Exhibit 10 (h)
BERGEN BRUNSWIG
AMENDED AND RESTATED
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
(As Of September 24, 1998)
EXH 10(h) - Page 55
TABLE OF CONTENTS
Page
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ARTICLE I PLAN HISTORY...................................................1
ARTICLE II DEFINITIONS...................................................2
2.1 "Accrued Benefit"..................................2
2.2 "Beneficiary"......................................4
2.3 "Bergen 401(k) Plan"...............................6
2.4 "Bergen Brunswig Corporation"......................7
2.5 "Board of Directors"...............................7
2.6 "Break in Service" ................................7
2.7 "Capital Accumulation Plan" .......................7
2.8 "Code".............................................7
2.9 "Compensation".....................................8
2.10 "Credited Service".................................8
2.11 "Employee".........................................9
2.12 "Employer".........................................9
2.13 "Employment"......................................10
2.14 "Equivalent"......................................11
2.15 "ERISA"...........................................11
2.16 "Executive Benefits"..............................11
2.17 "Key Management Benefits".........................12
2.18 "Normal Benefit Form".............................12
2.19 "Normal Retirement Age"...........................13
2.20 "Optional Benefit Form"...........................13
2.21 "Participant".....................................13
2.22 "Plan"............................................13
2.23 "Plan Administrator"..............................14
2.24 "Plan Rules"......................................14
2.25 "Plan Year".......................................14
2.26 "Service".........................................14
2.27 "Spouse"..........................................16
2.28 "Trust"...........................................16
2.29 "Vested"..........................................16
2.30 "Vesting Service".................................16
ARTICLE III PARTICIPATION...............................................16
3.1 Requirements for Participation....................17
3.2 Former Participants...............................19
ARTICLE IV AMOUNT OF BENEFIT............................................20
4.1 Determination of Benefit Amount...................20
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ARTICLE V VESTING.......................................................24
5.1 Vesting of Accrued Benefit........................24
5.2 Forfeiture of Benefits............................32
ARTICLE VI PAYMENT OF BENEFITS..........................................32
6.1 Benefits on Termination of Employment.............32
6.2 Death Benefits....................................33
6.3 Joint and Survivor Annuities......................33
6.4 Optional Benefit Forms............................36
6.5 Funeral Benefit...................................37
6.6 Delay in Distribution.............................37
6.7 No Suspension of Benefits.........................38
6.8 Release Required..................................38
ARTICLE VII ADMINISTRATION OF THE PLAN..................................39
7.1 Duties of the Plan Administrator..................39
7.2 Delegation of Administrative Responsibility.......40
7.3 Compensation, Expenses and Indemnity..............41
7.4 Claims Procedure..................................43
7.5 Effect of Plan Administrator Action...............48
ARTICLE VIII AMENDMENT AND TERMINATION OF THE PLAN......................49
8.1 Amendments........................................49
8.2 Termination of Plan...............................51
ARTICLE IX FUNDING OF BENEFITS..........................................51
9.1 Plan is Unfunded..................................51
9.2 Trust.............................................52
9.3 Interrelationship of the Plan and the Trust.......52
ARTICLE X MISCELLANEOUS PROVISIONS..........................53
10.1 Payments..........................................53
10.2 Consolidation or Merger of Companies..............54
10.3 Adoption of Plan to Cover Other Companies,
Facilities or Groups..............................55
10.4 Termination of Employment.........................55
10.5 Determination of Hours of Service.................60
10.6 Alienation........................................60
10.7 Division of Benefits by Domestic Relations Orders.60
10.8 Legal Costs; Increased Benefit....................66
10.9 Duty to Provide Data..............................67
10.10 Limitation on Rights of Employees.................68
10.11 Restrictions......................................69
10.12 Service of Process................................70
10.13 Spouse's Interest.................................70
EXH 10(h) - Page ii
10.14 Distribution in the Event of Taxation.............70
10.15 Governing Law.....................................70
10.16 Plurals...........................................71
10.17 Titles............................................71
10.18 References........................................71
10.19 Entire Agreement..................................71
10.20 Severability......................................71
10.21 Withholding.......................................72
EXH 10(h) - Page iii
ARTICLE I
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PLAN HISTORY
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Bergen Brunswig Corporation, a New Jersey corporation (sometimes
hereinafter referred to as the "Company") adopted the Bergen Brunswig Capital
Accumulation Plan in 1980. The Capital Accumulation Plan was frozen effective
October 7, 1987. To replace the Capital Accumulation Plan, Bergen Brunswig
Corporation adopted this Supplemental Executive Retirement Plan, effective
January 1, 1991. The Supplemental Executive Retirement Plan was amended and
restated, effective July 28, 1994, and further amended and restated effective as
of March 3, 1995 in order to provide the Participants (as hereinafter defined)
with certain additional benefits in the event of a Change in Control (as defined
below). The Company now desires to amend and restate the Supplemental Executive
Retirement Plan in order to modify the method used to determine accrued benefits
under Article IV and the definition of Compensation (within the meaning of
Section 2.9 below) effective with respect to Participants who are Employees (as
defined below) on or after September 24, 1998. This Amendment and Restatement of
the Supplemental Executive Retirement Plan is effective as of September 24, 1998
and incorporates all prior amendments (as amended and restated, the "Plan").
While the Plan is not intended to qualify under the Code as a qualified
plan, the Plan is intended to be a pension benefit plan which, although subject
to ERISA, is exempt from Parts 2, 3 and 4 of Title I of ERISA because it is
(solely for purposes of ERISA) an unfunded plan that only covers a select group
of management or highly compensated employees. Persons become participants as
provided herein. Benefits
EXH 10(h) - Page 1
under the Plan become payable on account of a Participant's retirement or death.
ARTICLE II
DEFINITIONS
The following terms, when capitalized, shall have the meaning specified
below unless the context clearly indicates to the contrary.
2.1 "Accrued Benefit" of a Participant shall be the individual's benefit
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under this Plan, accrued as of the time of determination. A Participant's
Accrued Benefit shall only be payable to the extent Vested. Subject to this
limitation, a Participant's Accrued Benefit shall be the amount by which the
product of the amounts described in subsections (a) and (b) exceeds the offsets
set forth in Section 4.1(a), all as calculated as of the time of determination:
(a) the individual's benefit under Section 4.1 before application
of the offsets set forth in Section 4.1(a), and
(b) a fraction, the numerator of which is the individual's Credited
Service and the denominator of which is the greater of
(i) the total Credited Service the individual could earn
before his or her Normal Retirement Age, or
(ii) the result determined by subtracting from fifteen the
individual's years of Service completed prior to performing any
services for the Employer in a Credited Service position.
In no event shall a Participant's fraction under this subsection exceed one. See
Section 4.1(c) for special benefit calculation rules that apply when a
Participant is demoted.
EXH 10(h) - Page 2
(c) For all benefit purposes, if a Participant accumulates eighty
"points" before his or her fraction in subsection (b) equals one, his or
her fraction in subsection (b) shall be raised to one. A Participant
shall accumulate 1 "point" for each year of age, 1 "point" for each year
of Employment prior to becoming employed in a position covered by this
Plan and 1.5 "points" for each year of Employment subsequent to becoming
employed in a position covered by this Plan.
(d) For purposes of this Section, a person shall be considered to
have been employed in a position covered by this Plan if the position is
a position for which he or she receives Credited Service credit.
2.2 "Beneficiary" shall mean the person designated by a Participant to
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receive payments from the Plan due to the Participant's death. Beneficiary
designations and determinations shall be made in accordance with the following
rules:
(a) Each Participant shall have the right, at any time, to
designate his or her Beneficiary (both primary as well as contingent) to
receive any benefits payable under the Plan to a Beneficiary upon the
death of a Participant. The Beneficiary designated under this Plan may
be the same as or different from the Beneficiary designation under any
other plan of an Employer in which the Participant participates. A
Participant shall designate his or her Beneficiary by completing and
signing a Beneficiary Designation Form, in form and substance
satisfactory to the Plan Administrator, and returning it to the Plan
Administrator for acceptance. No designation or change in designation of
a Beneficiary shall be effective until received, accepted and
acknowledged in writing by the Plan Administrator.
EXH 10(h) - Page 3
(b) A Participant shall have the right to change a Beneficiary by
completing, signing and otherwise complying with the terms of the
Beneficiary Designation Form and the Plan Rules as in effect from time
to time. Upon the acceptance by the Plan Administrator of a new
Beneficiary Designation Form, all Beneficiary designations previously
filed shall be canceled. The Plan Administrator shall be entitled to
rely on the last Beneficiary Designation Form filed by the Participant
and accepted by the Plan Administrator prior to his or her death.
(c) A Participant can designate someone other than his or her
Spouse as Beneficiary, but only with written spousal consent.
(d) If a deceased Participant has not properly designated a
Beneficiary, the Participant's Spouse shall be treated as the
Beneficiary.
(e) If a deceased Participant is survived neither by a Spouse nor a
properly designated Beneficiary, the Participant's estate shall be
treated as the Beneficiary.
(f) With the Plan Administrator's consent and subject to any
conditions which the Plan Administrator may specify, the Participant may
designate more than one person to be his or her Beneficiary, provided
that one Beneficiary is designated as the "measuring life" on which the
duration and amount of the joint and survivor annuity is to be
calculated and the portion of the survivor annuity to be paid to each
Beneficiary is specified (e.g., my mother, Jane Doe, and my invalid
daughter, Janet Doe, shall share equally in survivor benefits while they
both live; any survivor benefits payable following the death of either
my mother, Jane Doe, or my invalid daughter, Janet Doe, shall be paid to
the survivor; survivor benefits are to be determined as if only my
invalid daughter, Janet Doe, were the Beneficiary).
EXH 10(h) - Page 4
2.3 "Bergen 401(k) Plan" shall mean the Bergen Brunswig Corporation
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Pre-Tax Investment Retirement Account Plus Employer Contributions Plan, or any
successor to that plan.
2.4 "Bergen Brunswig Corporation" shall mean Bergen Brunswig
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Corporation, a New Jersey corporation.
2.5 "Board of Directors" shall mean the Board of Directors of Bergen
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Brunswig Corporation.
2.6 "Break in Service" shall mean a period of non-Employment which
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causes a former Employee to lose credits under this Plan. A former Employee
incurs one Break in Service upon the completion of each three hundred and
sixty-five consecutive day period throughout which the individual is not an
Employee. This period shall commence on the day following the last day on which
the individual was an Employee. See Section 10.4 for special rules relating to
maternity and paternity absences.
2.7 "Capital Accumulation Plan" shall mean the Bergen Brunswig
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Corporation Capital Accumulation Plan that was originally effective July 1,
1980, and frozen effective October 7, 1987.
2.8 "Code" shall mean the Internal Revenue Code of 1986, as amended from
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time to time.
2.9 "Compensation" shall mean the average monthly earnings payable to a
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Participant for the three calendar years, whether or not consecutive, in which
the Participant received the highest Compensation during the five calendar years
immediately preceding the Participant's termination of Employment. This average
EXH 10(h) - Page 5
shall be computed by dividing the Participant's total "earnings" (as defined in
this Section) during the three years in question by thirty-six. A Participant's
"earnings" shall mean the base salary paid to the Participant during the
calendar year in question, including any salary waived or deferred under any
nonqualified deferred compensation or other salary reduction arrangement, but
not including bonuses, noncash payments or cash payments other than base salary.
Notwithstanding the foregoing, in the case of a Participant who is an Employee
on or after September 24, 1998, a Participant's "earnings" shall mean the base
salary and bonus paid to the Participant during the calendar year in question,
including any salary or bonus waived or deferred under any nonqualified deferred
compensation or other salary reduction arrangement, but not including noncash
payments or cash payments other than base salary and bonus.
2.10 "Credited Service" shall mean the number of years of Service in
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which the Participant was employed in the position he or she held at the time he
or she was designated by the Plan Administrator to be a Participant or was
covered by the Capital Accumulation Plan, or any position held thereafter,
including years before or after the adoption of either plan, but excluding any
Service while the Participant was not employed in such a position or positions.
Notwithstanding the above, should a Participant change positions, the Plan
Administrator can, in its sole discretion, determine that the new position
should not be considered a position for which such Participant shall receive any
Credited Service credit.
2.11 "Employee" shall mean an individual who renders services to the
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Employer as a common law employee or officer (i.e., a person whose wages from
the Employer are subject to federal income tax withholding). A person rendering
EXH 10(h) - Page 6
services to the Employer purportedly as an independent contractor shall not be
treated as an Employee before the Employer has acknowledged that it must
withhold federal income taxes from his or her pay. For purposes of this Plan, an
individual shall remain an "Employee" if he or she ceases to work for the
Employer for the purposes of taking an Employer arranged job.
2.12 "Employer" shall mean:
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(a) Adopting Employers. Bergen Brunswig Corporation, any related
company designated by Bergen Brunswig Corporation, any successor entity
which continues the Plan or such companies collectively; and
(b) Non-Adopting Employers. Companies that have not adopted the
Plan but are related to the adopting Employers as described in
subsection (e).
(c) All Employees of adopting and non-adopting Employers shall be
treated as employed by a single company for all Plan purposes, including
Service crediting, except that no person shall be eligible to become a
Participant or accrue Credited Service except while employed by an
adopting Employer.
(d) In contexts in which actions are required or permitted to be
taken or notice is to be given, the Employer shall mean Bergen Brunswig
Corporation.
(e) A company is a "related company" while it and the Employer are
members of a controlled group of corporations or a group of trades or
businesses under common control (within the meaning of Code Sections
414(b) and (c)).
EXH 10(h) - Page 7
2.13 "Employment" shall mean the period during which an individual is an
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Employee. Employment shall commence on the day the individual first performs
services for the Employer as an Employee and shall terminate on the day such
services cease.
2.14 "Equivalent" shall mean the actuarial equivalent of a given amount
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or benefit payable in another manner, at another time or by any other means,
determined conclusively by, or under the direction of, the Plan Administrator in
accordance with actuarial principles, methods and assumptions which are found to
be appropriate by the Plan's actuary. For purposes of this Plan, equivalencies
shall be based on the mortality assumptions included in the indices used by
Metropolitan Life Insurance Company, or such other nationally recognized
insurance company, in quoting a premium to purchase a non-qualified individual
annuity with survivor coverage as of the date of the event necessitating the
calculation (e.g. retirement, termination of Employment, disability, etc.).
2.15 "ERISA" shall mean the Employee Retirement Income Security Act of
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1974, as amended from time to time.
2.16 "Executive Benefits" shall mean the benefits provided under this
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Plan for officers of Bergen Brunswig Corporation who are Participants.
2.17 "Key Management Benefits" shall mean the benefits provided under
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this Plan for officers of a subsidiary of Bergen Brunswig Corporation and
directors of a corporate department of Bergen Brunswig Corporation who are
Participants.
2.18 "Normal Benefit Form" shall mean the normal form of benefit under
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the Plan, which shall be the Equivalent of a Participant's Vested Accrued
Benefit, payable as a joint and survivor annuity based on the life expectancies
EXH 10(h) - Page 8
of the Participant and the measuring life Beneficiary at the time payment of the
benefit commences, consisting of monthly payments to the Participant commencing
as of the first day of the calendar month coincident with or next following the
Participant's benefit commencement date and ending with the payment for the
calendar month in which the Participant dies, with the provision that, if the
Participant dies and is survived by the Beneficiary, such Beneficiary shall
receive monthly payments of, in the case of Executive Benefits, seventy-five
percent or, in the case of Key Management Benefits, fifty percent, of the
monthly payments that were being made prior to the Participant's death,
commencing with the payment for the calendar month following the month in which
the Participant died and ending with the payment for the calendar month in which
the Beneficiary dies.
2.19 "Normal Retirement Age" of a Participant shall mean the date on
-----------------------
which the Participant attains age sixty-two.
2.20 "Optional Benefit Form" shall mean any form of benefit available
----------------------
under the Plan, other than the Normal Benefit Form.
2.21 "Participant" shall mean any person who is included in the Plan
-----------
pursuant to Article III. Any Participant who holds the title of Executive Vice
President, Senior Vice President, President, Chief Operating Officer, Chief
Executive Officer or Chairman of the Board upon the occurrence of a Change in
Control (as defined in Section 5.1(b)(ii)) shall be designated an "Executive
Participant" and shall be eligible for the acceleration of benefits set forth in
Section 5.1(b). A Participant shall cease to be a Participant at the time
determined under Section 3.1(c).
2.22 "Plan" shall mean this document. The Plan consists of two
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components: Executive Benefits and Key Management Benefits, as more fully
EXH 10(h) - Page 9
described in this document.
2.23 "Plan Administrator" shall mean Bergen Brunswig Corporation, acting
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through its chief executive officer or such officer's delegate.
2.24 "Plan Rules" shall mean rules adopted by the Plan Administrator in
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accordance with Section 7.1(e) for the administration, interpretation or
application of the Plan.
2.25 "Plan Year" shall mean the fiscal year of the Plan, which is
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currently the twelve month period ending on December 31.
2.26 "Service" shall mean an Employee's period of Employment. Special
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rules for calculating Service are found in Section 2.10, which explains what
Service is counted for benefit accrual purposes, and Section 10.4, which deals
with maternity and paternity absences. Service shall be calculated under the
following elapsed time rules:
(a) Service shall be measured in days. Service shall commence with
the first day on which an individual performs or resumes performing
services for the Employer as an Employee (e.g., the day the individual
first performs an "hour of service" for which he or she is entitled to
payment by the Employer). Except as provided in subsection (b), an
Employee's Service shall thereafter end on the day on which his or her
Employment ends, as determined under Section 10.4. An Employee shall be
credited with one year of Service for each three hundred and sixty-five
days in his or her period or periods of Service. (Fractional results
shall be rounded up to the nearest whole year.)
(b) No more than three hundred and sixty-five days of Service will
be credited for any continuous period during which an individual is an
EXH 10(h) - Page 10
Employee but performs no duties as an Employee (except as required by
law with respect to military leaves and maternity and paternity absences
(see Section 10.4)). If an individual's Employment terminates but it
resumes within three hundred and sixty-five days (i.e., before he or she
incurs a Break in Service), the period between the termination and
resumption will be included in his or her period of Service.
(c) If an individual has more than one period of Service, the
periods shall be aggregated. However, a Participant's prior period of
Service shall be ignored if thereafter the Participant completed five
consecutive Breaks in Service before he or she has earned a Vested
Accrued Benefit.
2.27 "Spouse" shall mean the person to whom a Participant is legally
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married at the time in question under the laws of the state in which the
Participant then resides (excluding a common-law spouse). A person shall cease
to be a Spouse when his or her marriage to the Participant is deemed dissolved
or annulled under the laws of the state in which the Participant then resides.
2.28 "Trust" shall mean the trust established pursuant to that certain
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Master Trust Agreement, dated as of December 27, 1994, between Bergen Brunswig
Corporation and the trustee named therein, as amended from time to time.
2.29 "Vested" shall mean nonforfeitable.
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2.30 "Vesting Service" of an Employee shall mean his or her years of
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Service calculated in accordance with Section 2.26.
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ARTICLE III
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PARTICIPATION
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3.1 Requirements for Participation.
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(a) Executive Benefits. A person shall become a Participant in the
------------------
Executive Benefits portion of the Plan on the date he or she becomes an
officer of Bergen Brunswig Corporation and is selected by the Plan
Administrator to be a Participant.
(b) Key Management Benefits. A person shall become a Participant in
-----------------------
the Key Management Benefits portion of the Plan on the date he or she
becomes an officer of a wholly-owned subsidiary of Bergen Brunswig
Corporation or becomes a director of a corporate department of Bergen
Brunswig Corporation and is selected by the Plan Administrator to be a
Participant.
(c) Change in Status. Whenever a Participant changes positions, the
----------------
Plan Administrator shall determine, in his or her sole discretion,
whether such Participant is in a position that is covered by the
Executive Benefits portion of the Plan, a position covered by the Key
Management portion of the Plan or a position that is not covered by the
Plan. Except as provided in the next sentence, if the Plan Administrator
makes no such determination within thirty (30) days of the change in
position, the Participant shall remain in the portion of the Plan in
which he or she was covered prior to the position change. If there is no
determination by the Plan Administrator and the change in position
entails becoming an officer of Bergen Brunswig Corporation, the
Participant shall become a Participant of the Executive Benefits portion
of the Plan; if there is no determination by the Plan Administrator and
EXH 10(h) - Page 12
the position change entails becoming an officer of a wholly-owned
subsidiary of Bergen Brunswig Corporation or becoming a director of a
corporate department of Bergen Brunswig Corporation, the Participant
shall become a Participant of the Key Management Benefits portion of the
Plan.
(d) Termination. A Participant shall cease to be a Participant when
-----------
his or her Employment terminates (see Section 2.13), unless the
Participant becomes totally and permanently disabled while a
Participant, in which case he or she shall remain a Participant until he
or she attains age sixty-two. (A Participant shall be considered totally
and permanently disabled while the Participant is receiving long-term
disability benefits under the Bergen Brunswig Long Term Disability Plan
(or would receive such benefits if the individual were covered by that
plan). A totally and permanently disabled Participant shall continue to
earn Vesting Service during such disability. However, the individual
shall not be granted Credited Service for any period of disability. At
the option of the Plan Administrator, the Plan Administrator can
terminate the Plan with respect to the Participant and pay him or her
the Equivalent of his or her Vested Accrued Benefit in an immediate cash
lump sum payment or a monthly annuity for a term of years to be
determined by the Plan Administrator, in his or her sole discretion,
provided that such term of years shall not exceed the life expectancy of
the Participant. If the Plan Administrator exercises his or her option,
the Participant shall be deemed to be fully Vested, whether or not he or
she meets the requirements set forth in Article V.
EXH 10(h) - Page 13
3.2 Former Participants. A former Participant who requalifies for the
--------------------
Plan shall again become a Participant on the date he or she requalifies.
EXH 10(h) - Page 14
ARTICLE IV
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AMOUNT OF BENEFIT
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4.1 Determination of Benefit Amount. The Accrued Benefit payable to a
--------------------------------
Participant under the Plan shall be calculated as follows (but it shall only be
paid to the extent Vested under Section 5.1):
(a) Executive Benefits. The benefit shall be a single life annuity
------------------
(1983 Group Annuity Table) based on the Participant's life expectancy at
the Normal Retirement Age and payable monthly commencing the month after
the Participant reaches the Participant's Normal Retirement Age, equal
to eighty percent (80%) of Compensation, subject to reduction under the
fractional accrual rule in Section 2.1 and subject to the offsets
described below. Notwithstanding the foregoing, for purposes of
determining the benefit of a Participant who is an Employee on or after
September 24, 1998, sixty percent (60%) shall be substituted for eighty
percent (80%) in the preceding sentence. A Participant's benefit shall
be subject to the following offsets (each to be expressed as an
Equivalent amount commencing at the Participant's Normal Retirement Age
in an Optional Benefit Form):
(i) the Participant's primary insurance amount payable under
the Social Security Act at his or her Social Security retirement
age;
(ii) the Participant's benefit under the Capital Accumulation
Plan;
(iii) the monthly annuity the Participant could have purchased
under the Bergen 401(k) Plan, if the Participant had made annual
contributions to the Bergen 401(k) Plan of six percent of his or
EXH 10(h) - Page 15
her taxable compensation (but not more than the maximum
contribution, if any, allowable under Code Section 402(g)) and had
received an annual matching Employer contribution of fifty percent
of that amount or, if different, the amount determined under the
table set forth below, from later of (i) the adoption of the Bergen
401(k) Plan or (ii) the date of the Participant's Employment
through to the Normal Retirement Age. The sum of such hypothetical
contributions for any calendar year shall not exceed the amount
then applicable under Code Section 415(c)(1)(A). Such hypothetical
contributions shall be deemed to have been made to the Bergen
401(k) Plan on the last day of each calendar year and shall be
credited with earnings at a rate equal to the average yield of the
Bergen 401(k) Plan's guaranteed income fund, or successor fund as
determined by the Plan Administrator, as of the beginning of the
plan year of the Bergen 401(k) Plan. For calendar years commencing
before 1990, the matching Employer contribution rate used shall be
as follows:
Employer
Matching
Calendar Contribution
Year Rate
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1985 1.5%
1986 1.7%
1987 1.2%
1988 3.0%
1989 6.0%
EXH 10(h) - Page 16
Notwithstanding anything contained herein to the contrary, for
Participants who are Employees on or after September 24, 1998,
Participant contributions (whether or not hypothetical) shall not
be taken into account for purposes of this subparagraph (iii)
(except for purposes of determining the hypothetical matching
Employer contribution rate for calendar years ending before January
1, 1985), and the matching Employer contribution rate for calendar
years commencing after December 31, 1989 shall be deemed to be as
follows:
Employer
Matching
Calendar Contribution
Year Rate
---- -------------
1990 through 1998 3.0%
After 1998 4.0%
The offset required by this paragraph shall apply without regard to
whether the Participant was eligible for the Bergen 401(k) Plan or
actually made any contributions. In calculating the offset,
hypothetical contributions shall not be deemed to have been made in
calendar years prior to 1985 or in calendar years beginning before
the Participant's fortieth birthday, whichever is later; and
(iv) any amounts owed by the Participant to the Employer
(other than amounts owed by the Participant to the Employer under
programs which expressly provide that the amount owed shall not be
subject to this offset). This offset shall be applied only after
EXH 10(h) - Page 17
first applying the offsets described in paragraphs (i)-(iii), and
only if payment of the benefit commences before a change in
control, as defined in Section 5.1(b)(ii).
(b) Key Management Benefits. A Participant in the Key Management
-------------------------
Benefits portion of the Plan shall receive the benefit described in
subsection (a), except that the monthly benefit shall be sixty-five
percent (not eighty percent) of his or her Compensation. Notwithstanding
the foregoing, a Participant in the Key Management Benefits portion of
the Plan who is an Employee on or after September 24, 1998 shall receive
the benefit described in subsection (a), except that the monthly benefit
shall be forty-eight percent (48%) (not sixty percent (60%)) of his or
her Compensation.
(c) If a Participant who is covered by the Key Management Benefits
portion of the Plan becomes covered by the Executive Benefits portion of
the Plan, the Participant's benefit shall be calculated entirely under
the Executive Benefits portion of the Plan. If a Participant who is
eligible for the Executive Benefits portion of the Plan thereafter
becomes eligible only for the Key Management Benefits portion of the
Plan, his or her benefits under the Plan shall be the greater of (1) the
benefit, if any, he or she would have had if his or her Employment
terminated when the Participant ceased to be covered by the Executive
Benefits portion of the Plan, or (2) his or her benefit calculated under
the Key Management Benefits portion of the Plan. If a Participant who is
eligible for the Executive Benefits portion of the Plan or the Key
Management Benefits portion of the Plan ceases to be employed in a
position covered by this Plan, his or her benefits shall be determined
as if his or her Employment terminated when the Participant ceased to be
EXH 10(h) - Page 18
employed in a position covered by this Plan.
EXH 10(h) - Page 19
ARTICLE V
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VESTING
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5.1 Vesting of Accrued Benefit.
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(a) General Vesting Provisions. Payments Upon Change in Control.
----------------------------
Except as otherwise provided in Section 5.1(b) below, a Participant's
Accrued Benefit shall become fully Vested upon completion of five years
of Vesting Service or, if earlier, upon the later of the Participant's
attainment of age sixty-two while an Employee or his or her fifth
anniversary of becoming a Participant.
(b) Vesting and Payment of Benefits Upon a Change in Control.
--------------------------------------------------------
(i) Notwithstanding any other provisions of the Plan, upon the
occurrence of a Change in Control (as defined below), each
Participant's Accrued Benefit shall deemed to be fully Vested under
the Plan and each Executive Participant shall be entitled to
benefits under the Plan in accordance with the following: (A) As of
the date of the Change in Control, such Executive Participant shall
be deemed to have attained the Normal Retirement Age; (B) with
respect to each year between such Executive Participant's actual
age as of the date of the Change in Control (if less than the
Normal Retirement Age) and the Normal Retirement Age (the "Interim
Period"), such Executive Participant shall be deemed to have been
continuously employed by the Company in, and to have continuously
performed (without any Breaks in Service) the duties of, the
position with the Company that such Executive Participant held as
of the date of the Change in Control; (C) such Executive
Participant shall be deemed to be entitled to Credited Service for
EXH 10(h) - Page 20
all times during the Interim Period; (D) such Executive
Participant's base salary as of the date of the Change in Control
shall be deemed to have increased at a rate of 4.0% per year each
year during the Interim Period, resulting in a corresponding
increase in the Executive Participant's Compensation for purposes
of the Plan; (E) such Executive Participant's Accrued Benefit under
the Plan shall be calculated in accordance with the assumptions set
forth in the preceding clauses (A) - (D), but without deduction of
the offset described in Section 4.1.(a)(iv) of the Plan; and (F)
prior to or upon the consummation of the transactions giving rise
to the Change in Control, the Company shall pay to such Executive
Participant, by certified or bank cashier's check, a cash lump sum
payment that is the Equivalent of such Executive Participant's
Vested Accrued Benefit determined in accordance with this Section
5.1.(b).
(ii) A "Change in Control" shall be deemed to occur 90 days
prior to the occurrence of any of the following events:
(w) any "person" (as defined in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act")), shall become the "beneficial owner" (as defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of Bergen Brunswig Corporation representing 50% or
more of the combined voting power of Bergen Brunswig
Corporation's then outstanding securities, provided, however,
that for purposes of this calculation, purchases by employee
EXH 10(h) - Page 21
benefit plans of Bergen Brunswig Corporation and purchases by
Bergen Brunswig Corporation itself shall be disregarded; or
(x) there shall be consummated: (A) any consolidation, merger
or transaction in the nature of a Section 351 transaction
under the Internal Revenue Code of 1986, as amended from time
to time (the "Code") (whether or not it meets the requirements
for nonrecognition of gain under Section 351 of the Code) of
Bergen Brunswig Corporation in which either Bergen Brunswig
Corporation is not the continuing or surviving corporation,
the majority of the common stock of Bergen Brunswig
Corporation is no longer held by holders of Bergen Brunswig
Corporation common stock immediately prior to the transaction
or pursuant to which shares of Bergen Brunswig Corporation's
common stock would be converted into cash, securities or other
property; provided, however, that a consolidation, merger or
transaction in the nature of a Section 351 transaction under
the Code in which the holders of Bergen Brunswig Corporation's
common stock immediately prior to the merger own, on a
proportionate basis, at least 80% of the common stock of the
surviving corporation immediately after the transaction shall
not be considered a Change in Control; or (B) any sale, lease,
exchange or other transfer (in one transaction or a series of
related transactions) of all, or substantially all, of the
EXH 10(h) - Page 22
operating assets of Bergen Brunswig Corporation; or
(y) the stockholders of Bergen Brunswig Corporation approve a
plan or proposal for the liquidation or dissolution of Bergen
Brunswig Corporation; or
(z) during any rolling period of two consecutive years ending
on any date after the date hereof, individuals who at the
beginning of such period constituted the Board of Directors
and any new director whose election or nomination for election
was approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors at
the beginning of the period or whose election or nomination
for election was previously so approved, cease for any reason
to constitute a majority thereof; provided, however, that no
director shall be considered to have been so approved if such
individual initially assumed office as a result of either an
actual or threatened "Election Contest" (as described in Rule
14a-11 promulgated under the Exchange Act) or other actual or
threatened solicitation of proxies or consents by or on behalf
of a "person" (as defined in Sections 13(d) and 14(d) of the
Exchange Act) other than the Board of Directors (a "Proxy
Contest"), including by reason of any agreement intended to
avoid or settle any Election Contest or Proxy Contest.
(iii) In the event of a Change in Control, upon payment to
each Executive Participant of the cash lump sum payment referred to
EXH 10(h) - Page 23
in clause (F) of subsection 5.1(b)(i) above, the Company shall also
pay to such Executive Participant, by certified or bank cashier's
check, a cash lump sum payment equal to (x) the amount of excise
tax for which such Executive Participant is or may become liable
under Internal Revenue Code Section 4999 (or any successor
provision) with respect to the payments under this Section 5.1(b),
taking into account all compensation includable in the computation
under Internal Revenue Code Section 280G (or any successor
provision), including, without limitation, payments under this
subsection (iii) plus (b) the amount of such Executive
Participant's income tax liability arising from the Company's
payment of the excise tax liability referred to in the preceding
clause (a), such that the payments under clauses (a) and (b) taken
together shall provide such Participant with sufficient
after-income tax dollars to pay such Participant's liability for
Internal Revenue Code Section 4999 excise taxes. The maximum
combined marginal federal and applicable state(s) income tax rate
in effect for the year in which the payments under this subsection
(iii) are to be made shall be used in computing the amount of such
payments. In the event that the Company and the Executive
Participant are unable to agree upon the amount of the payment
required under this subsection (iii), such amount shall be
determined by Tax Counsel (as defined below). The decision of such
Tax Counsel shall be final and binding upon both the Company and
the Executive Participant. All fees and expenses of such Tax
Counsel shall be paid by the Company. As used in this subsection
(iii), the term "Tax Counsel" shall mean an attorney at law or
EXH 10(h) - Page 24
certified public accountant who is a partner at a law firm of at
least 25 attorneys or a partner at a "Big 6" accounting firm,
respectively, provided that such firm has not provided services to
the Company or the respective Executive Participant or any
affiliate of the Company or such Executive Participant within the
last year.
(iv) Upon the occurrence of a Change in Control, (x) this
subsection 5.1(b) shall become irrevocable, and (y) Sections 6.8,
7.4(h), 7.4(i), 7.5 and 10.11 hereof shall cease to apply, none of
such sections shall ever thereafter be reinstated, and no similar
provisions shall ever be adopted hereunder. 5.2 Forfeiture of
Benefits. The unvested portion of an Executive Participant's
Accrued Benefit shall be forfeited on the date the Executive
Participant completes five consecutive Breaks in Service.
EXH 10(h) - Page 25
ARTICLE VI
----------
PAYMENT OF BENEFITS
-------------------
6.1 Benefits on Termination of Employment. A Participant who terminates
-------------------------------------
Employment on or after attaining Normal Retirement Age shall receive his or her
Vested Accrued Benefit commencing immediately and payable in accordance with
this Article. If the Participant terminates Employment before his or her Normal
Retirement Age, the Participant shall receive the Equivalent of his or her
Vested Accrued Benefit commencing immediately upon termination of Employment and
payable in accordance with this Article.
6.2 Death Benefits. Subject to Section 10.7, if a Participant with a
---------------
Vested Accrued Benefit dies, at the option of the Plan Administrator, the
Participant's Beneficiary shall be paid the lump sum Equivalent of the remaining
balance of the Participant's Vested Accrued Benefit.
6.3 Joint and Survivor Annuities.
----------------------------
(a) Subject to Section 6.4, a Participant's Vested Accrued Benefit
shall be paid in the Normal Benefit Form. Distribution shall also be
made in the form of a joint and survivor annuity if a former Spouse is
entitled to survivor annuity benefits under a qualified domestic
relations order, as provided in Section 10.7. More than one Spouse may
be entitled to joint and survivor annuity benefits. For example, two
former Spouses may have been awarded survivor benefits and there may
also be a current Spouse. In such cases, this Section shall be applied
by dividing the Participant's Vested Accrued Benefit in proportion to
the spousal entitlements and then applying this Section to each portion
EXH 10(h) - Page 26
as if each portion were a separate Vested Accrued Benefit belonging to
the Participant and the Spouse or former Spouse in question.
(b) After a Participant has received the explanation required by
subsection (c), the Participant and his or her Spouse, if any, if such
Spouse is a Beneficiary (or former Spouse if such Spouse has the power
to do so under a qualified domestic relations order), may elect, with
the consent of the Plan Administrator and in the manner prescribed by
it, not to receive a joint and survivor annuity, in which case the
Participant shall receive his or her Vested Accrued Benefit in an
Optional Benefit Form. This election may be made at any time but must be
made no later than one year preceding the time benefit payments would
otherwise commence under Section 6.1. This election shall become
irrevocable one year preceding the time benefit payments would otherwise
commence under Section 6.1. Spousal consents to elections waiving joint
and survivor annuity benefits that are required must be given in writing
witnessed by a representative of the Plan Administrator or a notary
public. A spousal consent will only be valid if it also consents to both
the alternative form of payment chosen and the Beneficiary, if any,
thereunder and only if the form of payment and the Beneficiary cannot be
changed without future spousal consent (unless the written spousal
consent expressly permits such changes to be made and the Spouse
acknowledges that he or she understands that he or she does not have to
grant this permission). A Spouse's written consent must acknowledge the
effect of the payment and the Beneficiary election to which he or she is
consenting. The Plan Administrator in its discretion may refuse to
recognize a spousal consent if it believes for any reason that the
EXH 10(h) - Page 27
consent is invalid. Spousal consent shall be waived by the Plan
Administrator if a Participant has no Spouse and may be waived if the
Spouse cannot be located or for such other reasons authorized in
applicable Treasury Regulations. Revocations of previous elections to
waive the joint and survivor annuity may be made at any time and any
number of times within the election period and new waiver elections may
thereafter be made. Revocations of elections to waive the joint and
survivor annuity may be made without spousal consent. A spousal consent
given by one Spouse shall be invalid as to any former or subsequent
Spouse (but no benefit shall be payable under this Section to a person
who becomes the Participant's Spouse after the Participant's benefit
payments under the Plan have commenced).
(c) Assuming sufficient notice of termination of Employment has
been provided to the Plan Administrator, no less than thirty nor more
than ninety days before termination of Employment, the Plan
Administrator shall furnish each Participant with a written explanation
of the terms and conditions of the Normal Benefit Form, the
Participant's right to make an election to waive the Normal Benefit Form
or to revoke a previous election and the effect of such election or
revocation, the rights of the Participant's Spouse in connection with an
election by the Participant, and the relative values of the Optional
Benefit Forms then available under the Plan.
6.4 Optional Benefit Forms. Instead of receiving a benefit in the Normal
----------------------
Benefit Form, a Participant may elect to receive payments in an Optional Benefit
Form. This election must be made in writing in accordance with the requirements
EXH 10(h) - Page 28
of the Plan Administrator and must be delivered to the Plan Administrator prior
to the Participant's termination of Employment. A married Participant may be
required to obtain his or her Spouse's consent to this election pursuant to the
rules set forth in Section 6.3(b). If an Optional Benefit Form provides benefits
to a Beneficiary, election of the Optional Benefit Form shall not be effective
unless the Beneficiary is alive on the date of the Participant's Retirement. The
Optional Benefit Forms available to a Participant are as follows:
(a) A cash lump sum which is the Equivalent of the Participant's
Vested Accrued Benefit.
6.5 Funeral Benefit. In addition to any other benefit payable under the
---------------
Plan, the estate of a Participant who dies before termination of Employment
shall be paid a cash lump sum in the amount of $5,000 to cover funeral expenses
of the Participant. This additional benefit shall be paid only if the estate
gives written notice of the Participant's death to the Plan Administrator and
only if the Participant had a Vested Accrued Benefit, without regard to whether
any or all of the Vested Accrued Benefit will be paid. This benefit shall be
reduced by the funeral benefit, if any, which became payable with respect to the
Participant under section 6.3 of the Capital Accumulation Plan.
6.6 Delay in Distribution.
---------------------
(a) If the amount payable under this Article cannot be ascertained
or the person to whom it is payable has not been determined or located
and reasonable efforts to do so have been made, then distributions under
this Article shall commence, retroactive to the date they would normally
have commenced, within a reasonable time after such amount is
ascertained or such person is determined or located.
EXH 10(h) - Page 29
(b) Distribution of benefits to a Participant shall not be
triggered by the transfer of the Participant to any other job (whether
or not with the Employer or an affiliate) if the transfer is arranged by
the Employer. The Participant's benefit will commence when the
Participant ceases to be employed by the Employer or by any other
company for which the Participant worked in an Employer-arranged job.
6.7 No Suspension of Benefits. Benefits which are in pay status shall
--------------------------
not be suspended if a Participant subsequently performs services for the
Employer in any capacity.
6.8 Release Required. No benefits shall be payable to a Participant
-----------------
unless the Participant executes a general release waiving any and all claims the
Participant may have against the Employer and related parties. The release shall
be made on the form prescribed by the Employer and cannot be given any earlier
than one month before benefit payments are expected to commence. A release shall
not be required with respect to benefits that become payable under the Plan
because of termination of Employment due to death.
EXH 10(h) - Page 30
ARTICLE VII
-----------
ADMINISTRATION OF THE PLAN
--------------------------
7.1 Duties of the Plan Administrator. The Plan Administrator shall be
---------------------------------
responsible for the general administration and management of the Plan. The Plan
Administrator shall have all powers and duties and the discretion necessary to
fulfill its responsibilities, including, but not limited to, the following
powers and duties:
(a) To determine all questions relating to the eligibility of
persons to participate;
(b) To determine the amount and kind of benefits payable to
Participants;
(c) To maintain all records necessary for the administration of the
Plan;
(d) To provide for disclosure of all information and filing or
provision of all reports and statements to Participants, Spouses,
Beneficiaries or governmental bodies as shall be required by ERISA or
any other federal law;
(e) To adopt or modify Plan Rules for the regulation or application
of the Plan; such Rules may establish administrative procedures or
requirements which modify the terms of this Plan but Plan Rules shall
not substantially alter significant requirements or provisions of the
Plan;
(f) To administer the claims procedure set forth in Section 7.4;
(g) To delegate any power or duty to any firm or person in
accordance with Section 7.2; and
EXH 10(h) - Page 31
(h) To exercise all other powers or duties granted to the Plan
Administrator by other provisions of the Plan.
7.2 Delegation of Administrative .
-----------------------------
(a) The Plan Administrator may delegate all or any portion of its
administrative responsibilities with respect to the Plan to any other
person pursuant to this Section.
(b) A delegation under this Section shall be accomplished by a
written instrument executed by the Plan Administrator specifying
responsibilities delegated and the fiduciary responsibilities allocated
to such delegate. The delegation of such responsibilities shall be
effective upon the date specified in the delegation, subject to written
acceptance by the delegate. Any delegation of responsibilities shall
provide for reports, no less often than annually, by such delegate to
the Plan Administrator of such information necessary to fully inform the
Plan Administrator of the status and operation of the Plan and of the
delegate's discharge of responsibilities delegated.
7.3 Compensation, Expenses and Indemnity.
------------------------------------
(a) The Plan Administrator and any delegate under Section 7.2 who
is an Employee shall serve without compensation for services to the
Plan. The Employer shall furnish the Plan Administrator or any such
delegate with all clerical or other assistance necessary in the
performance of his or her duties. The Plan Administrator is authorized
to employ such legal counsel and advisors as it may deem advisable to
assist in the performance of its duties hereunder.
EXH 10(h) - Page 32
(b) All costs of administering the Plan (including the cost of
legal services described in subsection (a)) shall be paid by the
Employer. Except as the Plan Administrator otherwise directs, any
expenses incurred in resolving disputes among different claimants as to
their entitlement to a benefit shall be charged against the benefit,
which shall be reduced accordingly.
(c) To the extent permitted by applicable law, the Employer shall
indemnify and save harmless the Board of Directors, the Plan
Administrator and any delegate appointed pursuant to Section 7.2 who is
an Employee against any and all expenses, liabilities and claims
(including legal fees incurred to defend against such liabilities and
claims) arising out of their discharge in good faith of responsibilities
under or incident to the Plan. Expenses and liabilities arising out of
willful misconduct shall not be covered under this indemnity. This
indemnity shall not preclude such further indemnities as may be
available under insurance purchased by the Employer or provided by the
Employer under any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise, as such indemnities are permitted
under applicable law. Payments with respect to any indemnity and payment
of expenses or fees shall be made only from assets of the Employer.
7.4 Claims Procedure.
----------------
(a) Normally, a Participant, Beneficiary Contingent Annuitant or
Spouse need not present a formal claim in order to qualify for rights or
benefits under this Plan. However, if any such person (a "claimant")
does not believe he or she will receive the benefits to which the person
EXH 10(h) - Page 33
is entitled or believes that the Plan is not being operated properly,
the claimant must file a formal claim under the procedures set forth in
this Section. A formal claim must be filed within six months of the date
upon which the claimant (or his or her predecessor in interest) first
knew (or should have known) of the facts upon which the claim is based.
(b) A claim by any person shall be presented to the Plan
Administrator in writing. A claims official appointed by the Plan
Administrator shall, within ninety days of receiving the claim, consider
the claim and issue his or her determination thereon in writing. The
claims official may extend the determination period for up to an
additional ninety days by giving the claimant written notice. If the
claim is granted, the benefits or relief the claimant seeks will be
provided.
(c) If the claim is wholly or partially denied, the claims official
shall, within ninety days (or such longer period as described above),
provide the claimant with written notice of the denial, setting forth,
in a manner calculated to be understood by the claimant,
(i) the specific reason or reasons for the denial,
(ii) specific references to pertinent Plan provisions on which
the denial is based,
(iii) a description of any additional material or information
necessary for the claimant to perfect the claim and an explanation
of why the material or information is necessary, and
(iv) an explanation of the Plan's claim review procedure. If
the claims official fails to respond to the claim in a timely
manner, the claimant may treat the claim as having been denied by
the claims official.
EXH 10(h) - Page 34
(d) Each claimant shall have the opportunity to appeal in writing
the claims official's denial of a claim to a review official (which may
be a person or a committee) designated by the Plan Administrator for a
full and fair review. A claimant must request review of a denied claim
within sixty days after receipt by the claimant of written notice of
denial of his or her claim or within sixty days after such written
notice was due, if the written notice was not sent. In connection with
the review proceeding, the claimant or his or her duly authorized
representative may review pertinent documents and may submit issues and
comments in writing. The claimant may only present evidence and theories
during the review which the claimant presented during the claims
procedure, except for information which the claims official requested
the claimant to provide to perfect the claim (see subsection (b)(iii)).
Any claims which the claimant does not in good faith pursue through the
review stage of the procedure shall be treated as having been
irrevocably waived.
(e) The Plan Administrator shall adopt procedures pursuant to which
claims shall be reviewed and may, in its discretion, adopt different
procedures for different claims without being bound by past actions. Any
procedures adopted, however, shall be designed to afford a claimant a
full and fair review of his or her claim.
(f) The decision by the review official upon review of a claim
shall be made not later than sixty days after the written request for
review is received by the Plan Administrator, unless special
circumstances require an extension of time for processing, in which case
EXH 10(h) - Page 35
a decision shall be rendered as soon as possible, but not later than one
hundred twenty days after receipt of the request for review.
(g) The decision on review shall be in writing and shall include
specific reasons for the decision written in a manner calculated to be
understood by the claimant, with specific references to the pertinent
Plan provisions on which the decision is based.
(h) If a claimant pursued his or her claim through the review stage
of the claims procedure and the claim was denied (or the review official
failed to decide the claim on a timely basis, in which case it shall be
deemed denied), the claimant will be permitted to appeal the denial by
arbitration pursuant to Section 7.5 of the Plan. In no event shall any
claim to which this procedure applies be subject to resolution by any
means (such as in a court of law) other than by this claim procedure or
arbitration under Section 7.5
(i) This Section shall apply to a claim notwithstanding any failure
by the Plan Administrator or its delegates to follow the procedures in
this Section with respect to the claim. However, an arbitrator reviewing
such a claim may permit a claimant to present additional evidence or
theories if the arbitrator determines that the claimant was precluded
from presenting them during the claim and review procedures due to
procedural errors of the Plan Administrator or its delegates.
7.5 Effect of Plan Administrator Action. The Plan shall be interpreted
-------------------------------------
by the Plan Administrator and all Plan fiduciaries in accordance with the terms
of the Plan and their intended meanings. However, the Plan Administrator and all
EXH 10(h) - Page 36
Plan fiduciaries shall have the discretion to make any findings of fact needed
in the administration of the Plan, and shall have the discretion to interpret or
construe ambiguous, unclear or implied (but omitted) terms in any fashion they
deem to be appropriate in their sole judgment. The validity of any such finding
of fact, interpretation, construction or decision shall not be given de novo
review if challenged in court, by arbitration or in any other forum, and shall
be upheld unless clearly arbitrary or capricious. To the extent the Plan
Administrator or any Plan fiduciary has been granted discretionary authority
under the Plan, the Plan Administrator's or Plan fiduciary's prior exercise of
such authority shall not obligate it to exercise its authority in a like fashion
thereafter. If, due to errors in drafting, any Plan provision does not
accurately reflect its intended meaning, as demonstrated by consistent
interpretations or other evidence of intent, or as determined by the Plan
Administrator in its sole and exclusive judgment, the provision shall be
considered ambiguous and shall be interpreted by the Plan Administrator and all
Plan fiduciaries in a fashion consistent with its intent, as determined by the
Plan Administrator in its sole discretion. The Plan Administrator, without the
need for Board of Directors' approval, shall amend the Plan retroactively to
cure any such ambiguity. This Section may not be invoked by any person to
require the Plan to be interpreted in a manner which is inconsistent with its
interpretation by the Plan Administrator or by any Plan fiduciaries. All actions
taken and all determinations made in good faith by the Plan Administrator or by
Plan fiduciaries shall be final and binding upon all persons claiming any
interest in or under the Plan. This Section shall cease to apply upon the
occurrence or a change in control (see Section 5.1(b)(ii)) and it shall
thereafter never be reinstated in any way.
EXH 10(h) - Page 37
ARTICLE VIII
------------
AMENDMENT AND TERMINATION OF THE PLAN
-------------------------------------
8.1 Amendments.
----------
(a) Bergen Brunswig Corporation, through its Board of Directors,
reserves the right at any time to amend the Plan or to merge,
consolidate, divide or otherwise restructure the Plan prospectively or
retroactively, in accordance with this Article VIII, subject to the
restrictions set forth in Sections 4.1(a)(iv), 5.1(b) and 7.5, which
take effect upon the occurrence of a change in control (as defined in
Section 5.1(b)(ii)).
(b) All amendments or other changes shall be adopted in writing by
resolution of the Board of Directors or, in the case of an amendment
that does not substantially alter the nature or expense of the Plan, by
the Plan Administrator without Board approval.
(c) Any material modification of the Plan by amendment or
termination shall be communicated to all interested parties in the time
and manner required by law.
(d) No Plan amendment shall be applied retroactively to decrease
the Vested percentage or Vested Accrued Benefit of a Participant or
former Participant whose Employment terminated before the date the
amendment became effective.
(e) No Plan amendment shall be applied retroactively to decrease
the amount of Service credited to any person for Employment before the
date the amendment became effective.
EXH 10(h) - Page 38
(f) Except as provided in subsections (d) and (e), all rights under
the Plan shall be determined under the terms of the Plan as in effect at
the time the determination is made.
8.2 Termination of Plan. The Plan is intended to be a permanent program,
but any Employer, through its Board of Directors, shall have the right at any
time to declare the Plan terminated completely as to it or as to any of the
Employer's divisions, facilities, operational units or job classifications. If
the Plan is terminated, all unvested benefits shall be forfeited but all Vested
benefits shall remain payable. The Employer may accelerate the payment of such
benefits, however, and pay the person entitled to the benefit the Equivalent of
the remaining payments due.
EXH 10(h) - Page 39
ARTICLE IX
----------
FUNDING OF BENEFITS
-------------------
9.1 Plan is Unfunded. This Plan is, for purposes of ERISA and the Code,
----------------
an unfunded deferred compensation plan for a select group of management and
highly compensated employees. Participants and their Beneficiaries, successors
and assigns shall have no legal or equitable rights, interests or claims in any
property or assets of an Employer. Any and all of an Employer's assets shall be,
and remain, the general, unpledged unrestricted assets of the Employer. An
Employer's obligation under the Plan shall be merely that of an unfunded and
unsecured promise to pay money in the future.
9.2 Trust. Bergen Brunswig Corporation shall establish the Trust, and
-----
the Adopting Employers shall at least annually transfer over to the Trust such
assets as the Adopting Employers determine, in good faith, are necessary to
provide for each Employer's future liabilities created under this Plan. Whether
or not an Employer funds the Trust, it shall at all times remain liable to carry
out its obligations under the Plan.
9.3 Interrelationship of the Plan and the Trust. The provisions of the
--------------------------------------------
Plan shall govern the rights of a Participant to receive distributions pursuant
to the Plan. The provisions of the Trust shall govern the rights of the
Employers, Participants and the creditors of the Employers to the assets
transferred to the Trust. Each Employer shall at all times remain liable to
carry out its obligations under the Plan. Each Employer's obligations under the
Plan may be satisfied with Trust assets distributed pursuant to the terms of the
Trust, and any such distribution shall reduce the Employer's obligations under
this Plan.
EXH 10(h) - Page 40
ARTICLE X
---------
MISCELLANEOUS PROVISIONS
------------------------
10.1 Payments.
--------
(a) In the event any amount becomes payable under the Plan to a
minor or a person who, in the sole judgment of the Plan Administrator,
is considered to be unable to give a valid receipt for the payment by
reason of physical or mental condition, the Plan Administrator may
direct that payment be made to any person found by the Plan
Administrator, in its sole judgment, to have assumed the care of the
person in question. Any payment made pursuant to such a finding shall
constitute payment by the Plan and result in a full release and
discharge of the Plan Administrator, the Employer and their officers,
directors, employees, agents and representatives.
(b) Payment of benefits to the person entitled thereto may be made
by a check sent first class mail, address correction requested, to the
last known address on file with the Plan Administrator. If within six
months from the date of issuance of the check the payment letter cannot
be delivered to the person entitled thereto or the check has not been
negotiated, all benefits under the Plan may be forfeited at the
discretion of the Plan Administrator.
(c) If the Plan Administrator retains at the Plan's expense a
private investigator or other person or service to assist in locating a
missing person, all costs incurred for such services shall be charged to
the benefit to which the missing person was entitled (which shall be
reduced by the amount of the costs incurred), except as the Plan
Administrator may otherwise direct.
EXH 10(h) - Page 41
10.2 Consolidation or Merger of Companies. In the event of the
----------------------------------------
consolidation or merger of the Employer with or into any other business entity,
or the sale by the Employer of all of its assets, the successor may continue the
Plan by adopting the same by resolution of its board of directors or agreement
of its partners or proprietor. This Plan shall not be construed as preventing
the Employer from selling, transferring or otherwise disposing of all or any
part of the business or assets of the Employer, and the purchaser of all or any
part of the Employer shall not be obligated to continue this Plan. If, within
ninety days from the effective date of a consolidation, merger or sale of
assets, the new corporation, partnership or proprietorship does not adopt the
Plan, the Plan shall be terminated in accordance with Section 8.2.
10.3 Adoption of Plan to Cover Other Companies, Facilities or Groups.
------------------------------------------
Any company, with the approval of the Plan Administrator, may adopt the Plan (as
a whole company or as to any one or more divisions or facilities or other
employment classifications) effective as of the date it specifies. Adoption
shall be accomplished either by action of the adopting company (without board
approval) or by resolution of the adopting company's own board of directors or
agreement of its partners. The same procedure shall be followed when an Employer
that has adopted the Plan wishes to change the positions or facilities covered
by this Plan.
10.4 Termination of Employment
-------------------------
(a) A person's Employment shall terminate upon the first to occur
of his or her resignation from or discharge by the Employer, or his or
her death or retirement. A person's Employment shall not terminate on
account of an authorized leave of absence, sick leave or vacation, or on
EXH 10(h) - Page 42
account of a military leave described in subsection (b), a direct
transfer between Employers or a temporary layoff for lack of work.
However,
(i) continuation upon a temporary layoff for lack of work for
a period in excess of the number of months allowable under
applicable personnel policies of the Employer shall be considered a
discharge effective as of the end of the last day of such period,
(ii) failure to return to work upon expiration of any leave of
absence, sick leave or vacation or within the time period allowed
under applicable personnel policies of the Employer after recall
from a temporary layoff for lack of work shall be considered a
resignation effective as of the expiration of such leave of
absence, sick leave, vacation or layoff, and
(iii) solely for purposes of this Plan, Employment shall not
terminate until the expiration of all severance benefits payable by
the Employer.
(b) Any Employee who leaves the Employer directly to perform
service in the Armed Forces of the United States or in the United States
Public Health Service under conditions entitling the Employee to
reemployment rights, as provided in the laws of the United States, shall
be on military leave. An Employee's military leave shall expire if such
Employee voluntarily resigns from the Employer during the leave or if he
or she fails to make application for reemployment within the period
specified by such laws for the preservation of reemployment rights. In
such event, the individual's Employment shall be deemed to terminate by
resignation on the date the military leave expired.
EXH 10(h) - Page 43
(c) If a Participant ceases to be employed by the Employer and all
related companies, as determined under Section 2.12(e), because of the
disposition by the Employer or a related company of its interest in a
subsidiary (within the meaning of Code Section 409(d)(3)) or
substantially all of the assets (within the meaning of Code Section
409(d)(2)) used by the Employer or a related company in a trade or
business, the Participant's Employment shall be considered terminated
for all Plan purposes. This subsection shall not apply to the extent it
is overridden by any contrary or inconsistent provision in applicable
sales documents or any related documents, whether adopted before or
after the sale and any such contrary or inconsistent provision shall
instead apply and is hereby incorporated in the Plan by this reference.
(d) If an Employee is absent from work because of such individual's
pregnancy, the birth of a child, placement of an adopted child, or
caring for an adopted or natural child following birth or placement,
determinations of whether the Employee has incurred a Break in Service
because of the absence shall be made in accordance with the following
special rules:
(i) If the maternity/paternity absence is an Employer-approved
----------------------------------------------------------
leave of absence, it shall be treated as any other approved leave
----------------
of absence (i.e., a Break in Service will not occur until the
individual's Employment terminates because he or she quits or is
discharged or he or she is considered terminated pursuant to
Section 10.4(a)).
(ii) If the maternity/paternity absence is not an
-------------------------------------------------------
Employer-approved leave of absence the individual's Employment will
----------------------------------
EXH 10(h) - Page 44
be deemed terminated as of the date determined under applicable
personnel policies of the Employer but the individual shall not
incur a Break in Service until the end of the second three hundred
and sixty-five consecutive day period of his or her absence from
Employment. If the individual returns to Employment during the
first three hundred and sixty-five consecutive days of absence, the
period of absence shall be treated as Service. If the individual
returns to Employment during the second three hundred and
sixty-five consecutive day period of absence, the portion of that
second period which precedes the individual's return to Employment
will not be a Break in Service but will not count as Service.
(e) No credit shall be given under subsection (d) unless the
Employee files a written request which establishes valid reasons for the
absence, as determined by the Plan Administrator.
(f) Except to the extent that a maternity or paternity absence
constitutes an authorized leave of absence from the Employer under
applicable personnel policies, an Employee who is absent from work for
reasons of maternity or paternity shall be deemed to have terminated
Employment for all purposes of this Plan other than the special rules in
subsection (d).
10.5 Determination of Hours of Service. This Plan uses the elapsed time
---------------------------------
system for crediting Service. Therefore, a Participant's hours of Service need
not be measured or defined by this Plan.
10.6 Alienation. Except as otherwise provided in this Plan, the rights
----------
of a Participant, Spouse or Beneficiary under the Plan shall not be subject to
EXH 10(h) - Page 45
any claim of any creditor nor to attachment or garnishment or other legal
process by any creditor. A Participant, Spouse or Beneficiary shall not have the
right to alienate, anticipate, commute, pledge, encumber or assign any of the
benefits or payments or proceeds which the individual may expect to receive,
contingently or otherwise, under the Plan. The provisions of this Section shall
not preclude any assignment or alienation expressly required under applicable
pension law or other provisions of the Plan.
10.7 Division of Benefits by Domestic Relations Orders.
-------------------------------------------------
(a) This Plan will follow the terms of any qualified domestic
relations order issued with respect to a Participant. However, except as
provided in subsection (e), the Plan will only follow orders which meet
all of the requirements of subsection (b) or subsection (c). Subsection
(c) establishes an optional standardized procedure.
(b) A "qualified domestic relations order" is any judgment, decree
or order, including the approval of a property settlement agreement,
issued by a court of competent jurisdiction, provided that
(i) the order relates to the provision of child support,
alimony or marital property rights and is made pursuant to state
domestic relations or community property laws;
EXH 10(h) - Page 46
(ii) the order creates or recognizes the existence of an
alternate payee's right to receive all or a portion of a
Participant's Accrued Benefit;
(iii) the order specifies the name and last known mailing
address of the Participant and each alternate payee covered by the
order;
(iv) the order precisely specifies the amount or percentage of
the Participant's Accrued Benefit to be paid to each alternate
payee or the manner in which the amount or percentage is to be
determined;
(v) the order specifies the number of payments or the period
to which the order applies;
(vi) the order specifically names this Plan as the plan to
which the order applies;
(vii) the order does not require this Plan to provide any type
of benefits or form of benefits not otherwise provided under this
Plan;
(viii) the order does 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 by the
Plan Administrator to be a qualified domestic relations order; and
(ix) (if the order requires that payments to the alternate
payee commence before they commence with respect to the
Participant) the order (1) specifies that payments will not
commence before the earlier of (a) the date on which the
EXH 10(h) - Page 47
Participant attains age fifty or the first date on which the
Participant could begin receiving benefits under the Plan if the
Participant's Employment terminated, whichever is later, or (b) the
date benefits first become payable to the Participant and (2) does
not permit the alternate payee to elect a joint and survivor
annuity covering the alternate payee and a spouse (other than the
Participant). A qualified domestic relations order may provide that
a former Spouse of the Participant is to be treated as a surviving
Spouse for purposes of the pre-retirement or post-retirement joint
and survivor annuity provisions of this Plan. Subsection (d) sets
forth the procedures under which the Plan Administrator shall
determine whether a domestic relations order properly qualifies.
(c) The Plan Administrator at its discretion may furnish on request
a standard form of qualified domestic relations order to a Participant
or any other person. This order may provide for an immediate lump sum
payment of the Equivalent of the amount to which the Plan Administrator
shall treat it as a qualified domestic relations order and shall pay
benefits to the alternate payee in accordance with its terms. If this
procedure is not followed, the alternate payee (1) must wait until the
EXH 10(h) - Page 48
time described in subsection (b)(ix) before benefits which are not in
pay status can become payable to the alternate payee and (2) cannot use
any special forms of benefit payment authorized in the standard form of
order. Any special benefit form provisions in standard domestic
relations orders adopted by the Plan Administrator shall be authorized
as benefit options under this Plan, but only as Plan Administrator shall
treat it as a qualified domestic relations order and shall pay benefits
to the alternate payee in accordance with its terms. If this procedure
is not followed, the alternate payee (1) must wait until the time
described in subsection (b)(ix) before benefits which are not in pay
status can become payable to the alternate payee and (2) cannot use any
special forms of benefit payment authorized in the standard form of
order. Any special benefit form provisions in standard domestic
relations orders adopted by the Plan Administrator shall be authorized
as benefit options under this Plan, but only as to alternate payees for
whom the standard order has been used.
(d) The Plan Administrator need not treat any judgment, decree or
order as a qualified domestic relations order unless it meets all of the
requirements set forth in subsection (b) or (c) and is sufficiently
precise and unambiguous so as to preclude any interpretative disputes.
If the order meets these requirements, the Plan Administrator shall
follow the terms of the order whether or not this Plan has been joined
as a party to the litigation out of which the order arises. Upon receipt
of a domestic relations order, the Plan Administrator shall notify the
Participant and each alternate payee of (1) its receipt of the order and
(2) its need to determine the qualified status of the order in
accordance with subsection (b) or (c). An alternate payee may designate
a representative to receive copies of future notices with respect to the
qualified status of the order. To the extent an order calls for benefits
to be paid to an alternate payee before the qualified nature of the
order is determined, a separate account shall be established to hold the
benefit payments affected by the order. This account shall be
administered in accordance with the rules set forth in Section
206(d)(3)(H) of ERISA.
EXH 10(h) - Page 49
(e) The Plan Administrator in its discretion may treat a property
settlement agreement or stipulation which is not contained in a
judgment, decree or order as a qualified domestic relations order if it
meets all of the other requirements of this Section.
10.8 Legal Costs; Increased Benefit.
------------------------------
(a) The Employer shall pay to a Participant all reasonable
attorneys' fees and necessary costs and disbursements incurred by or on
behalf of such Participant in connection with or as a result of a
dispute under this Agreement, whether or not the Participant ultimately
prevails. Attorneys' fees shall be paid by the Employer within 30 days
of presentment by the Participant to the Employer of an invoice received
by the Participant from the Participant's attorneys. Any late payments
under this Section shall bear interest at a rate of twenty percent (20%)
per month.
(b) If the Employer disputes any position taken by a Participant
under this Agreement and the Participant prevails, the Participant's
benefit under this Plan shall be doubled and the increased amount shall
become immediately due and payable to the Participant.
10.9 Duty to Provide Data.
(a) Every person with an interest in the Plan or claiming benefits
under the Plan shall furnish the Plan Administrator on a timely and
accurate basis with such documents, evidence or information as it
considers necessary or desirable for the purpose of administering the
Plan. The Plan Administrator may postpone payment of benefits until such
EXH 10(h) - Page 50
information and such documents have been furnished.
(b) Once every twelve months every person claiming a benefit under
this Plan shall file a signed, written notice to the Plan Administrator
of his or her post office address and each change of post office
address. Any communication, statement or notice addressed to such a
person at his or her latest post office address as filed with the Plan
Administrator will, on deposit in the United States mail with postage
prepaid, be as binding upon such person for all purposes of the Plan as
if it had been received, whether actually received or not. If a person
fails to give notice of his or her correct address, the Plan
Administrator, the Employer and Plan fiduciaries shall not be obliged to
search for, or to ascertain, his or her whereabouts.
10.10 Limitation on Rights of Employees. Except as otherwise required by
---------------------------------
law or in other written agreements between the Employer and Participant, nothing
contained in the Plan shall give any Participant the right to be retained in the
service of the Employer or to interfere with or restrict the right of the
Employer, which is hereby expressly reserved, to discharge or retire any
Participant at any time, with or without cause. Except as otherwise required by
law or in other written agreements between the Employer and Participant,
inclusion under the Plan will not give any Participant any right or claim to any
benefit hereunder except to the extent such right has specifically become fixed
under the terms of the Plan. If any dispute arises under the Plan between a
Participant and the Employer or any of its subsidiaries, such subsidiary or any
other Participant shall not be necessary parties to the dispute and need not be
named in any litigation. Except as otherwise provided herein, benefits under
this Plan shall not be accelerated merely because there is a change in ownership
EXH 10(h) - Page 51
of the Employer. This Plan shall not obligate the Employer to maintain a minimum
net worth in order to insure payment of benefits. The doctrine of substantial
performance shall have no application to Employees or Participants. Each
condition and provision, including numerical items, has been carefully
considered and constitutes the minimum limit on performance which will give rise
to the applicable right.
10.11 Restrictions. A Participant shall not at any time, either directly
------------
or indirectly, accept employment with, render service, assistance or advice to,
or allow his or her name to be used by any competitor of the Employer unless
approved by the Executive Committee of the Board of Directors. Determination by
the Executive Committee of the Board of Directors that the Participant has
engaged in any such activity shall be binding and conclusive on all parties, and
in addition to all other rights and remedies which the Employer shall have, the
Participant shall not be entitled to any payments hereunder. This provision
shall cease to apply upon a change in control, as defined in Section 5.1(b)(ii).
10.12 Service of Process. The Secretary of Bergen Brunswig Corporation
------------------
is hereby designated as agent for the service of legal process on the Plan.
10.13 Spouse's Interest. The interest in the benefits hereunder of a
------------------
Spouse of a Participant who has predeceased the Participant shall automatically
pass to the Participant and shall not be transferable by such Spouse in any
manner, including but not limited to such Spouse's will, nor shall such interest
pass under the laws of intestate succession.
10.14 Distribution in the Event of Taxation. If, for any reason, all or
-------------------------------------
any portion of a Participant's benefit under this Plan becomes taxable to the
EXH 10(h) - Page 52
Participant prior to receipt, a Participant's Employer shall distribute to the
Participant immediately available funds in an amount equal to the taxable
portion of his or her benefit.
10.15 Governing Law. Subject to ERISA, the Plan shall be interpreted,
-------------
administered and enforced in accordance with the internal laws of the State of
California without regard to its conflicts of laws principles.
10.16 Plurals. Where the context so indicates, the singular shall
-------
include the plural and vice versa.
10.17 Titles. Titles are provided herein for convenience only and are
------
not to serve as a basis for interpretation or construction of the Plan.
10.18 References. Unless the context clearly indicates to the contrary,
----------
a reference to a Plan provision, statute, regulation or document shall be
construed as referring to any subsequently enacted, adopted or executed
counterpart.
10.19 Entire Agreement. This Plan contains the full and complete
-----------------
understanding of the parties with respect to the subject matter hereof and
supersedes all prior representations and understandings, whether oral or
written.
10.20 Severability. In the event that any provision hereof or any
------------
obligation or grant of rights herein is found invalid or unenforceable pursuant
to judicial decree or decision, any such provision, obligation or grant of
rights shall be deemed and construed to extend only to the maximum extent
permitted by law, and the remainder of this Plan shall remain valid and
enforceable according to its terms.
10.21 Withholding. Anything in this Plan to the contrary
-----------
notwithstanding, all payments required to be made hereunder to a Participant or
Beneficiaries shall be subject to the withholding of such amounts relating to
EXH 10(h) - Page 53
taxes as the Plan Administrator may reasonably determine should be withheld
pursuant to any applicable law or regulation.
EXH 10(h) - Page 54
IN WITNESS WHEREOF, the Company has caused this Amendment and
Restatement to be executed by its duly authorized officer as of the ________ day
of ____________, 199_.
By Order of the Board of Directors of
BERGEN BRUNSWIG CORPORATION, a New Jersey corporation
By:________________________________
Executive Vice President,
Chief Legal Officer and Secretary
EXH 10(h) - Page 55