sanofi-aventis plan analysis and overview - t. rowe price · pdf filechemistry matters...

C H E M I ST RY M AT T E R S

sanofi-aventis Plan Analysis and OverviewT. Rowe Price Tools and Best Practice Considerations for your U.S. Savings Plan

Providing Ways to Move Your Plan ForwardT. RowE PRICE IS CoMMITTEd to providing you with resources to help you with your strategic and fiduciary oversight as you move your plan forward. Developed specifically for you, these resources can help you:

Review and analyze your plan

Understand the costs incurred and the value received

Evaluate participant behavior, trends, and asset allocations

Improve and maintain your plan

Minimize your fiduciary risk

Stay in alignment with your retirement plan goals

Drive participant success

Your Diagnostic and Strategic Planning ToolsThese innovative resources can help you manage plan risk and bolster your ability to be a champion for the overall health of your plan:

Plan & Investment Review

Plan MeterTM

Strategic Plan Review

Plan Cost Analysis & Report Card

Fiduciary Source

We invite you to explore how we use these tools to help you provide your participants with the best possible retirement outcomes.

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With the Plan & Investment Review, you will know at a glance how your participants are contributing and investing, as well as how your plan compares with other plans. This powerful tool helps you:

Identify plan trends to understand how your participants are saving

Stay informed on legislative and product updates

Analyze your plan trends against Profit Sharing/401(k) Council of America data and T. Rowe Price clients

See how your investment options compare against the Lipper Peer Group Averages

Plan & Investment Review includes:

Cash flow

Participation and contribution rates

Asset Allocation by age and status

One fund contributors and investors

Net exchanges and exchange detail

Loan and rollover trends

Call center and online statistics

4. PlAn SERvICES: nuTS And BolTS

PlAn & InvESTMEnT REvIEw

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Plan at a glance

36T. ROWE PRICE RETIREMENT PLAN SERVICES

SANOFI-AVENTIS US SAVINGS PLAN

The following table shows how your plan compares to the T. Rowe Price universe of defined contribution plans in a number of key areas.

As of December 31, 2008.Time period January 1 — March 31, 2008. Time period January 1 — March 31, 2009. Time period January 1 — December 31, 2008. T. Rowe Price average includes all plans.

YOUR PLAN YOUR PLAN

3/31/08 3/31/09 TRP AVERAGE

PARTICIPATION AND CONTRIBUTIONS

Participation rate 92.7% 92.4% 73.5%

Average participant account balance $116,799 $93,811 $44,243

Average contribution percentage, excluding non-participants 10.1% 9.9% 7.7%

Percentage of participants contributing at or above

the company match limit, excluding non-participants 93.2% 92.6% N/A

INVESTMENT DIRECTION

Percentage of participants directing all

new contributions into one investment

option, excluding target date funds 5.3% 9.9% 15.6%

Percentage of participants directing all

new contributions into target date funds only 42.2% 39.1% 43.1%

Percentage of participants with all

assets in one fund, excluding target date funds 5.7% 7.3% 13.0%

Percentage of participants with all assets in target date funds only 28.4% 27.1% 32.2%

PLAN ASSETS

Percentage of plan assets in money market/stable value funds 14.0% 21.4% 27.4%

Percentage of plan assets in bond funds 4.0% 6.4% 6.7%

Percentage of plan assets in target date funds 44.6% 39.1% 21.1%

Percentage of plan assets in stock funds 30.0% 25.7% 34.9%

Percentage of plan assets in company stock 3.6% 3.6% 13.0%

Percentage of plan assets in TradeLink® Investments 2.4% 2.0% 1.9%

LOANS, DISTRIBUTIONS AND EXCHANGES

Percentage of participants who have loans 11.1% 11.6% 16.9%

Direct rollovers versus cashouts 91%/9% 88%/12% 78%/22%

Asset allocation - active

42 T. ROWE PRICE RETIREMENT PLAN SERVICES


� Stability/Money Market $168,727,513 10.6%sanofi-aventis Stable Value Fund 168,727,513 10.6 3,660

� Bond $73,915,803 4.6%PIMCO Total Return Fund 73,915,803 4.6 2,345

� Target Date $663,900,056 41.7%Retirement 2005 Fund 7,287,045 <1.0 141Retirement 2010 Fund 48,896,669 3.1 429Retirement 2015 Fund 62,511,000 3.9 569Retirement 2020 Fund 110,661,260 6.9 1,074Retirement 2025 Fund 115,850,334 7.3 1,138Retirement 2030 Fund 136,027,313 8.5 1,835Retirement 2035 Fund 88,521,717 5.6 1,637Retirement 2040 Fund 64,262,543 4.0 1,716Retirement 2045 Fund 17,665,613 1.1 762Retirement 2050 Fund 1,378,976 <1.0 65Retirement Income Fund 10,837,586 <1.0 333

� Stock $556,598,547 34.9%American Funds

Growth Fund of America 103,503,241 6.5 4,006Small-Cap Stock Fund 89,612,479 5.6 4,112JPMorgan EAFE Plus Index 88,714,057 5.6 3,538Vanguard Mid-Cap Index Fund 79,405,642 5.0 3,707Vanguard Institutional Index Fund 70,072,089 4.4 2,687Wellington Large Cap Research Trust 68,748,388 4.3 2,298Vanguard Windsor II Admiral Fund 56,542,650 3.6 2,653

� Company Stock $58,138,461 3.7%sanofi-aventis ADR Fund 58,138,461 3.7 4,102

� Other $72,442,438 4.6%TradeLink® Investments 44,919,068 2.8 210Outstanding Loan Balance 27,523,370 1.7 1,858

� Stability/Money Market $211,044,192 17.1%sanofi-aventis Stable Value Fund 211,044,192 17.1 3,991

� Bond $89,873,633 7.3%PIMCO Total Return Fund 89,873,633 7.3 2,698

� Target Date $460,443,227 37.4%Retirement 2005 Fund 4,803,891 <1.0 148Retirement 2010 Fund 29,602,614 2.4 385Retirement 2015 Fund 43,778,023 3.6 537Retirement 2020 Fund 75,393,904 6.1 989Retirement 2025 Fund 76,828,569 6.2 1,037Retirement 2030 Fund 93,878,255 7.6 1,702Retirement 2035 Fund 64,887,559 5.3 1,506Retirement 2040 Fund 47,210,524 3.8 1,523Retirement 2045 Fund 14,273,159 1.2 691Retirement 2050 Fund 1,197,905 <1.0 83Retirement Income Fund 8,588,825 <1.0 389

� Stock $366,734,337 29.8%American Funds

Growth Fund of America 71,787,005 5.8 3,807Small-Cap Stock Fund 64,020,294 5.2 3,855Vanguard Mid-Cap Index Fund 51,753,374 4.2 3,520sanofi-aventis

International Core Fund 49,958,981 4.1 3,179Vanguard Institutional Index Fund 48,634,178 4.0 2,634Wellington Large Cap Research Trust 41,066,797 3.3 2,116Vanguard Windsor II Admiral Fund 39,513,706 3.2 2,574

� Company Stock $44,150,282 3.6%sanofi-aventis ADR Fund 44,150,282 3.6 3,616

� Other $59,587,610 4.8%TradeLink® Investments 31,505,219 2.6 218Outstanding Loan Balance 28,082,391 2.3 1,846

PARTICIPANT BALANCES

# of Participants 12,205

Average Account Balance $130,564

Investment Option Usage 3.5 per participant

PARTICIPANT BALANCES

# of Participants 11,410

Average Account Balance $107,944

Investment Option Usage 3.6 per participant

Number ofParticipants

Number ofParticipants

TOTAL ASSETS: $1,593,722,818

As of March 31, 2008

TOTAL ASSETS: $1,231,833,281


Asset allocation by age: active


ASSETS BY AGE AND PRIMARY HOLDING


100%

80%

60%

40%

20%

0<20 20-29 30-39 40-49 50-59 60-64 65-69 70+

ASSET ALLOCATION BY AGE GROUP

Other - Loan balance outstanding and TradeLink® Investments.

45 T. ROWE PRICE RETIREMENT PLAN SERVICES

— $24,120 $58,302 $115,881 $186,483 $241,550 $204,767 $327,212

Average Account Balance

— 648 4,258 3,947 2,039 394 84 17

Participant Counts

<20 — — — — — —

20-29 956,031 6.1 680,917 4.4 7,812,294 50.0 5,265,964 33.7 629,800 4.0 285,027 1.8

30-39 20,578,865 8.3 12,583,690 5.1 104,052,958 41.9 89,484,263 36.1 10,726,475 4.3 10,824,436 4.4

40-49 55,187,172 12.1 30,383,104 6.6 179,187,592 39.2 151,696,272 33.2 19,376,266 4.2 21,552,524 4.7

50-59 91,105,415 24.0 33,060,470 8.7 130,880,369 34.4 99,933,546 26.3 9,988,292 2.6 15,271,387 4.0

60-64 31,102,555 32.7 10,205,090 10.7 31,607,922 33.2 15,574,748 16.4 2,598,366 2.7 4,082,037 4.3

65-69 6,060,954 35.2 1,759,767 10.2 5,217,798 30.3 2,933,715 17.1 666,708 3.9 561,445 3.3

70+ 3,454,813 62.1 492,481 8.9 887,934 16.0 588,763 10.6 131,631 2.4 6,983 <1.0

Stability/Money Market Bond Target Date Stock

CompanyStock Other

$ % $ % $ % $ % $ % $ %

AgeGroup

Stability/Money Market Bond Target Date Stock Company Stock Other

Plan OPPOrtunities DiscOvereD

During the recent downturn of the market, here’s what we

discovered about your plan:

• There was a 36% increase in call volume; most participants

were simply seeking assurance. There was only a slight increase

in loans and exchanges (less than 5% of participants).

• 90% of participants who made exchanges opted to exchange

into the Stable Value Fund.

Identification of these trends led to the creation of a customized

communication strategy for participants, including Web seminars

for plan sponsors and participants and a new section on your

myRetirementPlan Web site for important market updates and videos.

lOOKinG FOrWarD

• A large number of your participants (approximately 6%) are only contributing to or investing in the Stable Value Fund. We can provide additional communication to participants on the benefits of diversification.

• Terminated participants make up 35% of your plan’s assets. You might consider increasing communication to this particular group.

• Of the participants that initiate contact with T. Rowe Price, 86% use electronic communication methods, 7% choose to speak with a representative and 7% use our automated phone service. You may want to consider utilizing electronic communications to support participant preferences.

Plan Meter gives you a glimpse of your participants’ replacement income projections. This resource not only looks at how much your participants are investing but also at the way they are investing. It also shows the potential impact of changes you can consider to improve your results.

Each Plan Meter report is custom-generated for your plan and is based on your retirement program’s options and rules.

PlAn METERTM

Plan OPPOrtunities DiscOvereD:

In November 2008, here’s what Plan Meter identified to help your participants reach their retirement goals:

• The median replacement income for your participants is 31%.

• Your median employee contribution rate is 8%. With your average 8% company match, the average participant savings rate is 16%. T. Rowe Price suggests targeting a 20% average participant savings rate.

• 6% of your total population has a replacement income of 0%— these employees have a median age of 39 and 3 years of tenure.

• Highly compensated employees who are over age 50 are projected to realize as much as a 10% improvement as a result of making catch-up contributions.

lOOKinG FOrWarD:

Savings rates are critical toward generating sufficient replacement income. The most dramatic improvements across the board result from increasing savings rates. Both auto-increase and auto-enrollment would be effective solutions to improve replacement income.

• By adding auto-increase up to 12%, you can improve participants’ replacement income by an average of 50% and help your plan reach an average 20% savings rate.

• An opportunity exists with the 6% of your employee population that has a 0% replacement income. This can be achieved by considering the utilization of auto-reenrollment to get this population into the plan. Encouraging highly compensated employees who are over age 50 and are contributing the maximum to consider catch-up contributions may increase their replacement income by 10%.

Source: Plan Meter™ for sanofi-aventis – Fall 2008

plan meterSM

A RETIREMENT INCOME ANALYSIS FOR YOUR PLAN

Prepared exclusively for:

ABC Company

Plans:

12345 & 98765

2009

1 2 | T. R O W E P R I C E

AGE EMPL RI:CURRENT

RI:AAS

TOTAL SEGMENT

>=60

50−59

40−49

30−39

<=29

1

1

1

1

0

16

25

10

29

0

21

37

15

56

0

MM/SV: >=80% (4 EMPLOYEES)

21%

29%

RI:CURRENT

RI:AAS

>=60

50−59

40−49

30−39

<=29

0

3

4

3

0

0

16

13

20

0

0

24

16

28

0

MM/SV: 60%−79% (10 EMPLOYEES)

15%

23%

RI:CURRENT

RI:AAS

>=60

50−59

40−49

30−39

<=29

1

6

3

5

1

21

12

17

18

29

22

15

24

23

41


16%22%

RI:CURRENT

RI:AAS

>=60

50−59

40−49

30−39

<=29

0

8

9

18

1

0

15

19

26

39

0

16

21

29

43


21%24%

RI:CURRENT

RI:AAS

AGE EMPL RI:CURRENT

RI:AAS

>=60

50−59

40−49

30−39

<=29

8

53

106

191

68

7

13

20

26

35

7

13

21

26

33

MM/SV: < 20% (426 EMPLOYEES)

24% 24%

RI:CURRENT

RI:AAS

I m pac t o f A s s e t A l l o c at i o n

These hypothetical scenarios arelargely based on 100% plan participation and 100% adoption of solution.

Asset allocation for each category iscalculated as an average and may nottotal 100%.

Replacement income for each categoryis calculated as a median.

M M / SVMoney market/stable value

A A SHypothetical asset allocation strategies based on each employee’sage are used in the projections. Seeappendix for additional information.

R IReplacement income —A percentage measurement of theemployee’s projected income relative to current salary.

R I : C U R R E NTReplacement income percentage as calculated using each employee’s current asset allocation and contribution rate.

R I : A A S Replacement income percentage calculated assuming an age- appropriate hypothetical assetallocation strategy for each employeeand using current contribution rates.This metric shows potential impact ofchanged asset allocation.

� INDIVIDUAL STOCK� DIVERSIFIED STOCK FUNDS� BONDS� MONEY MARKET/STABLE VALUE

IMPACT OF SOLUTIONS: DEFINED CONTRIBUTION PLAN(S)

ASSET ALLOCATION

Helps to illustrate the potential impact of a hypothetical asset allocationstrategy based on the employee’s age.

12 12

24 24

36 36

48 48

60 60

72 72

84 84

96 96

108 108

120 120

REPLACEMENT INCOME RANGES AS % OF CURRENT SALARY

NU

MB

ER

OF

EM

PL

OY

EE

S

REPLACEMENTINCOME: 23%

REPLACEMENT INCOMETARGET: 50%

0

89

114

122

101

34

20

82 2 0 0

7 | T. R O W E P R I C E

STATI STI C Stotal employees . . . . . . . . . . . . . . . . . . . . . . . . . . . 492total non-participants . . . . . . . . . . . . . . . . . . . . . . . 57median salary . . . . . . . . . . . . . . . . . . . . . . $64,055.00median age . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 median employee contribution – all . . . . . . . . . . 5%median employee contribution – participants 5%median total contribution – all . . . . . . . . . . . . . . 9%median total contribution – participants . . . . 9%median savings as multiple of salary . . . . . . . 0.32median RI participants . . . . . . . . . . . . . . . . . . . . 25%median RI non-participants . . . . . . . . . . . . . . . . . 0%

Non-participants are defined as total employee contribution = 0%

S O LUTI O N ST. Rowe Price offers a suite of solutions to address challenges and increase projected replacement income.

Plan Meter gathers employee data, including participation, salary deferral, loan usage, and catch-up contributions. The benefit of Plan Meter is that italso considers plan specifics, like your matching formula.

R IReplacement income —A percentage measurementof the participant’s projected income relative to current salary.

Projected Retirement Income/Current Salary = RIEx. $50,000/$100,000 = 50%

Years in Retirement = 95 – Assumed Retirement Age.

R e p l ac e m e n t I n c o m e A n a lys i s

REPLACEMENT INCOME ANALYSIS

Illustrates distribution of replacement ratios across the employee population. These data highlight the amount of income employees can expect to receive in retirement based on their current plan assets.

EXECUTIVE SUMMARY: DEFINED CONTRIBUTION PLAN(S)

6T. R O W E P R I C E |

EXECUTIVE SUMMARY: DEFINED CONTRIBUTION PLAN(S)

R I : C U R R E NTReplacement income percentage as calculated using each employee’s currentasset allocation and contribution rate.

R I : A A S Replacement income percentage calculated assuming an age appropriatehypothetical asset allocation strategy foreach employee and using currentcontribution rates. This metric showspotential impact of changed asset allocation.

R I : A A S + TA R G E T CO NTR I B UTI O NR ATE + C ATC H - U PReplacement income percentage calculated assuming each employeeinvests in an age appropriate hypothetical asset allocation strategy,contributes at the targeted rates andmakes additional catch-up contributions,where applicable. This metric showspotential impact of changed assetallocation, increased contribution rate,and catch-up contributions.

R I : A A S + TA R G E T CO NTR I B UTI O NR ATE + C ATC H - U P + D E L AY E DR E TI R E M E NT Replacement income percentage calculated assuming each employeeinvests in an age-appropriate hypothetical asset allocation strategy,contributes at the targeted rates, takesadvantage of the catch-up contributions,if applicable, and delays retirementfor three years. This metric shows potential impact of improved assetallocation, increased contribution rate,and delayed retirement.

REPLACEMENT INCOME PROJECTIONS

These charts compare the current projected income level of your defined contribution plan(s) with your projected outlook after adopting certain suggested behaviors. The percentages expressed in these charts are aggregatesof employees’ projected replacement income as a percentage of their currentsalaries. Based on such aggregated information and certain identified assumptions, these data highlight the amount of income your employees canexpect to receive in retirement from their assets in your defined contributionplan(s). They also compare current projected income levels with your targetreplacement income.

Please note that the Aggregate Summary at the end of this report contains anexpanded replacement income analysis, which can take into account estimatedSocial Security benefits and projected income from any applicable defined benefit plan(s).

IDENTIFYING OPPORTUNITIES

In the following pages, the overall effectiveness of your defined contributionplan(s) is (are) analyzed within key populations. Your retirement program’s potential for change is then shown by projecting each population’s adoption ofdifferent saving behaviors.

ACHIEVING YOUR PROGRAM’S POTENTIAL

The keys to success for any retirement program are always to save more (we suggest saving 15% of pretax salary), to use an appropriate asset allocation strategy, to invest more conservatively over time, and to delay drawing on savings for as long as possible. The goal is to get the maximum possible amountof money working for the longest possible time.

T. Rowe Price offers many solutions that can reinforce these important messagesand help drive employee behavior.

C u r r e n t a n d P r o j e c t e d I n c o m e S c e n a r i o s

3520

5 50

23%

CURRENT

MEDIAN

CURRENT RI

3520

5 50

24%

MEDIAN

PROJECTED

RI:AAS

3520

5 50

46%

PROJECTED OUTLOOK

MEDIAN

PROJECTED

RI:AAS + TARGET

+ CATCHUP

3520

5 50

56%

MEDIAN

PROJECTED

RI:AAS + TARGET

+ CATCHUP

+ DELAY

Plan OPPOrtunities DiscOvereD:

In 2009, T. Rowe Price and sanofi-aventis are working together to:

• Utilize participant e-mail addresses to streamline communications and create personalized messaging strategies to increase savings.

• Determine how encrypted e-mail can enhance security of your day-to-day contacts.

• Consider automatically restarting deferrals for participants who have taken hardship distribution.

lOOKinG FOrWarD:

Looking ahead, there are several options you can leverage to improve participant outcomes:

• Consider adding Roth contributions to enable participants to increase their spendable retirement income.

• Leverage automated services such as auto-increase (opt-out), auto-enrollment, and auto-reenroll to boost enrollment and participant savings rates.

• Update your communication strategy to target participants that prefer electronic interactions.

The Strategic Plan Review is a customized analysis of your current plan against the latest industry trends and presents solutions from our service offering that you may want to consider for your plan. The goal of this annual review is to continually move your plan forward. Elements of the Strategic Plan Review include:

Plan design – the fundamental architecture of your plan

Your plan’s current and investment offerings you may want to consider adding in the future

Service offerings such as compliance testing, enrollment, loans, transaction processing, and data transfers

Participant education, communication, and third-party advice options

Sponsor tools

STRATEgIC PlAn REvIEw

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Strategic Solutions for 2009

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Strategic Plan


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To meet this objective, we are highlighting important areas to consider in the coming year—along with suggested solutions that are designed to make the best use of innovative technology and resources. Optimizing the plan with best practices brings improvement on many levels:

With the use of automated services, for example, we can make the process of retirement saving easier and more e�ective. �is area covers plan design changes that encourage improved participation and savings behaviors.

Target-date investments promote diversi�ed asset allocation, which can reduce risk. However, diversi�cation cannot assure a pro�t or protect against loss in a declining market. Here, we o�er other ideas to help participants invest with greater success to meet their retirement income goals.

Updating a plan with electronic services can improve the accuracy and timeliness of participant data. Learn about the services and practices available today to further streamline administrative processes.

Personalized communications can grab participants’ attention by delivering targeted statements and messaging that can help them make wiser saving and investing decisions. �is section outlines educational tools that can be used to increase participant outcomes in 2009.

Sponsors need an array of products and services that can further assist them in examining their plans. For example, Plan MeterSM and other tools can help more accurately assess participants’ retirement readiness.

Of course, having serviced thousands of clients over the years, we’ve learned that an important aspect of applying best practices is keeping in mind that one size does not �t all. We understand that just like participants, each plan sponsor is unique—with an individual business culture and outlook for the company’s bene�ts program. Our goal is to �nd solutions that work for sponsors while improving our ability to e�ectively meet the needs of participants.

If we can provide additional information or be of further assistance, please contact your T. Rowe Price representative.

Call 1-800-638-7890 to request a prospectus, which includes investment objectives, risks, fees, expenses, and other information that you should read and consider carefully before investing.

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To build a successful plan, sponsors need to continually examine the plan’s current design and consider options for enhancement. By taking advantage of the latest proven solutions—and revisiting standard features to better address key participant behaviors—plan sponsors can build the framework for a comprehensive and competitive plan that keeps pace in today’s business environment.

1. Increase enrollment and employee contribution rates Research shows that it’s the amount of money a participant saves that has the biggest impact on retirement readi-ness. As a rule of thumb, �nancial experts recommend a 15% to 20% total contribution rate, which includes employer contributions. To reach that level—thus moving employees toward a more secure retirement—plan design should encourage them to begin saving immediately and to increase their contributions on a regular basis. Automated services, such as automatic enrollment and automatic increase, take advantage of inertia and keep participants on track for their retirement goals. Sponsors may also consider structuring appropriate plan defaults, such as enrolling new participants at a 6% rate, as well as some of the options provided below to further optimize participant savings.

enrollment

employee contributions

*A plan sponsor who wants to qualify for safe harbor status cannot auto-enroll participants at a deferral rate in excess of 10% of compensation.

These two tools work synergistically to outline your plan’s fees and your investment options.

Plan Cost Analysis The Plan Cost Analysis enables you to easily view and compare the fees your participants are paying against the Lipper expense ratio average. This level of fee transparency helps you review the cost of your plan by providing:

Market value of your plan’s assets and a breakdown of each fund’s percentage within your overall plan

Fund expense ratios

Plan investment and administrative costs

Participant communications costs

Report CardThe Report Card is a one-page summary of investment performance compared with relevant peer groups over multiyear periods. This tool provides summary and detailed fund information including:

Performance history over 1-, 3-, 5-, and 10-year periods

Lipper classification and ranking

Sharpe ratio and annual standard deviation relative to Lipper peer group

PlAn CoST AnAlYSIS & REPoRT CARd

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INVESTMENT EXPENSE (costs paid indirectly as reflected in the share price for the fund)

Fund Lipper Fund Category

Market Value of

Plan Assets

3/31/2009 % of Plan

Fund

Expense

Ratio

Lipper No-Load

Expense Ratio

Average

Administrative

Fee Payment

Received

PIMCO:Tot Rtn;Inst Intermediate Investment Grade Debt Funds Average $105,068,206 6.4% 0.52% 0.67% 0.00%

TRP Retirement 2030 Mixed-Asset Target 2030 Funds Average $125,858,277 7.6% 0.72% 0.92% 0.00%








TRP Retirement 2005 Mixed-Asset Target 2010 Funds Average $13,613,364 0.8% 0.58% 0.71%

TRP Retirement Income Mixed-Asset Target Alloc Moderate Funds Average $12,922,642 0.8% 0.55% 1.21% 0.00%

TRP Retirement 2050 Mixed-Asset Target 2050+ Funds Average $1,568,116 0.1% 0.73% 0.96% 0.00%

American Funds Gro;R-5 Multi-Cap Growth Funds Average $83,046,026 5.0% 0.34% 1.40% 0.05%

TRP Small-Cap Stock Small-Cap Core Funds Average $74,000,431 4.5% 0.89% 1.23% 0.00%

Vanguard Md-Cp Idx;Inst Mid-Cap Core Funds Average $59,709,179 3.6% 0.07% 1.13% 0.00%

Vanguard Instl Indx;Inst S&P 500 Index Objective Funds Average $55,415,751 3.4% 0.05% 0.31% 0.00%

Wellington Large Cap Research S&P 500 Index Objective Funds Average $49,234,586 3.0%

Vanguard Windsor II;Adm Large-Cap Value Funds Average $45,125,407 2.7% 0.29% 1.04% 0.00%

Principal US Property Acct $11,736 0.0%

Sanofi-Aventis Stable Value Money Market Average $353,215,983 21.4%

Sanofi-Aventis ADR Fund stock $58,978,078 3.6%

Sanofi-Aventis Int'l Core Fund $57,245,325 3.5%

Forfeitures $895,012 0.1%

TradeLink Investments $33,245,446 2.0%

Outstanding Loan Balance $30,602,200 1.9%

Total: $1,650,649,654 100.0% 0.37% 0.58% 0.00%

Annual $ Cost $6,142,424 $9,579,540 $41,523

# Plan Participants w/ Balance 17,583 17,583 17,583

Average Cost per Participant $349 $545 $2

Weighted Average

Administrative Fee Payment (AFP) shown for non-T. Rowe Price Investment options within the plan reflects the fees that T. Rowe Price Retirement Plan Services, Inc. receives in the form of

administrative fee payments from the outside fund firms. AFPs are included in the total expense ratio of the investment vehicle.

Note: T. Rowe Price may receive earnings on assets awaiting allocation or distribution from the plan. T. Rowe Price received approximately $1.81 per participant over all plans for which we

provided recordkeeping services in 2008. This money was used to offset banking and associated charges related to processing contributions and distributions, with any excess used to reduce

the expenses of T. Rowe Price mutual and common trust funds in which participants invest through defined contribution plans for which T. Rowe Price provides recordkeeping services.

For the sanofi-aventis Stable Value fund and the JP Morgan EAFE Plus fund, the "fund expense ratio" is an effective fee calculated based on each fund's tier fee schedule and the assets in

the fund as of 9/30/2008. The fee schedule for the sanofi-aventis Stable Value Fund is 0.20% on the first $50 million in assets, 0.15% on the next $50 million, 0.10% on the next $100 million

and 0.08% on assets over $200 million. The fee schedule for the JP Morgan EAFE Plus fund is 0.72% on the first $50 million, 0.60% on the next $50 million and 0.55% on the balance.

July 14, 2009

Sanofi-Aventis U.S. Savings Plan

Lipper Averages do not include common trust funds (trusts). When a trust is present within a retirement plan's investment line-up, we have selected a Lipper Average that represents mutual

funds having investment objectives similar to the trust. Such data is shown for illustrative purposes only.

Each fund's annualized expense ratio is based on fiscal year-end data available as of 03/31/2009. The "Lipper No-Load Expense Ratio Average" is provided to compare the ongoing costs of

investing in each listed fund with other funds in the identified Lipper category.

sanofi-aventis

# of Funds in Portfolio* ExpenseNASDAQ Lipper Classification 5 Yrs 3 Yrs 5 Yrs 10 Yrs 3 Yrs 5 Yrs 10 Yrs Turnover Ratio* Manager

Fund Name Symbol Lipper Classification 1 Yr 3 Yrs 5 Yrs 10 Yrs Rank Quartile Rank Quartile Rank Quartile Rank Quartile Quartile Quartile Quartile Quartile Quartile Quartile Quartile Quartile Tenure

American Funds Growth Fund of America;R-5 RGAFX Multi-Cap Growth Funds 458 365 306 - 165 2 122 2 58 1 - - 2 2 - 1 1 - 1 1 -

PIMCO Total Return Fund;Institutional PTTRX Intermediate Investment Grade Debt Funds 566 462 395 210 25 1 3 1 2 1 1 1 1 1 1 2 2 3 3 1 22.5

T Rowe Price Retirement 2005 Fund TRRFX Mixed-Asset Target 2010 Funds 185 112 42 - 45 1 28 1 4 1 - - 1 1 - 2 2 - 2 1 -

T Rowe Price Retirement 2010 Fund TRRAX Mixed-Asset Target 2010 Funds 185 112 42 - 78 2 50 2 10 1 - - 1 1 - 4 4 - 1 1 -

T Rowe Price Retirement 2015 Fund TRRGX Mixed-Asset Target 2015 Funds 120 52 18 - 39 2 22 2 7 2 - - 1 2 - 4 4 - 1 1 -

T Rowe Price Retirement 2020 Fund TRRBX Mixed-Asset Target 2020 Funds 167 92 38 - 75 2 37 2 4 1 - - 1 1 - 4 4 - 1 1 -

T Rowe Price Retirement 2025 Fund TRRHX Mixed-Asset Target 2025 Funds 99 37 8 - 27 2 10 2 1 1 - - 1 1 - 3 4 - 1 1 -

T Rowe Price Retirement 2030 Fund TRRCX Mixed-Asset Target 2030 Funds 160 89 32 - 63 2 19 1 1 1 - - 1 1 - 4 4 - 1 1 -

T Rowe Price Retirement 2035 Fund TRRJX Mixed-Asset Target 2035 Funds 94 33 8 - 29 2 10 2 1 1 - - 1 1 - 4 4 - 1 1 -

T Rowe Price Retirement 2040 Fund TRRDX Mixed-Asset Target 2040 Funds 152 82 32 - 38 1 12 1 1 1 - - 1 1 - 3 4 - 1 1 -

T Rowe Price Retirement 2045 Fund TRRKX Mixed-Asset Target 2045 Funds 88 27 - - 20 1 6 1 - - - - 1 - - 2 - - 1 1 -

T Rowe Price Retirement 2050 Fund TRRMX Mixed-Asset Target 2050+ Funds 116 - - - 27 1 - - - - - - - - - - - - 1 1 -

T Rowe Price Retirement Income Fund TRRIX Mixed-Asset Target Alloc Moderate Funds 524 388 295 - 16 1 23 1 30 1 - - 1 1 - 1 1 - 1 1 -

T Rowe Price Small-Cap Stock Fund OTCFX Small-Cap Core Funds 768 617 503 242 92 1 201 2 159 2 94 2 2 2 2 2 2 2 1 1 17.5

T Rowe Price Summit Cash Reserves Fund TSCXX Money Market Funds 309 287 270 198 31 1 25 1 21 1 16 1 1 1 1 3 3 3 - 1 -

Vanguard Institutional Index Fund;Institutional VINIX S&P 500 Index Objective Funds 175 168 149 92 18 1 9 1 8 1 2 1 1 1 1 3 3 4 3 1 9.5

Vanguard Mid-Cap Index Fund;Institutional VMCIX Mid-Cap Core Funds 382 305 241 123 265 3 179 3 96 2 34 2 3 2 2 3 3 2 1 1 11.5

Vanguard Windsor II Fund;Admiral VWNAX Large-Cap Value Funds 564 485 410 - 118 1 154 2 102 1 - - 1 1 - 2 2 - 2 1 -

# of Funds That Beat Their Lipper Peer Group 17 16 16 5 16 16 5 7 6 2 15 18 15.3out of out of out of out of out of out of out of out of out of out of out of out of Year

Total Number of Funds 18 17 16 5 17 16 5 17 16 5 17 18 Average1st or 1st or 1st or 1st or 1st or 1st or 1st or 1st or 1st or 1st or 1st or 1st or2nd 2nd 2nd 2nd 2nd 2nd 2nd 2nd 2nd 2nd 2nd 2nd

Quartile Quartile Quartile Quartile Quartile Quartile Quartile Quartile Quartile Quartile Quartile Quartile

% of Funds That Beat Their Lipper Peer Group 94% 94% 100% 100% 94% 100% 100% 41% 38% 40% 88% 100%

1 Yr 3 Yrs 10 Yrs

Sharpe Ratio*Lipper Ranking*

Annl Standard Deviation*(Rel. to Lipper Peer Gr.) (Rel. to Lipper Peer Gr.)

Plan OPPOrtunities DiscOvereD anD aDDresseD

Here are changes implemented as a result of continual review

and analysis of your plan’s costs and investment performance:

• Expanded online advice services with Morningstar Advice, which resulted in a cost savings of $18.00 per participant.

• Established regular reviews and updates of the investment lineup with common trusts and nonproprietary funds from several investment management companies.

• Provided ongoing and proactive monitoring to provide an advantageous fee arrangement for your plan.

• Instituted an administrative budget to add value to the plan.

lOOKinG FOrWarD

The following fee structure is proposed in our response to your Request for Proposal (RFP):

• $40 per participant for sanofi-aventis and $60 per participant for Sanofi Pasteur on a stand-alone basis or $40 per participant combined.

• Any administrative revenue in excess of the stated per-participant fee will be applied to an Administrative Budget to be used by the plans for any ERISA-eligible plan expense.

• The Administrative Budget does not “expire” but should be used within the year earned or as soon as administratively feasible.

T. Rowe Price Fiduciary Source is a library of practical tools that provides checklists, reference materials, and best practice considerations to help you meet important fiduciary responsibilities.

This valuable resource features:A comprehensive look at fiduciary responsibilities and how to fulfill them

Your plan’s records, such as investment report cards, plan cost analysis, communication plans, and nondiscrimination testing results

Regular updates on legislative requirements and industry hot topics to keep you informed and help you keep your plan in compliance

fIduCIARY SouRCE

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HiGHliGHts OF tHe latest sanOFi-aventis FiDuciary revieWs:

• Presented a comprehensive Fiduciary Source Kit last fall in which we discussed the Fiduciary Checklist, roles and responsibilities, and the plan document and contract review to members of your team who are designated with fiduciary responsibility.

• Provided an inventory of contracts and documents, compliance reporting results, procedural flow summaries, plan cost analysis reviews, report cards of investment results, communication plans, and employee meeting reports.

• Updated you on Department of Labor rules and guidance.

• Sent a Fiduciary E-kit highlighting important topics to consider in 2009.

Helping plan sponsors meet their fiduciary duties

| rps.troweprice.com/sponsor

1

Helping you to understand and meet your responsibilities

In keeping with our commitment to helping you meet your �duciary responsibilities, we want to update you on guidance from the U.S. Department of Labor (DOL) regarding the receipt by plan �duciaries of gi�s and entertainment from third parties dealing with their plan. Recent attention paid by the DOL on receipt of gi�s and gratuities by plan �duciaries has raised concern that routine business and social contacts could be seen to result in potential violations of ERISA’s prohibition against a �duciary receiving “consideration for his own personal account from any party dealing with [a] plan in connection with a transaction involving the assets of the plan.” ERISA § 406(b)(3). Prior court decisions interpreting ERISA § 406(b)(3) suggest that the provision was intended to prevent fairly egregious circumstances in which a plan o�cial receives something of signi�cant value for agreeing to direct plan business to a particular party. While merely attending a free conference or other event sponsored by a service provider was not generally considered to raise a claim under ERISA § 406(b)(3), it is important for plan �duciaries to be aware of DOL guidance describing the application of ERISA § 406(b)(3) and new disclosure rules that require the reporting of gi�s and entertainment.

In recognition of the bene�ts of o�ering certain services to the plan such as provider-sponsored conferences that educate plan sponsors about their duties and responsibilities to the plan, the DOL has provided further clari�cation on ERISA § 406(b)(3) in the context of receipt by plan �duciaries of non-monetary compensation of insubstantial value (such as gi�s or meals) associated with conferences, events, and business meetings pertaining to the plan. �e guidance is in the form of an addition to DOL’s enforcement manual, which provides guidelines to be used by its investigators in reviewing plans regulated by ERISA. �e new text is paragraph 12 of the Fiduciary Investigations Program section of the manual.

In determining whether a plan �duciary’s acceptance of meals, gi�s, entertainment, or expenses associated with educational conferences is a possible �duciary violation, the manual instructs the DOL investigator to examine:

of gi�s, gratuities, or other consideration were for the �duciary’s personal account and received in connection with a transaction or transactions involving the assets of the plan in violation of ERISA § 406(b)(3); and

written policy or plan provision governing the receipt of items or services from parties dealing with the plan and whether the �duciary adhered to that policy. �is suggests that, for ERISA enforcement purposes, DOL �nds acceptable written plan policies akin to corporate ethics policies.

�ere is no further elaboration of the circumstances that would meet all of the elements of and thus possibly violate § 406(b)(3). �e manual does provide, however, that for enforcement purposes, investigators should generally not treat the following as § 406(b)(3) violations:

from any one individual or entity (including any employee, a�liate, or other related party) of (a) gi�s, gratuities, meals, entertainment, or other consideration (other than cash or cash equivalents); and (b) reimbursement of expenses associated with educational conferences, provided that the aggregate annual value of the items in (a) and (b) is less than $250 and their receipt does not violate any plan policy or provision. �e receipt of such items is deemed “insubstantial”; and

SuMMARY

Adding Value for You and Your ParticipantsAs you can see, T. Rowe Price strives to add value for you and your participants. The resources we provide to our clients are a culmination of our long-term investment management expertise and understanding of participant behavior. By continually combining our expertise with your strategic business goals, together we can minimize risk and promote the best possible retirement outcomes for your participants.

Jean Fisher: Relationship ManagerAs your strategic collaborator, I’m ready to help you leverage our tools and best practices to help meet the objectives of your retirement plan and help your participants move toward a more financially secure retirement. There’s much more work ahead, and I ask for the opportunity to continue to build our relationship.

If you have questions or need assistance, I’m ready to work with you toward your goals. Phone: 410-345-7433; e-mail: [email protected]

T. Rowe Price Retirement Plan Services, Inc.

www.troweprice.com

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