice is required to be given to any person other than in his capacity as stockholder, it may be given by hand delivery, by telegram or by mail. Whenever under the provisions of these by-laws notice is required to be given to any stockholder, it may be given by mail, by depositing the same in the post office or a letter box, in a post-paid, sealed envelope, addressed to such stockholder at such address as appears on the stock books of the corporation, and such notice shall be deemed to be given at the time when the same shall be thus mailed. Any person entitled to notice under any provision of these by-laws may waive such notice. 59. Fiscal Year. The fiscal year of the corporation shall begin the first day of January in each year. 60. Offices. The corporation may have an office in Madison, New Jersey, and at such other places as the business of the corporation may require. 61. Seal. The corporate seal shall have inscribed thereon the name of the corporation and the words "Corporate Seal, Delaware." 62. Amendments. These by-laws may be altered or repealed and new by-laws may be adopted at any meeting of stockholders by the vote of the holders of a majority of the outstanding stock having voting power, provided the notice of such meeting includes the proposed alterations or repeal or the proposed new by-laws, or a summary thereof, or the Board by vote of a majority of all the directors. EX-10.1 4 savings.txt SAVINGS PLAN WYETH SAVINGS PLAN Third Restatement (As of January 1, 1997) As Amended to March 19, 2003 SECTION 1 INTRODUCTION This Plan shall be known as the "Wyeth Savings Plan" (the "Plan"). The Plan became effective as of April 1, 1985. In adopting this Plan, it was the purpose of Wyeth and other participating Employers to encourage Employees to save by providing a program of matching contributions by the Employer equal to fifty percent (50%) of salary deferral and after tax contributions of up to 6% of covered compensation. The Plan has been designed to provide benefits for eligible Employees upon their retirement, or termination of service and for their beneficiaries in the event of their death. The Plan is amended and restated effective January 1, 1997, unless otherwise noted herein, to comply with the Uruguay Round Agreements Act of 1994 ("GATT"); the Uniform Services Employment and Reemployment Rights Act of 1994 ("USERRA"); the Small Business Job Protection Act of 1996 ("SBJPA"); the Taxpayers Relief Act of 1997 ("TRA 97"); the Internal Revenue Service Restructuring and Reform Act of 1998 ("RRA 98"); and the Community Renewal Tax Relief Act of 2000 ("CRA") (collectively know as "GUST"). Benefits for any Participant, or Beneficiary of such Participant, who retired, died or terminated employment at any time prior to January 1, 1997 will be determined under the provisions of the Plan as in effect on the date of the Participant's retirement, death, or termination, unless additional benefits are specifically provided by a subsequent amendment to the Plan. The restated Plan contained herein will apply to Participants, or Beneficiaries of such Participants, who retire, die or terminate employment at any time on or after January 1, 1997. Effective March 11, 2002, the Company changed its corporate name from American Home Products Corporation to Wyeth and the name of the Plan was changed accordingly. SECTION 2 DEFINITIONS The terms used herein shall have the following meanings unless a different meaning is clearly required by the context: 2.01 "Account" means the bookkeeping account of a Participant kept pursuant to Section 5 which consists of subaccounts, including the Salary Deferral Account, the Rollover Account, the Matching Account, and the QVEC Account and the After Tax Contribution Account. 2.02 "Adjustment Factor" means the cost of living adjustment factor prescribed by the Secretary of the Treasury under Section 415(d) of the Code for years beginning after December 31, 1987, as applied to such items and in such manner as the Secretary shall provide. 2.03 "Affiliate" means any corporation which is a member of a controlled group of corporations (as defined in Section 414(b) of the Code) which includes the Company; any trade or business (whether or not incorporated) which is under common control (as defined in Section 414(c) of the Code) with the Company; any organization (whether or not incorporated) which is a member of an affiliated service group (as defined in Section 414(m) of the Code) which includes the Company; and any other entity required to be aggregated with the Company pursuant to regulations under Section 414(o) of the Code. 2.04 "After Tax Contribution Account" means the separate subaccount of the Participant's Account credited with After Tax Contributions pursuant to Section 4.1(b). 2.05 "After Tax Contributions" means contributions to the Plan made by a Participant during the Plan Year pursuant to Section 4.1(b). 2.06 " Code" means the Internal Revenue Code of 1986, as amended from time to time. 2.07 "Committee" means the Savings Plan Committee of the Company or its designee which is provided for in accordance with Section 12 of the Plan. 2.08 "Company" means Wyeth, a Delaware corporation. Prior to March 11, 2002, the term Company meant "American Home Products Corporation". For historical purposes, the term "American Home Products Corporation" has been retained where applicable. 2.09 "Covered Compensation" means a Participant's regular salary or wages for services rendered to the Employer, including overtime, sales bonuses, and commissions, the amount of elective deferrals made pursuant to Section 125 of the Code and the amount of Salary Deferral Contributions made by an Employer on behalf of a Participant to the Plan. Covered Compensation does not include other deferred compensation, amounts realized from the exercise of a nonqualified stock option or premature distribution of an incentive stock option or the lapse of restrictions applicable to restricted stock or other property, amounts realized from the sale, exchange or other disposition of stock acquired under a qualified stock option or incentive stock option, premiums for group term life insurance, other amounts which receive special tax treatment or any benefits derived from the Company's Performance Incentive Award Program or other bonus or award programs. Beginning with the Plan Year commencing on January 1, 1989, for purposes of the Plan, the annual Covered Compensation of any Participant shall not exceed $200,000 multiplied by any cost of living factor prescribed by the Secretary of the Treasury under Section 415(d) of the Code. For purposes of this Section, for Plan Years on or after January 1, 2001, for Covered Compensation paid or made available during such Plan Year shall include elective amounts that are not includible in the gross income of the Employee by reason of Section 132(f)(4) of the Code. Effective for Plan years beginning on and after January 1, 2002, Covered Compensation shall be limited as provided under Section 401(a)(17) of the Code as amended from time to time. For purposes of this Section, for Plan years beginning on and after January 1, 2001, Covered Compensation paid or made available during such Plan Year shall not include elective amounts that are not includible in the gross income of the Employee by reason of Section 132(f)(4) of the Code. 2.10 "Continuous Service" means the aggregate of the period of elapsed time between the commencement of an Employee's employment by the Employer and his or her Severance From Service, provided that Continuous Service shall include the period following a Severance From Service if an Employee is reemployed by the Employer within 12 months after such Severance From Service. If the Employee's Severance From Service occurs while the Employee is otherwise absent from employment, the period following such Severance From Service shall be counted as Continuous Service only if the Employee is reemployed by the Employer within 12 months following the commencement of such other absence from employment. However, in the case of determining the eligibility of a part-time or seasonal Employee to participate in the Plan, Continuous Service shall be computed as follows: (i) The "initial eligibility computation period" shall consist of the 12-consecutive month period beginning on the first day for which the part-time or seasonal Employee is credited with One Hour of Service (the "Employment Commencement Date.") If such part-time or seasonal Employee is credited with 1,000 or more Hours of Service during such initial 12-month period, he or she shall be credited with one year of Continuous Service. (ii) Thereafter, Continuous Service shall be computed on the basis of each Plan Year during which the part-time or seasonal Employee is credited with 1,000 or more Hours of Service during such Plan Year. The first Plan Year shall begin with the Plan Year which includes the first anniversary of the part-time or seasonal Employee's Employment Commencement Date. The computation period used for measuring eligibility after the `initial eligibility computation period' will be used to measure breaks in service for eligibility to participate in the plan. 2.11 "Employee" means (i) any person employed by the Employer and shall include a person other than a non-resident alien as to the United States who is not a Participant in the Plan, who is then currently employed by the Company or a Subsidiary and who is then not currently entitled to receive any retirement benefits or disability benefits for total and permanent disability under any plan, program, contract, or arrangement of the Company or any subsidiary, or deemed totally and permanently disabled under the Plan, and (ii) Leased Employees within the meaning of Section 414(n)(2) of the Code. The term "Employee" shall not include any individual who performs services for the Employer and is classified or designated by the Employer as a fee for service worker or independent contractor even if such individual is later reclassified as a common law employee of the Employer by a government entity, a court of competent jurisdiction, arbitrator or other third party for any purpose. The term Employee shall also exclude Leased Employees. 2.12 "Employer" means the Company and any Affiliate which is a domestic corporation not operating primarily in Puerto Rico. 2.13 "Entry Date" means (1) for part-time Employees, the first day of any calendar month following 12 months of Continuous Service and attainment of age 21 provided the Employee has submitted a completed enrollment form to the Plan Administrator, and (2) for full-time Employees, the first day of any calendar month provided the Employee has submitted a completed enrollment form to the Plan Administrator. 2.14 "ERISA" means the Employee Retirement Income Security Act of 1974, as amended. 2.15 "Former Participant" means any person who terminates employment with the Company and was at one time a Participant and who has not yet received a complete distribution of his or her Account from the Plan. 2.16 "Fund" means the investment funds available to Participants under the Plan as selected by the Savings Plan Committee and as listed on Schedule A, which is attached hereto and incorporated herein by reference. 2.17 "Highly Compensated Employee" (a) Effective for Plan Years starting after December 31, 1996, the term "Highly Compensated Employee" includes highly compensated active Employees and highly compensated former Employees. A highly compensated active Employee means any Employee who: (1) was a Five-Percent Owner (as defined in section 416(i)(1) of the Code) at any time during the Look-Back Year or the Determination Year and applying the constructive ownership rules of Section 318 of the Code; or (2) for the Look-Back Year, received Compensation from the Employer or Affiliates in excess of $80,000 (as adjusted by the Secretary of the Treasury pursuant to Section 415(d) of the Code). For purposes of this Subparagraph (a), the Employer has not made the Top-Paid Group election. In determining whether an Employee is a Highly Compensated Employee for years beginning in 1997, the above definition shall be treated as having been in effect for years beginning in 1996. A former Employee shall be treated as a Highly Compensated Employee if: (i) such Employee was a Highly Compensated Employee when such Employee separated from service, or (ii) such Employee was a Highly Compensated Employee for any Plan Year after attaining age 55. If the former Employee's separation from service occurred prior to January 1, 1987, he or she is a Highly Compensated Employee only if he or she satisfied clause (a) of this Section or received Compensation in excess of $50,000 during: (1) the year of his or her separation from service (or the prior year); or (2) any year ending after his or her 54th birthday. (b) For the purposes of this Section, the following definitions shall apply: "Compensation" means compensation within the meaning of Section 415(c)(3) of the Code. This determination will be made without regard to Sections 125, 402(e)(3) or 402(h)(1)(B) of the Code. "Determination Year" means the Plan Year with respect to which the determination of an individual's status as a "Highly Compensated Employee" (or Non-Highly Compensated Employee) is being made. "Look-Back Year" means the period of twelve (12) consecutive months immediately preceding the Determination Year or, if the Employer elects, the calendar year ending with or within the Determination Year. "Top-Paid Group" means that group of Employees of the Employer and its Affiliates who, when ranked on the basis of compensation paid during the Determination Year or Look-Back Year are among the twenty percent (20%) of Employees receiving the greatest amount of such compensation. Employees described in Section 414(q)(5) of the Code and the regulations promulgated thereunder shall be excluded. 2.18 "Hour of Service" with respect to any Plan Year or eligibility computation period, shall include the following: (1) Each hour for which an Employee is paid, or entitled to payment, for the performance of duties for the Employer. Such hours shall be credited to that Plan Year or eligibility computation period in which such duties were performed. (2) Each hour for which back pay, irrespective of mitigation of damages, is awarded or agreed to by the Employer, exclusive of hours previously credited under subparagraph (1), immediately above. Such hours shall be credited to that Plan Year or eligibility computation period to which such award or agreement pertains, and shall be computed and credited in the manner prescribed in subparagraph (3) immediately below. (3) Each hour for which an Employee is paid, or entitled to payment, directly or indirectly (through an insurer, trust fund or otherwise) by the Employer for a period of time during which no duties are performed (irrespective of whether he or she has ceased to be an Employee) on account of vacation, holiday, illness, incapacity, disability, layoff, jury duty or leave of absence, subject to the following: Notwithstanding the foregoing, (a) no more than 501 hours shall be credited for any such single continuous period, (b) no such hours shall be credited if such payment is made under a plan maintained solely for the purpose of complying with the applicable workmen's compensation, unemployment compensation and disability compensation laws, and (c) no such hours shall be credited for any payment which solely reimburses an Employee for medical or medically related expenses incurred by the Employee. The rules set forth in paragraphs (b) and (c) of the Department of Labor Regulation Section 2530.200b-2 are hereby incorporated by reference. (4) Solely for purposes of determining whether a One Year Period of Severance has occurred, each hour (not in excess of 501 hours) for which the Employee is absent from work and during which no duties are performed due to the pregnancy of the Employee, the birth of a child of the Employee, the placement of a child with the Employee in connection with the adoption of such child by the Employee, or the caring for such child for the period immediately following birth or placement. Any such hour shall be credited to the Plan Year or eligibility computation period in which such absence begins if, as of the date the absence begins, the Employee has completed less than 501 hours of service; in any other case, such hours shall be credited to the next Plan Year or eligibility computation period. 2.19 "Matching Account" means that separate subaccount of the Participant's Account credited with Matching Contributions under Section 4.5. 2.20 "Matching Contributions" means the contribution by the Employer to the Matching Account pursuant to Section 4.5. 2.21 "Non-Highly Compensated Employee" means an Employee who is not a Highly Compensated Employee. 2.22 "Normal Retirement Date" means the first day of the calendar month following the Participant's 65th birthday. 2.23 "Participant" means an Employee who pursuant to the terms of Section 3 is eligible to participate under the Plan and who elects to so participate. 2.24 " Plan" means the Wyeth Savings Plan. 2.25 " Plan Year" means the calendar year. 2.26 "Revaluation Date" means the date on which the Accounts under the Plan are valued pursuant to Section 5.3. 2.27 "Rollover Account" means the separate subaccount of a Participant's Account which is credited with Rollover Contributions pursuant to Section 4.11. 2.28 "Rollover Contribution" means (1) an Eligible Rollover Distribution within the meaning of Section 402(c)(4) of the Code; (2) a contribution by a Participant of a distribution received from the qualified plan of another employer provided the Participant makes the contribution within 60 days of his or her receipt of a distribution which satisfied the requirements of Section 402(c)(1) of the Code; or (3) a direct transfer of the Participant's interest from the trustee of a qualified plan maintained by another employer. Before accepting a Rollover Contribution, the Committee or its delegate may require the Participant to furnish satisfactory evidence that the proposed transfer is in fact a Rollover Contribution which the Code permits a Participant to make to a qualified plan. All Rollover Contributions shall be fully vested at all times. In addition, such Rollover Contributions must satisfy the requirements of Section 4.11. 2.29 "Salary Deferral Account" means the separate subaccount of a Participant's Account which is credited with Salary Deferral Contributions pursuant to Section 4.1(a). 2.30 "Salary Deferral Contribution" means the contribution paid by the Employer to the Trust, at the election of the Participant, in lieu of cash Compensation, which is credited to the Salary Deferral Account. 2.31 "Severance From Service" means the earliest of the following dates: (i) resignation, (ii) discharge, (iii) death or (iv) retirement. A Severance From Service shall also occur if an Employee remains continually absent from work (for any reason other than resignation, discharge, retirement or death) on the first anniversary of the first day of absence (except in the case of military leave). 2.32 "Trust" means the Trust established under Section 13 of the Plan which Trust shall form a part of the Plan. 2.33 "Trustee" means the Trustee designated in accordance with the provisions of the Trust. 2.34 "Trust Fund" means the assets of the Trust which shall include investments of the Participants' Accounts. 2.35 "Wyeth Common Stock" means the common stock of Wyeth. SECTION 3 PARTICIPATION 3.1 General.1 General. Each Employee who is employed in the United States by the Employer who is not a member of a recognized collective bargaining unit (unless there is a collective bargaining agreement making the Plan applicable to members of such unit) and Employees outside of the United States (except Employees of a division or subsidiary of the Company operating primarily in Puerto Rico) who are covered by the Wyeth Retirement Plan - United States shall be eligible to participate in the Plan when he or she has met the following conditions. Full time Employees of the Employer who have attained age 21 (i.e., Employees scheduled to work with the Employer at least 1,000 hours in a 12-month period) will be eligible to participate in the Plan as of their date of hire if they meet the other requirements of this Section 3.1, and part time and seasonal Employees who have attained age 21 (i.e., Employees scheduled to work with the Employer less than 1,000 hours in a 12-month period) will be eligible to participate in the Plan after they work 1,000 hours or more in a 12-month period with the Employer if they meet the other requirements of this Section 3.1. The Employee must submit an election to include a salary deferral agreement and/or authorization for After Tax Contribution, investment selection form, and a beneficiary designation form. Such written election shall be filed no later than 15 days prior to the Entry Date unless otherwise determined by the Committee. 3.2 Termination of Participation.2 Termination of Participation. A Participant shall cease to be a Participant upon his or her Severance From Service and having received a distribution of his or her entire Accounts under the Plan. 3.3 Reemployment.3 Reemployment. A Former Participant who is reemployed by the Employer shall be eligible again to participate in the Plan as of the next Entry Date following his or her date of reemployment provided that he or she has filed an election with the Committee described in Section 3.1. A former Employee who was not a Participant and is reemployed shall be eligible to participate when he or she meets the requirements of Section 3.1. 3.4 Collective Bargaining Agreements, Etc..4 Collective Bargaining Agreements, Etc. If a Participant becomes covered by a collective bargaining agreement or is otherwise transferred to a position with the Employer which makes him or her ineligible to participate in the Plan, his or her participation in the Plan shall cease but he or she shall not be considered to have terminated employment. If such Employee subsequently ceases to be covered by a collective bargaining agreement or is otherwise transferred to a position which makes them eligible to participate, he or she shall again become eligible for participation. Notwithstanding the foregoing, an Employee who ceases to be a Participant upon being covered by a collective bargaining agreement shall nonetheless continue to be considered a Participant solely for purposes of the loan provisions as set forth in Article 9 of the Plan and the hardship distribution provision as set forth in Section 8.1. 3.5 Leased Employees. Any individual who is a Leased Employee, within the meaning of Section 414(n) of the Code, of an Employer shall not be eligible to participate in the Plan. For purposes of determining the number or identity of Highly Compensated Employees or for purposes of the pension requirements of Section 414(n)(3) of the Code, employees of the Employer shall include individuals defined as Leased Employees. "Leased Employee" shall mean a person who is not a common law employee of the Employer or an Affiliate but who provides services to the Employer or an Affiliate, and: (1) such services are performed pursuant to an agreement between the Employer and any other person or entity (the "Leasing Organization"); (2) the person performing the services has done so on a substantially full-time basis for at least one (1) year; and (3) for Plan Years starting before January 1, 1997, the services performed are of a type historically performed in the business field of the recipient by Employees; and (4) for Plan Years starting after December 31, 1996, the services are performed under the primary direction and control of the recipient of those services. Notwithstanding the preceding sentence, the Plan shall not treat an individual as a Leased Employee if the Leasing Organization covers the individual by a money purchase pension plan with a nonintegrated contribution rate of at least ten percent (10%) of Covered Compensation, and provides for immediate participation and full and immediate vesting, provided that Leased Employees constitute less than twenty percent (20%) of the Company's Non-Highly Compensated Employees. SECTION 4 CONTRIBUTIONS 4.1 Salary Deferral Contributions and After Tax Contributions. (a) Each Participant may authorize the Employer to contribute to the Trust on his or her behalf a Salary Deferral Contribution with respect to each Plan Year which shall be allocated to his or her Salary Deferral Account. A Participant may elect to have a stated whole percentage from 1% to 16% of his or her Covered Compensation allocated to his or her Salary Deferral Account. Such Salary Deferral Contributions shall be paid by the Employer to the Trustee at least monthly and each Participant's pay for such month shall be reduced by an identical amount. (b) Before a contribution is made as a Salary Deferral Contribution, the Committee may, in its discretion, decide that if the Average Actual Deferral Percentage Test set forth in Section 4.9 may not be met, a portion or all of such contribution for a Highly Compensated Employee that would otherwise have been allocated as a Salary Deferral Contribution shall in lieu thereof be allocated to an After Tax Contribution Account in accordance with a formula determined by the Committee. Independent of his or her election to defer compensation as a Salary Deferral Contribution, a Participant may elect to contribute on an after tax basis a portion of his or her Covered Compensation to his or her After Tax Contribution Account which, subject to any determination made by the Committee to comply with Section 4.10 shall be a stated whole percentage of the Participant's Covered Compensation for the Plan Year of not less than one percent (1%) nor more than sixteen percent (16%). (c) The combination of the Salary Deferral Contributions and After Tax Contributions for any Participant shall not be less than one percent (1%) nor exceed sixteen percent (16%) of the Participant's Covered Compensation for the Plan Year. 4.2 Maximum Amount of Salary Deferral Contributions. The maximum amount of Covered Compensation a Participant is permitted to defer during any calendar year is limited to $7,000 as adjusted by the Secretary of Treasury pursuant to Section 402(g)(5) of the Code. To the extent the Committee believes that a Participant's election of a Salary Deferral Contribution will exceed the limits set forth in the preceding paragraph, before a contribution is made as a Salary Deferral Contribution, a portion of or all of such contribution that would otherwise have been allocated as a Salary Deferral Contribution may in lieu thereof be allocated to an After Tax Contribution Account. To the extent any Salary Deferral Contributions in excess of the Section 402(g) of the Code are not corrected as indicated above, such excess Salary Deferral Contributions, plus any income and minus any loss allocable thereto, shall be distributed no later than April 15 to any Participant to whose account excess Salary Deferrals Contributions were assigned for the preceding year and who claims Salary Deferrals Contributions for such taxable year. Excess Salary Deferrals Contributions shall be adjusted for any income or loss in the same manner that income/earnings or loss is calculated under the Plan. However, such income or loss may be calculated using a reasonable method to be applied by the Committee on a uniform and non-discriminatory basis. 4.3 Election of Salary Deferral Contributions or After Tax Contributions. Each Participant electing to have the Employer contribute a Salary Deferral Contribution on his or her behalf or electing to make an After Tax Contribution shall file with the Committee on prescribed forms, 15 days prior to the Entry Date, an election of the percentage of his or her Covered Compensation (within the limits stated in and in accordance with the provisions of Section 4.1) to be contributed to his or her Salary Deferral Account or After Tax Contribution Account by authorizing the Employer to withhold such amount from his or her pay. 4.4 Vesting. A Participant shall be fully vested at all times in his or her Account attributable to his or her Salary Deferral Account, Rollover Contribution Account, and After Tax Contribution Account. A Participant shall also be fully vested in his or her account attributable to his or her Matching Account if he or she has five (5) or more years of Continuous Service. If the Participant has less than five (5) years of Continuous Service, he or she shall become vested in his or her Matching Account according to the following vesting schedule: Years of Continuous Service Vesting Percentage After 1 year 0% After 2 years 25% After 3 years 50% After 4 years 75% After 5 years 100% Regardless of the number of years of Continuous Service, a Participant shall be fully vested in his or her account, attributable to his or her Matching Account, and such benefit shall be non-forfeitable, when he or she attains age 65 or upon his or her death, if earlier. If a Participant receives a distribution from his or her Matching Account prior to incurring 5 consecutive One Year Periods of Severance and he or she is less than 100% vested in his or her Matching Account at such time, the vested portion of his or her Matching Account at any time thereafter shall be the Participant's (1) vested percentage of the sum of the balance of his or her Matching Account and all prior distributions from his or her Matching Account, minus (2) all prior distributions from his or her Matching Account. 4.5 Matching Contributions. The Employer shall contribute to each Matching Account a Matching Contribution in an amount equal to 50% of up to the first six percent (6%) of Covered Compensation which the Participant elects to either defer as a Salary Deferral Contribution or make as an After Tax Contribution in a Plan Year. Such Matching Contribution shall be contributed in cash. 4.6 Matching Contributions to be made from Earnings and Profits. Matching Contributions shall only be made out of current income or accumulated retained earnings. The Company and each Affiliate shall make Matching Contributions only with respect to its own Employees, provided, however, that if the Company or any Affiliate is prevented from making all or part of the Matching Contribution for any Plan Year by reason of insufficient accumulated retained earnings as of the close of such Plan Year, then a contribution equal to the amount which it is prevented from making for such year may be made by the Company if it is not prevented from contributing for such year. The foregoing proviso shall be interpreted in accordance with Section 404(a)(3)(B) of the Code, unless otherwise determined by the Company. 4.7 Forfeitures. Forfeitures of amounts in the Matching Accounts due to the fact that a Participant is not fully vested in such amounts shall be applied to reduce any subsequent Matching Contributions. 4.8 Changes and Suspensions of Salary Deferral Contributions and After Tax Contributions. A Participant may by 15 days advance written notice or by such other method acceptable to and approved by the Plan Administrator, change the rate of Salary Deferral Contributions and After Tax Contributions once each calendar quarter during a Plan Year effective on the first pay day of any month. A Participant may once each calendar quarter during a Plan Year, by 15 days advance written notice, elect to suspend all contributions to his or her Account on the first day of any pay period, but he or she may not thereafter recommence contributions for a three month period. 4.9 Limitation on Salary Deferral Contributions in Accordance with Section 401(k) of the Code. With respect to Salary Deferral Contributions, the Average Actual Deferral Percentage for Participants who are Highly Compensated Employees for the Plan Year must meet either of the following tests: (i) it must not exceed the Average Actual Deferral Percentage for Participants who are Non-Highly Compensated Employees for the Plan Year multiplied by 1.25; or (ii) it must not exceed the Average Actual Deferral Percentage for Participants who are Non-Highly Compensated Employees for the Plan Year multiplied by 2, provided that the Average Actual Deferral Percentage for Participants who are Highly Compensated Employees does not exceed the Average Actual Deferral Percentage for Participants who are Non-Highly Compensated Employees by more than two (2) percentage points or such lesser amount as the Secretary of the Treasury shall prescribe to prevent the multiple use of this alternative limitation with respect to any Highly Compensated Employee. Notwithstanding any other provision of the plan, Excess Contributions, plus any income and minus any loss allocable thereto, shall be distributed no later than the last day of each Plan year to Participants to whose accounts such Excess Contributions were allocated for the preceding Plan Year. Excess Contributions are allocated to the Highly Compensated Employees with the largest amounts of Employer contributions taken into account in calculating the Actual Deferral Percentage test for the year in which the excess arose, beginning with the Highly Compensated Employee with the largest amount of such employer contributions and continuing in descending order until all the Excess Contributions have been allocated. For purposes of the preceding sentence, the "largest amount" is determined after distribution of any Excess Contributions. Excess Contributions (including the amounts recharacterized) shall be treated as annual additions under the Plan. "Excess Contributions" shall mean, with respect to any Plan Year, the excess of: a. The aggregate amount of employer contributions actually taken into account in computing the Actual Deferral Percentage of Highly Compensated Employees for such Plan Year, over b. The maximum amount of such contributions permitted by the Actual Deferral percentage test (determined by hypothetically reducing contributions made on behalf of Highly Compensated Employees in order of the Actual Deferral Percentage, beginning with the highest of such percentages). For purposes of this Section 4.9, "Actual Deferral Percentage" means the ratio (expressed as a percentage) of Salary Deferral Contributions on behalf of the Participant for the Plan Year to the Participant's compensation for the Plan Year. "Average Actual Deferral Percentage" means the average (expressed as a percentage) of the Actual Deferral Percentages of the Participants in a group. "Participant" for purposes of this Section 4.9 and Section 4.10 means an Employee eligible to participate in the Plan, regardless of whether he or she elects to participate. "Compensation" for purposes of this Section 4.9 and Section 4.10 means all the compensation received during the Plan Year by the Participant from the Employer that is currently includible in gross income for income tax purposes (including, but not limited to, income attributable to non-qualified stock options or incentive stock options, regardless of whether such income is includible in gross income for the Plan Year in which the option is granted). "Compensation" for purposes of this Section 4.9 and Section 4.10 includes the amount of any Salary Deferral Contributions made by an Employee during a Plan Year and income under Code Section 125 or 402(a)(8). However, "Compensation" for purposes of this Section 4.9 and Section 4.10 shall not include any amounts received while an Employee is not a Participant. For purposes of this Section 4.9, the Actual Deferral Percentage for any Participant who is a Highly Compensated Employee for the Plan Year and who is eligible to have Salary Deferral Contributions allocated to his or her Account under two or more plans or arrangements described in Section 401(k) of the Code that are maintained by the Employer or an Affiliated Employer shall be determined as if all such Salary Deferral Contributions were made under a single arrangement. The Actual Deferral Percentage test described above will be conducted using the current year testing method provided, however, that the Plan may be amended at any time to change to the prior year testing method in those situations for which such a change is approved in Internal Revenue Service Notice 98-1 (Part VII(A) or in subsequent guidance promulgated by the Secretary of the Treasury. In the event it is determined that the amount of Salary Deferral Contributions made on behalf of Highly Compensated Employees would exceed the limits described in this Section 4.9, the amount of such Salary Deferral Contributions (and any related income) which causes such limits to be exceeded may, to the extent permitted under Section 4.10, be recharacterized and allocated to the After Tax Contribution Account, in accordance with procedures established by the Committee. Also, such Salary Deferral Contributions (and any related income) may be refunded to Highly Compensated Employees in accordance with procedures established by the Committee. The decision as to whether such Salary Deferral Contributions are to be recharacterized or refunded shall be made by the Committee. The amount of Excess Salary Deferral Contributions which is to be refunded or recharacterized as After-Tax Contributions shall be determined as set forth below for Plan Years commencing after December 31, 1996. On or before the fifteenth day of the third month following the end of each Plan Year, the Salary Deferral Contributions of the Highly Compensated Employee with the highest dollar amount of Salary Deferral Contributions for that Plan Year shall be recharacterized or reduced until either all Excess Salary Deferral Contributions have been distributed or until such Salary Deferral Contributions are equal to the dollar amount of Salary Deferral Contributions of the Highly Compensated Employee with the next highest dollar amount of such contributions, whichever occurs first. Step (1) above shall be repeated with respect to the Participant with the second and successive highest dollar amount of Salary Deferral Contributions under the Plan until the Plan has recharacterized or distributed all excess Salary Deferral Contributions. If the recharacterization or refunds described above are made, the Actual Deferral Percentage is treated as satisfying the non-discrimination test of Section 401(k)(3) of the Code regardless of whether the Actual Deferral Percentage, if recalculated after such refunds or recharacterizations have occurred would satisfy Section 401(k)(3) of the Code. Any amounts of Salary Deferral Contributions (and income thereon) under this section shall be subject to the provisions of Section 8 that apply to Salary Deferral Contributions. For purposes of Section 401(k)(2) of the Code, if a corrective distribution of Excess Salary Deferral Contributions has been made, the Average Actual Deferral Percentage of Highly Compensated Employees is deemed to be the largest amount permitted under Section 401(k)(2) of the Code. If Salary Deferral Contributions distributed pursuant to this paragraph have received any Matching Contributions, such Matching Contributions shall be forfeited, if forfeitable. The Administrator shall, to the extent administratively possible, recharacterize or refund all Excess Salary Deferral Contributions (and related income) which are required to be made pursuant to this Section, prior to the fifteenth day of the third month following the end of the Plan Year in which the excess Salary Deferral Contributions arose. Any refund or recharacterization of excess Salary Deferral Contributions must be made no later than 2 1/2 months after the close of the Plan Year in which the excess Salary Deferral Contributions relate. In any event, however, the excess After Tax Contributions and/or Matching Contributions and any income allocable thereto shall be distributed prior to the end of the Plan Year following the Plan Year in which the excess After-Tax Contributions arose. Also, before a contribution is made as a Salary Deferral Contribution, the Committee may, in its discretion, decide, that if the limitation set forth in this Section 4.10 may not be met, to limit the amount of Salary Deferral Contributions a Highly Compensated Employee can make or direct that a portion of all of such contribution for a Highly Compensated Employee shall in lieu thereof, to the extent permitted under Section 4.10, be allocated to an After Tax Contribution Account in accordance with procedures established by the Committee. 4.10 Limitation on After Tax Contributions and Matching Contributions In Accordance With Section 401(m) of the Code. With respect to After Tax Contributions and Matching Contributions, the Average Contribution Percentage for Participants who are Highly Compensated Employees for the Plan Year must meet either of the following tests: (i) it must not exceed the Average Contribution Percentage for Participants who are Non-Highly Compensated Employees for the Plan Year multiplied by 1.25; or (ii) it must not exceed the Average Contribution Percentage for Participants who are Non-Highly Compensated Employees for the Plan Year multiplied by 2, provided that the Average Contribution Percentage for Participants who are Highly Compensated Employees does not exceed the Average Contribution Percentage for Participants who are Non-Highly Compensated Employees by more than two (2) percentage points or such lesser amount as the Secretary of the Treasury shall prescribe to prevent the multiple use of this alternative limitation with respect to any Highly Compensated Employee. Notwithstanding any other provision of the plan, Excess Aggregate Contributions, plus any income and minus any loss allocable thereto, shall be forfeited, if forfeitable, or if not forfeitable, distributed no later than the last day of each Plan Year to participants to whose accounts such Excess Aggregate Contributions were allocated for the preceding Plan Year. Excess Aggregate Contributions are allocated to the Highly Compensated Employees with the largest Contribution Percentage Amounts taken into account in calculating the ACP test for the year in which the excess arose, beginning with the Highly Compensated Employee with the largest amount of such Contribution Percentage Amounts and continuing in descending order until all the Excess Aggregate Contributions have been allocated. For purposes of the preceding sentence, the "largest amount" is determined after distribution of any Excess Aggregate Contributions. Definitions: 1. "Excess Aggregate Contributions" shall mean, with respect to any Plan Year, the excess of: a. the aggregate Contribution Percentage Amounts taken into account in computing the numerator of the Contribution Percentage actually made on behalf of Highly Compensated Employees for such Plan Year, over b. The maximum Contribution Percentage Amounts permitted by the ACP test (determined by hypothetically reducing contributions made on behalf of Highly Compensated Employees in order of their Contribution Percentages beginning with the highest of such percentages). For purposes of this Section 4.10, "Average Contribution Percentage" means the average (expressed as a percentage) of the Contribution Percentages of the Participants in a group. "Contribution Percentage" means the ratio (expressed as a percentage) of the sum of the After Tax Contributions and Matching Contributions under the Plan on behalf of the Participant for the Plan Year to the Participant's compensation for the Plan Year. "Participant" and "Compensation" for purposes of this Section 4.10 have the same definitions as set forth in Section 4.9. In the event that the Plan satisfies the requirements of Section 410(b) of the Code only if aggregated with one or more other plans, or if one or more other plans satisfy the requirements of Section 410(b) of the Code only if aggregated with this Plan, this Section 4.10 shall be applied by determining the Contribution percentages of Participants as if all such plans were a single plan. In the event it is determined that the amount of the After Tax Contributions and Matching Contributions made on behalf of a Highly-Compensated Employee would exceed the limits described in this Section 4.10, the amount of such After-Tax Contributions and/or Matching Contributions (and any related income) which causes such limits to be exceeded may be distributed to individual Highly Compensated Employees (or, if forfeitable, forfeited) determined as set forth below for Plan Years commencing after December 31, 1996. The amount to be distributed pursuant to this paragraph shall be determined after taking into account any Salary Deferral Contributions that have been recharacterized as After-Tax Contributions under Section 4.9. For purposes of meeting the limitations described in Section 4.10, After-Tax Contributions that have not received a Matching Contribution may be distributed before After-Tax Contributions that have received a Matching Contribution. The After Tax Contributions and/or Matching Contributions of the Highly Compensated Employee with the highest dollar amount of such Contributions for the Plan Year shall be reduced until either all excess After Tax Contributions and/or Matching Contributions have been distributed or until the excess After Tax Contributions and/or Matching Contributions are equal to the dollar amount of the After Tax Contributions and/or Matching Contributions of the Highly Compensated Employee with the next highest dollar amount of contributions, whichever occurs first. Step (1) above shall be repeated with respect to the second and successive Highly Compensated Employee with the highest dollar amount of After Tax Contributions and/or Matching Contributions under the Plan until the Plan has distributed all excess After-Tax and/or Matching Contributions. If the refunds described above are made, the Average Actual Contribution Percentage is treated as meeting the non-discrimination test of Section 401(m)(2) of the Code regardless of whether the Average Actual Contribution Percentage, if recalculated after such distributions, would satisfy Section 401(m)(2) of the Code. For purposes of Section 401(m)(9) of the Code, if a corrective distribution of excess After Tax Contributions and/or Matching Contributions has been made, the Average Actual Contribution Percentage of Highly Compensated Employees is deemed to be the largest amount permitted under Section 401(m)(2) of the Code. Multiple Use Test. In order to prevent the multiple use of the alternative method described in Section 4.10(ii) and in Section 4.9(ii) above, any Highly Compensated Employee eligible to make Salary Deferral Contributions and After-Tax Contributions or to receive Company Matching Contributions under the Plan shall have his or her contribution percentage reduced if required pursuant to Regulation section 1.401(m)-2. The Administrator shall, to the extent administratively possible, distribute all After-Tax Contributions and any income allocable thereto which are required to be made pursuant to this Section, prior to the fifteenth day of the third month following the end of the Plan Year in which the excess Contributions arose. In any event, however, the excess Contributions and any income allocable thereto shall be distributed prior to the end of the Plan Year following the Plan Year in which the excess After-Tax Contributions arose. The determination and treatment of the Contribution Percentage of any Participant shall satisfy such other requirements as may be prescribed by the Secretary of the Treasury. 4.11 Rollover Contributions From Other Qualified Plans. A Participant, with the approval of the Administrator (or its delegate) and upon a determination by the Administrator that a distributing plan is qualified under Section 401(a) of the Code, make, and that Plan shall accept, a Rollover contribution on the Participant's behalf from such distributing plan, provided that the Rollover Contribution is deposited to the Plan no later than 60 days receipt by the Participant thereof. The amount rolled over shall be subject to all of the terms and conditions of the Plan after it is rolled over, except that such amounts shall be fully vested at all times. The amounts rolled over shall be deposited in an account designated as the Participant's Rollover Account. Such amounts shall be invested in accordance with the Participant's investment elections in effect at the time of the rollover. The Administrator (or its delegate) may require a Participant to furnish such evidence as the Administrator may deem necessary or appropriate. Notwithstanding the foregoing, effective as of January 1, 1999, the Administrator shall accept distributions made from any defined benefit pension plan maintained by the Company which is qualified under Code Section 401(a) provided it is received by the Plan no later than the 60th day after the distribution was received or made payable to the Participant. For this purpose, a Rollover Contribution means (a) a contribution of a distribution received from the qualified plan of another employer, provided the Participant makes the contribution within 60 days of his or her receipt of a distribution which satisfied the requirements of Section 402(a)(5) of the Code and Section 402(c) or (b) a direct transfer of the Participant's interest from the trustee of a qualified plan maintained by another employer. SECTION 5 PARTICIPANT'S ACCOUNT 5.1 Separate Accounts. The Trustee shall maintain separate accounts for each Participant and Former Participant. Each Participant's or Former Participant's Account shall be divided into separate subaccounts: the Salary Deferral Account, QVEC Account, the After Tax Contribution Account, and the Matching Account, and the Rollover Account. 5.2 Separate Accounting. The amounts in a Participant's Salary Deferral Account, QVEC Account, After Tax Contribution Account, Matching Account, and Rollover Account shall at all times be separately accounted for by adjusting such accounts for withdrawals, distributions and contributions. Withdrawals, distributions, forfeitures (from Matching Accounts), and other credits or charges shall be separately allocated among Salary Deferral Accounts, After Tax Contribution Accounts, Matching Accounts, and Rollover Accounts on a reasonable and consistent basis. 5.3 Valuation of Trust. The assets of the Accounts of Participants shall be held by the Trustee. The assets of the Trust Plan shall be revalued by the Trustee at the close of each business day. In making such revaluation the Trustee shall take into account earnings or losses of the Trust Fund net of reasonable expenses and capital appreciation or depreciation in such assets whether or not realized. The method of revaluation shall be determined by the Trustee, and shall be followed with reasonable consistency from period to period. The amount credited to the Accounts of all Participants shall be adjusted as of each Revaluation Date so as to be equal to the value of such assets on such date. The settlement of the Accounts of a Participant shall be based upon the amount credited to his or her Accounts (pursuant to Section 6) as of the most recent revaluation completed prior to issuance of payments provided the Participant submits all documentation required to make settlement in the form, time and manner prescribed by the Committee. In making the adjustments, the Accounts of Participants shall be reduced by any payments made from the Accounts of the Participant and increased by any contributions made since the last adjustment. SECTION 6 INVESTMENTS AND OTHER PROVISIONS AFFECTING CONTRIBUTIONS 6.1 Investment of Participant's Account. Salary Deferral Contributions on behalf of a Participant shall be paid to the Trustee and allocated directly to the Participant's Salary Deferral Account, and After Tax Contributions shall be paid to the Trustee and allocated directly to the Participant's After Tax Contribution Account. A Participant may elect to have amounts credited to his or her Salary Deferral Account, After Tax Contribution Account, Matching Account, and Rollover Account each be invested in the Funds in ten (10%) percent multiples, in such a way that the combination of the percentage for the contributions to each Account totals 100%. Contributions need not be invested in the same manner. 6.2 Matching Account. Matching Contributions shall only be in the form of cash which shall be invested in any of the Funds as directed by the Participant. 6.3 Investment of Rollover Account. At the time a Rollover Contribution is made to the Plan at a Participant's direction which is made in accordance with Section 4.11, the Participant must elect, in such form, time and manner as prescribed as by the Committee, to have his or her Rollover Contribution invested in any of the investment Funds described in Section 6.1, in whole 10% increments. 6.4 Temporary Investments and Investment in Qualifying Employer Securities. The assets of the Trust Fund may be invested in qualifying employer securities as defined in ERISA, without regard to the percentage of the total fair market value of the Trust Fund or any Participant's Account which said investment comprises. Pending investment or reinvestment or pending payments or distribution, all or part of the Trust Fund may be invested temporarily in accounts with financial institutions or short-term financial instruments. 6.5 Change in Investment Election For Funds Contributed by a Participant . A Participant may change his or her investment election for his or her Salary Deferral Account, After Tax Contribution Account, or Matching Account to any of the investments set forth in Section 6.1 of the Plan by contacting the Trustee by telephonic or electronic means on any business day. The Committee may issue new rules for such changes in investment elections including rules with respect to the time, manner and form in which such changes are made. 6.6 Change in Investment Election for Funds Already Accumulated in a Participants' Accounts . A Participant or Former Participant may also transfer the value of his or her Accounts in any of the investment Funds set forth in Section 6.1 of the Plan to another investment Fund as set forth in said Section in whole percentages or in an amount of at least $250 (or the entire account balance if the amount is less than $250). To change an investment election for funds already accumulated in a Participant's Account, the Participant or Former Participant must contact the Trustee on any business day. This right to change existing investment allocations to or from any investment Fund offered by the Plan is subject to any transfer restrictions imposed by the Fund's management as set forth in a prospectus with respect to that Fund. The Committee may issue new rules for such changes in investment elections, including rules with respect to the time, manner and form in which such changes are made. 6.7 Return of Matching Contributions. In the event a Matching Contribution (a) is made under a mistake of fact, or (b) is conditioned upon deduction of the contribution under Section 404 of the Code and such deduction is disallowed, or (c) is conditioned upon qualification of the Plan under Section 401 (a) of the Code and the Plan does not so qualify, such contribution may be returned to the Employer within ninety days after the payment of the contribution, the disallowance of the deduction, or the date of denial of the Plan qualification, whichever is applicable. SECTION 7 DISTRIBUTIONS 7.1 Distribution After Retirement. After the retirement of a Participant at his or her then Normal Retirement Date or thereafter, the entire value of a Participant's Accounts shall be distributed to him or her in a lump sum payment in cash, unless he or she elects, pursuant to Section 7.6, to receive the Wyeth Common Stock Fund portion in Wyeth Common Stock. 7.2 Distribution After Death. After the death of a Participant, the Trustee, pursuant to directions from the Committee, shall pay in a lump sum payment the entire value of the deceased Participant's Account to the Participant's surviving spouse, or, if there is no surviving spouse or if the Participant had elected to have such lump sum payment made to someone other than his or her spouse and the spouse consents in writing to such election which consent acknowledges the effect of such election and such consent is witnessed by a notary public, then such lump sum payment shall be paid to the beneficiary designated by such Participant. The benefit payable under this Section will be distributed to the beneficiary named by the Participant no later than one year after the Participant's death, but if the designated beneficiary is the Participant's surviving spouse, the benefit will be distributed no later than the date on which the Participant would have attained age 70 1/2. If the Participant has no designated beneficiary or surviving spouse, the Participant's benefit must be distributed within five years after the Participant's death. 7.3 Designation of Beneficiary. A Participant at the time he or she joins the Plan shall designate a beneficiary or beneficiaries to receive the sums credited to his or her Account in the event of his or her death, if he or she has no surviving spouse at such time, which designation may be changed by the Participant from time to time and shall cease to be effective if he or she thereafter becomes married. To be effective, the original designation of the beneficiary and any subsequent change must be in writing on the form provided for that purpose by the Committee and filed with the Committee. 7.4 Failure to Designate a Beneficiary. In the event that a Participant has no surviving spouse at the time of his or her death and beneficiary is properly designated or that designated beneficiary predeceases the Participant, the Participant's account balance shall be paid in the following order of priority: (1) first, to the Participant's surviving children (if any), in equal shares; (2) second, if there are no surviving children, to the Participant's surviving parents, if any, in equal shares; and (3) finally, if there are no surviving parents, to the legal representatives of the Participant's estate. 7.5 Distribution After Termination of Employment. If a Participant terminates employment with the Employer due to resignation, discharge or the Participant retires before his or her Normal Retirement Date, he or she shall receive a lump sum cash distribution of his or her Salary Deferral Account, QVEC Account, After Tax Contribution Account, Rollover Account and the vested portion of his or her Matching Account if the value of his or her Account balance does not exceed $3,500, or does not exceed $5,000 for distributions occurring on or after January 1, 1998. If the value of his or her Account exceeds $3,500 at the time of such resignation, discharge or retirement (or exceeds $5,000 on or after January 1, 1998), any amount payable hereunder shall not be immediately distributed without his or her consent. The nonvested portion of the Matching Account of a Participant who receives a lump sum cash distribution shall be forfeited on his or her termination of employment and shall be restored only if the Participant is reemployed prior to incurring five consecutive One-Year Periods of Severance. A "One Year Period of Severance" shall occur if there is a Severance From Service and the Participant is not reemployed within the twelve consecutive month period commencing on the date of Severance From Service. (In the case of a Participant who is absent from service by reason of (i) the pregnancy of the Participant, (ii) the birth of a child of the Participant, (iii) the placement of a child with the Participant in connection with the adoption of such child by the Participant, or (iv) the caring for such child for the period immediately following such birth or placement, and such Participant is absent from service beyond the first anniversary of the first date of such absence, the Severance From Service date for such Participant is the second anniversary of the first date of such absence. The period between the first and second anniversaries of the first date of absence from work is neither a period of service nor a period of severance. If such Participant is not reemployed between the second and third anniversaries of the first date of absence from work a One-Year Period of Severance shall occur.) In the case of Participants who are part time or seasonal Employees a One Year Period of Severance shall be the Plan Year or other applicable computation period during which the Participant has not completed more than 500 Hours of Service. The nonvested portion of the Matching Account of a Participant who does not receive a lump sum cash distribution shall be forfeited when he or she has incurred five consecutive One Year Periods of Severance. Notwithstanding the foregoing, a Participant shall not incur a One-Year Period of Severance with respect to any period during which he or she is on a leave of absence under the federal Family and Medical Leave Act. 7.6 Election of Wyeth Common Stock; Converting Common Stock to Cash. If prior to the date of distribution, in accordance with rules adopted by the Committee, the Participant or other distributee elects to receive the Wyeth Common Stock Fund portion of his or her Account in Wyeth Common Stock, he or she will receive the number of shares of Wyeth Common Stock in such Account. Otherwise, all distributions will be in cash in a lump sum. Wyeth Common Stock converted into cash will be valued as the Revaluation Date set forth in Section 5.3. Distribution will be made as soon thereafter as is practicable in accordance with rules adopted by the Committee. 7.7 Time Distributions Are to Begin. Distribution of a Participant's Account, subject to Section 7.8, shall be made as soon as practicable but no later than 150 days after the end of the calendar quarter in which the following events occur: (1) For distributions on account of retirement, the Participant's retirement, or, if elected, either (i) December 31 of the year of retirement, or (ii) the last day of the sixth full calendar month following the Participant's date of retirement. (2) For distributions on account of death, the Committee receives satisfactory evidence of the death of the Participant and the identification of the beneficiary. (3) For distributions on account of termination of employment on account of resignation or discharge, the date of termination of employment, or, if elected, either (i) December 31 of the year of such termination or (ii) the last day of the sixth full calendar month following the Participant's date of termination of employment. Subject to Section 7.8, no person subject to Section 16(b) of the Securities Exchange Act of 1934 shall receive a distribution earlier than six (6) months from the date of his or her retirement or other termination of employment unless the Committee in its discretion shall authorize an earlier distribution in accordance with Section 7.7. 7.8 Limitations on Distributions. The entire interest of a Participant will be distributed based on the date of his or her retirement, death, or termination of employment as provided in this Section 7, provided, however, in no event will such interest be distributed earlier than the later of April 1 of the calendar year following the later of the calendar year in which the Participant attains age 70 1/2 or the calendar year in which he or she retires. Distributions will be made in accordance with Section 401(a)(9) of the Code and regulations thereunder. In addition, in accordance with Section 401(a)(14) of the Code, unless a Participant otherwise elects, the commencement of distributions will begin not later than the 60th day after the latest of the close of the Plan Year in which occurs: (1) the date a Participant attains age 65, (2) the 10th anniversary of the year in which a Participant commenced participation in the Plan, or (3) the Participant's termination of employment with the Employer. Unless otherwise permitted by law or regulation, distribution of benefits under this Plan must begin by the April 1 of the calendar year following the year in which the Participant attains age 70 1/2, regardless of whether the Participant is still working for the Employer at such time. The amount of the distribution which a Participant who is still working for the Employer must receive from the Plan shall be determined in accordance with regulations prescribed by the Secretary of the Treasury. Notwithstanding anything in the foregoing to the contrary, commencing as of January 1, 2000, distribution of benefits to a Participant who is not a five percent (5%) owner of the Employer, will begin no later than April 1 of the calendar year following the later to occur of the calendar year in which the Participant attains age 70 1/2 of the calendar year in which the Participant retires. Distributions to a Participant who is a 5% owner will begin no later than April 1 of the calendar year following the calendar year in which he or she attains age 70 1/2. With respect to distributions under the Plan made for calendar years beginning on or after January 1, 2002, the Plan will apply the minimum distribution requirements of Section 401(a)(9) of the Code in accordance with the regulations that were proposed on January 17, 2001, notwithstanding any provision of the Plan to the contrary. 7.9 Amount of Distribution Cannot be Ascertained or Participant or Beneficiary Cannot be Located. If the amount of payment required to commence by a certain date in accordance with the Plan cannot be ascertained by such date, or if it is not possible to make payment on such date because the Committee has been unable to locate the Participant or beneficiary, a payment retroactive to such date shall be made no later than 60 days after the earliest date on which the amount of such payment can be ascertained or the date on which the Participant or beneficiary is located. If after reasonable effort the Committee cannot locate the Participant or beneficiary, the Participant's Account shall be forfeited. The amount of such forfeiture shall reduce the Matching Contribution required to be made by the Employer. Any such forfeited Account shall be reinstated and become payable if a claim therefor is made by the Participant or beneficiary which is approved by the Committee. 7.10 Withholding Tax on Distributions. Distributions under the Plan shall be subject to tax withholding under all applicable tax laws. 7.11 Distribution Upon Sale of Stock or Substantially all the Assets of a Corporation as Permitted by Section 401(k)(2)(B)(i)(II) of the Code. (a) Upon the date of sale by the Company or a subsidiary thereof of substantially all of the assets (within the meaning of section 409 (d) (2) of the Code) used by the Company or subsidiary in a trade or business with respect to an Employee who continues employment with the corporation acquiring such assets, or (b) upon the date of sale of stock by the Company or a subsidiary thereof of its interest in a subsidiary (within the meaning of section 409 (d) (3) of the Code) with respect to an Employee who continues employment with the subsidiary which is sold, the Committee may exercise its discretion to distribute to a Participant in a lump sum distribution the Participant's Account Balance including the vested portion of his or her Matching Account if the value of the Account does not exceed $3,500 prior to January 1, 1998 or does not exceed $5,000 on or after January 1, 1998. If the value of his or her account exceeds $3,500 prior to January 1, 1998, (or exceeds $5,000 on or after January 1, 1998), any amount payable shall not be immediately distributed without the Participant's consent. This Section 7.11 shall be interpreted in accordance with the requirements of Section 401 (k) of the Code and the regulations issued thereunder. 7.12 Plan to Plan Transfers. The Committee may exercise its discretion from time to time to authorize the transfer of account balances for one or more Participants of such Participant's Accounts (including the vested portion of his or her Matching Account) to another plan in which such Participant also participates if such other plan also qualifies when applicable, under Section 401 (a) and Section 401 (k) of the Code, provided that the Committee is satisfied that such other plan will accept the transfer of such account balances and that such plan to plan transfer is otherwise in accordance with the applicable qualification requirements of the Code. 7.13 Rollover of Eligible Rollover Distributions. (1) Notwithstanding any provision of the Plan to the contrary that would otherwise limit a Distributee's election under this section 7.13, 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. However, notwithstanding the above, the Plan Administrator may adopt procedures wherein the Plan will not make a distribution pursuant to this Section 7.13 unless the Eligible Rollover Distribution is at least $200, and that the Plan will directly rollover only a portion of an Eligible Rollover Distribution if the portion to be rolled over is at least $500. If a distribution is one to which Sections 401(a)(11) and 417 of the Code do not apply, such distribution may commence less than 30 days after the notice required under Section 1.411(a)-11(c) of the Income Tax Regulations is given, provided that: (i) The Plan Administrator clearly informs the Participant that the Participant has a right to a period of at least 30 days after receiving the notice to consider the decision of whether or not to elect a distribution, and (ii) that Participant, after receiving the notice, affirmatively elects a distribution. (2) For purposes of this Section 7.13, the following definitions shall apply: Eligible Rollover Distribution. An Eligible Rollover Distribution is any distribution of all or any portion of the Plan benefit 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 specific period of ten years or more; any distribution to the extent such distribution is required under Section 401(a)(9) of the Code, and a hardship withdrawal as described in Section 8.1 if (and only if) such withdrawal is made after December 31, 1999. Eligible Retirement Plan. An Eligible Retirement Plan is an individual retirement plan described in Section 408(b) of the Code, an annuity plan described in Section 403(a) of the Code, or a qualified trust described in Section 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 of a Participant, an Eligible Retirement Plan is an individual retirement account or individual retirement annuity. Distributee. A Distributee includes an Employee or former Employee. In addition, the Employee's or former Employee's surviving spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in Section 414(p) of the Code, are Distributees with regard to the interest of the spouse or former spouse. Direct Rollover. A Direct Rollover is a payment by the Plan to the Eligible Retirement Plan specified by the Distributee. SECTION 8 WITHDRAWALS 8.1 Hardship Withdrawals. A Participant can withdraw amounts in his or her Salary Deferral Account (which for this purpose excepts investment income earned after January 1, 1989), Rollover Account and vested amounts in his or her Matching Contribution Account on account of a hardship. For the withdrawal to constitute a hardship, the withdrawal (1) must be made on account of an immediate and heavy financial need of the Participant, and (2) must be necessary to satisfy that need. The determination of whether a Participant has an immediate and heavy financial need is to be made by the Committee on the basis of all relevant facts and circumstances. A financial need shall not fail to qualify as immediate and heavy merely because such need was reasonably foreseeable or voluntarily incurred by the Participant. The following types of expenses will be deemed to constitute an immediate and heavy financial need for purposes of this Section 8.1: (i) medical expenses (described in Section 213(d) of the Code) incurred by the Participant or his or her spouse or dependents (as defined in Section 152 of the Code); (ii) purchase (excluding mortgage payments) of a principal residence for the Participant; (iii)payment of tuition and related educational fees for the next 12 months of post-secondary education for the Participant, his or her spouse, children or dependants; or (iv) the need to prevent the eviction of the Participant from his or her principal residence or foreclosure on the mortgage of the Participant's principal residence. Other types of expenses which the Internal Revenue Service deems are immediate and heavy financial needs as set forth in the publication of revenue rulings, notices and other documents of general applicability shall be deemed to constitute an immediate and heavy financial need for purposes of this Section 8.1. The requirement that a hardship withdrawal must be necessary to satisfy an immediate and heavy financial need will be met if the funds cannot be obtained from other resources reasonably available to the Participant and the amount distributed does not exceed the amount required to relieve the financial need. Before a Participant can make a hardship withdrawal, he or she must first withdraw all amounts in his or her After Tax Contribution Account, available for withdrawal, and take out a loan on amounts in his or her Plan Accounts, if available, under the provisions of Section 9. To the extent that a Participant cannot access funds necessary to meet his or her immediate and heavy financial need by a loan from his or her Plan Accounts or by a withdrawal of available amounts in his or her After Tax Contribution Account, the Participant must do (A) and (B) as follows: (A) The Participant must furnish the Committee with a signed statement representing that the required funds cannot be obtained: (i) through reimbursement or compensation by insurance; (ii) by reasonable liquidation of the Participant's assets, to the extent such liquidation would not itself cause an immediate and heavy financial need; for this purpose, the Participant's assets shall be deemed to include those assets of the Participant's spouse and minor children that are reasonably available to the Participant; (iii)by discontinuing his or her Salary Deferral Contributions and After Tax Contributions to the Plan; or (iv) by borrowing from plans maintained by any other employer or by borrowing from commercial sources on reasonable commercial terms. (B) The Participant must suspend all Salary Deferral Contributions and After Tax Contributions to the Plan for at least 12 months after receipt of the hardship withdrawal and the amount of the Participant's Salary Deferral Contributions for the calendar year after the year in which the hardship withdrawal was received cannot exceed the amount of the applicable limit on Salary Deferral Contributions, as set forth in Section 4.2, less the amount of the Participant's Salary Deferral Contributions made in the year the hardship withdrawal was received. A Participant shall notify the Committee in writing of his or her request to make a hardship withdrawal on a form provided therefor pursuant to rules established by the Committee. Hardship withdrawals shall also meet the following requirements: (i) No more than one hardship withdrawal per Plan Year shall be permitted. (ii) The minimum hardship withdrawal shall be $500.00. (iii)The hardship withdrawal shall not exceed the amount of the Participant's Salary Deferral Account, Rollover Account, and the vested portion of his or her Matching Account. (iv) The amount of the hardship withdrawal shall be deducted from the Participant's Salary Deferral Account, Rollover Account and Matching Account, as the case may be, and the balance remaining after the withdrawal shall then constitute the total value of the Participant's Salary Deferral Account, Rollover Account and Matching Account. Hardship withdrawals shall first be made from the Participant's Salary Deferral Account and when that is exhausted, may be made from the Rollover Account (until exhausted) and then from the vested portion of the Matching Account in that order. Such withdrawals shall be made from the Investment Funds in Participant's Accounts as designated by the Participant in writing to the Trustee/Recordkeeper. If a Participant fails to provide such instructions, each Account shall be charged proportionately based on the foregoing sentences and on the status at the most recent Revaluation Date with respect to the different investments options in the Accounts elected pursuant to Section 6.1. (v) All hardship withdrawals shall be made in cash. Conversion of Wyeth Common Stock to cash shall be done in the manner described in Section 7.6. (vi) All hardship withdrawals shall be paid in an amount determined in the discretion of the Committee (including amounts representing the amount of federal, state and local taxes the Participant will incur as a result of the withdrawal) in accordance with the hardship withdrawal application submitted by the Participant, based on the amount in the Participant's Account as of the Revaluation Date after the Committee makes its determination. (vii)In addition to a Participant's written request for a hardship withdrawal, the Participant must submit any additional documentation that the Committee may determine is necessary to evidence the nature and extent of the immediate and heavy financial need. 8.2 Withdrawals of After Tax Contributions. A Participant can withdraw amounts in his or her After Tax Contribution Account once a year, for any reason, in accordance with the following requirements: (i) such withdrawal request shall be made pursuant to instructions transmitted by either telephonic or electronic means from the Participant to the Trustee/Recordkeeper,; pursuant to rules established by the Committee; (ii) a Participant may make withdrawals of After-Tax Contributions once each calendar year, provided, however, that each withdrawal must be made in a minimum amount of at least $500; (iii)all withdrawals shall be made from the investment Funds in a Participant's After-Tax Contribution Account as specified by the Participant in instructions sent in accordance with subsection (i) above. If the Participant fails to provide such instructions, such withdrawals shall be charged proportionately to the Participant's investment Funds in his or her After-Tax Contributions Account as of the most recent Revaluation Date; and (iv) all withdrawals of amounts in the After Tax Contribution Account shall be made in either cash or Wyeth Common Stock, if applicable, as elected by the Participant in accordance with subsection (i) above. If the Participant fails to provide such instructions, such withdrawals shall be in cash. Conversion of Wyeth Common Stock to cash shall be done as soon as practicable after the receipt of instructions from the Participant. 8.3 Age 59 1/2 Withdrawal. Notwithstanding the provisions of Section 8.1, a Participant who has attained age 59 1/2 may make a withdrawal from his or her Salary Deferral Account, Rollover Account, and the vested portion of his or her Matching Account once a calendar year for any reason without having to demonstrate financial necessity. Such withdrawal shall be made in accordance with instructions sent by the Participant to the Trustee/Recordkeeper by either electronic or telephonic means in accordance with the rules set forth in Section 8.1 except for those provisions pertaining to the demonstration of an immediate and heavy financial need, financial necessity and suspension of Salary Deferral Contributions and After-Tax Contributions. 8.4 Withdrawals of Salary Deferral Contributions By Former Participants. A Former Participant may withdraw amounts from his or her Account, for any reason, if the following requirements are satisfied: (i) each withdrawal shall be made pursuant to instructions sent by the Participant either electronically or telephonically to the Trustee/Recordkeeper in accordance with procedures established or approved by the Administrator; (ii) a Participant may make such a withdrawal as frequently as he or she may desire, provided, however, that the minimum amount of each withdrawal must be at least $1,000; (iii) each withdrawal shall be made from the investment Funds in the Participant's Account as specified by the Participant in instructions provided as described in subsection (i) above. If a Participant fails to provide such instructions, the withdrawal shall be charged proportionately to such Participant's investment Funds in his or her Account as of the most recent Revaluation Date; and (iv) all withdrawals from a Participant's Account shall be made in cash or Wyeth common stock, if applicable, as elected by the Participant in instructions provided in accordance with subsection (i) above. If no such election is made, all such withdrawals will be made in cash. SECTION 9 LOANS 9.1 Loans. A Participant may borrow no more than once every six months from his or her Account under the Plan on terms specified by the Committee which are consistent with the requirements of Section 72(p), 401(k) and 4975(d)(1) of the Code, provided that: (a) The minimum loan amount must be $1,000 and the aggregate amount of all such loans to a Participant from this Plan shall not, at the time any such loan is made, exceed the lesser of (i) $50,000 reduced by the excess (if any) of the highest outstanding balance of loans from the Plan during the one (1) year period ending on the day before the date on which such loan was made, over the outstanding balance of loans from the Plan on the date on which such loan was made, or (ii) fifty percent (50%) of the vested portion of the Participant's Account Balance at the time of the making of such loan. For purposes of this limitation, all loans from all qualified plans maintained by the Employer or by any entity which is required to be aggregated with the Employer pursuant to Sections 414(b), (c), (m) or (o) must be aggregated. If a loan is repaid and another loan taken out within six months, the maximum loan amount cannot exceed the limits of section 72 (p) of the Code. (b) A Participant must apply for a loan by submitting a loan application authorized by the Committee. In order for a loan to be approved, the Participant must sign a document evidencing the loan request. A Participant who has applied for a home purchase/construction loan will be required to submit an executed copy of a purchase or construction agreement and a written statement certifying that the home will be used as the Participant's primary residence. (c) For purposes of subsection 9.1(a), a Participant's Account balance shall be valued as of a Revaluation Date immediately prior to receipt of the Participant's loan application. Issuance of the loan will be as soon as possible in the month in which a loan application is approved. (d) The maximum number of loans from the Plan which a Participant may have outstanding at the same time are two general purpose loans payable within five years and one loan to acquire or construct any dwelling to be used as the principal residence of the Participant payable within 15 years. (e) Any loan, by its terms, must be required to be repaid within a whole year term not exceeding five years, unless the loan is used to acquire or construct any dwelling to be used (within a reasonable time after the loan is made) as the principal residence of the Participant, in which case the whole year term can be from 1 to 15 years. Notwithstanding the foregoing, a loan must be scheduled to be repaid by the end of the year in which the Participant attains age 70 1/2. (f) The amount of the loan (principal plus interest) must be repaid through periodic deductions from the Participant's paycheck in accordance with his or her payroll frequency. Besides payroll frequency, the amount of the periodic deduction will be based upon the amount of the loan, the term of the loan, and, unless otherwise provided in Department of Treasury regulations, a substantially level amortization of the loan over the term of the loan. All amounts of loan repayments by the Participant shall be deposited into the investment accounts elected by the Participant in accordance with Section 6.1 in effect at the time the repayments were made. Repayments will begin with the first paycheck received in the month following the date the loan check is received by the Participant or as soon as practicable thereafter. Repayments will be deposited into the Participant's Account in the following order to the extent that money was borrowed from the Account: (1) After Tax Contribution Account, (2) Company Matching Account, (3) Rollover Account, and (4) Salary Deferral Account. (g) If a Participant terminates employment with the Employer due to resignation, discharge, retirement or death and the loan has not been repaid with interest as is required by the Plan or the loan is otherwise in default the remaining unpaid balance is due and payable. Such Participant's Account shall be reduced to the extent of the outstanding loan provided that the Participant has consented to the immediate distribution of his or her Account balance. If such Participant defers receipt of his or her distribution, he or she is required to repay the loan in full. (h) The loan funds will be charged against each of the Participant's investment options in the Participant's Accounts as specified by the Participant in instructions transmitted by either electronic or telephonic means by the Participant to the Trustee/Recordkeeper. If instructions are not provided by a Participant, the loan funds shall be charged ratably against each of the Participant's investment options within each of his or her Accounts. (i) Loan funds shall be charged first to the Salary Deferral Account and then, to the extent necessary, to the Rollover Account, to the Matching Account, and to the After Tax Contribution Account, in that order. (j) The interest rate charged for the term of a loan from the Plan will be provided such rate provides a return commensurate with the interest rates charged by persons in the business of lending money for loans which would be made under similar circumstances, or such other rate as permitted by government regulations or releases. Interest begins to accrue when payments are scheduled to commence. (k) A loan can be prepaid in full as early as six months into the loan prepayment period upon Committee approval. Partial prepayments are not permitted. (l) The loan will be declared in default if the Participant rescinds his or her payroll authorization deduction, or if the Participant is on an unpaid leave of absence or temporary layoff and there is a suspension of repayments beyond the end of the quarter following the quarter in which the repayment was due or the loan term and alternative repayment arrangements cannot be arranged. Upon default, if the loan is not repaid when called, the Committee may cancel the loan and treat the outstanding balance as a taxable withdrawal from the Plan. (m) The loan program under the Plan shall be administered by the Committee in a uniform and nondiscriminatory manner. The Committee may provide for an overall limit on the amount of loans that may be provided by the Plan at any one time and shall establish the appropriate and reasonable security and interest rates on such loans. The Committee shall have sole discretion (i) to determine which Participants are entitled to receive a loan, (ii) to determine under what conditions a loan shall be granted, (iii) to determine what the terms of the loan, promissory note and security agreement are, (iv) to determine when a loan is in default and what course of action to take, and (v) to determine other questions which arise under this Section 9, provided that such discretion shall be exercised in accordance with the requirements of law. SECTION 10 LIMITATIONS ON ANNUAL ADDITIONS 10.1 Basic Limitation. Subject to the adjustments hereinafter set forth, the maximum aggregate Annual Addition to a Participant's Account in any Limitation Year shall in no event exceed the lesser of: (a) $30,000 (or such greater amount as may be permitted under Section 415(d) of the Code; or (b) twenty-five percent (25%) of the amount of Participant's compensation for the Limitation Year. For purposes of this Section 10, compensation shall mean compensation as defined under the safe-harbor definition of compensation under Regulation Section 1.415-2(d)(10). Beginning with the Plan Year commencing on January 1, 1994, for purposes of this Section 10, compensation of any Participant shall not exceed the OBRA '93 Compensation which shall equal $150,000 multiplied by any cost of living factor prescribed by the Secretary of the Treasury under Section 401(a)(17)(B) of the Code. Effective for Plan Years beginning on and after January 1, 2002, compensation shall be limited as provided under Section 401(a)(17) of the Code as amended from time to time. For purposes of this Section, for Plan Years beginning on and after January 1, 2001, compensation paid or made available during such Plan Year shall include elective amounts that are not includible in the gross income of the Employee by reason of Section 132(f)(4) of the Code. 10.2 Definitions. (a) For purposes of this Section 10 the term "Annual Addition" shall mean the sum for any Limitation Year of the following amounts: (1) Salary Deferral Contributions; (2) Matching Contributions; (3) After Tax Contributions; (4) Forfeitures arising from termination of employment if allocated to the Accounts of Participants; and (5) Any amount described in Sections 415(l)(1) and 419A(d)(2) of the Code. (b) For purposes of this Section 10 and Section 11, the term "Limitation Year" or "year" means the calendar year. 10.3 Limitation for Participants in a Combination of Plans. Notwithstanding the foregoing, in the case of an Employee who participates in this Plan and a defined benefit plan which meets the requirements of section 401(a) of the Code maintained by an Employer, the sum of the defined benefit plan fraction and the defined contribution plan fraction for any year shall not exceed 1.0. The foregoing limitation shall not apply for Plan Years beginning after December 31, 1999. (a) The term "defined benefit plan fraction" shall mean the projected annual benefit payable under the defined benefit plan, without regard to the restrictions imposed by section 415 of the Code, over the annual benefit which may be payable under such plan, taking into account such restrictions, but increased as provided in Section 415 (e) (2) (B) of the Code. (b) The term "defined contribution plan fraction" shall mean the actual aggregate Annual Additions, as herein defined, to this Plan determined as of the close of the year, over the aggregate of the maximum Annual Additions which could have been made for each year of the Participant's service had such Annual Additions been limited each such year to the maximum Annual Additions permitted under Section 415 of the Code, but increased as provided by Section 415(e) (3) of the Code, and taking into account the transition rules for years ending prior to January 1, 1983, prescribed under Section 415 of the Code and under ERISA. Effective as of the first day of the first Limitation Year commencing after December 31, 1999, and notwithstanding any other provision of the Plan, the benefit for any Participant shall be determined by applying the limitations of section 415 of the Code without regard to the limitations of section 415(e). 10.4 Treatment of Similar Plans. The limitations of this Section with respect to any Participant who at any time has participated in any other defined contribution plan which is qualified under Section 401(a) of the Code, or in more than one qualified defined benefit plan, maintained by an Employer or by a corporation which is a member of a controlled group of corporations (within the meaning of Section 1563(a) (determined without regard to Section 1563(a)(4) and (e)(3)(C), and Section 415(h) of the Code) of which an Employer is a member shall apply as if the total benefits payable under all such defined benefit plans in which the Participant has been a member were payable from one plan, and as if the total Annual Additions made to all defined contribution plans in which the Participant has been a member were made to one plan. For purposes of this Section 10, the term "Employer" includes any corporation which is a member of a controlled group, as described herein. 10.5 Preclusion of Excess Annual Additions. The Committee shall maintain records showing for each month during the Limitation Year a Participant's contributions credited to the Participant's Account, (including for this purpose, the forfeitures used to reduce such contributions). If the Committee determines at any time that no additional contributions may be made and credited to the Participant's Account during a year without exceeding the limitations prescribed in this Section 10 for the year, then no further contributions shall be made or credited to the Participant's Account during the year. If a portion, but not all, of the contributions which are scheduled to be made and credited to the Participant's Account during the year or the remainder of the year may be made and credited without exceeding the limitations prescribed hereunder, the Participant's contributions shall be reduced to such amount which shall cause the limitations to be met. 10.6 Adjustment to Defined Benefit Plan. Notwithstanding the provisions of Section 10.5, but after giving effect to the transition rule described in Section 415(e)(6) of the Code, in the event that the limitations prescribed under Section 10.4 are exceeded with respect to any Participant who participates in this Plan and a qualified defined benefit plan maintained by an Employer, the Employer shall freeze or reduce the benefits under the defined benefit plan prior to making any adjustments under this Plan. The limitations of this Section with respect to any Participant who at any time has participated in any other defined contribution plan which is qualified under Section 401(a) of the Code, or in more than one qualified defined benefit plan, maintained by an Employer or by a corporation which is a member of a controlled group of corporations (within the meaning of Section 1563(a) (determined without regard to Section 1563(a)(4) and (e)(3)(C), and Section 415(h) of the Code) of which an Employer is a member shall apply as if the total benefits payable under all such defined benefit plans in which the Participant has been a member were payable from one plan, and as if the total Annual Additions made to all defined contribution plans in which the Participant has been a member were made to one plan. For purposes of this Section 10, the term "Employer" includes any corporation which is a member of a controlled group, as described herein. Effective as of the first day of the first Limitation Year commencing after December 31, 1999, and notwithstanding any other provision of the Plan, the benefit for any Participant shall be determined by applying the limitation of Section 415 of the Code without regard to the limitations of Section 415(e) of the Code. 10.7 Disposal of Excess Annual Additions. In the event that, notwithstanding Section 10.5 hereof, the limitations with respect to Annual Additions prescribed hereunder are exceeded with respect to any Participant and such excess arises as a consequence of the crediting of forfeitures to the Participant's Account or a reasonable error in estimating the Participant's Compensation, such excess shall be disposed of by returning to the Participant Contributions to his or her Accounts if any, for the year in which the excess arose, and the earnings thereon, but only to the extent necessary to cause the Annual Additions to the Participant's Account to equal, but not exceed, the limitations prescribed hereunder. In the event that after such contributions and earnings are returned there remains an excess, such excess shall be held in a suspense account and reallocated among the Accounts of all Participants in the Limitation Year succeeding the year in which the excess arose. SECTION 11 TOP HEAVY PLAN RULES 11.1 General Rule. The Plan shall meet the requirements of this Section 11 in the event that the Plan is or becomes a Top-Heavy Plan. 11.2 Top-Heavy Plan. (a) Subject to the aggregation rules set forth in paragraph (b), the Plan shall be considered a Top-Heavy Plan pursuant to Section 416(g) of the Code in any Plan Year if, as of the Determination Date, the present value of the cumulative Accounts of all Key Employees exceeds sixty percent (60%) of the value of the cumulative accounts of all of the Employees as of such Date, excluding former Key Employees and excluding any Employee who has not received Compensation from the Employer during the five (5) consecutive Plan Year period ending on the Determination Date, but taking into account in computing the ratio any distributions made during the five (5) consecutive Plan Year period ending on the Determination Date. For purposes of the above ratio, the Account of a Key Employee shall be counted only once each Plan year, notwithstanding the fact that an individual may be considered a Key Employee for more than one reason in any Plan Year. (b) Aggregation and Coordination with Other Plans. For purposes of determining whether the Plan is a Top-Heavy Plan and for purposes of meeting the requirements of this Section 11, the Plan shall be aggregated and coordinated with other qualified plans in a Required Aggregation Group and may be aggregated or coordinated with other qualified plans in a Permissive Aggregation Group. If such Required Aggregation Group is Top-Heavy, this Plan shall be considered a Top-Heavy Plan. If such Permissive Aggregation Group is not Top-Heavy, this Plan shall not be a Top-Heavy Plan. Solely for purposes of determining if the Plan, or any other plan included in a required aggregation group of which this Plan is a part, is Top-Heavy the accrued benefit of a Non-Key Employee shall be determined under (a) the method, if any, that uniformly applies for accrual purposes under all plans maintained by an Affiliated Employer, or (b) if there is no such method, as if such benefit accrued not more rapidly than the slowest accrual rate permitted under the fractional accrual rate of Section 411(b)(1)(C) of the Code. 11.3 Definitions. For the purpose of determining whether the Plan is Top-Heavy, the following definitions shall be applicable: (a) Determination and Valuation Dates. The term "Determination Date" shall mean, in the case of any Plan Year, the last day of the preceding Plan Year. The value of an individual's Account shall be determined as of the Valuation Date and shall include any contribution actually made after such Valuation Date but on or before the Determination Date. The term "Valuation Date" means the most recent Revaluation Date defined in Section 2.26 occurring within a twelve (12) month period ending on the Determination Date. (b) Key Employee. An individual shall be considered a Key Employee if he or she is an Employee or former Employee who at any time during the current Plan Year or any of the four (4) preceding Plan Years: (1) was an officer of the Employer who has annual compensation in excess of 50% of the amount in effect under Section 415(b)(1)(A) of the Code; provided, however that the number of individuals treated as Key Employees by reasons of being officers hereunder shall not exceed the lesser of 50 or 10% of all Employees, or (2) was one of the ten (10) Employees owning the largest interests in the Employer with annual Compensation in excess of the dollar limit on Annual Additions to a defined contribution plan under Section 415 of the Code, or (3) was a more than five percent (5%) owner of the Employer; or (4) was a more than one percent (1%) owner of the Employer whose annual compensation from the Employer in the applicable Plan year exceeded $150,000. For purposes of determining who is a Key Employee, ownership shall mean ownership of the outstanding stock of the Employer or of the total combined voting power of all stock of the Employer, taking into account the constructive ownership rules of Section 318 of the Code, as modified by Section 416 (i) (1) of the Code. For purposes of paragraph (1) but not for purposes of (2), (3) and (4), except for purposes of determining compensation under (4), the term "Employer" shall include any entity aggregated with an Employer pursuant to Section 414 (b), (c) or (m) of the Code. For purposes of paragraph (2), an Employee (or former Employee) who has some ownership interest is considered to be one of the top ten (10) owners unless at least ten (10) other Employees (or former Employees) own a greater interest than such Employee (or former Employee); provided that if an Employee has the same ownership interest as another Employee, the Employee having greater annual compensation from the Employer is considered to have the larger ownership interest. (c) Non-Key Employee. The term "Non-Key Employee" shall mean any Employee who is a Participant and who is not a Key Employee. (d) Beneficiary. Whenever the term "Key Employee", "former Key Employee", or "Non-Key Employee" is used herein, it includes the beneficiary or beneficiaries of such individual. If an individual is a Key Employee by reason of the foregoing sentence as well as a Key Employee in his or her own right, both the value of his or her inherited benefit and the value of his or her own account will be considered his or her account for purposes of determining whether the Plan is a Top-Heavy Plan. (e) Compensation and Compensation Limitation. For purposes of this Section 11, except as otherwise specifically provided, the term "Compensation" has the same meaning as in Subsection 10.1 (b). (f) Required Aggregation Group. The term "Required Aggregation Group" shall mean all other qualified defined benefit and defined contribution plans maintained by the Employer and in which a Key Employee participates, and each other plan of the Employer which enables any plan in which a Key Employee participates to meet the requirements of Sections 401(a) (4) or 410 of the Code. (g) Permissive Aggregation Group. The term "Permissive Aggregation Group" shall mean all other qualified defined benefit and defined contribution plans maintained by the Employer that meet the requirements of Sections 401(a)(4) and 410 of the Code when considered with a Required Aggregation Group. 11.4 Requirements Applicable if Plan is Top-Heavy. In the event the Plan is determined to be Top-Heavy for any Plan Year, the following requirements shall be applicable. (a) Minimum Allocation (1) In the case of a Non-Key Employee who is covered under this Plan but does not participate in any qualified defined benefit plan maintained by the Employer, the Minimum Allocation of contributions plus forfeitures allocated to the Account of each such Non-Key Employee who has not separated from service at the end of a Plan Year in which the Plan is Top-Heavy shall equal the lesser of three percent (3%) of compensation for such Plan Year or the largest percentage of compensation provided on behalf of any Key Employee for such Plan Year (including any Salary Deferral Contributions). The Minimum Allocation provided hereunder may not be suspended or forfeited under Sections 411(a)(3)(B) or 411(a)(3)(D) of the Code. The Minimum Allocation shall be made for a Non-Key Employee for each Plan Year in which the Plan is Top-Heavy, regardless of the Non-Key Employee's level of compensation, even if he or she has not completed a Year of Service in such Plan Year or if he or she has declined to elect to make Salary Deferral Contributions or After-Tax Contributions, provided, however, in order to receive such Minimum Allocation, the Non-Key Employee must not have Separated From Service before the end of the Plan Year for which the Plan is found to be Top-Heavy. (2) A Non-Key Employee who is covered under this Plan and under a qualified defined benefit plan maintained by the Employer shall not be entitled to the Minimum Allocation under this Plan but shall receive the minimum benefit provided under the terms of the qualified defined benefit plan. (b) Top Heavy Vesting Schedule. Unless the Plan's vesting is more favorable, Non-Key Employee whose employment is terminated after the completion of 2 or more Years of Service shall be entitled to receive his or her vested interest in the value of the Employer Contributions credited to his or her account determined in accordance with the following schedule: Years of Service Vested Percentage 2 20% 3 40% 4 60% 5 80% 6 100% The vesting schedule under this paragraph (b) shall apply to a Non-Key Employee's interest in the value of the Employer Contributions credited to his or her Account under the Plan before or while the Plan is a Top-Heavy Plan. A Non-Key Employee is at all times one hundred percent (100%) vested in the full value of his or her Account attributable to his or her Salary Deferral Contributions and Employee Contributions to the Plan. (c) Vesting Percentage. In the event that the Plan previously was a Top-Heavy Plan but subsequently is not a Top-Heavy Plan, the vesting schedule under paragraph (b) shall be changed to the vesting schedule provided under Section 4.4, provided, however, that any Non-Key Employee who has completed at least 3 or more Years of Service and who had at least one Hour of Service while the Plan was a Top Heavy Plan, shall be entitled to elect, within a reasonable period, which of the above two vesting schedules is applicable to his or her benefit. (d) Limitations on Annual Additions and Benefits. For purposes of computing the defined benefit plan fraction and defined contribution plan fraction as set forth in Sections 415(e)(2)(B) and 415(e)(3)(B) of the Code, the dollar limitations on benefits and annual additions applicable to a Limitation Year shall be multiplied by 1.0 rather than by 1.25. (e) Limitation on Compensation. The annual compensation of a Key Employee taken into account under the Plan shall not exceed the limitation on compensation as provided in Section 401(a)(17) of the Code, as may be adjusted for increases in the cost of living pursuant to regulations issued under Section 415 of the Code. SECTION 12 ADMINISTRATION 12.1 Savings Plan Committee. This Plan shall be administered by the Savings Plan Committee. No member of the Committee shall receive any compensation from the Trust Fund for his or her service thereon. The Committee shall be the "Administrator" of the Plan for purposes of Section 3(16)(A) of ERISA and the "Named Fiduciary" of the Plan pursuant to Section 402(a) of ERISA. The Committee may delegate various duties and responsibilities to one or more employees or agents as set forth herein. In carrying out their respective responsibilities under the Plan, the Committee and other Plan fiduciaries shall have the discretionary authority to interpret the terms of the Plan and to determine eligibility for an entitlement to Plan benefits in accordance with the terms of the Plan. Any interpretation or determination made pursuant to such discretionary authority shall be given full force and effect, unless it can be shown that the interpretation or determination was arbitrary and capricious. 12.2 Power and Duties of the Committee. (a) The Committee shall have the following powers and duties: (i) To establish and enforce such rules, regulations and procedures as it shall deem necessary or proper for the efficient administration of the Plan; (ii) To interpret the Plan, its interpretation thereof in good faith to be final and conclusive; (iii)To decide all questions concerning the Plan and the eligibility of any Employee to participate in the Plan; (iv) To compute the amount of benefits which shall be payable to any Participant, in accordance with the provisions of the Plan, and to determine the person or persons to whom such benefits shall be paid; and (v) To authorize the payment of benefits. (b) In the exercise of all of its functions, the Committee shall act in an impartial and nondiscriminatory manner. (c) The Committee shall act by a majority of its members and the action of a majority of the Committee without a meeting which is duly recorded or otherwise appropriately documented shall be the action of the Committee. 12.3 Claims Procedure. The Committee shall provide adequate notice in writing to any Participant or to any Beneficiary ("Claimant") whose claim for benefits under the Plan the Committee has denied within 90 days after the claim was received. The Committee's notice to the Claimant shall set forth: (a) The specific reason for the denial; (b) Specific references to pertinent Plan provisions on which the Committee based its denial; (c) A description of any additional material and information that is needed; and (d) That any appeal the Claimant wishes to make of the adverse determination must be in writing to the Committee within sixty (60) days after receipt of the Committee's notice of denial of benefits. The Committee's notice must further advise the Claimant that his or her failure to appeal the action to the Committee in writing within the sixty (60) day period will render the Committee's determination final, binding and conclusive. Such notice shall be forwarded to the Claimant within 90 days of the Committee's receipt of the claim; provided, however, that in special circumstances the Committee may extend the response period for up to an additional 90 days, in which event it shall notify the Claimant in writing of the extension, and shall specify the reason(s) for the extension. If the Claimant should appeal to the Committee, he or she, or his or her duly authorized representative, may submit, in writing, whatever issues and comments he or she or his or her duly authorized representative feels are pertinent. The Claimant, or his or her duly authorized representative, may review pertinent Plan documents. The Committee shall reexamine all facts to the appeal and make a final determination as to whether the denial of benefits is justified under the circumstances. The Committee shall advise the Claimant of its decision within sixty (60) days of the Claimant's written request for review, unless special circumstances (such as a hearing) would make the rendering of a decision within the sixty (60) day limit unfeasible, but in no event shall the Committee render a decision respecting a denial for a claim for benefits later than one hundred twenty (120) days after its receipt of a request for review. The Committee's notice of denial of benefits shall identify the name and address of the Committee to whom the Claimant may forward his or her appeal. 12.4 Records Management. The Committee shall designate in its sole discretion a firm or organization to maintain the required records and reports of the Plan. The Company shall pay all expenses of such firm or organization. SECTION 13 TRUST 13.1 Trust Fund. (a) A Trust Fund has been established into which shall be paid the contributions to the Accounts which shall be held in separate subaccounts. At no time prior to the satisfaction of all liabilities under this Plan with respect to Participants, Former Participants, and beneficiaries of Participants, shall any part of the corpus or income of the Trust Fund be used for or diverted to any purpose other than for their exclusive benefit, except as stated in Section 16. No person shall have any financial interest in or right to the Trust Fund or any part thereof, except as expressly provided for in this Plan and a Participant's interest may not be assigned or alienated by act of the Participant or by operation of law, except as provided in Section 16. (b) Each Participant or Former Participant or other person who shall claim the right to any payment under the Plan shall be entitled to look only to the Trust Fund for such payment. No liability for the payment of benefits under the Plan shall be imposed upon the Company, an Affiliate, the Committee, or the officers, directors, or stockholders of any such entity. 13.2 Administrative Expenses. The reasonable expenses of administering the Plan, as determined by the Administrator, shall be payable from the Trust maintained for the Plan, except to the extent that the Employer, in its discretion, pays the expenses directly. SECTION 14 FIDUCIARY RESPONSIBILITY 14.1 Conduct. Each fiduciary shall discharge his or her duties with respect to the Plan and Trust Agreement solely in the interest of the Participants, Former Participants, and beneficiaries of Participants for the exclusive purpose of providing benefits to Participants, Former Participants, and their beneficiaries, and defraying reasonable expenses of administering the Plan and Trust Fund with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims, and in accordance with this Plan and any other documents or instruments governing the Plan and Trust Fund. A fiduciary who complies with the foregoing standards shall not be liable for any loss, action or omission hereunder. 14.2 Allocation and Delegation of Responsibilities. Plan Fiduciaries may allocate the responsibilities, obligations and duties granted to them for the operation and administration of the Plan and Trust Agreement among themselves. Any Plan Fiduciary may designate other individuals, corporations or other entities, who are not Plan Fiduciaries, to carry out such Plan Fiduciary's responsibilities, obligations and duties with respect to the Plan and Trust Agreement, except to the extent that ERISA prohibits such delegation of authority and discretion. Such allocations and delegations may be revoked or modified at any time and any such allocation, delegation, revocation or modification shall be made by written instruments signed by the Plan Fiduciary, if an individual, or in the case of other entities who are Plan Fiduciaries, in accordance with the procedures governing the functions of such entity, and a written record shall be kept thereof. 14.3 Co-Fiduciary Responsibility. A Plan Fiduciary or any individual, corporation or other entity employed or appointed by a Plan Fiduciary to serve in a fiduciary capacity with respect to the Plan or Trust Fund shall be solely responsible for the responsibilities, obligations or duties allocated or delegated to it, whether under this Plan and Trust Agreement or under the terms and conditions of employment or appointment. No person to whom such responsibilities, obligations or duties have not been allocated or delegated shall be responsible with respect to any action directed, taken or omitted by the Plan Fiduciary or individual, corporation or other entity serving in a fiduciary capacity to whom such responsibilities, obligations or duties have been allocated or delegated unless he or she participates knowingly in, or knowingly undertakes to conceal, an act or omission of such other Plan Fiduciary or individual, corporation or entity, knowing such act or omission is a breach of fiduciary responsibility or, if he or she has knowledge of a breach, he or she fails to make reasonable efforts under the circumstances to remedy the breach. 14.4 Duties of Fiduciaries With Respect to Investments. The Trustee shall have primary responsibility for investment of the assets of the Trust Fund which it administers unless the Company shall either: (a) Allocate control and management of all or any portion of the Trust assets to an Investment Manager, or (b) Notify the Trustee that the Committee shall direct the Trustee in the investment of all or any portion of the Trust Fund. If the Company appoints an Investment Manager pursuant to the foregoing, such Investment Manager shall be an investment adviser registered under the Investment Advisers Act of 1940, a bank as defined in such Act, or an insurance company which is qualified to manage the assets of employee benefit plans under the laws of more than one state. An Investment Manager shall acknowledge in writing its appointment as a Plan Fiduciary hereof, and shall serve until a proper resignation is received by the Company, or until it is removed or replaced by the Company. The Company, the Affiliates, the Committee and the Trustee shall be under no duty to question the direction or lack of direction of any Investment Manager, but shall act and shall be fully protected in acting, in accordance with each such direction. An Investment Manager shall have sole investment responsibility for that portion of the Trust assets which it has been appointed to manage, and no other Plan Fiduciary or any Trustee shall have any responsibility for the investment of any such assets, the management of which has been delegated to an Investment Manager, or liability for any loss to or diminution in value of such Trust assets resulting from any action directed, taken or omitted by an Investment Manager. If the Company notifies the Trustee that the Committee will direct the Trustee in the investment of all or any portion of the Trust Fund, the Trustee shall be subject to proper directions of the Committee, which are made in accordance with the terms of the Plan and which are not contrary to the provisions of Title I of ERISA. The Trustee shall be fully protected in acting in accordance with each such direction. No other Plan Fiduciary shall have any responsibility for the investment of any asset of the Trust Fund, the direction of which is given to the Committee, or liability for any loss to or diminution in value of such Trust Fund resulting from any action taken or omitted by the Trustee in accordance with such direction. SECTION 15 AMENDMENT, TERMINATION, AND MERGER 15.1 Right to Amend or Terminate the Plan. It is the intention of the Company to continue this Plan indefinitely and to make such contributions as may be required hereunder regularly each year. Nevertheless, subject to the provisions hereinafter set forth, the Board of Directors of the Company reserves the right at any time or from time to time to amend, alter or discontinue the Plan in whole or in part. The Retirement Committee of the Company shall have the right to alter or amend the Plan if such action is necessary or desirable and is (1) required by law, agreed to through collective bargaining or is appropriate to maintain the tax-qualified status of the Plan, or (2) is estimated not to result in a cost increase to the Company in excess of five (5) percent, provided, however, that no amendment or alterations shall be made which: (a) shall adversely affect any right or obligations of any Participant with respect to any contributions made hereto; (b) permits any funds paid to the Trustee to revert to the Company; or (c) provides for the use of the assets of the Plan, or any part thereof other than for the exclusive benefit of Participants, former Participants or their Beneficiaries or paying the reasonable expenses of administering the Plan. (d) will deprive any Participant, Former Participant or his or her beneficiary, without his or her consent, of any benefit theretofore accrued to him or her under the Plan. (e) will, except as provided in Section 16, violate Section 15.1. Any amendment of the Plan may be made, retroactively if necessary, which the Company deems necessary or appropriate to conform the Plan to, or to satisfy the conditions of, ERISA, the Code, or any other law, governmental regulations or rulings. 15.2 Termination of the Plan. In the event of the complete termination of the Plan or upon complete discontinuance of contributions under the Plan, the interest of all Participants in their Account Balances under the Plan to the date of termination of the Plan, shall be fully vested and nonforfeitable. In the event of the partial termination of the Plan, the affected interests of the affected Participants shall be fully vested and nonforfeitable. 15.3 Merger, Consolidation or Transfer. In the case of a merger or consolidation of the Plan with, or transfer of assets or liabilities of the Trust Fund to, any other plan or trust, the terms of the merger, consolidation or transfer shall be such that the benefits to which a Participant is entitled immediately after the merger, consolidation or transfer shall be equal to or greater than the benefit to which the Participant is entitled immediately prior to the merger, consolidation or transfer. For purposes of this Section, the benefit to which a Participant is entitled shall be determined on the assumption that the Plan had terminated on the day such determination is made. SECTION 16 NONALIENATION OF BENEFITS EXCEPT FOR QUALIFIED DOMESTIC RELATIONS ORDERS Benefits provided under the Plan may not be assigned or alienated or otherwise subject in any manner to anticipation, sale, transfer, pledge, garnishment, encumbrance or charge except in the case of a Qualified Domestic Relations Order as defined in this Section 16. The Plan shall establish procedures to determine that the requirements of Section 414(p) of the Code are met with respect to Qualified Domestic Relations Orders. For purposes of this Section 16, a Qualified Domestic Relations Order must meet the following requirements of (a) and (b) set forth below. (a) A Qualified Domestic Relations Order consists of any judgment, decree, or order (including approval of a property settlement agreement) which relates to the provision of child support, alimony payments, or marital property rights of a spouse, child, or other dependent and is made pursuant to a State domestic relations law (including a community property law) and which creates or recognizes the existence of an alternate payee's right to, or assigns to an alternate payee the right to, receive all or a portion of the benefits payable with respect to a Participant under the Plan. (b) A Qualified Domestic Relations Order must also meet the following conditions: (i) Such Order must clearly specify the name and the last known mailing address (if any) of the Participant and the name and mailing address of each alternate payee covered by the Order. (ii) Such Order must clearly specify the amount or percentage of the Participant's benefits to be paid by the Plan to each such alternative payee, or the manner in which such amount or percentage is to be determined. (iii)Such Order must clearly specify the number of payments or period to which such Order applies and the name of the Plan. (iv) Such Order shall not require the Plan to provide any type or form of benefit, or any option, not otherwise provided under the Plan. (v) Such Order shall not require the Plan to provide increased benefits (determined on the basis of actuarial value). (vi) Such Order shall not require the payment of benefits to an alternate payee which are required to be paid to another alternate payee under another Order previously determined to be a Qualified Domestic Relations Order. This Section 16 shall be construed in accordance with Section 414(p) of the Code and regulations issued thereunder. After an Order has been found to meet the conditions for a Qualified Domestic Relations Order, the Administrator of the Plan may make payments to the alternate payee who has been assigned a right to benefits payable with respect to a Participant under the Plan as soon as administratively feasible in accordance with the terms of the Qualified Domestic Relations Order. SECTION 17 MISCELLANEOUS PROVISIONS 17.1 Plan Not a Contract of Employment. Nothing in the Plan shall give any Employee the right to be retained in the employ of the Company or any Affiliate; all Employees shall remain subject to discharge, discipline or lay-off to the same extent as if the Plan had not been put into effect. 17.2 Gender and Number. Wherever appropriate, the masculine pronoun as used herein shall mean the feminine, and the singular, the plural. 17.3 Governing Law. The Plan shall be governed in accordance with the laws of the State of New York except to the extent superseded by ERISA. 17.4 Records and Reports. The Committee or its designee shall exercise appropriate authority to comply with ERISA relating to records and reports to Participants and appropriate governmental agencies, including annual notification to Participants of their Account balances, and annual registration of the Plan. 17.5 Wyeth Common Stock. The Trustee shall vote Wyeth Common Stock represented by the units it holds in the Wyeth Common Stock Fund in accordance with the instructions received from the Participant and if no instructions are received such stock shall not be voted. 17.6 Communications. For all purposes under the Plan, any reference to the written form shall also include any telephonic or electronic form as approved by the Committee. SECTION 18 TREATMENT OF RETURNING VETERANS 18.1 Applicability and Effective Date. Notwithstanding any other provisions of the Plan, the rights of any Returning Veteran who resumes employment with the Company on or after December 12, 1994 shall be modified as set forth in this Section. 18.2 Definitions. For purposes of this Section 18, the terms defined herein shall have the following meanings: (a) "Qualified Military Service" means any service (either voluntary or involuntary) by an individual in the Uniformed Services if such individual is entitled to reemployment rights with the Company with respect to such service. (b) "Returning Veteran" means a former Employee who, on or after December 12, 1994, returns from Qualified Military Service to employment with the Company within the period of time during which his or her reemployment rights are protected by law. (c) "Uniformed Services" means the Armed Forces, the Army National Guard and Air National Guard (when engaged in active duty for training, inactive duty training, or full-time National Guard duty), the commissioned corps of the Public Health Service, and any other category of persons designated by the President of the Untied States in time of war or emergency. 18.3 Eligibility to Participate. For purposes of Section 3 of the Plan: (a) A Returning Veteran who was an Employee eligible to participate in the Plan immediately prior to his or her Qualified Military Service shall be deemed to have remained an eligible Employee throughout his or her Qualified Military Service. (b) A Returning Veteran who would have become a Participant in the Plan during the period of his or her Qualified Military Service but for the resulting absence from employment, shall be deemed to have become a Participant as of the date when he or she would have become a Participant if he or she had not entered into Qualified Military Service. 18.4 No Break in Service. A Returning Veteran shall be deemed not to have incurred any break in service on account of his or her Qualified Military Service. 18.5 Vesting Credit. A Returning Veteran's Years of Service for vesting purposes shall be determined under Section 4.4, except that with respect to any period of Qualified Military Service, he or she shall be credited with the Hours of Service with which he or she would have been credited had he or she remained an Employee during such period. 18.6 Restoration of Salary Deferral Contributions and After-Tax Contributions. (a) Each Returning Veteran who, during his or her period of Qualified Military Service would have been eligible to make Salary Deferral Contributions and After-Tax Contributions, shall be permitted to contribute an amount equal to the amount of Salary Deferral Contributions and After-Tax Contributions that the Employee could have made during such absence from employment. Such "make-up" contributions shall be made during the period that begins with the Employee's reemployment by the Employer and ends with: (i) the expiration of a period of five years, or (ii) if shorter, a period equal to three times the period of Qualified Military Service. (b) Any make-up contributions described in Subsection (a) hereof shall be made in addition to those Salary Deferral Contributions After-Tax Contributions that the Participant may elect to make after his or her reemployment pursuant to Section 4.1. 18.7 Determination of Covered Compensation. For purposes of determining the amount of any make-up contributions under this Section 18, and for applying the limits of Section 10, a Participant's Covered Compensation during any period of Qualified Military Service shall be deemed to equal either: (a) the Covered Compensation the Participant would have received but for such Qualified Military Service, based on the rate of pay he or she would have received from the Company; or (b) if the amount described in (a) above is not reasonably certain, the Participant's average Covered Compensation from a participating Company during the 12-month period immediately preceding the Qualified Military Service (or, if shorter, the period of employment immediately preceding the Qualified Military Service). Such amount shall be adjusted as necessary to reflect the length of the Participant's Qualified Military Service. 18.8 Restoration of Matching Contributions. If a Returning Veteran contributes "make-up" Salary Deferral Contributions After-Tax Contributions pursuant to Section 18.6, the Company shall contribute on his or her behalf the related Matching Contributions that it would have made under Sections 4.5 and 4.6 if such Salary Deferral Contributions After-Tax Contributions had been made in the year to which they relate. Such Matching Contributions shall not include the earnings that would have accrued on such amount or any forfeitures that would have been allocated to the Returning Veteran's Account during the period of Qualified Military Service. 18.9 Application of Certain Limitations. (a) For purposes of applying the limitations of Sections 4.9 and 4.10, any make-up contributions described in Section 18.6, and any related Matching Contributions described in Section 18.8, shall be treated as contributions for the Plan Year to which they relate, rather than the Plan Year in which they were actually made. (b) For purposes of applying the limitations of Section 4.2, any such make-up contributions shall be treated as contributions for the calendar year to which they relate, rather than the calendar year in which they are actually made. (c) For purposes of applying the limitations of applying the limitations of Sections 4.9 and 4.10 and Section 11, any make-up contributions described in Section 18.6 and related Matching Contributions described in Section 18.8 shall be disregarded, both for the Plan Year to which the contributions relate, and for the Plan Year in which they are actually made. 18.10 Suspension of Loan Repayments. Notwithstanding any provisions of Article 9 to the contrary, if a Participant receives a loan from the Plan and enters into Qualified Military Service during the term of the loan, a decrease in Compensation or failure to make required loan repayments during such Qualified Military Service shall not result in a default under Section 9.1(l). 18.11 Administrative Rules and Procedures. The Committee or the Administrator shall establish such rules and procedures as it deems necessary or desirable to implement the provisions of this Article, provided that they are not in violation of the Uniformed Services Employment and Reemployment Rights Act of 1994, any regulations thereunder, or any other applicable law. SCHEDULE A Investment Funds 1. Company Stock Fund 2. MSIFT Value Fund 3. Interest Income Fund 4. Fidelity U.S. Equity Index Portfolio 5. Fidelity Megellan Fund 6. Fidelity Low Price Stock Fund 7. Fidelity Balanced Fund 8. Fidelity International Growth and Income Fund AMERICAN HOME PRODUCTS CORPORATION SAVINGS PLAN (the "Plan") APPENDIX I VESTING FOR PARTICIPANTS WHO ARE TRANSFERRED TO BAUSCH & LOMB INCORPORATED American Home Products Corporation ("AHPC") and Bausch & Lomb Incorporated ("B&L") entered into an agreement (the "Purchase Agreement"), whereby B&L purchased, as of December 31, 1997 (the "Closing Date"), substantially all of the issued and outstanding shares and certain assets of Storz Instrument Company and Storz Ophthalmics, Inc. ("Storz"), wholly-owned subsidiaries of AHPC. Pursuant to Section 9.4.3 of the Purchase Agreement, the Plan is amended to provide that, notwithstanding the provisions of Section 4.4 of the Plan, a Plan Participant, as of the Closing Date, whose employment is transferred to B&L, as of the Closing Date, shall be fully vested in his or her benefit attributable to his or her Matching Account accrued as of the Closing Date, regardless of whether he or she has less than five years of Continuous Service. APPENDIX II- ROLLOVERS OF DISTRIBUTIONS TO THE PLAN FROM THE SOLVAY AMERICA COMPANIES' SAVINGS PLAN American Home Products Corporation ("AHPC") entered into a purchase agreement with Solvay America ("Purchase Agreement") whereby AHPC purchased certain assets of the Solvay Animal Health Division (the "Business") and certain employees of the Business became employees of AHPC pursuant to the Purchase Agreement (the "Transferred Employees"). As part of the Purchase Agreement, the Plan is hereby amended to permit Transferred Employees to roll over their account balances in the Solvay America Companies' Savings Plan (including loans) into the Plan. However, such rollovers shall only be permitted during a period commencing on the closing date for the acquisition of Solvay Animal Health Division (the "Closing Date") and ending ninety (90) calendar days thereafter. APPENDIX III - GENETICS INSTITUTE ACQUISITION Effective July 1, 1997, the Genetics Institute (401(k)) Savings and Investment Plan ("Genetics Institute Savings Plan") was merged into the American Home Products Corporation Savings Plan ("AHPC Savings Plan"). The following special provisions will apply under the AHPC Plan to Participants of the Genetics Institute Savings Plan. 1. Transfer of Assets The account balances of Participants in the Genetics Institute Savings Plan shall be transferred to the AHPC Savings Plan as of July 1, 1997 into investment funds under the AHPC Savings Plan which most closely correspond to the investment funds under the Genetics Institute Savings Plan in which such account balances are invested on that date. After the transfer, Participants in the Genetics Institute Savings Plan may thereafter elect, in accordance with the provisions of Section 6.5 of the AHPC Plan, to transfer these amounts into any other investment funds offered in the AHPC Savings Plan. 2. Participation Participants in the Genetics Institute Savings Plan as of June 30, 1997, who are actively employed with Genetics Institute shall become Participants in the AHPC Savings Plan as of such date. 3. Vesting Participants of the Genetics Institute Savings Plan who are actively employed by Genetics Institute or any of its affiliates on June 30, 1997, shall be 100% vested in all amounts in their accounts in the Genetics Institute Savings Plan as of such date (including any Company Matching Contributions and earnings on those contributions) regardless of the amount of the Participant's service. Participants of the Genetics Institute Savings Plan on June 30, 1997 who were not actively employed with Genetics Institute or any of its affiliates as of that date shall be vested in these accounts in accordance with the provisions of the Genetics Institute Savings Plan. With respect to contributions made to the AHPC Plan after June 30, 1997, former Participants of the Genetics Institute Savings Plan who had three or more years of service with Genetics Institute as of that date will be vested under either the AHPC Savings Plan vesting schedule or the Genetics Institute Savings Plan, based upon whichever provides the greater vested amount. Participants of the Genetics Institute Savings Plan on July 1, 1997 who had less than 3 years of service will be vested to the same extent as they were vested under the Genetics Institute Savings Plan on such date and future Company contributions shall be vested in accordance with the vesting provisions of the Plan. 4. Distributions Upon Employment Termination Amounts that have been contributed to the Genetics Institute Savings Plan and which have been transferred to the AHPC Savings Plan, as well as amounts contributed after July 1, 1997, shall be distributed in accordance with the provisions of Section 7 of the AHPC Savings Plan. 5. In-Service Withdrawals As of July 1, 1997, the provisions of the AHPC Savings Plan regarding in service withdrawals, as set forth in Section 8 of the AHPC Savings Plan, shall apply to the amounts transferred to the AHPC Savings Plan from the Genetics Institute Savings Plan. 6. Loans After July 1, 1997, the provisions of Section 9 of the AHPC Savings Plan shall apply with respect to loans to Participants whether or not the loan is made from amounts contributed to the Genetics Institute Savings Plan or the AHPC Savings Plan. AMERICAN HOME PRODUCTS CORPORATION SAVINGS PLAN (the "Plan") APPENDIX IV VESTING FOR PARTICIPANTS WHO ARE TRANSFERRED TO TYCO INTERNATIONAL (US), INC. American Home Products Corporation ("AHPC"), American Cyanamid Company ("Cyanamid"), and AHPC Subsidiary Holding Corporation ("AHPC Sub") entered into an agreement (the "Purchase Agreement") with Tyco International (US), Inc. ("Tyco"), dated as of October 20, 1997, whereby Tyco purchased, as of February 27, 1998 (the "Closing Date"), substantially all of the issued and outstanding shares and certain of the assets of Sherwood Medical Company, a wholly-owned subsidiary of AHPC. Pursuant to Section 9.4(c) of the Purchase Agreement, the Plan is amended to provide that, notwithstanding the provisions of Section 4.4 of the Plan, a Plan Participant, as of the Closing Date, whose employment is transferred to Tyco as of the Closing Date, shall be fully vested in his or her benefit attributable to his or her Matching Account accrued as of the Closing Date, regardless of whether he or she has less than five years of Continuous Service. AMERICAN HOME PRODUCTS CORPORATION SAVINGS PLAN (the "Plan") APPENDIX V - APOLLON ACQUISITION Employees of Apollon, Inc. ("Apollon"), on April 14, 1998, who are employed by American Home Products Corporation or one of its subsidiaries as of April 15, 1998 ("Transferred Employees") will become eligible for participation in the Plan, effective as of April 15, 1998, after satisfying the requirements of Section 3.1 of the Plan. For purposes of the eligibility requirements under Section 3.1 of the Plan and for purposes of the vesting requirements under Section 4.4 of the Plan, service of Transferred Employees under the Plan shall include their service with Apollon prior to April 15, 1998, provided however, that such service shall be credited in accordance with the provisions and rules of the Plan for the crediting of such service. AMERICAN HOME PRODUCTS CORPORATION SAVINGS PLAN (the "Plan") APPENDIX VI VESTING FOR PARTICIPANTS WHO ARE TRANSFERRED TO QIC HOLDING CORPORATION American Home Products Corporation ("AHPC") and A.H. Robins Company, Incorporated entered into an agreement (the "Purchase Agreement") with QIC Holding Corporation ("QIC"), dated as of May 28, 1998, whereby QIC purchased, as of June 5, 1998 (the "Closing Date"), substantially all of the issued and outstanding shares and certain of the assets of Quinton Instrument Company, a wholly-owned subsidiary of AHPC. Pursuant to Section 9.4(c) of the Purchase Agreement, the Plan is amended to provide that, notwithstanding the provisions of Section 4.4 of the Plan, a Plan Participant, as of the Closing Date, whose employment is transferred to QIC as of the Closing Date, shall be fully vested in his or her benefit attributable to his or her Matching Account accrued as of the Closing Date, regardless of whether he or she has less than five years of Continuous Service. AMERICAN HOME PRODUCTS CORPORATION SAVINGS PLAN (the "PLAN") APPENDIX VII - SOLGAR ACQUISITION Employees of Solgar Vitamins and Herb Company and Solgar Laboratories, Inc. ("Solgar Company") Effective July 30, 1998, the following special provisions shall apply under the American Home Products Corporation Savings Plan - United States (the "Plan"), notwithstanding any other provision of the Plan to the contrary, to employees of Solgar Vitamins and Herb Company and Solgar Laboratories, Inc. (the "Solgar Company"), who became employees of the American Home Products Corporation ("AHPC") on July 30, 1998, as a result of the purchase of assets of the Solgar Company by AHPC (the "Transferred Employees"). Transferred Employees will become eligible for participation in the Plan, effective as of July 30, 1998, after satisfying the requirements of Section 3.1 of the Plan. For purposes of the eligibility requirements under Section 3.1 of the Plan and the vesting requirements under Section 4.4 of the Plan, service of Transferred Employees under the Plan shall include their service with the Solgar Company prior to July 30, 1998, provided however, that such service shall be credited in accordance with the provisions and rules of the Plan for the crediting of such service. AMERICAN HOME PRODUCTS CORPORATION SAVINGS PLAN (the "Savings Plan") APPENDIX VIII VESTING FOR PARTICIPANTS TRANSFERRED TO SINALUNGA HOLDING B.V. American Home Products Corporation - Sinalunga Holding B.V. Agreement to Sell the Eurand Companies American Home Products Corporation ("AHPC") entered into an agreement (the "Purchase Agreement") with Sinalunga Holding B.V. ("Sinalunga"), a Dutch corporation, dated March 19, 1999, to purchase substantially all of the issued and outstanding shares of the Eurand Companies, a wholly-owned subsidiary of AHPC (the "Purchase Agreement"), as of April 1, 1999 (the "Closing Date"). Pursuant to Section 7.2(c) of the Purchase Agreement, the Savings Plan is hereby amended to provide that, notwithstanding the provisions of Section 4.4 of the Savings Plan, a Plan Participant as of the Closing Date, who becomes an employee of the Eurand Companies, Sinalunga or their affiliates as of the Closing Date, shall be fully vested in the portion of his or her Account attributable to Company Matching Contributions as of the Closing Date, regardless of whether he or she has less than five years of Continuous Service. AMERICAN HOME PRODUCTS CORPORATION SAVINGS PLAN (the "Plan") APPENDIX IX - GLAXO FACILITY PURCHASE American Home Products Corporation (the "Company") acquired substantially all of the assets of a facility located at 40 Technology Way, West Greenwich, Rhode Island, pursuant to a purchase agreement with Glaxo Wellcome Biopharmaceuticals, Inc., a Delaware corporation and wholly-owned subsidiary of Glaxo Wellcome, Inc. ("Glaxo"), dated August 23, 1999. Employees of Glaxo, on September 24, 1999 (the "Closing Date"), who are offered and accept employment with the Company or one of its subsidiaries as of the Closing Date in the United States (the "Glaxo Employees") will become eligible for participation in the Plan, effective as of the Closing Date, after satisfying the eligibility requirements of Section 3.1 of the Plan. For purposes of the eligibility requirements under Section 3.1 of the Plan and for purposes of the vesting requirements under Section 4.4 of the Plan, service of Glaxo Employees under the Plan shall include their service with Glaxo prior to the Closing Date, provided however, that such service shall be credited pursuant to the provisions and rules of the Plan for the crediting of service. AMERICAN HOME PRODUCTS CORPORATION SAVINGS PLAN - UNITED STATES (the "Savings Plan") VESTING FOR PARTICIPANTS AFFECTED BY THE SALE TO BASF AKTIENGESELLSCHAFT APPENDIX X American Home Products Corporation (the "Company") and American Cyanamid Company ("Cyanamid") a wholly-owned subsidiary of the Company, entered into an agreement with BASF Aktiengesellschaft, a corporation organized under the laws of Germany ("BASF"), dated as of March 20, 2000 (the "Purchase Agreement"), whereby the Company sold to BASF the crop protection business conducted by Cyanamid. Pursuant to Section 9.4(c) of the Purchase Agreement, the Savings Plan is hereby amended to provide that, notwithstanding the provisions of Section 4.4 of the Savings Plan, all Plan Participants who are "U.S. Employees" as defined in the Purchase Agreement (or whose employment is otherwise transferred to BASF in connection with the transactions contemplated by the Purchase Agreement), shall be fully vested in his or her benefit attributable to his or her Matching Account as of June 30, 2000 (the "Closing Date"), regardless of whether he or she has less than five years of Continuous Service. Notwithstanding the foregoing, Participants who are on disability, leave of absence, or lay off with recall rights on the Closing Date shall become fully vested in the benefits attributable to his or her Matching Account as of the time he or she returns to work and is transferred to employment with BASF, provided such return to employment occurs within 180 days after the Closing Date. Assets of Participants in the Savings Plan who become employed by BASF as of the Closing Date shall be transferred to the defined contribution plan of BASF as soon as practicable after the Closing Date. AMERICAN HOME PRODUCTS CORPORATION SAVINGS PLAN - UNITED STATES VESTING FOR PARTICIPANTS WHO ARE TRANSFERRED TO R.P. SCHERER, INC. APPENDIX XI American Home Products Corporation (the "Company") entered into an asset purchase agreement, dated December 22, 2000 (the "Purchase Agreement"), with R.P. Scherer Corporation ("Scherer") pursuant to which the Company agreed to sell and Scherer agreed to buy certain assets relating to the Company's vegetable-based capsule business. Pursuant to the terms of the Purchase Agreement, the American Home Products Corporation Savings Plan - United States (the "Plan") is hereby amended to provide that, notwithstanding the provisions of Section 4.4 of the Plan, a Participant in the Plan whose employment is transferred to Scherer in connection with the foregoing transaction shall be fully vested in his or her benefit attributable to his or her matching account accrued as of the date of the transfer of employment, regardless of whether he or she has less than five years of Continuous Service (as defined in the Savings Plan) on that date. AMERICAN HOME PRODUCTS SAVINGS PLAN - UNITED STATES EGTRRA AMENDMENTS APPENDIX XII SECTION 1. LIMITATIONS ON CONTRIBUTIONS 1. Effective date. This Section shall be effective for Limitation Years beginning after December 31, 2001. 2. Maximum Annual Addition. Except to the extent permitted under Section 7 of this amendment and Section 414(v) of the Code, if applicable, the Annual Addition that may be contributed or allocated to a Participant's Account under Section 10 of the Plan for any Limitation Year shall not exceed the lesser of: (a) $40,000, as adjusted for increases in the cost-of-living under Section 415(d) of the Code, or (b) 100 percent of the Participant's Compensation, within the meaning of Section 415(c)(3) of the Code, for the Limitation Year. The Compensation limit referred to in (b) shall not apply to any contribution for medical benefits after separation from service (within the meaning of Section 401(h) or Section 419A(f)(2) of the Code) which is otherwise treated as an Annual Addition. SECTION 2. INCREASE IN COMPENSATION LIMIT The annual Compensation of each Participant taken into account in determining allocations for any Plan Year beginning after December 31, 2001, shall not exceed $200,000, as adjusted for cost-of-living increases in accordance with Section 401(a)(17)(B) of the Code. Annual Compensation means Compensation during the Plan Year or such other consecutive 12-month period over which Compensation is otherwise determined under the Plan (the "determination period"). The cost-of-living adjustment in effect for a calendar year applies to annual Compensation for the determination period that begins with or within such calendar year. SECTION 3. MODIFICATION OF TOP-HEAVY RULES 1. Effective date. This Section shall apply for purposes of determining whether the Plan is a top-heavy Plan under Section 416(g) of the Code for Plan Years beginning after December 31, 2001, and whether the Plan satisfies the minimum benefits requirements of Section 416(c) of the Code for such years. This Section amends Section 11 of the Plan. 2. Determination of top-heavy status. 2.1 Key Employee. Key Employee means any Employee or former Employee (including any deceased employee) who at any time during the Plan Year that includes the Determination Date was an officer of the Employer having annual compensation greater than $130,000 (as adjusted under Section 416(i)(1) of the Code for Plan Years beginning after December 31, 2002), a 5-percent owner of the employer, or a 1-percent owner of the Employer having annual compensation of more than $150,000. For this purpose, annual compensation means compensation within the meaning of Section 415(c)(3) of the Code. The determination of who is a Key Employee will be made in accordance with Section 416(i)(1) of the Code and the applicable regulations and other guidance of general applicability issued thereunder. 2.2 Determination of present values and amounts. This Section 2.2 shall apply for purposes of determining the amounts of account balances of Employees as of the Determination Date. 2.2.1Distributions during year ending on the Determination Date. The amounts of account balances of an Employee as of the Determination Date shall be increased by the distributions made with respect to the Employee under the Plan and any plan aggregated with the Plan under Section 416(g)(2) of the Code during the 1-year period ending on the Determination Date. The preceding sentence shall also apply to distributions under a terminated plan which, had it not been terminated, would have been aggregated with the Plan under Section 416(g)(2)(A)(i) of the Code. In the case of a distribution made for a reason other than separation from service, death, or disability, this provision shall be applied by substituting "5-year period" for "1-year period." 2.2.2Employees not performing services during year ending on the Determination Date. The Accounts of any individual who has not performed services for the Employer during the 1-year period ending on the Determination Date shall not be taken into account. 3. Minimum benefits. Matching Contributions. Matching Contributions shall be taken into account for purposes of satisfying the minimum contribution requirements of Section 416(c)(2) of the Code and the Plan. The preceding sentence shall apply with respect to Matching Contributions under the Plan. Matching Contributions that are used to satisfy the minimum contribution requirements shall be treated as Matching Contributions for purposes of the actual contribution percentage test and other requirements of Section 401(m) of the Code. SECTION 4. DIRECT ROLLOVERS OF PLAN DISTRIBUTIONS 1. Effective date. This Section shall apply to distributions made after December 31, 2001. 2. Modification of definition of Eligible Rollover Distribution to exclude hardship withdrawals. For purposes of the direct rollover provisions in Section 7.14 of the Plan, any amount that is distributed on account of hardship shall not be an Eligible Rollover Distribution and the Distributee may not elect to have any portion of such a distribution paid directly to an Eligible Retirement Plan. 3. Modification of definition of Eligible Rollover Distribution to include after-tax contributions. For purposes of the direct rollover provisions in Section 7.14 of the Plan, a portion of a distribution shall not fail to be an Eligible Rollover Distribution merely because the portion consists of after-tax contributions which are not includible in gross income. However, such portion may be transferred only to an individual retirement account or annuity described in Section 408(a) or (b) of the Code, or to a qualified defined contribution plan described in Section 401(a) or 403(a) of the Code that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution which is includible in gross income and the portion of such distribution which is not so includible. 4. Modification of definition of Eligible Retirement Plan. For purposes of the direct rollover provisions in Section 7.13 of the Plan, an Eligible Retirement Plan shall also mean an annuity contract described in section 403(b) of the Code and an eligible plan under section 457(b) of the Code which is maintained by a state, political subdivision of a state and which agrees to separately account for amounts transferred into such plan from this plan. The definition of Eligible Retirement Plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relation order, as defined in section 414(p) of the Code. The Plan will accept Participant Rollover Contributions and/or direct rollovers of Eligible Rollover Distributions made after December 31, 2001, from a qualified Plan described in Section 401(a) or 403(a) of the Code. SECTION 5. REPEAL OF MULTIPLE USE TEST The multiple use test described in Treasury Regulation Section 1.401(m)-2 and Section 4.10 of the Plan shall not apply for Plan Years beginning after December 31, 2001. SECTION 6. ELECTIVE DEFERRALS - CONTRIBUTION LIMITATION No Participant shall be permitted to have Salary Deferral Contributions made under this Plan, or any other qualified plan maintained by the Employer during any taxable year, in excess of the dollar limitation contained in Section 402(g) of the Code in effect for such taxable year, except to the extent permitted under Section 7 of this amendment and Section 414(v) of the Code, if applicable. SECTION 7. CATCH-UP CONTRIBUTIONS All Employees who are eligible to make Salary Deferral Contributions under this Plan and who have attained age 50 before the close of the Plan Year shall be eligible to make catch-up contributions in accordance with, and subject to the limitations of, Section 414(v) of the Code. Such catch-up contributions shall not be taken into account for purposes of the provisions of the Plan implementing the required limitations of Sections 402(g) and 415 of the Code. The Plan shall not be treated as failing to satisfy the provisions of the Plan implementing the requirements of Sections 401(k)(3), 401(k)(11), 401(k)(12), 410(b), or 416 of the Code, as applicable, by reason of the making of such catch-up contributions. This Section 7 shall apply to contributions made after December 31, 2001. SECTION 8. SUSPENSION PERIOD FOLLOWING HARDSHIP DISTRIBUTION A Participant who receives a distribution of Salary Deferral Contributions after December 31, 2001, on account of hardship shall be prohibited from making Salary Deferral Contributions and After-Tax Contributions under this Plan and all other plans of the Employer for 6 months after receipt of the distribution. SECTION 9. DISTRIBUTION UPON SEVERANCE FROM EMPLOYMENT 1. Effective date. This Section 9 shall apply for distributions and severances from employment occurring after the dates set forth below. 2. New distributable event. A Participant's Salary Deferral Contributions, Matching Contributions, and earnings attributable to these contributions shall be distributed on account of the Participant's severance from employment. However, such a distribution shall be subject to other provisions of the Plan regarding distributions, other than provisions that require a separation from service before such amounts may be distributed. This Section shall apply for distributions after severances from employment occurring after December 31, 2001. AMERICAN HOME PRODUCTS CORPORATION SAVINGS PLAN (the "Plan") VESTING FOR PARTICIPANTS WHO ARE TRANSFERRED TO IMMUNEX CORPORATION APPENDIX XIII American Home Products Corporation ("AHPC"), a Delaware corporation, and AHPC Subsidiary Holding Corporation, a Delaware corporation, (together with AHPC the "Sellers") entered into a purchase agreement with Immunex Corporation ("Immunex"), a Washington corporation, (the "Buyer"), dated November 6, 2001 (the "Purchase Agreement"), for the purchase as of January 3, 2002 (the "Closing Date") by Immunex of one thousand (1,000) shares of Greenwich Holdings Inc. ("Greenwich"), a Delaware corporation, which constitutes all of the issued and outstanding shares of capital stock of Greenwich. Pursuant to Section 8.1(b) of the Purchase Agreement, Buyers agreed to amend the Plan to provide that Participants in the Plan who have their employment transferred to Immunex on the Closing Date, the "Transferred Employees", as defined in the Purchase Agreement), shall be fully vested in their benefit attributable to their Matching Account as of the Closing Date, regardless of the number of years of Continuous Service of the Transferred Employees on that date. WYETH SAVINGS PLAN - UNITED STATES (the "Savings Plan") VESTING FOR PARTICIPANTS WHO ARE TRANSFERRED TO BAXTER HEALTHCARE CORPORATION APPENDIX XIV Wyeth, a Delaware corporation and Wyeth Pharmaceuticals Inc., a New York corporation and wholly-owned subsidiary of Wyeth (together with Wyeth, the "Sellers"), entered into an agreement with Baxter Healthcare Corporation, a Delaware corporation ("Buyer"), dated as of June 8, 2002 (the "Purchase Agreement"), whereby Sellers agreed to sell certain assets to Buyer and Buyer agreed to assume certain liabilities in each case related primarily to the "Business" (as defined in the Purchase Agreement). Pursuant to Section 9.2(c) of the Purchase Agreement, the Savings Plan is hereby amended to provide that, notwithstanding the provisions of Section 4.4 of the Savings Plan, each Savings Plan Participant who is a "Transferring Employee", as defined in the Purchase Agreement, shall be fully vested in his or her Matching Account as of the Closing Date (as defined in the Purchase Agreement), regardless of whether he or she has less than five years of Continuous Service (as defined in the Savings Plan) as of the Closing Date. Notwithstanding the foregoing, a Participant in the Savings Plan who is not actively at work on the Closing Date due to short-term disability or other authorized leave of absence shall become fully vested in his or her Matching Account as of the date he or she returns to employment and is transferred to employment with Buyer, provided such return to employment occurs within 180 days after the Closing Date. EX-10.2 5 serp.txt SERP THE WYETH SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN As Amended to January 15, 2003 I. PURPOSE The purpose of the Supplemental Executive Retirement Plan of Wyeth ("Supplemental Plan") is to provide a means of supplementing the benefits of the non-union employees who participate in the Wyeth Retirement Plan - United States and/or the Wyeth Retirement Plan - Canada (individually and collectively "Wyeth Plan") and who also participate in the Performance Incentive Award Plan ("PIA Plan"). II. ADMINISTRATION The Retirement Committee of the Corporation shall administer the Supplemental Plan and shall have the full authority to determine all questions arising in connection with the Plan, including its interpretation. The Committee's decisions shall be conclusive and binding on all persons. The Committee may adopt procedural rules and may employ and rely on legal counsel, actuaries, accountants and any other agents as may be deemed to be advisable to assist in the administration of the Supplemental Plan. III. PARTICIPATION Any participant in the PIA Plan shall be eligible to receive benefits from the Supplemental Plan whenever his or her benefits from the Supplemental Plan formula exceed the amount of benefits provided under the Wyeth Plan. The benefits of this Supplemental Plan are available only to employees actively at work on or after October 28, 1982. IV. SUPPLEMENTAL PLAN FORMULA A. The benefit payable under the Supplemental Plan to an employee who did not reach his Normal Retirement Date prior to October 1, 1981, shall be equal to the difference between: (i) the annual benefit which would be calculated, without respect to any option election, calculated to be payable as of the qualification date, under the "Final Average Annual Pension Earnings" formula (Formula E) of the Wyeth Plan - United States (or Formula C of the Wyeth Plan - Canada) assuming the "Rate of Annual Earnings" as defined in each Wyeth Plan included the annual PIA Plan award granted in each Plan Year to which such "Rate of Annual Earnings" applies, and (ii) the annual benefit actually payable, under each Wyeth Plan, as of the qualification date, without respect to any option election. For the purpose of the above "qualification date" means the earliest of (i) the date of termination of employment, (ii) the retirement date and (iii) the Normal Retirement Date. B. The annual benefit payable under the Supplemental Plan, to an employee who reached his Normal Retirement Date prior to October 1, 1981, shall be equal to the difference between: (i) the annual benefit which would be calculated, without respect to any option election, to be payable as of the Normal Retirement Date, under the 2%/2.67% Career Average Pension Earnings formula (Formula B) of the Wyeth Plan, assuming the "Rate of Annual Earnings", as defined in the Wyeth Plan included the annual PIA Plan award granted in each Plan Year to which such "Rate of Annual Earning" applies, and (ii) the annual benefit actually payable under the Wyeth Plan, as of the Normal Retirement Date, without respect to any option election. The Supplemental Plan benefit shall be payable in accordance with the same terms and conditions which are applicable to the participant's benefit under the Wyeth Plan, including vesting and whatever optional benefits he or she may elect or have elected, in the same manner and to the same extent as provided in such Wyeth Plan. C. Effective as of April 1, 2001, an election by a Participant to receive a distribution of his or her benefit under the Plan in the form of a lump sum shall be effective six (6) months after the date of his or her retirement (and effective April 1, 2002, twelve (12) months after his or her retirement) (the "Deferral Period"). The plan benefit of a Participant shall be credited with interest on a quarterly basis during the Deferral Period based upon the interest rate being used to determine the value of the Refund Feature under the Wyeth Retirement Plan on the date of the commencement of the Deferral Period. Such interest rate shall be adjusted during the Deferral Period to reflect changes to the interest rate being used to determine the Refund Feature under the Wyeth Retirement Plan. In the event a Participant dies during the Deferral Period, his or her plan benefit shall be paid to his or her designated beneficiary in a lump sum payment as soon as practicable after such death, and shall be adjusted for include for interest credited during the Deferral Period. Notwithstanding the foregoing, a Participant may elect upon his or her retirement, in lieu of receiving a lump sum distribution from the Supplemental Plan, to transfer all or any portion of his or her plan benefit to the Wyeth Deferred Compensation Plan on the terms and conditions set forth therein, in accordance with the election procedure set forth in that plan. V. TERMINATION The Supplemental Plan may be terminated or amended at any time by the Retirement Committee of the Corporation, provided that benefits vested prior to such termination or amendment shall remain unaffected unless provided for under a qualified or other non-qualified plan. WYETH SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (the "SERP") Appendix I CONTINGENT VESTING FOR PARTICIPANTS WHO ARE TRANSFERRED TO BAXTER HEALTHCARE CORPORATION Wyeth, a Delaware corporation and Wyeth Pharmaceuticals, Inc., a New York corporation and wholly-owned subsidiary of Wyeth (together with Wyeth, the "Sellers"), entered into an agreement with Baxter Healthcare Corporation, a Delaware corporation ("Buyer"), dated as of June 8, 2002 (the "Purchase Agreement"), whereby the Sellers agreed to sell certain assets to Buyer and Buyer agreed to assume certain liabilities, in each case relating primarily to the "Business" (as defined in the Purchase Agreement). Pursuant to Section 9.2(b) of the Purchase Agreement, the SERP is hereby amended to provide that each Participant in the SERP who is a "Transferring Employee", as defined in the Purchase Agreement, shall have such Participant's service with Buyer or its Affiliates after the Closing Date (as defined in the Purchase Agreement), considered as Continuous Service under the Plan solely for the following purposes: (i) determining if such Participant is vested in any benefits he or she has accrued as of the Closing Date; and (ii) determining eligibility for subsidized early retirement benefits in the benefits accrued as of the Closing Date upon the Participant's retirement and commencement of receipt of benefits under the SERP. Notwithstanding the foregoing, a Participant in the SERP who is not actively at work on the Closing Date due to short-term disability or other authorized leave of absence shall have the service credit described above credited at such time as he or she returns to employment and is transferred to Buyer; provided however, that such return to employment occurs within 180 days of the Closing Date. In no event shall any Participant described above accrue any additional retirement benefits under the SERP after the Closing Date. In addition, a Participant described above who becomes eligible for retirement, other than disability retirement, may elect to commence receipt of his or her retirement benefits in accordance with the terms and conditions of the SERP in effect at that time; provided, however, that such a Participant shall not be eligible to commence receipt of such benefits until his or her employment with Buyer or any successor thereto has terminated. EX-10.3 6 sesp.txt SESP WYETH SUPPLEMENTAL EMPLOYEE SAVINGS PLAN (As Amended to January 15, 2003) l. PURPOSE The purpose of the Supplemental Employee Savings Plan ("the Plan") is to provide a savings plan of deferred compensation for selected managers or highly compensated employees in situations where part of such employees' compensation falls outside of the IRS qualified savings plan. The Plan shall be implemented by agreements entered into between the selected employees and their respective employers which shall be either Wyeth ("Wyeth") or a U.S. or Puerto Rico subsidiary thereof. The Plan shall be unfunded for tax purposes and for purposes of the Employee Retirement Income Security Act of 1974, as amended ("ERISA") and shall be administered and interpreted in such manner as not to be subject to the participation and vesting, the funding and the fiduciary responsibility provisions of Title I of ERISA. Participants in the Plan have the status of general unsecured creditors of their employers and the Plan constitutes a mere promise by the employer to make benefit payments in the future. The Plan shall be administered by the Savings Plan Committee (the "Committee") which also administers the Wyeth Savings Plan. The Committee shall have sole discretion to determine which selected employees will be permitted to participate in the Plan. II. ADMINISTRATION The Committee shall administer the Plan and shall have full authority to determine all questions arising in connection with the Plan, including its interpretation. The Committee's decisions shall be conclusive and binding on all persons. The Committee may adopt rules and procedures to implement the Plan. III. PARTICIPATION The Committee shall have discretion to determine which employees of Wyeth and its subsidiaries may participate in the Plan. The Committee shall also have discretion to determine when participation begins and terminates. At the discretion of the Committee, a selected employee may begin or terminate participation at any time by appropriate notice to the Committee. A letter designating selection shall be issued to such employee by such employee's employer. Such letter shall indicate the applicable salary for which the employee may participate. When the agreement set forth at the end of the Plan is executed by both the employee and the appropriate officer of the employer, it shall become effective and the employee shall thereupon become a participant in the Plan. An employee who accepts an offer to participate in the Plan agrees to have from 1% to 6% of his or her applicable salary, as determined by the Committee, reduced from salary otherwise payable in accordance with the terms and conditions set forth in Article IV. IV. PLAN FORMULA (1) In General Employee Salary Deferral Contributions, (1% to 6% of applicable salary) and Matching Contributions (50% of the Salary Deferral Contributions as defined in the Savings Plan, hereinafter referred to as "Salary Deferral Contributions" and "Matching Contributions" respectively) may be made to the Plan and the Plan may receive contributions of such amounts. Salary Deferral Contributions shall be withheld from the respective employee's salary and accounted for separately. Matching Contributions shall be accounted for separately. (2) Investments Salary Deferral Contributions and Matching Contributions shall be adjusted for investment experience in the same manner, as directed by the employee, that would have resulted if these contributions were able to be invested as Salary Deferral Contributions in the investment funds described in Section 6 of the Savings Plan which are set forth in Appendix A, as attached hereto, and incorporated herein by reference. (3) Valuation, Distributions and Vesting, Etc. The distribution of Salary Deferral Contributions and Matching Contributions shall be in a lump sum in cash and the amount of the distribution shall be determined in accordance with the investment performance under the applicable provisions of the Savings Plan as if such amounts had actually been invested in the same investment funds as set forth in Appendix A, as attached hereto, and incorporated herein by reference. Distributions shall be made in accordance with the provisions set forth in Section 7 of the Savings Plan, except that the Committee may waive one or more of the requirements set forth therein. No payments will be made under the Plan until the employee terminates employment by death or otherwise, or is permanently disabled. Vesting shall be determined in accordance with the same provisions set forth in the Savings Plan. Whatever beneficiary designations were made pursuant to the Saving Plan shall also apply to the Plan in the event of the Participant's death. Beneficiary designations shall be made pursuant to the Plan and in accordance with the agreement between the employer and the employee. Notwithstanding the provisions of this paragraph IV(3), lump sum distributions will only be made on six (6) months prior written notice or effective as of April 1, 2002, upon twelve months prior written notice. A Participant may elect, upon his or her separation from service, in lieu of receiving a distribution, to transfer part or all of the value of his or her account to the Wyeth Deferred Compensation Plan (the "Deferred Compensation Plan) on the terms and conditions set forth therein, provided that such Participant is a participant in the Deferred Compensation Plan and is Retirement Eligible (as defined in the Deferred Compensation Plan) at the time of his or her separation from service. Employee's foreign salary shall be converted into U.S. dollars under guidelines adopted by the Committee. V. FOREIGN LAW This Plan shall be construed so that foreign law does not apply. If foreign law should apply to a particular participant, participation in the Plan shall terminate for such participant and such participant shall be appropriately reimbursed for any Salary Deferral Contributions and Matching Contributions made to the date of such termination. VI. AMENDMENT AND TERMINATION The Plan may be terminated or amended at any time by the Committee provided that benefits vested prior to such termination or amendment shall remain unaffected. VII. GOVERNING LAW AND CONSTRUCTION The Plan shall be governed in accordance with the laws of the State of New York except to the extent superseded by ERISA. The provisions of the Savings Plan are hereby incorporated by reference to the extent that they are referred to herein and to the extent that they do not conflict with the express provisions of the Plan set forth above. The Plan shall be deemed to have been adopted contemporaneously with the Savings Plan so that elections of savings percentages made under the Savings Plan may be made effective at such election date under the Plan. If any provision of the Plan is unenforceable due to operation of law or is contrary to foreign law, such provision shall be severable and not affect other portions of the Plan. APPENDIX A - As Amended to July 1, 1997 INVESTMENT FUNDS AVAILABLE UNDER THE SUPPLEMENTAL EMPLOYEE SAVINGS PLAN The following funds shall be available for investment under the Supplemental Employee Savings Plan: 1. the Interest Income Fund; 2. the Fidelity Balanced Fund; 3. the Spartan U.S. Equity Index Fund; 4. the Fidelity Magellan Fund; 5. the Fidelity International Growth & Income Fund; 6. the Fidelity Low-Price Stock Fund; 7. the MSIF Trust Value Fund; and 8. the Wyeth Common Stock Fund AMENDMENT TO THE WYETH SUPPLEMENTAL EMPLOYEES SAVINGS PLAN - UNITED STATES (the "SESP") VESTING FOR PARTICIPANTS WHO ARE TRANSFERRED TO BAXTER HEALTHCARE CORPORATION Wyeth, a Delaware corporation and Wyeth Pharmaceuticals Inc., a New York corporation and wholly-owned subsidiary of Wyeth (together with Wyeth, the "Sellers"), entered into an agreement with Baxter Healthcare Corporation, a Delaware corporation ("Buyer"), dated as of June 8, 2002 (the "Purchase Agreement"), whereby Sellers agreed to sell to Buyer certain assets and Buyer agreed to assume certain liabilities in each case relating primarily to the "Business" (as defined in the Purchase Agreement). Pursuant to Section 9.2(c) of the Purchase Agreement, the SESP is hereby amended to provide that each participant who is a "Transferring Employee", as defined in the Purchase Agreement, shall be fully vested in his or her Matching Account as of the Closing Date (as defined in the Purchase Agreement), regardless of whether he or she has less than five years of Continuous Service as of the Closing Date. Notwithstanding the foregoing, a participant in the SESP who is not actively at work on the Closing Date due to short-term disability or other authorized leave of absence shall become fully vested in his or her Matching Account as of the date he or she returns to employment and is transferred to employment with Buyer, provided such return to employment occurs within 180 days after the Closing Date. EX-10.4 7 unionsav.txt UNION SAVINGS PLAN WYETH UNION SAVINGS PLAN SECOND RESTATEMENT Restated as of January 1, 1997 As Amended to March 19, 2003 WYETH UNION SAVINGS PLAN (Restated as of January 1, 1997) The purpose of the Plan is to provide eligible employees with the opportunity to accumulate personal savings. The Plan is amended and restated, effective January 1, 1997, unless otherwise noted herein, to comply with the Uruguay Round Agreements Act of 1994 ("GATT"); the Uniform Services Employment and Reemployment Rights Act of 1994 ("USERRA"); the Small Business Job Protection Act of 1996 ("SBJPA"); the Taxpayers Relief Act of 1997 ("TRA 97"); the Internal Revenue Service Restructuring and Reform Act of 1998 ("RRA 98"); and the Community Renewal Tax Relief Act of 2000 ("CRA") (collectively know as "GUST"). Benefits for any Member or beneficiary of such Member, who retired, died or terminated employment at any time prior to January 1, 1997 will be determined under the provisions of the Plan as in effect on the date of the Member's retirement, death, or termination, unless additional benefits are specifically provided by a subsequent amendment to the Plan. The restated Plan contained herein will apply to Members, or beneficiaries of such Members, who retire, die or terminate employment at any time on or after January 1, 1997. Effective March 11, 2002, the Company changed its corporate name from American Home Products Corporation to Wyeth and the name of the Plan was changed accordingly. It is intended that the Plan and Trust Fund will be for the exclusive benefit of participating Members, their beneficiaries and families. Subject to the provisions of the Plan, and except as otherwise is permitted by law, in no event shall any part of the principal or income of the Trust Fund be paid to or revert to the Company. It is intended that the Plan and Trust will constitute a qualified plan and trust within the meaning of Section 401(a), Section 501(a) and Section 401(k) of the Code, and such intention shall be given great weight and consideration in the construction and interpretation of any provisions hereof. ARTICLE I DEFINITIONS As used herein: "Accounts" shall mean the bookkeeping accounts of a Member kept pursuant to Article V, including the Before-Tax Contribution Account, the Employee After-Tax Contribution Account, the Rollover Contribution Account, and the Company Contribution Account. "Act" shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time. "Adjustment Factor" shall mean the cost of living adjustment factor prescribed by the Secretary of the Treasury under Section 415(d) of the Code for years beginning after December 31, 1987, as applied to such items and in such manner as the Secretary shall provide. "Administrator" shall have the meaning specified in the Act and Section 16.01 of the Plan. "'Before-Tax Contribution" shall mean any amount constituting a reduction of the Covered Compensation of a Member which a Member shall have elected to cause the Participating Company which is the employer of such Member to contribute to the Plan on behalf of such Member in lieu of cash. "Code" shall mean the Internal Revenue Code of 1986, as amended from time to time. "Company" or "Employer" shall mean Wyeth, a Delaware corporation, and any successor thereto. Prior to March 11, 2002, the term Company meant "American Home Products Corporation". For historical purposes, the term "American Home Products Corporation" has been retained where applicable. "Company Contribution" shall mean any contribution to the Plan by or on behalf of any Participating Company pursuant to Article V. "Company Stock" shall mean for purposes of this Plan, common stock of Wyeth. "Company Stock Fund" shall mean the investment in a fund that will consist primarily of Company Stock with a portion of the Fund invested in short-term investments for liquidity. Members' interests will be expressed in Units rather than Shares and the value of the Unit will reflect the combined value of Company Stock and the short-term investments. "Computation Period" shall mean with respect to a Member a twelve consecutive month period commencing on the date on which such person first becomes an Employee and on each succeeding anniversary thereof. "Covered Compensation" shall mean regular wages, salary, overtime and shift differentials for time worked prior to any reduction as contemplated by Article IV-A, or by Sections 125, 127, 129 or successor provisions of the Code, and exclusive of incentive compensation, any compensation for special remuneration or bonuses paid to an Employee by a Participating Company; provided, however, that in no event will the annual Covered Compensation of an Employee exceed the limitation provided for in Section 401(a)(17) of the Code, as adjusted by the Adjustment Factor. In addition to other applicable limitations set forth in the Plan, and notwithstanding any other provision of the Plan to the contrary, the annual Covered 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 Code. The cost-of-living adjustment in effect for a calendar year applies to any period, not exceeding 12 months, over which Covered 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. Any reference in this Plan to the limitation under Section 401(a)(17) of the Code shall mean the OBRA'93 annual compensation limit set forth in this provision. If Covered Compensation for any prior determination period is taken into account in determining a Member's benefits accruing in the current Plan Year, the Covered Compensation for that prior determination period is subject to the OBRA'93 annual compensation limit in effect for that prior determination period. Effective for Plan Years beginning on and after January 1, 2002, Covered Compensation shall be limited as provided under Section 401(a)(17) of the Code as amended from time to time. For purposes of this Section, for Plan Years on or after January 1, 2001, Covered Compensation paid or made available during such Plan Year shall include elective amounts that are not includible in the gross income of the Employee by reason of Section 132(f)(4) of the Code. "Current Market Value" shall mean, with reference to Company Stock, the then fair market value thereof as determined by the Trustee in accordance with its standard procedures. "Employee" shall mean a person, other than a nonresident alien as to the United States who is not a Member of the Plan, who is then currently employed by the Company or a Subsidiary, and who is not then currently entitled to receive any retirement benefits or disability benefits for total and permanent disability, under any plan, program, contract or arrangement of the Company or any Subsidiary, or deemed totally and permanently disabled under the Plan. Unless otherwise specifically provided by the Board of Directors of the Company (or by any committee or person whom the Board of Directors may designate) with respect to any person or group of persons who become employed by a Participating Company in connection with the acquisition of any business or asset by the Company or a Subsidiary, such person or group of persons shall be considered Employees only during such time as the criteria of this paragraph are met. The term Employee shall not include an individual retained by the Company or a Subsidiary through or an agency to perform services for the Company or a Subsidiary who are classified or designated by the Company or a Subsidiary as an independent contractor or a fee for service worker, including, without limitation, any such individual who is or has been determined by a government entity, court, arbitrator or other third party to be a common law employee of the Company or a Subsidiary for any purpose and shall not include an individual designated as a Leased Employee. "Employee After-Tax Contributions" shall mean any after-tax contribution to the Plan made by a Member pursuant to Section 4.01. "Enrollment Date" shall mean the first day of each month while the Plan is in effect following a Member's satisfactory completion of the eligibility requirements of Article II. "Fund" shall mean any of the Funds specified in Section 6.01 or selected by the Savings Plan Committee to be an investment fund of the Plan as set forth in Schedule B which is attached hereto and incorporated herein by reference. "Highly Compensated Employee" shall mean: (a) effective for Plan Years starting after December 31, 1996, the term "Highly Compensated Employee" includes highly compensated active Employees and highly compensated former Employees. A highly compensated active Employee means any Employee who: (1) was a Five-Percent Owner (as defined in section 416(i)(1) of the Code and applying the constructive ownership rules of Section 318 of the Code) at any time during the Look-back Year or the Determination Year; or (2) for the Look Back Year had received Covered Compensation from the Employer in excess of $80,000 (as adjusted by the Secretary of the Treasury pursuant to Section 415(d) of the Code). For purposes of this Subparagraph (a), the Employer has not made the Top Paid Group election. In determining whether an Employee is a Highly Compensated Employee for years beginning in 1997, the above definition shall be treated as having been in effect for years beginning in 1996. A former Employee shall be treated as a Highly Compensated Employee if: (i) such Employee was a Highly Compensated Employee when such Employee separated from service, or (ii) such Employee was a Highly Compensated Employee for any Plan Year after attaining age 55. If the former Employee's separation from service occurred prior to January 1, 1987, he or she is a Highly Compensated Employee only if he or she satisfied clause (a) of this Section or received Compensation in excess of $50,000 during: (1) the year of his or her separation from service (or the prior year); or (2) any year ending after his or her 54th birthday. (b) For the purposes of this Section, the following definitions shall apply: "Compensation" means compensation within the meaning of Section 415(c)(3) of the Code. The determination will be made without regard to Sections 125, 402(e)(3) or 402(h)(1)(B) of the Code. "Determination Year" means the Plan Year with respect to which the determination of an individual's status as a "Highly Compensated Employee" (or Non-Highly Compensated Employee) is being made. "Look-Back Year" means the period of twelve (12) consecutive months immediately preceding the Determination Year or, if the Employer elects, the calendar year ending with or within the Determination Year. "Top-Paid Group" means that group of employees of the Employer and its Affiliates who, when ranked on the basis of compensation paid during the Determination Year or Look-back Year are among the 20 percent of Employees receiving the greatest amount of such compensation. Employees described in Section 414(q)(5) of the Code and the regulations promulgated thereunder shall be excluded. "Income" shall mean income with respect to contributions in a Member's Account(s) resulting from the investment and reinvestment of such contributions and any increment thereof and any distribution (and the net proceeds from the sale of any such distribution) with respect to any such investment and increments thereof. "Leased Employee" shall mean a person who is not a common law employee of the Employer or an Affiliate but who provides services to the Employer or an Affiliate, and: (1) such services are performed pursuant to an agreement between the Employer and any other person or entity (the "Leasing Organization"); (2) the person performing the services has done so on a substantially full-time basis for at least one (1) year; and (3) for Plan Years starting before January 1, 1997, the services performed are of a type historically performed in the business field of the recipient by employees; and (4) for Plan Years starting after December 31, 1996, the services are performed under the primary direction and control of the recipient of those services. Notwithstanding the preceding sentence, the Plan shall not treat an individual as a Leased Employee if the Leasing Organization covers the individual by a money purchase pension plan with a nonintegrated contribution rate of at least 10% of compensation, and provides for immediate participation and full and immediate vesting, provided that Leased Employees constitute less than 20% of the Company's Non-Highly Compensated Employees. "Member" shall mean and include (i) an Employee who is currently contributing to the Plan, and (ii) an Employee or former Employee who has any Shares or Units credited to any of his or her Accounts under the Plan. "Non-highly Compensated Employee" shall mean an Employee who is not a Highly Compensated Employee. "Participating Collective Bargaining Unit" shall mean a collective bargaining unit, which has bargained for and accepted participation in the Plan as set forth in Schedule A which is attached hereto and incorporated herein by reference. "Participating Company" shall mean and include (i) the Company, (ii) each Subsidiary that shall have elected to participate in the Plan with the consent of the Company, and (iii) with respect to United States citizens only, any Subsidiary which shall not have elected to participate in the Plan but which is (x) both a foreign subsidiary (within the meaning of Section 406 of the Code) of a domestic corporation (as contemplated by Section 406 of the Code) which is a Participating Company by reasons of clause (i) or (ii) hereof, and the subject of an agreement under Section 3121(1) of the Code, or (y) a domestic subsidiary (within the meaning of Section 407(a)(2)(A) of the Code) of a domestic parent corporation (within the meaning of Section 407(a)(2)(B) of the Code) which is a Participating Company by reason of clause (i) or (ii) hereof. "Payroll Deduction Authorization" shall mean any one of the several forms used by the Administrator from time to time for any of the purposes for which a Payroll Deduction Authorization is specified in the Plan. "Plan" shall mean the Wyeth Union Savings Plan, as from time to time amended. "Plan Fiduciary" shall mean the following: (a) The Employer and the Board of Directors of the Company and of each Subsidiary; (b) The Committee appointed in accordance with Article XVI of the Plan; and (c). The Trustee appointed in accordance with the provisions of the Trust Agreement. "Plan Year" shall mean the calendar year beginning January 1, 1997 and each calendar year thereafter during the existence of the Plan. "Rollover Contribution" shall mean any contribution to the Plan by a Member pursuant to Article XXI. "Shares" shall mean shares of the Mutual Funds with Vanguard or other Fund providers in which Members' Accounts are invested. "Subsidiary or Affiliate" shall mean a corporation or other entity not less than 80% of the voting stock, or not less than 80% of the other indicia of ownership (with a proportionate right to designate or control the management thereof), of which is owned directly or indirectly by the Company and/or any other Subsidiary or Subsidiaries, including, without limitation, all Members of a controlled group of corporations (as defined in Section 414(b) of the Code) which includes the Company; any trade or business (whether or not incorporated) which is under common control (as defined in Section 414(c) of the Code) with the Company; any organization (whether or not incorporated) which is a Member of an affiliated service group (as defined in Section 414(m) of the Code) which includes the Company; and any other entity required to be aggregated with the Company pursuant to regulations under Section 414(o) of the Code, with the Company, and any other entity which the Board of Directors of the Company may designate as a Subsidiary from time to time for the purposes of the Plan. Unless otherwise specifically provided by the Board of Directors of the Company (or any committee or person to whom the Board of Directors may delegate the authority) with respect to any Subsidiary, a Subsidiary shall be considered such (and employees thereof Employees) only during such time as the criteria of this paragraph are met. "Totally and Permanently Disabled", when used with respect to a Member, shall mean a person who is determined by the Company, on the basis of a written statement of a qualified physician selected by the Company, to be unable, indefinitely, as a result of any medical, physical or mental condition (whether occupational or non-occupational) to engage in any occupation of employment for substantial remuneration or profit other than for purposes of rehabilitation. "Trust Agreement" shall mean the assets of the trust established under Article XIII of the Plan, which trust shall form a part of the Plan. "Trust Fund" shall mean the assets of the trust established under Article XIII of the Plan, which trust shall form a part of the Plan. "Trustee" shall mean the trustee or trustees appointed by the Company pursuant to Article XIII. "Unit" shall have the meaning specified in Article VII. "Valuation Date" shall mean each day of any month on which the New York Stock Exchange is open for business. "Vanguard" shall mean the Vanguard Fiduciary Trust Company. ARTICLE II ELIGIBILITY Each Employee of a Participating Company who (1) has been employed by the Company or a Subsidiary at any time during at least one month of any twelve-month period ending on any anniversary of the date on which he or she first became employed by the Company or a Subsidiary, (2) is a member of a collective bargaining unit whose duly certified representative has been offered and accepted the Plan, and (3) is currently entitled to make contributions, shall upon completion of any forms required by the Administrator, be eligible to become a Member of the Plan; provided, however, that the Committee may waive any prior employment requirement set forth in this Article or in Article XXI with respect to any group of persons who become Employees as the result of the acquisition of any business or assets by a Participating Company, upon such terms and conditions as, and to the extent that, the Committee may specify. ARTICLE III PARTICIPATION Participation in the Plan shall be entirely voluntary. An eligible Employee may elect to become a Member of the Plan as of any Enrollment Date by delivering a Payroll Deduction Authorization to the Administrator or a Human Resources representative. A person shall continue to be a Member of the Plan so long as he or she has any Shares or Units credited to any of his or her Accounts under the Plan. ARTICLE IV EMPLOYEE CONTRIBUTIONS 4.01. Payroll Deductions. Each Member may make Employee After-Tax Contributions to the Plan only while an Employee, only from his or her Covered Compensation paid in the United States, and only by a payroll deduction of 1% to 16%, in whole percentages, as he or she may authorize from his or her Covered Compensation by delivering a Payroll Deduction Authorization form or by telephonic or electronic communication, which maximum percentage shall be reduced by the percentage of Covered Compensation of such Member represented by Before-Tax Contributions. 4.02. Adjustments. The percentage of Covered Compensation authorized as a payroll deduction for Employee After-Tax Contributions by a Member may be increased or decreased by the Member as of any Enrollment Date (but not more than once in any calendar quarter), by delivering a revised Payroll Deduction Authorization form. A resumption of Employee After-Tax Contributions, an increase in Employee After-Tax Contributions, the decrease of Employee After-Tax Contributions or, if the Member has previously adjusted his or her Employee After-Tax Contributions within twelve months, a termination of a Member's Payroll Deduction Authorization Form pursuant to Section 4.03, shall not be deemed an adjustment for purposes of the limitation of the number of adjustments permitted to a Member as specified in the preceding sentence. A change in Covered Compensation of a Member shall, without any notice being given by such Member, adjust the dollar amount of such Member's Employee After-Tax Contributions to that amount represented by the percentage previously in effect of his or her new Covered Compensation, so long as such amount may be deducted from his or her Covered Compensation paid in the United States. Such adjustment shall not be deemed an increase or decrease by a Member for the purposes of this Section. 4.03. Termination of Employee After-Tax Contributions. Payroll deductions for Employee After-Tax Contributions authorized by a Member may be terminated by him or her, effective as of any date determined by and in accordance with rules as established by the Committee, by delivering a revised Payroll Deduction Authorization form, or by telephonic or electronic communication as approved by and acceptable to the Administrator. If a Member shall become ineligible to make contributions to the Plan, his or her Payroll Deduction Authorization shall terminate immediately. 4.04. Resumption of Employee After-Tax Contributions. If the Payroll Deduction Authorization of a Member with respect to Employee After-Tax Contributions shall terminate, such individual thereafter may resume contributions to the Plan as of the next Enrollment Date on which such individual is eligible to authorize payroll deductions under the eligibility provisions of the Plan by delivering a new Payroll Deduction Authorization form or by telephonic or electronic communication as approved and acceptable to the Administrator. ARTICLE IV A VOLUNTARY PAY REDUCTIONS 4A.01. Contributions of Before-Tax Contributions. (a) In lieu of making all or any part of an Employee After-Tax Contribution, a Member may authorize, by delivering a Payroll Deduction Authorization form, or by telephonic or electronic communication as approved and acceptable to the Administrator, that such Member's Covered Compensation be reduced, subject to the limitations contained in the last two sentences of this Section 4A.01, 4A.03, 4A.03A and Section 5.02 by 1% to 16%, in whole percentages, and that such reduction be contributed to the Plan on behalf of such Member as a Before-Tax Contribution. The maximum amount of Covered Compensation a Member is permitted to defer during any calendar year is limited to $7,000 as adjusted by the Secretary of Treasury pursuant to Section 402(g) of the Code. Any amount that cannot be credited to his or her Employee Before-Tax Contribution account due to the foregoing limit shall be paid to the Member in cash. If the aggregate of: (i) the Before-Tax Contributions on behalf of a Member under this Plan for any Plan Year, and (ii) all other elective deferrals (as defined under Section 402(g)(3) of the Code) for such same Plan Year on behalf of such person under any other qualified benefit plan maintained by any other corporation or other entity which is, together with the Company treated as a single employer pursuant to Sections 414(b),(c),(m) or (o) of the Code, exceed the limitations of the last sentence of the preceding paragraph (such excess amounts being hereafter referred to as the "Excess Deferral Contributions"), then no later than April 15 of the following Plan Year, the Administrator shall distribute to such Member an amount of Before-Tax Contributions equal to the full amount of such Excess Deferral Contributions (together with the income allocable thereto for such prior Plan Year only). (b) A Member who is covered by an amendment to a collective bargaining agreement, dated March 22, 2001 (the "Amendment"), between Local No. 95, International Chemical Workers Union, AFL-CIO, Rouses Point, New York; Local No. 6, United Food and Commercial Workers International Union, AFL-CIO-CLC, Fort Dodge, Iowa; and Local No. 143, International Chemical Workers Union, AFL-CIO, Pearl River, New York, and the Company as agent for Wyeth-Ayerst Laboratories-Rouses Point, New York; Fort Dodge Laboratories-Fort Dodge, Iowa; and Wyeth-Ayerst Lederle-Pearl River, New York, may elect to contribute to the Plan as Before-Tax Contributions, the amount of a signing bonus to which he or she is entitled related to 2001 and/or 2004 pursuant to the Amendment, in lieu of receiving such amounts as cash. Such election shall be on a form supplied by the Administrator and must be made prior to the date such amounts would otherwise be payable to such Members. 4A.02. Method of Request; Termination; Adjustments. The percentage of Covered Compensation authorized as a payroll deduction for Before-Tax Contributions by a Member may be increased or decreased by him or her as of any Enrollment Date (but not more than once in any calendar quarter with respect to Before-Tax Contributions), by delivering a revised Payroll Deduction Authorization form, or by telephonic or electronic communication approved by the Administrator. A resumption of Before-Tax Contributions, a decrease of Before-Tax Contributions by reason of the election of an increase in Employee After-Tax Contributions, or, if the Member has previously adjusted his or her Before-Tax Contributions within twelve months, or a termination of a Member's Payroll Deduction Authorization form pursuant to this Section 4A.02 shall not be deemed an adjustment for purposes of the limitation of the number of increases or decreases permitted to a Member in any calendar quarter as specified in the first sentence of this Section 4A.02. A change in Covered Compensation of a Member shall, without any notice being given by such Member, adjust the dollar amount of the Before-Tax Contributions with respect to such Member to that amount represented by the percentage previously in effect of his or her new Covered Compensation, so long as such amount may be deducted from his or her Covered Compensation paid in the United States. Such adjustment shall not be deemed an increase or decrease for the purposes of the first sentence of this Section 4A.02. Payroll deductions for Before-Tax Contributions authorized by a Member may be terminated by him or her, effective as of any Enrollment Date, by delivering a revised Payroll Deduction Authorization form. If a Member shall become ineligible to make contributions to the Plan, his or her Payroll Deduction Authorization shall terminate immediately. If the Payroll Deduction Authorization of a Member with respect to Before-Tax Contributions terminates, such person thereafter may resume contributions to the Plan as of the next Enrollment Date on which such person is eligible to authorize payroll deductions under the eligibility provisions of the Plan by delivering a new Payroll Deduction Authorization form or by telephonic or electronic communication as approved and acceptable by the Administrator. 4A.03. Nondiscrimination Test for Before-Tax Contributions. From time to time during the course of the applicable Plan Year, the Administrator shall insure that either (i) the Average Actual Deferral Percentage for Eligible Members who are Highly Compensated Employees for the Plan Year shall not exceed the Average Actual Deferral Percentage for Eligible Members who are Non-highly Compensated Employees for the Plan Year multiplied by 1.25, or (ii) the Average Actual Deferral Percentage for Eligible Members who are Highly Compensated Employees for the Plan Year shall not exceed the Average Actual Deferral Percentage for Eligible Members who are Non-highly Compensated Employees for the Plan Year multiplied by 2, provided that the Average Actual Deferral Percentage for Eligible Members who are Highly Compensated Employees does not exceed the Average Actual Deferral Percentage for Eligible Members who are Non-highly Compensated Employees by more than two (2%) percentage points or such lesser amount as the Secretary of the Treasury shall prescribe to prevent the multiple use of this alternative limitation with respect to any Highly Compensated Employee. For the purpose of the foregoing determination, the following definitions shall be used. "Actual Deferral Percentage" shall mean the ratio (expressed as a percentage), of Before-Tax Contributions made on behalf of the Eligible Member for the Plan Year to the Eligible Member's Compensation for the Plan Year. For purposes of this Section and Section IV B, "Compensation" shall mean a Member's "Covered Compensation" for the Plan Year as herein defined. "Average Actual Deferral Percentage" shall mean the average (expressed as a percentage) of the Actual Deferral Percentages of the Eligible Members. "Eligible Members" shall mean all Employees of Participating Companies who are otherwise authorized under the terms of the Plan to have Before-Tax Contributions allocated to their Accounts for the Plan Year. For purposes of this section, the Actual Deferral Percentage for any Eligible Member who is a Highly Compensated Employee for the Plan Year and who is eligible to have Before-Tax Contributions allocated to his or her Account under two or more plans or arrangements described in Section 401(k) of the Code that are maintained by a Subsidiary shall be determined as if all such Before-Tax Contributions were made under a single arrangement. The determination and treatment of the Before-Tax Contributions, Compensation and Actual Deferral Percentage of any Member shall satisfy such other requirements as may be prescribed by the Secretary of the Treasury. The test described above will be conducted using the current year testing method; provided, however, that the Plan may be amended to use the prior year testing method in those situations for which such changes are approved in Internal Revenue Service Notice 98-1, or subsequent guidance promulgated by the Secretary. In the event that neither the standard in clause (i) or (ii) of the first paragraph of this Section 4A.03 is met, the Administrator shall reduce the Before-Tax Contributions requested by the Highly Compensated Employees in any manner deemed equitable by the Administrator so as to insure compliance with the foregoing standards. A future required reduction in a Before-Tax Contribution shall be paid to the affected Member as, and with the remainder of, such Member's Covered Compensation, but such Member may direct that such amount (or any portion thereof) be treated as an Employee After-Tax Contribution. 4A.03A. Compliance with Non-Discrimination Test. Following the close of the applicable Plan Year (the "Testing Year"), but no later than the last day of the following Plan Year, the Administrator shall determine whether the test set out in the first paragraph of Section 4A.03 was in fact met for the Testing Year. In the event that the Administrator determines that such test was not in fact met for the Plan, then the amount of such Before-Tax Contributions (and any related Income) which causes such limits to be exceeded, (and any related Income) shall be distributed to Highly Compensated Employees or recharacterized as Employee After-Tax Contributions as described below. In determining whether the test set out in the first paragraph of Section 4A.03 was in fact met for the Testing Year, Before-Tax Contributions made on behalf of any Employee shall be so taken into account for the Testing Year only if: (i) such contributions are allocated to such Employee's Accounts under the Plan as of a date no later than the last day of the Testing Year, and (ii) such contributions are attributable to Covered Compensation that, but for the making of such contributions, would otherwise have been (A) received by such Employee during the testing year or (B) earned during the Testing Year and received by such Employee within 2 1/2 months after the end of the Testing Year. The amount of Excess Before-Tax Contributions which is to be refunded or recharacterized shall be determined as set forth below for Plan Years beginning after January 1, 1996: Notwithstanding any other provision of the plan, Excess Contributions, plus any income and minus any loss allocable thereto, shall be distributed no later than the last day of each Plan Year to members to whose accounts such Excess Contributions were allocated for the preceding Plan Year. Pursuant to the dollar leveling method, Excess Contributions are allocated to the Highly Compensated Employees with the largest amounts of employer contributions taken into account in calculating the Actual Deferral Percentage test for the year in which the excess arose, beginning with the Highly Compensated Employee with the largest amount of such employer contributions and continuing in descending order until all the Excess Contributions have been allocated. For purposes of the preceding sentence, the "largest amount" is determined after distribution of any Excess Contributions. Excess Contributions (including the amounts recharacterized) shall be treated as annual additions under the plan. "Excess Contributions" shall mean, with respect to any Plan Year, the excess of: (a) The aggregate amount of employer contributions actually taken into account in computing the Actual Deferral Percentage of Highly Compensated Employees for such Plan Year, over (b) The maximum amount of such contributions permitted by the Actual Deferral Percentage test (determined by utilizing the ratio leveling method, thereby hypothetically reducing contributions made on behalf of Highly Compensated Employees in order of the Actual Deferral Percentage, beginning with the highest of such percentages). If the distributions or recharacterization described above are made, the Average Actual Deferral Percentage is treated as satisfying the non-discrimination test of Section 401(k)(3) of the Code regardless of whether the Average Actual Deferral Percentage, if recalculated after such distributions have occurred, would satisfy Section 401(k)(3) of the Code. For purposes of Section 401(k)(2) of the Code, if a corrective distribution of Excess Before-Tax Contributions has been made, the Average Actual Deferral Percentage of Highly Compensated Employees is deemed to be the largest amount permitted under Section 401(k)(2) of the Code. The Administrator shall, to the extent administratively possible, distribute all Excess Before-Tax Contributions and any income or loss allocable thereto which are required to be made pursuant to this Section, prior to the fifteenth day of the third month following the end of the Plan Year in which the Excess "Before-Tax" Contributions arose. In any event, however, the Excess Before-Tax Contributions and any Income allocable thereto shall be distributed prior to the end of the Plan Year following the Plan Year in which the Excess Before-Tax Contributions arose. Excess Before-Tax Contributions shall be treated as Annual Additions under Section 415 of the Code and Section 5.02 of the Plan. ARTICLE IV B NON-DISCRIMINATION TEST FOR COMPANY CONTRIBUTIONS AND EMPLOYEE AFTER-TAX CONTRIBUTIONS 4B.01. Non-Discrimination Test. From time to time during the course of the applicable Plan Year the Administrator shall, to the extent required for collectively bargained plans or in the Administrator's discretion, insure that either (i) the Average Contribution Percentage for Eligible Members who are Highly Compensated Employees for the Plan Year shall not exceed the Average Contribution Percentage for Eligible Members who are Non-highly Compensated Employees for the Plan Year multiplied by 1.25 or (ii) the Average Contribution Percentage for Eligible Members who are Highly Compensated Employees for the Plan Year shall not exceed the Average Contribution Percentage for Eligible Members who are Non-highly Compensated Employees for the Plan Year multiplied by 2, provided that the Average Contribution Percentage for Eligible Members who are Highly Compensated Employees does not exceed the Average Contribution Percentage for Eligible Members who are Non-highly Compensated Employees by more than two (2) percentage points or such lesser amount as the Secretary of the Treasury shall prescribe to prevent the multiple use of this alternative limitation with respect to any Highly Compensated Employee. 4B.02. Definitions. For purposes of this Article IV B only, the following definitions apply: "Average Contribution Percentage" shall mean the average (expressed as a percentage) of the Contribution Percentages of all the Eligible Members. "Contribution Percentage" shall mean the ratio (expressed as a percentage) of the sum of the Employee After-Tax Contributions, and Company Contributions (if applicable) under the Plan on behalf of the Eligible Member for the Plan Year to the Eligible Member's Compensation for the Plan Year. "Eligible Member" shall mean any Employee of a Participating Company who is otherwise authorized under the terms of the Plan to have Employee After-Tax Contributions or Company Contributions (if applicable) allocated to his or her Account for the Plan Year. 4B.03. Special Rules. For purposes of this Article IV B, the Contribution Percentage for any Eligible Member who is a Highly Compensated Employee for the Plan Year and who is eligible to make Employee After-Tax Contributions, or to have Company Contributions (if applicable) or Before-Tax Contributions allocated to his or her account under two or more plans described in Section 401(a) of the Code or arrangements described in Section 401(k) of the Code that are maintained by a Participating Company or a Subsidiary shall be determined as if all such contributions were made under a single plan. In the event that this Plan satisfies the requirements of Section 410(b) of the Code only if aggregated with one or more other plans, or if one or more other plans satisfy the requirements of Section 410(b) of the Code only if aggregated with this Plan, then this Article shall be applied by determining the Contribution Percentages of Eligible Members as if all such plans were a single plan. 4B.04. Compliance with Non-Discrimination Test. (a) Following the close of the applicable Plan Year (the "Testing Year"), but no later than the last day of the following Plan Year, the Administrator shall determine whether the test set out in Section 4B.01 was in fact met for the Testing Year. In the event the Administrator determines that such test was not in fact met for the Testing Year, then no later than the last day of the following Plan Year, the amount of the Employee After-Tax Contributions made on behalf of a Highly-Compensated Employee (and any related Income) which causes such limits to be exceeded may be distributed to individual Highly Compensated Employees determined as set forth below for Plan Years commencing after December 31, 1996. (b) Notwithstanding any other provision of the plan, Excess Aggregate Contributions, plus any income and minus any loss allocable thereto, shall be forfeited, if forfeitable, or if not forfeitable, distributed no later than the last day of each Plan Year to participants to whose accounts such Excess Aggregate Contributions were allocated for the preceding Plan Year. Pursuant to the dollar leveling method, Excess Aggregate Contributions are allocated to the Highly Compensated Employees with the largest Contribution Percentage Amounts taken into account in calculating the Actual Contribution Percentage test for the year in which the excess arose, beginning with the Highly Compensated Employee with the largest amount of such Contribution Percentage Amounts and continuing in descending order until all the Excess Aggregate Contributions have been allocated. For purposes of the preceding sentence, the "largest amount" is determined after distribution of any Excess Aggregate Contributions. Excess Aggregate Contributions shall be treated as annual additions under the Plan. Definitions: 1. "Excess Aggregate Contributions" shall mean, with respect to any Plan Year, the excess of: a. The aggregate Contribution Percentage Amounts taken into account in computing the numerator of the Contribution Percentage actually made on behalf of Highly Compensated Employees for such Plan Year, over b. The maximum Contribution Percentage Amounts permitted by the Actual Contribution Percentage test (determined by utilizing the ratio leveling method, thereby hypothetically reducing contributions made on behalf of Highly Compensated Employees in order of their Contribution Percentages, beginning with the highest of such percentages). (c) If the distribution described above is made, the Average Actual Contributions Percentage is treated as meeting the non-discrimination test of Section 401(m)(2) of the Code regardless of whether the Average Actual Contribution Percentage, if recalculated after such distributions, would satisfy Section 401(m)(2) of the Code. (d) For purposes of Section 401(m)(9) of the Code, if a corrective distribution of Excess Employee After-Tax Contributions has been made, the Average Actual Contribution Percentage of Highly Compensated Employees is deemed to be the largest amount permitted under Section 401(m)(2) of the Code. (e) The test described in Section 4B.01 above will be conducted using the current year testing method provided, however, that the Plan may be amended to use the prior year testing method in those situations for which such a change is approved in Internal Revenue Service Notice 98-1 (Part VII(A)) or in subsequent guidance promulgated by the Secretary of the Treasury. (f) The Administrator shall, to the extent administratively possible, distribute all Excess Employee After-Tax Contributions and any income allocable thereto which are required to be made pursuant to this Section, prior to the fifteenth day of the third month following the end of the Plan Year in which Excess Aggregate Employee After-Tax Contributions arose. Any Excess Aggregate After-Tax Contributions are to be distributed after the fifteenth day of the third month following the end of the Plan Year. In any event, however, the Excess Aggregate Employee After-Tax Contributions and any income allocable thereto shall be distributed prior to the end of the Plan Year following the Plan Year in which the Excess Employee After-Tax Contributions arose. Excess Aggregate After-Tax Contributions shall be treated as Annual Additions under Section 415 of the Code and Section 5.02 of the Plan. 4B.05. Multiple Use Test. In order to prevent the multiple use of the alternate method described in Section 4A.03 and Section 4B.04, any Highly Compensated Employee eligible to make Before-Tax Contributions and Employee After-Tax Contributions under the Plan shall have his or her contributions under the Plan reduced, if required, pursuant to Regulation section 1.401(m)-2. ARTICLE V COMPANY CONTRIBUTIONS 5.01. Company Contribution. As provided for below, Company Contributions (including any Matching Employee and Company Performance Contributions made under the prior Plan) shall no longer be available to Member's and shall cease effective December 31, 1996. The retention of this Article is purely for historical reference. The Company shall contribute to the Plan, out of its current or accumulated earnings and profits, but not otherwise, the following amounts, to the extent that they shall not exceed the amounts deductible under the applicable provision of the Code: (a)......With respect to each Member who is an Employee of the Company, except as provided in paragraph (b) of this Section 5.01, and subject to Article X and Section 10A.04, the Company Contribution, which shall be an amount equal to 50% of the Member's first (3%) of Employee After-Tax Contribution and Before-Tax Contribution of each such Member, for each month for which such Member makes an Employee After-Tax Contribution or there is contributed on his or her behalf a Before-Tax Contribution; (b)......with respect to Employee After-Tax Contributions deducted from, and Before-Tax Contributions reducing Covered Compensation paid after December 31, 1991 to each Member (other than a Member who is a member of a collective bargaining unit which has not been offered and accepted this provision and the other provisions of the Plan which become effective either January 1, 1992 or with respect to Covered Compensation paid before December 31, 1991) who has been an Employee of the Company or a Subsidiary at any time during at least three months of any calendar quarter period ending on any anniversary of the date on which he or she first became employed by the Company or a Subsidiary (provided, however, that (i) such eligibility requirements shall not apply to an Employee who becomes a Member in accordance with, and as described in, Article XXII B hereof, to the extent specified in such Article XXII B, and (ii) the Committee may waive any prior employment requirement set forth in this paragraph or in Article XXII B with respect to any group of persons who become Employees as the result of the acquisition of any business or assets by a Participating Company, upon such terms and conditions as, and to the extent that, the Committee may specify), subject to Article X and Section 10A.04, the Company Contribution, which shall be an amount equal to 75% of the first 4% of the Employee After-Tax Contribution and Before-Tax Contribution of each such Member, for each month for which such Member makes an Employee After-Tax Contribution or there is contributed on his or her behalf a Before-Tax Contribution. Notwithstanding the foregoing, effective on the dates set forth below, Company Contributions shall cease, effective at each of the facilities set forth below and shall not be applicable to any other Member beginning on or after January 1, 1997: at Pearl River, New York on January 15, 1996; at Bound Brook, New Jersey on January 26, 1996; at Danbury, Connecticut on June 14, 1996; and at Hannibal, Missouri on December 31, 1996. No Company Contributions shall be made to any Member on or after January 1, 1997. 5.02. Limitations. The "Annual Addition" which shall equal the total of (a) contributions made by all Participating Companies under this and any other defined contribution plan (as described in Section 415(k) of the Code) allocated for any Member in a Plan Year, plus (b) employee contributions allocated for such Member in such year, plus (c) forfeitures allocated for such Member in such year shall not exceed the Maximum Permissible Amount. The Maximum Permissible Amount with respect to any Participant shall be the lesser of (i) $30,000, or (ii) twenty-five percent (25%) of the Member's Covered Compensation for the Limitation Year. For the purpose of the foregoing, a Before-Tax Contribution shall be treated as a contribution by a Participating Company and shall be deducted from a Member's total Covered Compensation. The Annual Addition for any Plan Year beginning before January 1, 1987, shall not be recomputed to treat all employee contributions as part of the Annual Addition. If the Plan satisfied the applicable requirements of Section 415 of the Code as in effect for all Plan Years beginning before January 1, 1987, an amount shall be subtracted from the numerator of the defined contribution plan fraction (not exceeding such numerator) as prescribed by the Secretary of the Treasury so that the sum of the defined benefit plan fraction and defined contribution plan fraction computed under Section 415(e)(1) of the Code (as revised by this section) does not exceed 1.0 for such Plan Year; provided, however, that this sentence shall not apply for Plan Years beginning after December 31, 1999. In the event that the limitations with respect to Annual Additions prescribed hereunder are exceeded with respect to any Member and such excess arises as a consequence of the crediting of forfeitures to the Member's Account or a reasonable error in estimating the Member's Compensation, such excess shall be disposed of by returning to the Member Contributions to his or her Accounts if any, for the year in which the excess arose, and the earnings thereon, but only to the extent necessary to cause the Annual Additions to the member's Account to equal, but not exceed, the limitations prescribed hereunder. In the event that after such contributions and earnings are returned there remains an excess, such excess shall be held in a suspense account and reallocated among the Accounts of all Members in the Limitation Year succeeding the year in which the excess arose. ARTICLE V A TOP-HEAVY RULES 5A.01. Modification of Benefits. To the extent applicable to collectively bargained plans, the Plan will be considered a top-heavy plan for the year if as of the last day of the preceding year (hereinafter "determination date"), the Plan, together with all other employee benefit plans sponsored by the Company and qualified under Section 401(a) of the Code (including all terminated plans which covered a key employee and which were maintained within the five year period ending on the determination date), constitutes a "top heavy group" within the meaning of Section 416 of the Code, based on the calculations specified in Sections 416(g)(1), (2), (3) and (4) of the Code utilizing data as of the last day of the preceding year, and determining "key employees" as required by Section 416(i)(1) of the Code. If as of a determination date, the Plan is determined to be a top heavy plan, then, for the Plan Year immediately following such determination date, the rate of aggregate Company Contributions under the Plan (if any) and employer contributions under all other defined contribution plans (as described in Section 415(k) of the Code) included within the top-heavy group for all Members who (a) are Employees (regardless of the Employee's level of compensation and hours of service) and (b) are not key employees within the meaning of Section 416(i)(1) of the Code (other than such Members included in a unit of Employees covered by a collective bargaining agreement) shall be not less than the lesser of (i) 3% of such Member's compensation (within the meaning of Section 415(c)(3) of the Code) for such Plan Year and (ii) that percentage of such compensation which is equal to the percentage of such compensation for that key employee for which such percentage is the highest for such Plan Year represented by Company Contributions under this Plan and employer contributions under all other defined contribution plans included within the top-heavy group made on behalf of such key Employee. Pursuant to Section 416 of the Code, a defined benefit plan is top-heavy when the ratio of the present value of accrued benefits for key Employees to the present value of accrued benefits for all Employees exceeds 60%; a defined contribution plan is top-heavy when the ratio of account balances for key employees to account balances for all employees exceeds 60%. If there is more than one plan, the top-heavy ratios must be consolidated by adding together the numerators and then adding together the denominators to form one ratio. 5A.02. Termination of Benefit Modifications. The benefit modifications described in Section 5A.01 shall cease to apply for any Plan Year immediately following a determination date as of which the Plan together with all other employee benefit plans described in Section 5A.01 do not constitute a top-heavy group within the meaning of Section 416 of the Code. ARTICLE VI INVESTMENTS 6.01. Investment Funds. Subject to Sections 6.02, 6.04 and 10A.05, there shall be Funds available for the investment and reinvestment of contributions to the Plan as selected by the Savings Plan Committee as set forth in Schedule B which is attached hereto and incorporated herein by reference. 6.02. Investment Options of Members. The contribution amounts in a Member's Accounts shall be separately invested in any one or more of the Funds specified in Section 6.01 as such Member may elect; provided that an investment in any Fund shall be made in increments of 10% thereof. 6.03. Election of Investment Options. A Member's initial Payroll investment election shall be stated in his or her initial Payroll Deduction Authorization form. Investment elections shall remain in effect until changed by the Member with respect to future contributions to his or her Accounts as described below. The Member may make such election changes at any time by means of telephonic or electronic instructions to the Trustee/Recordkeeper on any business day which shall be effective as of the date received, provided such instructions are received prior to 4:00 p.m. Eastern Time. Instructions received after 4:00 p.m. Eastern Time shall be effective on the following business day. 6.04. Transfer of Accumulated Values. (a) Any Member may elect, as described below, to transfer any of the accumulated values in any of his or her Accounts in any one or more Funds and Income thereon, respectively, from such Fund or Funds to any other Fund or Funds, in specific dollar amounts or in whole percentages by telephoning the Trustee on any business day at the toll free number provided by the Trustee or by such electronic means as established by the Trustee for such purpose. The minimum amount that may be transferred into or out of a Fund shall be $250, provided, however, that if the Account balance of a Member is less than $250, the minimum amount that may be transferred shall be the entire Account balance. Any telephonic or electronic instructions received by a Trustee from a Member prior to 4:00 p.m. Eastern Time on a business day shall be effective as of that day. Any instructions received from a Member after 4:00 p.m. Eastern Time shall be effective on the following business day. 6.05. Investment of Company Contributions. A Member may invest Company Contributions, if any, in such Member's Account to any of the Funds and may transfer such amounts to any of the other Funds. Such elections may be made daily by telephonic or electronic means to the Trustee/Recordkeeper. Directions to change which are received by Vanguard by 4:00 P.M. will be made that day. Directions received by Vanguard after 4:00 P.M. on a business day will be made as of the close of business on the following business day. 6.06. Investment of Income. Income received from investments in the Funds shall be reinvested in the Fund from which it is derived. Dividends received on Company Stock in a form other than cash or additional shares of Company Stock shall be disposed of by the Trustee in a prudent manner as determined by the Trustee and the proceeds used to acquire shares of Company Stock. 6.07. Temporary Investments. Pending investment of any contributions in one of the Funds, the Trustee may retain such contributions in cash or may invest them in short-term obligations or in any common trust fund of the Trustee, in the Trustee's discretion. 6.08. Investments in Funds. Contributions made by a Member and Income attributable to such Contributions shall be invested as soon as practicable after receipt by the Trustee. The Trustee shall have complete discretion in choosing investments within the Funds described in Section 6.01 including the Vanguard Funds, and shall not be subject to direction by the Company or the Administrator or bound by any list of legal investments of a trustee or other fiduciary. 6.09. Common Trust Funds. Subject to the provisions of this Article, the Trustee may invest and reinvest all or any part of any Fund through the medium of any common trust fund of the Trustee qualified under Section 401(a) of the Code which is invested principally in property of a type authorized by the Plan for investment of such Fund. An investment in such a common trust fund or in any investment company shall not be deemed an investment in securities issued or guaranteed by the Company or a Subsidiary even if such securities are contained in such common trust or the portfolio of such investment company. 6.10. Voting and Registration of Company Stock. The shares of Company Stock held by the Trustee in the Company Stock Fund shall be registered in the name of the Trustee or its nominee, but shall not be voted by the Trustee or such nominee except as provided in Article XV. ARTICLE VII MEMBER'S ACCOUNTS IN FUNDS; MAINTENANCE AND VALUATION THEREOF 7.01. Separate Accounts. Each Member shall have established for him or her separate accounts in each Fund which shall reflect the value (as of the last preceding Valuation Date) of all his or her Employee After-Tax Contributions, Company Contributions, Rollover Contributions, and Before-Tax Contributions, respectively, invested in such Fund and the respective Income thereon. If a Member has received a loan from the Plan in accordance with Article X A, a Loan Account shall be established for him or her in accordance with Section 10A.05 hereof. 7.02. Payments to Trustee. Not later than fifteen business days after the end of each month, or at such other times as may be required under regulations promulgated by the Secretary of Labor, the Company shall transmit to the Trustee an amount equal to the aggregate amount of Employee After-Tax Contributions deducted in respect of the Plan during such month, or Before-Tax Contributions representing reductions of Covered Compensation during such month. Amounts received by the Company each month in repayment or prepayment of Article X A loans shall be paid to the Trustee no later than 15 business days after the end of such month and applied in accordance with Section 10A.06 hereof. Upon receipt of any Employee After-Tax Contributions, Rollover Contributions, or Before-Tax Contributions, by the Trustee, the aggregate amount thereof (and Income thereon, as from time to time received by the Trustee) shall be credited as hereinafter specified to the respective accounts of the Members in the respective Funds, and the Trustee shall hold, invest and dispose of the same as provided in the Plan. 7.03. Shares and Units. The values of the Funds administered by Vanguard will be represented by shares in each of the Funds credited to the Member's Accounts, which shares are valued daily in accordance with the specific valuation provisions of each Fund. Units of the Company Stock Fund and the Stable Value Fund shall be valued by determining the value of the assets of the Fund as of the Valuation Date, which shall be each business day, and deducting any liabilities due or accrued by the Fund as of such Valuation Date, and dividing the resulting value by the total number of Fund Units outstanding on the Valuation Date. 7.04. Crediting Units. As of each Valuation Date, and following the determination of the value of a Unit in the Company Stock Fund and Stable Value Fund the Account of each Member who has elected to invest any of his or her Member's contributions contributed on his or her behalf in such Fund shall be credited, as of such Valuation Date, with a number of Units of such Funds determined by dividing the value of such Unit on such Valuation Date into that portion of the Current Market Value of the Member's contributions to be invested in such Fund received by the Trustee since the last crediting of Units of such Fund and Income thereon. ARTICLE VIII VESTING 8.01. Employee After-Tax Contributions and Before-Tax Contributions. All Shares and Units attributable to Employee After-Tax Contributions, Rollover Contributions, and Before-Tax Contributions and Income respectively thereon shall be fully vested at all times and shall not any time be subject to forfeiture or divestiture. 8.02. Schedule of Vesting of Company Contributions. As provided for in Article V, Company Contributions ceased under the Plan as of December 31, 1996. Vesting of Units attributable to those Company Contributions is in accordance with the vesting schedule provided in such prior Plan and are now 100% fully vested. ARTICLE IX DISTRIBUTION FROM MEMBER'S ACCOUNTS UPON TERMINATION OF EMPLOYMENT 9.01. Lump Sum Distributions. In the event of the termination of employment of a Member, and unless the Member has otherwise elected in accordance with the Plan, the vested Share and Unit values as of the Valuation Date on or immediately preceding the date thereof of the Shares or Units in all of the Member's Accounts (other than any Loan Account, which shall be subject to Section 10A.08 hereof) shall be distributed as a lump sum distribution (i) to the Member commencing as soon as practicable after termination of employment or on such later date (subject to Section 9.08(b)) as the Member shall have elected, (ii) if the Member has so elected at any time prior to the distribution of such values, to the extent specified in such election and authorized by the Code, to an eligible retirement plan as defined in Section 402(a)(5)(E)(iv) of the Code commencing as soon as practicable after termination of employment or on such later date (subject to Section 9.08(b)) as the Member shall have elected, or (iii) if the Member's termination of employment was by reason of the death of the Member, as soon as practicable after termination of employment to the Member's surviving spouse, or if there is no surviving spouse or if the surviving spouse consents or has consented in the manner required under Section 417(a)(2) of the Code, to the previously designated beneficiary of such Member. Notwithstanding anything to the contrary in the preceding sentence, if at any time after termination of a Member's employment but prior to the annuity starting date (as defined in Section 417(f)(2) of the Code) respecting such lump-sum distribution, a Member shall die, the lump sum distribution payable to the Member shall be distributed as soon as practicable to the Member's surviving spouse or if there is no surviving spouse or if the surviving spouse consents or has consented in the manner required under Section 417(a)(2) of the Code, to the previously designated beneficiary of such Member. A lump sum distribution shall consist of cash representing the values of all Shares or Units in the Accounts of a Member and Income attributable thereto except such Units in the Company Stock Fund, which shall be distributed as the number of whole shares of Company Stock purchasable at the Current Market Value thereof with such Units of the Member in the Company Stock Fund and as cash to the extent of any fractional share. Units representing vested Company Contributions and Income thereon shall be distributed in the same manner as a Member's contributions and Income thereon in the Company Stock Fund. However, the recipient may elect that all Units in the Company Stock Fund in which such Member is vested shall be distributed in cash. The Administrator, prior to authorizing any distribution pursuant to clause (ii) of this Section 9.01, may require the submission of such evidence of the Trustee or other fiduciary under the eligible retirement plan to which such distribution is to be made certifying that such distributee is an eligible retirement plan as contemplated by Section 402(a)(5)(E)(iv) of the Code. 9.02. Distribution as an Annuity. The provisions of this Section shall only apply to Members who participated in the Plan on or prior to January 1, 1996. When a Member ceases to be an Employee and does not die prior to the annuity starting date (as defined in Section 417(f)(2) of the Code), if he or she has previously so elected, the vested Share and Unit values as of the Valuation Date on or immediately preceding the date thereof of the Shares and Units in all the Member's Accounts (other than any Loan Account, which shall be subject to Section 10A.08 hereof), and if the Member then has a spouse, shall be applied (subject to Section 9.08(a) to provide monthly payments from the Trust, commencing as soon as practicable after the termination of his or her status as an Employee or on such later date (subject to Section 9.08(b) as the Member shall have elected, to the Member for his or her life, and thereafter, monthly payments of 50% of the monthly payment made to the Member to such spouse, if surviving, for the life of such spouse. Notwithstanding the foregoing, this Section is not applicable to any Employee who becomes a Member on or after January 1, 1998. 9.03. Distributions in the Event of Death Prior to Annuity Starting Date. Upon the death of a Member prior to the annuity starting date (as defined in Section 417(f)(2) of the Code), the Share and Unit values as of the Valuation Date on or immediately preceding the date thereof of the Shares and Units in all the Member's Accounts (other than any Loan Account, which shall be subject to Section 10A.08 hereof), if the Member is then married, and if he or she has so elected, shall be applied (subject to Section 9.08(a)) to monthly payments, commencing as soon as practicable, to the surviving spouse of such Member for the life of such spouse. 9.04. Monthly Payments. When a Member ceases to be an Employee, if he or she has previously so elected, the vested Unit or Share values as of the Valuation Date on or immediately preceding the date thereof of the Shares and Units in all the Member's Accounts (other than any Loan Account which shall be subject to Section 10A.08 hereof) or in all such Accounts other than Unit values attributable to Units in the Company Stock Fund shall be applied (subject to Section 9.08(a)) to provide monthly payments from the Trust Fund for the Plan for 60, 120, 180, 240, 300 or 360 months commencing on the first day of the month immediately following the month of the termination of his or her status as an Employee or on such later date (subject to Section 9.08(b)) as the Member shall have elected. The amount of such monthly payments shall be as determined by the Administrator in accordance with the value of the Member's Accounts. Unit values attributable to Units in the Company Stock Fund not paid in monthly installments shall be paid in shares of Company Stock (to the extent of whole shares) and in cash as to any fractional share, all determined as provided in Section 9.01 hereof. In the event of the death of the Member prior to the annuity starting date or prior to the payment of the last annuity payment, such payments will be made or continued to the Member's surviving spouse, or if there is no surviving spouse, or if the surviving spouse consents in the manner required under Section 417(a)(2) of the Code, to the previously designated beneficiary of such Member. 9.05. Manner of Election of Payments. Any Member electing any optional form of distribution of benefits shall make such election by delivering a Payroll Deduction Authorization form. 9.06. Commencement of Benefits. Subject to Sections 9.01, 9.02, 9.03, 9.04 and 9.08 payment of benefits hereunder shall be made or commence as soon as practicable after the Member ceases to be an Employee, but in no event later than the 60th day after the latest of the close of the Plan Year in which (a) occurs the date on which the Member attains age 60; (b) occurs the tenth anniversary of the year in which the Member commenced participation in the Plan; or (c) the Member ceases to be an Employee. 9.07. Election of Benefits; Application. (a) No less than thirty (30) days and no more than ninety (90) days prior to the annuity starting date, the Committee shall provide to each Participant a written explanation of: (i) The terms and conditions of the qualified joint and survivor annuity; (ii) the Participant's right to make an election to waive the qualified joint and survivor annuity; (iii) The right of the Participant's spouse to consent to any election to waive the qualified joint and survivor annuity; (iv) The right of the Participant to revoke such election, and the effect of such revocation; and (v) The relative values of the various optional forms of benefits under the Plan. If a distribution is one to which Sections 401(a)(11) and 417 of the Code do not apply, such distribution may commence less than 30 days after the notice required under this Section is given, provided that: (a) the Committee clearly informs the Member that the Member has a right to a period of at least 30 days after receiving the notice to consider the decision of whether or not to elect a distribution (and, if applicable, a particular distribution option), and (b) the Member, after receiving the notice, affirmatively elects a distribution. The Administrator shall also provide in writing to each Member, within the applicable period, the following information: the Member's right to make, and the effect of, an election under Section 9.03; a description of the retirement benefits provided under Section 9.03 and the circumstances under which the benefits will be paid if elected; the Member's right to waive and reinstate an election under Section 9.03; and the rights of the Member's spouse under Section 9.09. As used in the preceding sentence, the "applicable period" means with respect to each Member, whichever of the following periods ends last: (i) the period beginning with the first day of the plan year in which the Member attains age 32 and ending with the close of the plan year preceding the plan year in which the Member attains age 35, (ii) a reasonable period after an individual becomes a Member, and (iii) a reasonable period after separation from service in case of a Member who separates before attaining age 35. (b) The period within which any election of benefits may be made under this Article IX shall begin not later than the 90th day prior to the first date on which such Member's retirement benefit could commence under any plan, program, contract or agreement of or with the Company or any subsidiary applicable to such Member (other than the Plan) or, if later, on the day such person first becomes a Member and shall end on the annuity starting date (as defined in Section 417(f)(2) of the Code), provided, however, that an election under Section 9.03 shall end on the date of the Member's death. Any election provided in this Article IX may be waived and/or reinstated during the period of time set forth in the preceding sentence. (c) Subject to Section 9.08, no benefits under the Plan need be paid to a Member until the Member has applied therefor in writing, specifying the payment option elected (if not previously specified) and giving such other information as the Administrator may reasonably specify to enable him or her to calculate the amount payable. If an application for benefits is received which is complete except that no payment option is specified, benefits shall be paid in the applicable form specified in Section 9.01, unless the Member has previously specified, and not revoked, another payment form. (d) No benefit shall be payable in more than one of the forms permitted by this Article IX. (e) A Member who receives a distribution or withdrawal from his or her Accounts in the Plan shall have the amounts so distributed or withdrawn made from the Funds in which such Member's funds are invested in accordance with elections made by the Member on a form supplied by the Administrator. If the Member fails to make such an election, the amounts shall be taken proportionately from the Funds in which his or her Accounts are invested. 9.08. Distributions of Small Amounts; Required Distributions. (a) Anything to the contrary in this Article IX notwithstanding, if at the time of termination of employment a Member's Accounts (including any Loan Account) in the Plan have an aggregate present value not exceeding $3,500 for distributions occurring prior to January 1, 1998 or not exceeding $5,000 for distributions occurring on or after January 1, 1998, the vested values of the Shares and Units in such Member's Accounts (other than any Loan Account, which shall be subject to Section 10A.08 hereof), shall be distributed as a lump-sum distribution as soon as practicable to the Member, or where the Member's employment has terminated by reason of the death of such Member, to the surviving spouse of such Member, or if there is no surviving spouse or if the surviving spouse consents in the manner required under Section 417(a)(2) of the Code, to the previously designated beneficiary of such Member. No distribution may be made under the preceding sentence after the annuity starting date (as defined in Section 417(f)(2) of the Code) unless the Member and his or her spouse (or where the Member has died, the surviving spouse) consent in writing to such distribution. The "present value" for purposes of this Section 9.08(a) shall be calculated in accordance with Section 417(e)(3) of the Code. If at the time of termination of employment a Member's Accounts (including any Loan Account) in the Plan have an aggregate present value for distributions occurring prior to January 1, 1998, exceeding $3,500 or exceeding $5,000 on or after January 1, 1998, the vested unit values of the Shares and Units in such Member's Accounts (other than the Loan Account which shall be subject to Section 10A.08 hereof) shall be retained in the Plan and subject to Section 9.08(b) hereof, any distribution shall be deferred until after the Member makes a distribution election by delivering a Payroll Deduction Authorization. (b) Anything to the contrary in this Article IX notwithstanding, the entire interest of a Member will be distributed to him or her beginning no later than April 1 of the calendar year following the calendar year in which such Member attains age 70 1/2, over a period not extending beyond the life expectancy of such Member and a designated beneficiary. If the distribution of a Member's interest has begun in accordance with the first sentence of this Section 9.08(b) and the Member dies before his or her entire interest has been distributed to him or her, the remaining portion of such interest shall be distributed at least as rapidly as under the method of distribution being used under the first sentence of this Section 9.08(b). If a Member dies before the distribution of his or her interest has begun in accordance with the first sentence of this Section 9.08(b) the entire interest of such Member will be distributed within 5 years after the death of such Member, provided, however, if any portion of such Member's interest is payable to a designated beneficiary, such portion shall be distributed over a period not extending beyond the life expectancy of such beneficiary and shall begin not later than one (1) year after the date of such Member's death. Notwithstanding the preceding sentence, if such designated beneficiary is the surviving spouse of such Member the date on which the distributions are required to begin shall not be earlier than the date on which the deceased Member would have attained age 70-1/2, provided, however, if such surviving spouse dies before distributions to such spouse begin, this sentence shall be applied as if such surviving spouse were the Member. Notwithstanding the foregoing, for Plan Years commencing on or after January 1, 2000, a Member who is not a five (5) percent owner of the Employer shall have his or her entire interest in the Plan distributed no later than April 1 of the calendar year following the later of (a) the calendar year in which he or she attains age 70 1/2, or (b) the calendar year in which he or she retires. Notwithstanding anything else to the contrary herein, the Administrator may not direct the Trustee to distribution the Member's nonforfeitable Account balance, nor may the Member select to have the Trustee distribute his or her Account balance over a period extending beyond the Member's life expectancy or over a period extending beyond the joint and last survivor life expectancy of the Member and his or her designated Beneficiary. The minimum distribution for a calendar year equals the Member's nonforfeitable Account balance as of the most recent accounting date preceding the calendar year (adjusted for allocations of contributions, forfeitures and distributions made after the accounting date but prior to the end of the calendar year, if applicable), divided by the applicable life expectancy or, if the Member's spouse is not his or her designated Beneficiary, the applicable divisor determined from the table set forth in Q&A-4 of Section 1.401(a)(9)-2 of the proposed regulations. The applicable life expectancy shall be the Member's life expectancy (or joint and last survivor expectancy) calculated using the attained age of the Member (or designated Beneficiary) as of the Member's (or designated Beneficiary's) birthday in the first distribution calendar year reduced by one for each calendar year which elapsed since the date life expectancy was first calculated. Applicable life expectancies will be determined under the unisex life expectancy multiples under Treasury regulation Section 1.72-9, and will not be recomputed. The minimum distribution required for the Member's first distribution calendar year must be made on or before the Member's required beginning date. The minimum distribution for other calendar years, including the minimum distribution for the distribution calendar year in which the Member's required beginning date occurs, must be made on or before December 31 of that distribution calendar year. The first distribution calendar year is the calendar year immediately preceding the calendar year which contains the Member's required beginning date. All distributions under the Plan must be made in accordance with Section 401(a)(9) of the Code and the Treasury regulations thereunder. To the extent provisions of this Plan are inconsistent with Section 401(a)(9) of the Code, Section 401(a)(9) of the Code will override such provisions. With respect to distributions under the Plan made for calendar years beginning on or after January 1, 2002, the Plan will, if applicable, apply the minimum distribution requirements of Section 401(a)(9) of the Code in accordance with the regulations that were proposed on January 17, 2001, notwithstanding any provision of the Plan to the contrary. This amendment shall continue in effect until the end of the last calendar year beginning before the effective date of final regulations under Section 401(a)(9) or such other date as may be specified in guidance published by the Internal Revenue Service. 9.09. Spousal Consent. Notwithstanding anything to the contrary contained in this Article IX (other than Section 9.08 hereof), in the event that a Member is married at any time prior to the annuity starting date (as defined in Section 417(f)(2) of the Code) such Member must obtain the written consent of his or her spouse (in the manner required under Section 417(a)(2) of the Code) if the Member has elected or elects (i) a beneficiary other than his or her spouse under Section 9.01 or (ii) the benefit provided for in Sections 9.02, 9.03 or 9.04 hereof. No election shall be effective unless it is made in compliance with the preceding sentence. A Member who is married at any time prior to the annuity starting date (as defined in Section 417(f)(2) of the Code) may revoke an election (i) to name a beneficiary other than his or her spouse under Section 9.01 or (ii) to take the benefit specified in Section 9.02, 9.03 or 9.04 or elect again to take such benefits at any time and any number of times during the period specified in Section 9.07(b) provided that such Member obtains the written consent of his or her spouse (in the manner required under Section 417(a)(2) of the Code). ARTICLE X WITHDRAWALS FROM MEMBERS' ACCOUNTS DURING EMPLOYMENT 10.01. Frequency of Withdrawals. No Member while an Employee may exercise rights under this Article X more frequently than once in any calendar quarter, provided however, that effective as of January 1, 1998, such rights may be exercised only once in a calendar year. 10.02. Withdrawals of Before-Tax Contributions. (a) Prior to a Member attaining the age of 59 1/2, such Member may not withdraw while an Employee any Before-Tax Contributions contributed on his or her behalf (except in case of financial hardship within the meaning of Regulation 1.401(k)-1(d)(2) of the Code) or Income thereon. "Financial hardship" means an immediate and heavy financial need occurring in the personal affairs of a Member such as: (i) amounts needed to obtain medical services described in Section 213(d) of the Code incurred by the Member, the Member's spouse, or any dependents of the Member (as defined in Section 152 of the Code) or necessary for those persons to obtain medical care; (ii) costs directly related to the purchase (excluding mortgage payments) of a principal residence for the Member; (iii) payment of tuition and related educational fees for the next 12 months of post-secondary education for the Member, his or her spouse, children, or dependents; or (iv) payments necessary to prevent the eviction of the Member from his or her place of residence or foreclosure on the mortgage of the Member's principal residence. A distribution will be deemed to be necessary to satisfy an immediate and heavy financial need of a Member if all of the following requirements are satisfied: (1) The distribution is not in excess of the amount of the immediate and heavy financial need of the Member including anticipated federal, state and local income taxes and penalties on the distribution, and (2) The Member has obtained all distributions, other than hardship distributions, and all nontaxable (at the time of the distribution) loans currently available under all plans maintained by the Company; and (3) The Member's After-Tax Contributions and Before-Tax Contributions under this Plan (and any other qualified or non-qualified plan of deferred compensation maintained by the Company) are suspended under a legally enforceable arrangement for at least twelve months after receipt of the hardship distribution; and (4) The Member may not make Before-Tax Contributions for the Member's taxable Year immediately following the taxable year of the hardship distribution in excess of the limitation set forth in Codes 402(g) for such next taxable year minus the amount of the Members Before-Tax Contributions for the year of the hardship withdrawal. The decision of the Administrator will be final in determining the existence of a hardship and the amount which may be withdrawn, but the Administrator shall make such determinations on a uniform and non-discriminatory basis. After receipt by a Member of a hardship withdrawal, the Member's right to make Employee After-Tax Contributions and Before-Tax Contributions shall be suspended for twelve (12) months. (b) When a Member has attained age 59 1/2, Before-Tax Contributions contributed on behalf of such Member and Income thereon may be withdrawn by such Member while an Employee as if such Before-Tax Contributions were Employee After-Tax Contributions and Income thereon, respectively, and the terms "Employee After-Tax Contributions," and "Income" as used hereinafter in this Article X, shall be deemed to include the respective Before-Tax Contributions and Income thereon in the accounts of Members aged 59 1/2 or more. 10.03. Withdrawals of Employee After-Tax Contributions. A Member while an Employee may withdraw from his or her accounts representing Employee After-Tax Contributions and Income thereon cash in an amount for a minimum amount of $500 of the lesser of (i) all Shares or Units therein with an aggregate value equal to the amount of such Member's Employee After-Tax Contributions not previously withdrawn or distributed or (ii) all the Shares or Units in such accounts to the extent not attributable to Income. Such withdrawal shall be made as close as practicable to equally from all Funds in which any Employee After-Tax Contributions of such Member are then invested. 10.04. Withdrawals of Remaining Shares or Units in Accounts Representing Employee After-Tax Contributions. After or contemporaneous with the maximum permitted withdrawals pursuant to Section 10.03, a Member while an Employee may withdraw in cash the value of all remaining Shares or Units in all Funds in the Member's Accounts representing Employee After-Tax Contributions. Each such request for a withdrawal shall terminate the Member's eligibility to have Company Contributions (if applicable) credited to his or her account for a period of nine months, effective as of the first payroll period ending on or after the effective date of any such withdrawal as provided in Section 10.07. 10.05. Withdrawals of Company Contributions. After or contemporaneous with the maximum permitted withdrawals pursuant to Section 10.04 and, if a Member had Accounts reflecting Employee After-Tax Contributions, Section 10.03, a Member while an Employee may withdraw in cash an amount not in excess of the sum of (i) the value of all vested Shares or Units in his or her Account in the Company Stock Fund representing Company Contributions (if applicable) (but not Income thereof) which have been credited to such account for at least 24 months as of the effective date of the withdrawal and (ii) the value of all vested Shares or Units in his or her Account in the Company Stock Fund representing Income on Company Contributions, regardless of how long the related Company Contributions have been credited to such Account as of the effective date of the withdrawal. Each such request for withdrawal shall terminate the Member's eligibility to have Company Contributions credited to his or her Account for a period of twelve months, effective as of the first payroll period ending on or after the effective date of any such withdrawal as provided in Section 10.06. 10.06. Effective Date. Each withdrawal shall be effective as of the business day on which the Trustee receives properly authorized instructions to make such withdrawals from the Plan Administrator (provided such instructions are received by the Trustee in good order prior to 4:00 p.m. Eastern Time). If not received by 4:00 P.M., the withdrawal shall be effective as of the next business day. The value of Shares or Units credited to the Member's Accounts shall be calculated (in the manner specified in Article VII) as of such Valuation Date. The amounts to which the Member is entitled shall be delivered to the Member as soon as practicable after the effective date of the withdrawal. 10.07. Withdrawals in Company Stock. To the extent of any withdrawal pursuant to this Article X of the value of Units in the Company Stock Fund, such withdrawal may be made, at the election of the Member, in shares of Company Stock (to the extent of whole shares) and in cash as to any fractional shares, all determined as provided in Section 9.01. 10.08. Termination of Employment; Eligibility Upon Re-Employment. If a Member who receives a distribution of his or her vested interest in Company Contributions (and Income attributable thereto) by reason of termination of his or her employment by the Company and all Subsidiaries again becomes employed by the Company or a Subsidiary within twelve months of his or her date of termination of employment, he or she shall be deemed to have made a withdrawal pursuant to Section 10.05 as of the date of his or her prior termination of employment. ARTICLE X A LOANS 10A.01. Eligibility and Loan Amount. (a) Active Members and, any other persons to the extent required by the Act or the Code or rules and regulations promulgated thereunder, shall be eligible to receive a loan from the Plan in accordance with the provisions set forth in this Article X A. "Active Member" for purposes of this Article X A shall mean any Member who is an Employee and who is not on layoff or leave of absence status for any reason or absent from work due to any disability. (b) Provided a Member meets the other requirements set forth in this Article X A, the Plan shall make a loan to a Member requesting the same in an amount which upon aggregating all such loans to a Member shall not, at the time any such loan is made, exceed the lesser of (i) $50,000 reduced by the excess (if any) of the highest outstanding balance of loans from the Plan during the one (1) year period ending on the day before the date on which such loan was made, over the outstanding balance of loans from the Plan on the date on which such loan was made, or (ii) fifty percent (50%) of the vested portion of the Participant's Account Balance at the time of the making of such loan. For purposes of this limitation, all loans from all qualified plans maintained by the Employer or by any entity which is required to be aggregated with the Employer pursuant to Sections 414(b), (c), (m) or (o) must be aggregated. (c) The minimum amount of any loan shall be $1,000. 10A.02. Term. Loans shall be granted for a minimum term of one year and for terms that are an integral multiple of one year up to a maximum term of five years; provided, however, that a loan may have a term of up to fifteen years if the purpose of the loan is to acquire the Member's principal residence. 10A.03. Interest Rate. The interest rate to be charged on a loan for the length of its term will be fixed and provide a return commensurate with the interest rates charged by institutions in the business of lending money for loans which would be made under similar circumstances, or such other rate as permitted by government regulations or releases. The interest rate in effect at the time a loan is approved shall be the fixed rate of interest charged on such loan over its entire term. Interest on a loan shall be calculated on the basis of actual days elapsed and a year of 365 days. Interest shall accrue from the date the loan amount is disbursed to a Member. 10A.04. Conditions to Loan Approval and Disbursement. (a) No loan shall be made to a Member prior to the execution and delivery by a Member of (i) a note and security agreement evidencing the loan from the Plan to such Member, (ii) any truth in lending disclosure material, and (iii) if such Member is receiving Covered Compensation, a Payroll Deduction Authorization authorizing payroll deductions for payment of interest on and principal of such loan. (b) A loan shall not be approved by the Plan prior to the Member's repaying in full all amounts due under any and all prior loans from the Plan. (c) The loan amount shall be disbursed as soon as practicable after the loan is approved by the Plan. (d) No more than one loan may be outstanding at any time with respect to a Member. 10A.05. Funding of Loans. (a) A loan from the Plan shall be funded as of a Valuation Date by (i) reducing the value of certain Accounts (as described in paragraph (b) below) of the Member requesting the loan by an amount equal to the loan amount, and (ii) transferring the proceeds resulting from such reduction to the Member's loan account (the "Loan Account"). Amounts in the Loan Account are then distributed as loan proceeds to the Member. From the time of loan disbursement to the Member and until the loan amount is repaid in full, the Member's Loan Account shall be treated as invested in the loan to the extent of any unpaid balance. A transfer to the Loan Account shall not constitute an investment election for purposes of Section 6.03 hereof. (b) Units and Shares shall be canceled on a pro rata basis in all Funds in which the Member is invested on the date the loan is approved by the Administrator. These Units or Shares shall be adjusted by redeeming the appropriate Funds using the value of the Funds as of the Valuation Date on which Vanguard receives authorized directions from the Plan Administrator to make the loan, provided that the directions are received properly executed prior to 4:00 P.M. Eastern Time. If the directions are received after 4:00 P.M. Eastern Time, the Accounts of a Member will be adjusted effective as of the next business day. 10A.06. Loan Repayment and Prepayment. (a) A loan shall be amortized in level payments. For a Member with an outstanding loan, interest and principal shall be payable on each payroll payment date. Commencing with the first payroll payment made in the month following the month in which the loan amount is disbursed, repayment shall be accomplished through regular payroll deductions. (b) Payments of principal and interest shall be applied to reduce amounts outstanding on a loan and shall be allocated to a Member's Loan Account and then applied to purchase Shares and Units in accordance with the Member's then current investment directions for contributions being made to the Savings Plan. (c) At any time after the sixth month anniversary date of a loan, a Member shall be entitled to prepay the loan in full. No partial prepayments shall be permitted. 10A.07. Loan Default. A Member's failure to make any payment of principal or interest on a loan when due (and in no event later than the end of the calendar quarter following the calendar quarter in which payment is due) shall constitute a "Default". ARTICLE XI MEMBERS' STATEMENTS At such times during the year as the Plan Administrator may deem appropriate, but no less frequently than annually, there shall be furnished to each Member a statement as of the end of such year of the value of the securities and cash in his or her Accounts. Such statement shall be deemed to have been accepted by the Member, his or her spouse at any time, if any, and his or her beneficiaries designated under Article XXI hereof as correct unless written notice to the contrary from the Member shall be received by the Administrator within 30 days after the mailing of such statement to the Member. ARTICLE XII NOTICES, ETC. 12.01. Notices to Employees, Etc. All notices, statements and other communications from the Administrator or a Participating Company to an Employee, Member or designated beneficiary required or permitted hereunder shall be deemed to have been duly given, furnished, delivered or transmitted, as the case may be, when delivered to (or when mailed by first class mail, postage prepaid and addressed to) the Employee at his or her work location, or to the Employee, Member or beneficiary at his or her address last appearing on the books of the Administrator. 12.02. Notices to Administrator. All notices, instructions and other communications from an Employee or Member to the Administrator required or permitted hereunder shall be effectuated by delivering to the Administrator, at least fifteen (or such lesser number of days as the Administrator from time to time may determine) days prior to the Enrollment Date or other applicable effective date in question a Payroll Deduction Authorization in the manner set forth therein, except as otherwise set forth in the Plan. A Payroll Deduction Authorization applicable to future Covered Compensation shall be effective with respect to Covered Compensation for pay periods commencing on and after the Enrollment Date in respect of which such Payroll Deduction Authorization was delivered. ARTICLE XIII APPOINTMENT OF TRUSTEE The Company shall appoint one or more individuals or corporations to act as Trustee under the Plan, and at any time may remove the Trustee and appoint a successor Trustee. The Company may, without reference to or action by any Employee, Member or beneficiary or any other Participating Company, enter into such Trust Agreement with the Trustee and from time to time enter into such further agreements with the Trustee, make such amendments to such Trust Agreement or further agreements and take such other steps and execute such other instruments as the Company in its sole discretion may deem necessary or desirable to carry the Plan into effect or to facilitate its administration. ARTICLE XIV APPLICATION OF FORFEITED CONTRIBUTIONS (a) Any of the Units in a Member's Account reflecting Company Contributions and Income attributable thereto which shall be forfeited pursuant to the provisions of the Plan shall be applied to reduce the Company Contributions of the Participating Company by which such Member was last employed. (b) If a check issued to a Member from the Plan is not cashed within 24 months after it is received by a Member, such check shall be forfeited to the Trust provided, however, if the Member should subsequently return and file a claim for the amount of the forfeited check, such amount shall be paid to the Member. ARTICLE XV VOTING OF COMPANY STOCK The Trustee, itself or by its nominee, shall vote shares of Company Stock attributable to Units of the Company Stock Fund in the Accounts of Members as follows: 15.01. Notice. The Company shall notify the Member of the date and purposes of each meeting of stockholders of the Company at which holders of shares of Company Stock shall be entitled to vote in the same manner as such holders are notified, and the Member shall instruct the Trustee as to the voting at such meetings of shares of Company Stock attributable to the Units of the Company Stock Fund in the Accounts of such Member, whether or not vested. 15.02. Vote. The Trustee, itself or by proxy, shall vote shares of Company Stock in such Accounts of the Member in accordance with instruction of the Member. 15.03. No Discretion. If, within five business days prior to such meeting of stockholders, the Trustee shall not have received instructions from the Members in respect of any shares of Company Stock in the Accounts of the Members, the Trustee may vote such shares at such meeting in the same proportion as such shares for which the Trustee has received timely instructions, subject to applicable law. ARTICLE XVI ADMINISTRATION 16.01. Savings Plan Committee. (a) This Plan shall be administered by the Savings Plan Committee. No member of the Committee shall receive any compensation from the Trust Fund for his or her service thereon. The Committee shall be the 'Administrator' of the Plan for purposes of Section 3(16) (A) of ERISA and the 'Named Fiduciary' of the Plan pursuant to Section 402(a) of ERISA. The Committee may delegate various duties and responsibilities to one or more employees or agents as set forth therein. In carrying out their respective responsibilities under the Plan, the Committee and other Plan fiduciaries shall have discretionary authority to interpret the terms of the Plan and to determine eligibility for an entitlement to Plan benefits in accordance with the terms of the Plan. Any interpretation or determination made pursuant to such discretionary authority shall be given full force and effect, unless it can be shown that the interpretation or determination was arbitrary and capricious. The Committee shall act by a majority of its members and the action of a majority of the Committee without a meeting which is duly recorded or otherwise appropriately documented shall be the action of the Committee. (b) In the exercise of all of its functions, the Committee shall act in an impartial and nondiscriminatory manner. (c) The Committee shall act by a majority of its members and the action of a majority of the Committee without a meeting which is duly recorded or otherwise appropriately documented shall be the action of the Committee. 16.02. Records Management. The Committee shall designate in its sole discretion a firm or organization to maintain the required records and reports of the Plan. 16.03. Books and Records. The Administrator shall cause to be maintained at all times accounts in such form and detail as are necessary for the effective administration of the Plan, except for records pertaining to the holdings in the various Funds other than the Stable Value Fund, which shall be kept by the Trustee. 16.04. Powers of the Administrator. The Administrator shall have all powers required for the administration and operation of the Plan, including, but not limited to, the following discretionary powers: (a) To establish and enforce such rules, regulations and procedures as it deems necessary or proper for the efficient administration of the Plan; (b) The discretionary authority to interpret the Plan and to decide any and all matters arising hereunder, including the right to remedy possible ambiguities, inconsistencies or omissions, and his or her decision or action in respect thereof shall be conclusive and binding upon all past, present and future Employees, Members and their beneficiaries, all Participating Companies and upon the Trustee; provided, however, that all such interpretations and decisions shall be applied without discrimination and in a uniform manner to all Employees, Members and beneficiaries similarly situated; and provided further, that no such interpretation shall limit or restrict the exercise by the Trustee of its fiduciary duties with respect to the Plan; (c) To decide all questions concerning the Plan and the eligibility of any Employee to participate in the Plan. (d) To authorize disbursements from the Trust on account of distributions and withdrawals; (e) To employ such advisors (including, but not limited to, attorneys, independent public accountants, and investment advisors) and such technical and clerical personnel as may be required in the Administrator's discretion for the proper administration of the Plan; (f) To designate, in his or her discretion, other fiduciaries with respect to the Plan, and to allocate to such fiduciaries such powers (including the appointment of advisors) and responsibilities (other than trustee responsibilities) with respect to the operation and administration of the Plan as he or she shall deem appropriate; (g) To compute the amount of benefits which shall be payable to any Member in accordance with the provisions of the Plan and to determine the person or persons to whom such benefits shall be paid; and (h) To authorize the payment of benefits. In carrying out his or her powers under this Section, the Administrator will be entitled to rely conclusively upon all information, tables, valuations, certificates, opinions and reports which will be furnished by any accountant, counsel, advisor, Employee or beneficiary. 16.05. Communications. Any person desiring to communicate with the Administrator, including any person claiming benefits under the Plan, shall direct such communication or claim to the Administrator, Wyeth Union Savings Plan, Wyeth, c/o Savings Plan Committee, Five Giralda Farms, Madison, New Jersey 07940. 16.06. Claims Review Procedure. (a) If any claim under the Plan is denied in whole or in part, the Administrator shall notify the claimant thereof in writing within a reasonable period of time after submission of such claim. Such written notice shall contain: (i) the specific reason or reasons for the denial; (ii) a specific reference to the provisions of the Plan on which such denial is based; (iii) a description of any additional material or information necessary for such person to perfect such claim, and an explanation of why such material or information is necessary; and (iv) an explanation of the Plan's review procedure as hereinafter set forth. (b) Every claimant whose claim has been denied in whole or in part, and any authorized representative of such person, may review all documents pertinent to such denial and, within 60 days after receipt by such claimant of the notification provided for in paragraph (a) of this Section, may request, by written notice sent to the Administrator, a review of such denial and may submit to the Administrator written issues and comments for consideration as part of such review. No claimant or representative shall have any right to appear personally, nor shall the Administrator be obligated to hold any meetings with any claimant or representative, or hold any hearings, as part of such review. The Administrator shall conduct such review as expeditiously as reasonably possible, and shall give due consideration to all written issues and comments submitted by or on behalf of such claimant. A decision on such review shall be made, if reasonably possible, not later than 60 days after the request for such review, but in any event not later than 120 days after receipt of such request. Such decision shall be in writing and shall include specific reasons for the decision, written in a manner calculated to be understood by the claimant, and shall also include specific references to the pertinent Plan provisions on which the decision is based. Effective for claims filed on or after January 1, 2002, a claim for benefits under the Plan and Trust shall be made by the Member or his or her Beneficiary (or his or her authorized representative) (hereinafter referred to as "Claimant") in writing to and in the form as prescribed by the Administrator. If such claim is wholly or partially denied (i.e., there is an adverse benefit determination), the Administrator shall provide such Claimant a written notice to that effect no later than ninety (90) days after the Plan's receipt of the Member's claim. However, if the Administrator determines that an extension of time for processing the claim is required as a result of special circumstances, written notice of the extension shall be furnished to the Claimant prior to the termination of the initial 90-day period. In no event shall such extension exceed a period of ninety (90) days from the end of such initial period. The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the Administrator expects to render the benefit determination. The Administrator shall provide a Claimant with written or electronic notification of any adverse benefit determination. Any electronic notification shall comply with the standards imposed by DOL Regulation 2520.104b-1(c)(1)(i), (iii), and (iv). The notification shall set forth, in a manner calculated to be understood by the Claimant, the specific reason or reasons for the adverse determination; reference to the specific Plan provisions on which the determination is based; a description of any additional material or information necessary for the Claimant to perfect the claim and an explanation of why such material or information is necessary; a description of the Plan's review procedures and the time limits applicable to such procedures, including a statement of the Claimant's right to bring a civil action under section 502(a) of ERISA following an adverse benefit determination on review. The Claimant shall have a reasonable opportunity to appeal and receive a full and fair review of an adverse benefit determination by the Named Fiduciary of the Plan. The Administrator shall provide a Claimant at least 60 days following receipt of a notification of an adverse benefit determination within which to appeal the determination. As part of its appeal review procedures, the Administrator shall provide a Claimant the opportunity to submit written comments, documents, records, and other information relating to the claim for benefits; provide that a Claimant shall be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the Claimant's claim for benefits; and provide for a review that takes into account all comments, documents, records, and other information submitted by the Claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination. A document, record, or other information will be considered relevant if such document, record, or other information was relied upon in making the benefit determination; was submitted, considered, or generated in the course of making the benefit determination, without regard to whether such document, record, or other information was relied upon in making the benefit determination; or demonstrates compliance with the administrative processes and safeguards otherwise designed to ensure and to verify that benefit claims determinations are made in accordance with the governing documents and are applied consistently. After the Named Fiduciary has had an opportunity to review a Claimant's appeal of an adverse benefit determination, the Administrator shall notify a Claimant of the benefit determination on review within a reasonable period of time, but not later than 60 days after receipt of the Claimant's request for review by the Plan, unless the Administrator determines that special circumstances (such as the need to hold a hearing, if the Plan's procedures provide for a hearing) require an extension of time for processing the claim. If the Administrator determines that 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 60-day period. In no event shall such extension exceed a period of 60 days from the end of the initial period. The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the Plan expects to render the determination on review. For purposes of this paragraph, "notification" shall mean written or electronic notification and shall include the specific reason or reasons for the adverse determination; reference to the specific Plan provisions on which the benefit determination is based; a statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the Claimant's claim for benefits; and a statement of the Claimant's right to bring an action under section 502(a) of ERISA. Whether a document, record, or other information is relevant to a claim for benefits shall be determined as provided for in the above paragraph. For purposes of reviewing an appeal of an adverse benefit determination, the period of time within which a benefit determination on review is required to be made shall begin at the time an appeal is properly filed, without regard to whether all the information necessary to make a benefit determination on review accompanies the filing. In the event that a period of time is extended as permitted above due to a Claimant's failure to submit information necessary to decide a claim, the period for making a benefit determination on review shall be tolled from the date on which the notification of the extension is sent to the Claimant until the date on which the Claimant responds to the request for additional information. The decision made at the appeal level will be binding, final and conclusive upon all parties. 16.07. Payment of Administrative Expenses . The reasonable expenses of administering the Plan, as determined by the Administrator, shall be payable from the Trust for the Plan, except to the extent that the Company, in its discretion, pays the expenses directly. ARTICLE XVII FIDUCIARY RESPONSIBILITY 17.01. Conduct. Each fiduciary shall discharge his or her duties with respect to the Plan and Trust Agreement solely in the interest of the Members and beneficiaries of Members for the exclusive purpose of providing benefits to Members and their beneficiaries, and defraying reasonable expenses of administering the Plan and Trust Fund with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with enterprise of a like character and with like aims, and in accordance with this Plan and any other documents or instruments governing the Plan and Trust Fund. A fiduciary who complies with the foregoing standards shall not be liable for any loss, action or omission hereunder. 17.02 Allocation and Delegation of Responsibilities. Plan Fiduciaries may allocate the responsibilities, obligations and duties granted to them for the operation and administration of the Plan and Trust Agreement among themselves. Any Plan Fiduciary may designate other individuals, corporations or other entities, who are not Plan Fiduciaries, to carry out such Plan Fiduciary's responsibilities, obligations and duties with respect to the Plan and Trust Agreement, except to the extent that ERISA prohibits such delegation of authority and discretion. Such allocations and delegations may be revoked or modified at any time and any such allocation, delegation, revocation or modification shall be made by written instruments signed by the Plan Fiduciary, if an individual, or in the case of other entities who are Plan Fiduciaries, in accordance with the procedures governing the functions of such entity, and a written record shall be kept thereof. 17.03 Co-Fiduciary Responsibility. A Plan Fiduciary or any individual, corporation or other entity employed or appointed by a Plan Fiduciary to serve in a fiduciary capacity with respect to the Plan or Trust Fund shall be solely responsible for the responsibilities, obligations or duties allocated or delegated to it, whether under this Plan and Trust Agreement or under the terms and conditions of employment or appointment. No person to whom such responsibilities, obligations or duties have not been allocated or delegated shall be responsible with respect to any action directed, taken or omitted by the Plan Fiduciary or individual, corporation or other entity serving in a fiduciary capacity to whom such responsibilities, obligations or duties have been allocated or delegated unless he or she participates knowingly in, or knowingly undertakes to conceal, an act or omission of such other Plan Fiduciary or individual, corporation or entity, knowing such act or omission is a breach of fiduciary responsibility or, if he or she has knowledge of a breach, he or she fails to make reasonable efforts under the circumstances to remedy the breach. 17.04 Duties of Fiduciaries With Respect to Investments. The Trustee shall have primary responsibility for investment of the assets of the Trust Fund which he or she administers unless the Company shall either: (a) Allocate control and management of all of any portion of the Trust assets to an Investment Manager, or (b) Notify the Trustee that the Committee shall direct the Trustee in the investment of all for any portion of the Trust Fund. If the Company appoints an Investment Manager pursuant to the foregoing, such Investment Manager shall be an investment adviser registered under the Investment Advisers Act of 1940, a bank as defined in such Act, or an insurance company which is qualified to manage the assets of employee benefit plans under the laws of more than one state. An Investment Manager shall acknowledge in writing its appointment as a Plan Fiduciary hereof, and shall serve until a proper resignation is received by the Company, or until it is removed or replaced by the Company. The Company, the Subsidiaries, the Committee and the Trustee shall be under no duty to question the direction or lack of direction of any Investment Manager, but shall act and shall be fully protected in acting, in accordance with each such direction. An Investment Manager shall have sole investment responsibility for that portion of the Trust assets which it has been appointed to manage, and no other Plan Fiduciary or any Trustee shall have any responsibility for the investment of any such assets, the management of which has been delegated to an Investment Manager, or liability for any loss to or diminution in value of such Trust assets resulting from any action directed, taken or omitted by an Investment Manager. If the Company notifies the Trustee that the Committee will direct the Trustee in the investment of all or any portion of the Trust Fund, the Trustee shall be subject to proper directions of the Committee, which are made in accordance with the terms of the Plan and which are not contrary to the provisions of Title I of ERISA. The Trustee shall be fully protected in acting in accordance with each such direction. No other Plan Fiduciary shall have any responsibility for the investment of any asset of the Trust Fund, the direction of which is given to the Committee, or liability for any loss to or diminution in value of such Trust Fund resulting from action taken or omitted by the Trustee in accordance with such direction. ARTICLE XVIII TERMINATION, AMENDMENT, MODIFICATION AND SUSPENSION 18.01. Amendment for Compliance with Law. The Board of Directors shall have the right to terminate, amend, or modify the Plan at any time for any reason; provided, however, that notwithstanding any other provision of the Plan, the Retirement Committee may amend or modify the Plan if such action is necessary or desirable and is (1) required by law, agreed to through collective bargaining or is appropriate to maintain the tax-qualified status of the Plan, or (2) is estimated not to result in a cost increase to the Company of more than five (5) percent, provided, however, that no amendment or alteration shall be made which: (a) shall adversely affect any right or obligation of any Participant with respect to any contribution made thereto; or (b) permits any fund paid. (a) shall adversely affect any right or obligation of any Participant with respect to any contributions made thereto; (b) permits any funds paid to the Trustee to revert to the Company; or (c) provides for the use of the assets of the Plan, or any part thereof other than for the exclusive benefit of Participants, former Participants or their Beneficiaries or paying the reasonable expenses of administering the Plan. 18.02. Effect. Any termination, amendment, modification or suspension of the Plan may affect Members in the Plan at the time thereof as well as future Members. 18.03. Immediate Vesting; Subsequent Distribution. Upon termination of the Plan or upon complete discontinuance of Company Contributions under the Plan having the effect of terminating the Plan, or upon complete discontinuance of Company Contributions under the Plan in respect of the employees of any Participating Company or in respect of the Employees of any entity by reason of such entity no longer being a Subsidiary, or in respect of all employees of the Company or its Subsidiaries located in any one state, territory or country solely by reason of such location and under circumstances in which such persons have not ceased to be Employees of the Company or a Subsidiary, in any such event having the effect of terminating the Plan as to such persons, all Units in the Accounts of persons affected thereby that are attributable to Company Contributions and Income thereon shall vest in such persons immediately. In the event of any termination or discontinuance referred to in this Section 18.03, the accounts of all affected Members will be distributed in accordance with Article IX, except that Before-Tax Contributions of affected Members who have not attained age 59 1/2 and Income thereon shall be distributed prior to such affected Member attaining such age only as permitted by Section 10.02(a). Upon such affected Member attaining age 59 1/2, such Before-Tax Contributions and Income thereon shall thereupon be distributed in accordance with Article IX. Notwithstanding the foregoing, if (a) the Savings Plan Committee directs the Administrator (in the case of (i) termination of the Plan, or (ii) the complete discontinuance of Company Contributions under the Plan having the effect of terminating the Plan, or (iii) the complete discontinuance of Company Contributions under the Plan in respect of all employees of the Company and its Subsidiaries located in any state, territory or country solely by reason of such location and under circumstances in which such persons have not ceased to be Employees of the Company or a Subsidiary, or (iv) upon complete discontinuance of Company Contributions under the Plan in respect of the Employees of any Participating Company where such former Participating Company remains a Subsidiary) or (b) the Administrator directs, in his or her discretion (in the case of a discontinuance of Company Contributions in respect of any entity by reason of such entity no longer being a Subsidiary and upon request of the Savings Plan Committee of such entity), that all Shares or Units in the Accounts of the persons affected thereby shall be transferred to a successor employees' trust described in Section 401(a) of the Code which is exempt from tax under Section 501(a) (or the analogous provisions of the Puerto Rico Tax Account) of the Code and which is authorized to accept such transfer, then in either such event such Units (including Shares or Units representing Before-Tax Contributions and Income thereon) shall be so transferred upon receipt by the Administrator, the Trustee and the trustee of such successor trust of such assurances as they shall respectively require that such transfer complies with the Act and the Code. In the event of such transfer, no Member or former Member shall have any right to any distribution from the Plan in lieu of such transfer to such other trust. Notwithstanding the foregoing, any such transfer to a trust which is part of a plan with respect to which the Internal Revenue Service has not issued a determination that such plan is qualified under Section 401(a) (unless the plan of which such trust forms a part is treated as a trust described in Section 401(a) pursuant to an election under Section 1022(i) of the Employees Retirement Income Security Act of 1974, as amended) shall be subject to the condition that, if no such determination has been issued within twelve months after such transfer, such Units shall be promptly re-transferred to the Trust. 18.04. No Diversion. Anything herein to the contrary notwithstanding, no termination, amendment or modification of the Plan or suspension of any provision thereof may (a) diminish the Shares or Units or value thereof in any Account of a Member as of the effective date of such termination, amendment, modification or suspension, or (b) have the effect of diverting all or any part of such Units amounts or value thereof in any Account of a Member as of the effective date of such termination, amendment, modification or suspension to purposes other than for the exclusive benefit of the Member and his or her beneficiaries, including any surviving spouse. 18.05. Further Restrictions on Rights of Company. (a) The rights of the Company hereunder are subject to the applicable rights granted to Members pursuant to Section 8.04. (b) There will be no merger or consolidation with, or transfer of any assets or liabilities to, any other plan, unless each Member will be entitled to receive a benefit immediately after such merger, consolidation, or transfer as if this Plan were then terminated which is at least equal to the benefit he or she would have been entitled to immediately before such merger, consolidation, or transfer as if this Plan had been terminated. ARTICLE XIX MEMBERS' RIGHTS NOT TRANSFERABLE OR ASSIGNABLE 19.01. Benefits Not Assignable. No right or interest of any Member under the Plan or in any of his or her Accounts shall be assignable or transferable, in whole or in part, either directly or by operation of law or otherwise, including without limitation, by execution, levy, garnishment, attachment, pledge or in any other manner, but excluding devolution by death or mental incompetency. No attempted assignment or transfer thereof shall be effective, and no right or interest of any Member under the Plan or in any of his or her accounts shall be liable for, or subject to, any obligation or liability of such Member. 19.02. Qualified Domestic Relations Order. Nothing in this Article XIX shall be deemed to apply to any payments required to made pursuant to any order of any court or agency which the Administrator determines to be a qualified domestic relations order, as defined in Section 206(d)(3)(B) of the Act. 19.03. Qualified Domestic Relations Order Procedure. Upon receipt by the Plan of any domestic relations order, the Administrator will promptly notify the affected Member and any Alternate Payee (as defined in Section 206(d)(3)(K) of the Act) of the receipt thereof and of the Plan's procedures for determining whether such order is a qualified domestic relations order, shall make such determination within a reasonable period after receipt of such order, and shall notify such Member and such Alternate Payee of such determination promptly thereafter. During the period in which the determination of whether a domestic relations order is a qualified domestic relations order is being made, the Administrator shall cause to be segregated in a separate account in the Plan the amounts which would have been payable to the Alternate Payee specified in such domestic relations order during such period if the order had been determined upon receipt to be a qualified domestic order, and such amounts shall be paid to such alternate payee if it is determined within eighteen months after receipt by the Administrator that such domestic relations order is a qualified domestic relations order. If, within such eighteen months, it is determined that such domestic relations order is not a qualified domestic relations order, or if such determination has not been made, then the Administrator shall pay the aggregate amounts segregated in such separate account to the Plan, the Member, or such other person or persons who would have been entitled to such amounts if there had been no order. No payment from such segregated account to any person shall be required to include interest. 19.04. Interest Rate For Qualified Domestic Relations Order. To the extent that any qualified domestic relations order requires payments to be made to an Alternate Payee prior to the time that the affected Member has separated from the service, as if such Member had retired on the date on which such payment is to begin under such order, and taking into account only the then present value of benefits actually accrued, the interest rate assumption utilized in determining such present value shall be six and one-half percent. 19.05 Obligation of Company. In the absence of a breach by the Administrator or any other fiduciary of the Plan of its or his or her fiduciary obligations to the Plan, the obligation of the Plan to the affected Member and to each Alternate Payee shall be discharged to the extent of any payment to either such Member or to such Alternate Payee based upon any determination by the Administrator that a domestic relations order is or is not a qualified domestic relations order. ARTICLE XX DESIGNATION OF BENEFICIARIES Effective January 1, 1983, each Member making any election under the Plan, and each surviving spouse, and each beneficiary who is a natural person, to whom any benefit under the Plan becomes payable shall file with the Administrator a written designation of a beneficiary or beneficiaries, in such proportions or sequence (in the event of the death of any such beneficiary prior to the completion of payments to such beneficiary) as the Member or surviving spouse or other beneficiary shall designate, to receive, subject to applicable law and any reasonable limitation of general application established by the Administrator, distributions from the Plan in the event of his or her death prior to complete distribution of benefits hereunder. A Member or such surviving spouse or other beneficiary may from time to time as permitted by the Plan revoke or change any such designation, subject to applicable laws and governmental regulations at the time in effect and any regulations which the Administrator may prescribe. In the case of lump sum distributions in respect of a deceased Member, if such Member did not designate a beneficiary, or if such beneficiary did not survive the Member, such distribution shall be made in the following order: first, to a Member's surviving spouse, if any; second, if there is no surviving spouse, to the Member's surviving children, if any, in equal shares; third, if there are no surviving children, to the Member's surviving parents, if any, in equal shares; and fourth, if there are no surviving parents, to the legal representative of the Member's estate. Any distribution in accordance with this Article XXI shall constitute a complete release of all Participating Companies, the Administrator and, the Trustee of all obligations with respect to such distribution. ARTICLE XXI TRANSFERS FROM OTHER QUALIFIED PLANS AND QUALIFIED TRUSTS 21.01. Transfers. In the event of an entity becoming a Subsidiary or of the acquisition by the Company or any Subsidiary of any business the employees of which become Employees, the Plan, upon authorization of the Board of Directors (or any committee or person to whom the Board of Directors may delegate the authority), may accept, from (a) any pension plan qualified under Section 401 of the Code which formerly provided coverage for such persons or (b) any trust qualified under Section 501 of the Code which formerly provided coverage for such persons, assets allocable to the accounts of such persons, subject to such reasonable conditions as the Administrator may impose to insure compliance with applicable law. Any transfers contemplated by this Section 21.01 shall be allocated and invested as contemplated by the Plan or as the Board of Directors (or any committee or person to whom the Board of Directors may delegate the authority) shall specify in authorizing such transfer as contemplated by this Section 21.01. 21.02. Transfers of Employees. If any Employee is transferred from a Subsidiary which is not a Participating Company to a Participating Company and elects to become a Member of the Plan, such person may elect, by filing a Payroll Deduction Authorization with the Administrator, to have transferred to the trust forming part of this Plan all of such person's individual account balances in any defined contribution individual account plan of such Subsidiary which is not a Participating Company in which such person participated as an employee thereof, subject to the requirements of such plan and its related trust, and subject to such reasonable conditions as the Administrator may propose to insure compliance with applicable law. Such transfer shall be effected as of such Valuation Date as the Administrator shall designate. 21.03. No Benefit Reduction. Nothing in this Article XXI shall be deemed to authorize or permit any reduction of the present value of any benefit attributable to any person. ARTICLE XXII ROLLOVER 22.01. Rollover. An Employee who was (a) a Member of a pension plan qualified under Section 401 of the Code, (b) covered by a trust qualified under Section 501 of the Code shall be permitted to transfer in cash his or her aggregate account balance from such prior plan into the Plan. Any such transfer shall be effected by the Employee delivering (on an Enrollment Date following within the period prescribed in the preceding sentence) a Rollover Application specifying the Fund or Funds in which such Employee's Rollover amount is to be invested. Notwithstanding any other provision in this Section 22.01 any transfers contemplated by this Section shall be subject to such reasonable conditions as the Administrator may impose to insure compliance with applicable law. 22.02. Direct Rollovers to Other Plans. (a) 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 from the Plan to an "Eligible Retirement Plan" specified by the distributee in a "Direct Rollover". (b) Definitions. "An Eligible Rollover Distribution" means any distribution of all or any portion of the balance to the credit of a Distributee, except that an Eligible Rollover Distribution does not include: (1) any distribution that is one of a series of substantially equal Periodic Payments (not less frequently than annually) made for (I) 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 (II) for a specified period of ten years or more; (2) any distribution to the extent such distribution is required under section 401(a)(9) of the Code; and (3) the portion of any distribution that is not includible in gross income (determined without regard to the exclusion for net unrealized appreciation with respect to employer securities) (4) A hardship withdrawal as described in Section 10.02 if (and only if) such withdrawal is made after December 31, 1999. (c) "Eligible Retirement Plan" for purposes of the Plan means an individual retirement account described in section 408(a) of the Code, an individual retirement annuity described in section 408(b) of the Code, an annuity plan described in section 403(a) of the Code, or a qualified trust described in section 401(a) of the Code that accepts the Distributee Member'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. (d) "Distributee" means an employee or former employee. In addition, the employee's spouse or former employee's surviving spouse and the employee's or former Member's spouse or former spouse who is the Alternate Payee under a qualified domestic relations order, as defined in section 414(p) of the Code, are Distributees with regard to the interest of the spouse or former spouse. (e) "Direct Rollover" means a payment by the plan to the Eligible Retirement Plan specified by the Distributee. 22.03. No Benefit Reduction. Nothing in this Article XXII shall be deemed to authorize or permit any reduction of the account balance of any benefit attributable to any person. ARTICLE XXIII MISCELLANEOUS PROVISIONS 23.01. Burden of Investment Risk. Each Member assumes all risk connected with any decrease in the market price of any securities, including Company Stock, credited to any of his or her Accounts. 23.02. No Contract of Employment. The establishment of the Plan shall not be construed as conferring any legal rights upon any Employee or any person for a continuation of employment nor shall it interfere with the rights of any Participating Company to discharge any Member or to treat him or her without any regard to the effect that such treatment might have on him or her as a Member. 23.03. Governing Law. This Plan shall be construed and interpreted in accordance with the laws of the State of New York, to the extent not pre-empted by the Act. 23.04. Leased Employees. Notwithstanding any other provisions of the Plan, for purposes of the pension requirements of Section 414(n)(3) of the Code, the employees of a Participating Company shall include individuals defined as "Employees" in Article I of the Plan. A Leased Employee within the meaning of Section 414(n)(2) of the Code shall become a Member in, or accrue benefits under, the Plan based on service as a Leased Employee only as provided in provisions of the Plan other than this Section 23.04. ARTICLE XXIV TREATMENT OF RETURNING VETERANS 24.01. Applicability and Effective Date. Notwithstanding, any other provisions of the Plan, the rights of any Returning Veteran who resumes employment with the Company on or after December 12, 1994 shall be modified as set forth in this Section. 24.02. Definitions. For purposes of this Section 24, the terms defined herein shall have the following meanings: (a) "Qualified Military Service" means any service (either voluntary or involuntary) by an individual in the Uniformed Services if such individual is entitled to reemployment rights with the Company with respect to such service. (b) "Returning Veteran" means a former Employee who, on or after December 12, 1994, returns from Qualified Military Service to employment with the Company within the period of time during which his or her reemployment rights are protected by law. (c) "Uniformed Services" means the Armed Forces, the Army National Guard and Air National Guard (when engaged in active duty for training, inactive duty training, or full-time National Guard duty), the commissioned corps of the Public Health Service, and any other category of persons designated by the President of the Untied States in time of war or emergency. 24.03. Eligibility to Participate. For purposes of Section 3 of the Plan: (a) A Returning Veteran who was an Employee eligible to participate in the Plan immediately prior to his or her Qualified Military Service shall be deemed to have remained an eligible Employee throughout his or her Qualified Military Service. (b) A Returning Veteran who would have become a Participant during the period of his or her Qualified Military Service but for the resulting absence from employment, shall be deemed to have become a Participant as of the date when he or she would have become a Participant if he or she had not entered into Qualified Military Service. 24.04. No Break in Service. A Returning Veteran shall be deemed not to have incurred any break in service on account of his or her Qualified Military Service. 24.05. Vesting Credit. To the extent applicable, a Returning Veteran's years of service for vesting purposes shall be determined under Article VIII, except that with respect to any period of Qualified Military Service, he or she shall be credited with the hours of service with which he or she would have been credited had he or she remained an Employee during such period. 24.06. Restoration of Before-Tax and After-Tax Contributions. (a) Each Returning Veteran who, during his or her period of Qualified Military Service would have been eligible to make Before-Tax and After-Tax Contributions, shall be permitted to contribute an amount equal to the amount of Before Tax Contributions that he or she could have made during such absence from employment. Such "make-up" contributions shall be made during the period that begins with the Employee's reemployment by the Employer and ends with: (i) the expiration of a period of five years, or (ii) if shorter, a period equal to three times the period of Qualified Military Service. (b) Any make-up contributions described in Subsection (a) hereof shall be made in addition to those Before-Tax Contributions or After-Tax Contributions that the Participant may elect to make after his or her reemployment pursuant to Section 4.01. 24.07. Determination of Compensation. For purposes of determining the amount of any make-up contributions under this Section 24.07, and for applying the limits of Section 5.02, a Member's Covered Compensation during any period of Qualified Military Service shall be deemed to equal either: (a) the Covered Compensation the Member would have received but for such Qualified Military Service, based on the rate of pay he or she would have received from the Company; or (b) if the amount described in (a) above is not reasonably certain, the Member's average Covered Compensation from a participating Company during the 12-month period immediately preceding the Qualified Military Service (or, if shorter, the period of employment immediately preceding the Qualified Military Service). Such amount shall be adjusted as necessary to reflect the length of the Member's Qualified Military Service. 24.08. Application of Certain Limitations. (a) For purposes of applying the limitations of Sections IV A and IV B, any make-up contributions described in Section 24.06, and any related Matching Contributions described in Section 24.08, shall be treated as contributions for the Plan Year to which they relate, rather than the Plan Year in which they were actually made. (b) For purposes of applying the limitations of Section IV A, any such make-up contributions shall be treated as contributions for the calendar year to which they relate, rather than the calendar year in which they are actually made. (c) For purposes of applying the limitations of applying the limitations of Sections IV A and IV B and Section V A, any make-up contributions described in Section 24.06 and related Company Contributions described in Section 24.08 (if any) shall be disregarded, both for the Plan Year to which the contributions relate, and for the Plan Year in which they are actually made. 24.09. Suspension of Loan Repayments. Notwithstanding any provisions of Article X A to the contrary, if a Member receives a loan from the Plan and enters into Qualified Military Service during the term of the loan, a decrease in Covered Compensation or failure to make required loan repayments during such Qualified Military Service shall not result in a default under Article X A. 24.10. Administrative Rules and Procedures. The Committee or the Administrator shall establish such rules and procedures as it deems necessary or desirable to implement the provisions of this Article, provided that they are not in violation of the Uniformed Services Employment and Reemployment Rights Act of 1994, any regulations thereunder, or any other applicable law. Wyeth Union Saving Plan Schedule A The following is a list of collective bargaining units, which have negotiated for and accepted participation in the Wyeth Union Savings Plan: 1. Teamsters Local 781 at Carol Stream, Illinois 2. International Chemical Workers Union Local 143 at Pearl River, New York 3. International Chemical Workers Union Council/UFEW Local 887-C at Hannibal, Missouri 4. International Chemical Workers Union Local 111 at Bound Brook, New Jersey 5. International Chemical Workers Union Local 560 at Danbury, Connecticut 6. International Chemical Workers Union Local 95 - Rouses Point, New York 7. Local 6, United Food and Chemical Workers International Union, AFL-CIO-CLC, Fort Dodge, Iowa WYETH UNION SAVINGS PLAN SCHEDULE B 1. Stable Value Fund (Vanguard Retirement Savings Trust) 2. Vanguard Balanced Index Fund 3. Vanguard 500 Index Fund 4. Vanguard Small-Cap Index Fund 5. Vanguard Total International Stock Index Fund 6. Wyeth Common Stock Fund AMERICAN HOME PRODUCTS CORPORATION UNION SAVINGS PLAN (the "Plan") APPENDIX I VESTING FOR PARTICIPANTS WHO ARE TRANSFERRED TO TYCO INTERNATIONAL (U.S.), INC. American Home Products Corporation ("AHPC"), American Cyanamid Company ("Cyanamid"), and AHPC Subsidiary Holding Corporation ("AHPC Sub") entered into an agreement (the "Purchase Agreement") with Tyco International (U.S.), Inc. ("Tyco"), dated as of October 20, 1997, whereby Tyco purchased, as of February 27, 1998 (the "Closing Date"), substantially all of the issued and outstanding shares and certain of the assets of Sherwood Medical Company, a wholly-owned subsidiary of AHPC. Pursuant to Section 9.4(c) of the Purchase Agreement, the Plan is amended to provide that, notwithstanding the provisions of Section 4.4 of the Plan, a Plan Participant, as of the Closing Date, whose employment is transferred to Tyco as of the Closing Date, shall be fully vested in his or her benefit attributable to his or her Matching Account accrued as of the Closing Date, regardless of whether he or she has less than five years of Continuous Service. AMERICAN HOME PRODUCTS CORPORATION UNION SAVINGS PLAN (the "Union Savings Plan") VESTING FOR PARTICIPANTS WHO ARE TRANSFERRED TO BASF AKTIENGESELLSCHAFT APPENDIX II American Home Products Corporation (the "Company") and American Cyanamid Company, a Maine Corporation ("Cyanamid") a wholly-owned subsidiary of the Company, entered into an agreement with BASF Aktiengesellschaft, a corporation organized under the laws of Germany ("BASF"), dated as of March 20, 2000 (the "Purchase Agreement"), whereby the Company sold to BASF the crop protection business conducted by Cyanamid. Pursuant to Section 9.4(c) of the Purchase Agreement, the Union Savings Plan is hereby amended as of June 30, 2000 (the "Closing Date") to provide that, notwithstanding the provisions of Section __ of the Union Savings Plan, all Plan Participants who are "U.S. Employees" as defined in the Purchase Agreement (or whose connection with the transactions contemplated by the Purchase Agreement) whose employment is transferred to BASF as of the Closing Date, shall be fully vested in his or her benefit attributable to his or her Matching Account accrued as of the Closing Date, regardless of whether he or she has less than five years of Continuous Service. However, Participants who are on disability, leave of absence, or layoff with recall rights on the Closing Date shall be fully vested in his or her benefit attributable to his or her Matching Contributions (is any) as of the time he or she returns to work and is transferred to employment with BASF, provided such return to employment and transfer occurs within 180 days after the Closing Date. AMERICAN HOME PRODUCTS UNION SAVINGS PLAN - UNITED STATES EGTRRA AMENDMENTS APPENDIX III SECTION 1. LIMITATIONS ON CONTRIBUTIONS 1. Effective date. This Section shall be effective for Limitation Years beginning after December 31, 2001. 2. Maximum Annual Addition. Except to the extent permitted under Section 7 of this amendment and Section 414(v) of the Code, if applicable, the Annual Addition that may be contributed or allocated to a Participant's Account under Section 10 of the Plan for any Limitation Year shall not exceed the lesser of: (a) $40,000, as adjusted for increases in the cost-of-living under Section 415(d) of the Code, or (b) 100 percent of the Participant's Compensation, within the meaning of Section 415(c)(3) of the Code, for the Limitation Year. The Compensation limit referred to in (b) shall not apply to any contribution for medical benefits after separation from service (within the meaning of Section 401(h) or Section 419A(f)(2) of the Code) which is otherwise treated as an Annual Addition. SECTION 2. INCREASE IN COMPENSATION LIMIT The annual Compensation of each Participant taken into account in determining allocations for any Plan Year beginning after December 31, 2001, shall not exceed $200,000, as adjusted for cost-of-living increases in accordance with Section 401(a)(17)(B) of the Code. Annual Compensation means Compensation during the Plan Year or such other consecutive 12-month period over which Compensation is otherwise determined under the Plan (the "determination period"). The cost-of-living adjustment in effect for a calendar year applies to annual Compensation for the determination period that begins with or within such calendar year. SECTION 3. MODIFICATION OF TOP-HEAVY RULES 1. Effective date. This Section shall apply for purposes of determining whether the Plan is a top-heavy Plan under Section 416(g) of the Code for Plan Years beginning after December 31, 2001, and whether the Plan satisfies the minimum benefits requirements of Section 416(c) of the Code for such years. This Section amends Section 11 of the Plan. 2. Determination of top-heavy status. 2.1 Key Employee. Key Employee means any Employee or former Employee (including any deceased employee) who at any time during the Plan Year that includes the Determination Date was an officer of the Employer having annual compensation greater than $130,000 (as adjusted under Section 416(i)(1) of the Code for Plan Years beginning after December 31, 2002), a 5-percent owner of the employer, or a 1-percent owner of the Employer having annual compensation of more than $150,000. For this purpose, annual compensation means compensation within the meaning of Section 415(c)(3) of the Code. The determination of who is a Key Employee will be made in accordance with Section 416(i)(1) of the Code and the applicable regulations and other guidance of general applicability issued thereunder. 2.2 Determination of present values and amounts. This Section 2.2 shall apply for purposes of determining the amounts of account balances of Employees as of the Determination Date. 2.2.1 Distributions during year ending on the Determination Date. The amounts of account balances of an Employee as of the Determination Date shall be increased by the distributions made with respect to the Employee under the Plan and any plan aggregated with the Plan under Section 416(g)(2) of the Code during the 1-year period ending on the Determination Date. The preceding sentence shall also apply to distributions under a terminated plan which, had it not been terminated, would have been aggregated with the Plan under Section 416(g)(2)(A)(i) of the Code. In the case of a distribution made for a reason other than separation from service, death, or disability, this provision shall be applied by substituting "5-year period" for "1-year period." 2.2.2 Employees not performing services during year ending on the Determination Date. The Accounts of any individual who has not performed services for the Employer during the 1-year period ending on the Determination Date shall not be taken into account. 3. Minimum benefits. Matching Contributions. Matching Contributions shall be taken into account for purposes of satisfying the minimum contribution requirements of Section 416(c)(2) of the Code and the Plan. The preceding sentence shall apply with respect to Matching Contributions under the Plan. Matching Contributions that are used to satisfy the minimum contribution requirements shall be treated as Matching Contributions for purposes of the actual contribution percentage test and other requirements of Section 401(m) of the Code. SECTION 4. DIRECT ROLLOVERS OF PLAN DISTRIBUTIONS 1. Effective date. This Section shall apply to distributions made after December 31, 2001. 2. Modification of definition of Eligible Rollover Distribution to exclude hardship withdrawals. For purposes of the direct rollover provisions in Section 7.14 of the Plan, any amount that is distributed on account of hardship shall not be an Eligible Rollover Distribution and the Distributee may not elect to have any portion of such a distribution paid directly to an Eligible Retirement Plan. 3. Modification of definition of Eligible Rollover Distribution to include after-tax contributions. For purposes of the direct rollover provisions in Section 7.14 of the Plan, a portion of a distribution shall not fail to be an Eligible Rollover Distribution merely because the portion consists of after-tax contributions which are not includible in gross income. However, such portion may be transferred only to an individual retirement account or annuity described in Section 408(a) or (b) of the Code, or to a qualified defined contribution plan described in Section 401(a) or 403(a) of the Code that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution which is includible in gross income and the portion of such distribution which is not so includible. 4. Modification of definition of Eligible Retirement Plan. For purposes of the direct rollover provisions in Section 7.13 of the Plan, an Eligible Retirement Plan shall also mean an annuity contract described in section 403(b) of the Code and an eligible plan under section 457(b) of the Code which is maintained by a state, political subdivision of a state and which agrees to separately account for amounts transferred into such plan from this plan. The definition of Eligible Retirement Plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relation order, as defined in section 414(p) of the Code. The Plan will accept Participant Rollover Contributions and/or direct rollovers of Eligible Rollover Distributions made after December 31, 2001, from a qualified Plan described in Section 401(a) or 403(a) of the Code. SECTION 5. REPEAL OF MULTIPLE USE TEST The multiple use test described in Treasury Regulation Section 1.401(m)-2 and Section 4.10 of the Plan shall not apply for Plan Years beginning after December 31, 2001. SECTION 6. ELECTIVE DEFERRALS - CONTRIBUTION LIMITATION No Participant shall be permitted to have Salary Deferral Contributions made under this Plan, or any other qualified plan maintained by the Employer during any taxable year, in excess of the dollar limitation contained in Section 402(g) of the Code in effect for such taxable year, except to the extent permitted under Section 7 of this amendment and Section 414(v) of the Code, if applicable. SECTION 7. CATCH-UP CONTRIBUTIONS All Employees who are eligible to make Salary Deferral Contributions under this Plan and who have attained age 50 before the close of the Plan Year shall be eligible to make catch-up contributions in accordance with, and subject to the limitations of, Section 414(v) of the Code. Such catch-up contributions shall not be taken into account for purposes of the provisions of the Plan implementing the required limitations of Sections 402(g) and 415 of the Code. The Plan shall not be treated as failing to satisfy the provisions of the Plan implementing the requirements of Sections 401(k)(3), 401(k)(11), 401(k)(12), 410(b), or 416 of the Code, as applicable, by reason of the making of such catch-up contributions. This Section 7 shall apply to contributions made after December 31, 2001. SECTION 8. SUSPENSION PERIOD FOLLOWING HARDSHIP DISTRIBUTION A Participant who receives a distribution of Salary Deferral Contributions after December 31, 2001, on account of hardship shall be prohibited from making Salary Deferral Contributions and After-Tax Contributions under this Plan and all other plans of the Employer for 6 months after receipt of the distribution. SECTION 9. DISTRIBUTION UPON SEVERANCE FROM EMPLOYMENT 1. Effective date. This Section 9 shall apply for distributions and severances from employment occurring after the dates set forth below. 2. New distributable event. A Participant's Salary Deferral Contributions, Matching Contributions, and earnings attributable to these contributions shall be distributed on account of the Participant's severance from employment. However, such a distribution shall be subject to other provisions of the Plan regarding distributions, other than provisions that require a separation from service before such amounts may be distributed. This Section shall apply for distributions after severances from employment occurring after December 31, 2001. EX-12 8 ex12.txt Exhibit 12 Wyeth Computation of Ratio of Earnings to Fixed Charges (3) (in thousands, except ratio amounts)
Year Ended December 31, Three Months Ended ------------------------------------------------------------------- March 31, 2003 2002 2001 2000 1999 1998 ------------------ ---------- ---------- ----------- ----------- ---------- Earnings - -------- Income (loss) from continuing operations before federal and foreign taxes $1,782,588 $6,097,245 $2,868,747 $(1,101,040) $(1,907,299) $3,089,936 Add: - ---- Fixed charges 83,190 430,449 439,058 324,887 403,694 371,986 Minority interests 4,863 27,993 20,841 26,784 30,301 620 Distributed equity income 0 0 0 0 0 771 Amortization of capitalized interest 2,206 8,866 2,497 1,917 1,803 1,487 Less: - ----- Equity income 328 20,766 70,372 55,991 2,122 473 Capitalized interest 24,600 88,008 94,257 43,303 15,375 9,497 ---------- ---------- ---------- ----------- ----------- ---------- Total earnings (loss) as defined $1,847,919 $6,455,779 $3,166,514 $(846,746) $(1,488,998) $3,454,830 ========== ========== ========== =========== =========== ========== Fixed Charges: - -------------- Interest and amortization of debt expense $46,520 $294,160 $301,145 $238,840 $343,271 $322,970 Capitalized interest 24,600 88,008 94,257 43,303 15,375 9,497 Interest factor of rental expense (1) 12,070 48,281 43,656 42,744 45,048 39,519 ---------- ---------- ---------- ----------- ----------- ---------- Total fixed charges as defined $83,190 $430,449 $439,058 $324,887 $403,694 $371,986 ========== ========== ========== =========== =========== ========== Ratio of earnings to fixed charges (2) 22.2 15.0 7.2 - - 9.3 (1) A 1/3 factor was used to compute the portion of rental expenses deemed representative of the interest factor. (2) The results of operations for the years ended December 31, 2000 and 1999 were inadequate to cover total fixed charges as defined. The coverage deficiency for the years ended December 31, 2000 and 1999 was $1,171,633 and $1,892,692, respectively. (3) Amounts have been restated to reflect the Cyanamid Agricultural Products business as a discontinued operation.
EX-99.1 9 ex991.txt CEO SARBANES-OXLEY CERTIFICATION Exhibit 99.1 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report of Wyeth (the "Company") on Form 10-Q for the fiscal quarter ended March 31, 2003, as filed with the Securities and Exchange Commission on May 15, 2003 (the "Report"), I, Robert Essner, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that: (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated: May 15, 2003 By /s/ Robert Essner ----------------------- Robert Essner Chairman, President and Chief Executive Officer EX-99.2 10 ex992.txt CFO SARBANES-OXLEY CERTIFICATION Exhibit 99.2 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Quarterly Report of Wyeth (the "Company") on Form 10-Q for the fiscal quarter ended March 31, 2003, as filed with the Securities and Exchange Commission on May 15, 2003 (the "Report"), I, Kenneth J. Martin, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that: (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated: May 15, 2003 By /s/ Kenneth J. Martin --------------------- Kenneth J. Martin Executive Vice President and Chief Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----