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EXHIBIT 10.6
ALLERGAN, INC.
SUPPLEMENTAL EXECUTIVE BENEFIT PLAN
Restated
1996
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RESTATED
ALLERGAN, INC.
SUPPLEMENTAL EXECUTIVE BENEFIT PLAN
ARTICLE I
INTRODUCTION
1.1 Purpose. This Allergan, Inc. Supplemental Executive
Benefit Plan (the "Plan") is hereby established by the board of directors
(hereinafter referred to as the "Board of Directors" or the "Board") of
Allergan, Inc., a Delaware corporation (the "Sponsor"), to provide certain
supplemental retirement benefits to selected officers of the Sponsor as more
fully provided herein. The benefits provided under this Plan are intended to
replace and be generally comparable to certain benefits (related to the
Management Bonus Plan and the limitation contained in Code Section 401(a)(17))
that are provided under that certain Supplemental Benefit Plan maintained by
SmithKline Beckman Corporation, a Pennsylvania corporation ("SKB"), as such
Supplemental Benefit Plan (the "SKB Plan") is in effect immediately prior to
the Effective Date hereof.
1.2 Effective Date and Term. This plan is adopted effective as
of July 27, 1989 (the "Effective Date"), and shall continue in effect until
terminated by the Board of Directors.
1.3 Participation. Participation in this Plan is open only to
those officers of the Sponsor who are appointed directly by the Board of
Directors (any such officer shall be referred to herein as a "Designated
Officer"). Each employee of the Sponsor who is, as of the Effective Date
hereof, a Designated Officer shall automatically commence participation in this
Plan as of such Effective Date. Any employee of the Sponsor who becomes,
subsequent to the Effective Date hereof, a Designated Officer shall
automatically commence participation in this Plan as of the date such employee
becomes a Designated Officer.
1.4 Applicability of ERISA. This Plan is intended to be a
"top-hat" plan -- that is, an unfunded plan maintained primarily for the
purpose of providing deferred compensation to a select group of management or
highly compensated employees within the meaning of ERISA.
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ARTICLE II
DEFINITIONS
2.1 Board; Board of Directors. "Board" and "Board of
Directors" each mean the board of directors of the Sponsor.
2.2 Code. "Code" means the Internal Revenue Code of 1986, as
amended.
2.3 Committee. "Committee" means the committee authorized to
administer this Plan as set forth in Section 3.1 hereof.
2.4 Effective Date. "Effective Date" means July 27, 1989.
2.5 ERISA. "ERISA" means the Employee Retirement Income
Security Act of 1974, as amended.
2.6 Former Designated Officer. "Former Designated Officer"
means any employee of the Sponsor who (a) commenced participation in this Plan
by reason of his holding or attaining the status of Designated Officer as
provided in Section 1.3 hereof, and (b) does not hold the status of Designated
Officer at the time of his Termination.
2.7 Participant. "Participant" means any Designated Officer
who commences participation in this Plan as provided under Section 1.3 hereof.
2.8 Pension Plan. "Pension Plan" means the Allergan, Inc.
Pension Plan as it may be amended from time to time.
2.9 Plan. "Plan" means this Allergan, Inc. Supplemental
Executive Benefit Plan adopted as of the Effective Date hereof and as it may be
amended from time to time.
2.10 Sponsor. "Sponsor" means Allergan, Inc., a Delaware
corporation.
2.11 Termination. "Termination" means the termination of a
Participant's employment with the Sponsor for any reason whatsoever, whether
voluntary or involuntary.
2.12 Termination Date. "Termination Date" means, with respect
to any Participant, the effective date of such Participant's Termination.
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ARTICLE III
ADMINISTRATION OF THE PLAN
3.1 Administration By Committee. This Plan shall be
administered by the same committee (the "Committee") which is appointed to
administer the Pension Plan. A member of the Committee may be a Participant in
this Plan, provided, however, that any action to be taken by the Committee
solely with respect to the particular interest in this Plan of a Committee
member who is also a Participant in this Plan shall be taken by the remaining
members of the Committee.
3.2 Committee Authority; Rules and Regulations. The Committee
shall have discretionary authority to (a) make, amend, interpret and enforce
all appropriate rules and regulations for the administration of the Plan, (b)
decide or resolve any and all questions, including interpretations of the Plan,
as may arise in connection with the Plan, and (c) take or approve all such
other actions relating to the Plan (other than amending or terminating the Plan
or making a final determination concerning an application for Plan benefits as
set forth in Section 3.6 hereof) as may be taken or approved by the Board;
provided, however, that the Board may, by written notice to the Committee,
withdraw all or any part of the Committee's authority at any time, in which
case such withdrawn authority shall immediately revest in the Board. Subject
to Section 3.6 hereof, the decision or action of the Committee in respect of
any question arising out of or in connection with the administration,
interpretation and application of this Plan and the rules and regulations
promulgated hereunder shall be final, conclusive and binding upon all persons
having any interest in the Plan.
3.3 Appointment of Agents. In the administration of this Plan,
the Board and/or the Committee may from time to time employ agents (which may
include officers and/or employees of the Sponsor) and delegate to them such
administrative duties as it sees fit and may from time to time consult with
counsel who may be counsel to the Sponsor.
3.4 Application For Benefits. The Committee may require any
person claiming benefits under the Plan to submit an application therefor,
together with such documents and information as the Committee may require. In
the case of any person suffering from a disability which prevents such person
from making personal application for benefits, the Committee may, in its
discretion, permit application to be made by another person acting on his
behalf. Notwithstanding the foregoing, if the Committee shall have all
information necessary to determine the amount and form of Plan benefits payable
to a Participant or Beneficiary who is entitled to benefit payments under this
Plan (including, to the extent applicable and without limiting the generality
of the foregoing, the name, age, sex and proper mailing address of all parties
entitled to benefit payments), then the failure of a Participant or Beneficiary
to file an application for benefits shall not cause the Committee to defer the
commencement of benefit payments beyond the benefit commencement date required
under this Plan.
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3.5 Action on Application. Within 60 days following receipt of
an application and all necessary documents and information, the Committee shall
furnish the claimant with written notice of the decision rendered with respect
to such application. Should special circumstances require an extension of time
for processing the claim, written notice of the extension shall be furnished to
the claimant prior to the expiration of the initial 60 day period. The notice
shall indicate the special circumstances requiring an extension of time and the
date by which a final decision is expected to be rendered. In no event shall
the period of the extension exceed 90 days from the end of the initial 60 day
period. In the case of a denial of the claimant's application, the written
notice thereof shall set forth specific reasons for the denial, with references
to the Plan provisions upon which the denial is based, a description of any
additional information or material necessary to perfect the application
(together with an explanation why such material or information is necessary),
and an explanation of the Plan's claim review procedure.
3.6 Appeal of Committee Decision.
(a) A claimant who does not agree with the decision rendered by the
Committee with respect to his application may appeal such decision to
the Board. The appeal must be in writing and must be filed with the
Board within 65 days after the date of notice of the Committee's
decision with respect to the application, or, if the application has
neither been approved nor denied within the applicable period provided
in Section 3.5 hereof, then the appeal must be filed within 65 days
after the expiration of such applicable period.
(b) The claimant may request that his application be given full and
fair review by the Board. The claimant may review all pertinent
documents and submit issues and comments to the Board in writing in
connection with the appeal. The decision of the Board shall be made
promptly, and not later than 60 days after the Board's receipt of a
request for review and all supporting documentation and information to
be submitted by the claimant, unless special circumstances require an
extension of time for processing, in which case a decision shall be
rendered as soon as possible, but not later than 120 days after receipt
of a request for review and such supporting documentation and
information. The Board's 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 reference to
the pertinent Plan provisions upon which the decision is based.
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ARTICLE IV
BENEFITS
4.1 Determination of Benefits.
(a) Except as provided in Section 4.2 or Article V hereof, the
supplemental retirement benefit payable to any Participant under this
Plan shall be determined as of such Participant's Termination Date and
shall be an amount equal to the excess (if any) of (i) the retirement
benefit to which such Participant would be entitled under the Pension
Plan if his retirement benefit under the Pension Plan were determined
(A) without regard to the limits imposed by Code Sections 401(a)(17)
and/or 415, and (B) by taking into account the amount of any
compensation deferred by such Participant prior to the Effective Date
hereof under SKB's Management Bonus Plan as if such compensation had
been paid in the year awarded; over (ii) the retirement benefit to which
such Participant would be entitled under the Pension Plan if his benefit
under the Pension Plan were determined without regard to the limits
imposed by Code Section 415.
(b) Notwithstanding the provisions of subsection (a) above or Section
4.2 hereof, in the case of any Participant in this Plan (including any
Former Designated Officer) who is not also a participant in the
Allergan, Inc. Supplemental Retirement Income Plan (a "Specified
Participant"), in no event shall the supplemental retirement benefit
payable under this Plan to such Specified Participant be less than such
Specified Participant's accrued benefit (if any) under the SKB Plan as
of July 26, 1989.
4.2 Loss of Designated Officer Status. In the case of any
Former Designated Officer, such Former Designated Officer's supplemental
retirement benefit under this Plan shall be determined under Section 4.1
hereof, provided, however, that for purposes of applying subsection (a)
thereof, the limits imposed by Code Section 401(a)(17) shall be disregarded
only with respect to those periods during which such Former Designated Officer
held the status of Designated Officer and only if, and to the extent that, such
periods are required to be used under the Pension Plan benefit formula in order
to calculate such Former Designated Officer's actual benefit under the Pension
Plan.
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4.3 Form and Payment of Benefits. Except as provided in
Article V hereof, a Participant's benefit under this Plan as determined
pursuant to this Article IV shall be paid to such Participant in the same form
and at the same time, and calculated under the same actuarial assumptions, as
the Participant's benefits under the Pension Plan. For example, if a
Participant were entitled to monthly benefit payments under the Pension Plan,
the Participant's benefit under this Plan would also be paid on a monthly basis
at the same time as the monthly benefit payments under the Pension Plan, and
the amount of each monthly benefit payment under this Plan would be the amount
(if any) by which the monthly benefit payment determined under clause (i) of
Section 4.1(a) hereof (as modified by Section 4.2 hereof if applicable) exceeds
the monthly benefit payment determined under clause (ii) of Section 4.1(a)
hereof (as modified by Section 4.2 hereof if applicable), subject to the
provisions of Section 4.1(b) hereof.
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ARTICLE V
CHANGE IN CONTROL
5.1 Effect of a Change in Control. Notwithstanding the
provisions of Article IV hereof, in the event that a Change In Control (as
defined in Section 5.4 hereof) occurs on or after the Effective Date hereof,
each Participant shall receive a "Lump Sum Benefit" in lieu of any benefits
under the Plan to which such Participant is or would otherwise become entitled
and which have not already been paid as of the date such Change In Control
occurs (the "Change In Control Date"), with such Lump Sum Benefit to be paid as
provided in Section 5.2 hereof in the amount calculated as provided in Section
5.3 hereof.
5.2 Payment of Lump Sum Benefit. The Lump Sum Benefit
payable to any Participant under Section 5.1 hereof shall be paid to such
Participant within 30 days following such Participant's Determination Date. As
used herein, a Participant's "Determination Date" shall be the later of the
Change In Control Date or such Participant's Termination Date.
5.3 Amount of Lump Sum Benefit. The amount of the Lump Sum
Benefit payable to any Participant pursuant to Section 5.1 hereof shall be the
amount equal to the lump sum actuarial equivalent, determined as of such
Participant's Determination Date, of the unpaid Plan benefits to which such
Participant is entitled under Article IV hereof, provided, however, that in
determining the lump sum actuarial equivalent of such Participant's unpaid Plan
benefits, the following special rules shall apply:
(a) The interest/discount rate assumed shall be 3.6 percent (3.6%);
(b) The mortality table used shall be the same as the mortality
table used for purposes of determining the Sponsor's minimum funding
obligation under ERISA with respect to the Pension Plan for the plan
year preceding the plan year in which the Participant's Determination
Date falls; and
(c) For purposes of determining what benefits the Participant is
entitled to receive under Article IV hereof, it shall be assumed that
the Participant would commence receiving benefit payments under the
Pension Plan and under Article IV of this Plan as of the earlier of (i)
the date such Participant actually commenced receiving Pension Plan
benefits, or (ii) the date which is the later of (A) such Participant's
Termination Date or (B) the earliest date such Participant would be
eligible to commence receiving Pension Plan benefits.
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5.4. Change in Control. As used in this Plan, "Change in
Control" shall mean the following and shall be deemed to occur if any of the
following events occur:
(a) Any "person," as such term is used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), is
or becomes the "beneficial owner" (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Sponsor
representing 50% or more of the combined voting power of the Sponsor's
then outstanding voting securities;
(b) Individuals who, as of the Effective Date hereof, constitute the
Board of Directors (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board of Directors, provided that
any person becoming a director subsequent to the Effective Date hereof
whose election, or nomination for election by the Sponsor's
stockholders, is approved by a vote of at least a majority of the
directors then comprising the Incumbent Board (other than an election or
nomination of an individual whose initial assumption of office is in
connection with an actual or threatened election contest relating to the
election of the directors of the Sponsor, as such terms are used Rule
14a-11 of Regulation 14A promulgated under the Exchange Act) shall, for
the purposes of this Plan, be considered as though such person were a
member of the Incumbent Board of the Sponsor;
(c) The stockholders of the Sponsor approve a merger or consolidation
with any other corporation, other than
(i) a merger or consolidation which would result in the voting
securities of the Sponsor outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by
being converted into voting securities of another entity) more
than 50% of the combined voting power of the voting securities
of the Sponsor or such other entity outstanding immediately
after such merger or consolidation, and
(ii) a merger or consolidation effected to implement a
recapitalization of the Sponsor (or similar transaction) in
which no person acquires 50% or more of the combined voting
power of the Sponsor's then outstanding voting securities; or
(d) The stockholders of the Sponsor approve a plan of complete
liquidation of the Sponsor or an agreement for the sale or other
disposition by the Sponsor of all or substantially all of the Sponsor's
assets.
Notwithstanding the preceding provisions of this Section 5.4, a Change in
Control shall not be deemed to have occurred (1) if the "person" described in
the preceding provisions of this Section 5.4 is an underwriter or underwriting
syndicate that has acquired the ownership of 50% or more of the combined voting
power of
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the Sponsor's then outstanding voting securities solely in connection with a
public offering of the Sponsor's securities, or (2) if the "person" described
in the preceding provisions of this Section 5.4 is an employee stock ownership
plan or other employee benefit plan maintained by the Sponsor (or any of its
affiliated companies) that is qualified under the provisions of ERISA.
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ARTICLE VI
MISCELLANEOUS PROVISIONS
6.1 Designation of Beneficiary. A Participant shall be
entitled to designate one or more individuals or entities, in any combination,
as his "Beneficiary" or "Beneficiaries" to receive any Plan payments to which
such Participant is entitled as of, or by reason of, his death. Any such
designation may be made or changed at any time prior to the Participant's death
by written notice filed with the Committee, with such written notice to be in
such form and contain such information as the Committee may from time to time
determine. In the event that either (a) a Beneficiary designation is not on
file at the date of a Participant's death, (b) no Beneficiary survives the
Participant, or (c) no Beneficiary is living at the time any payment becomes
payable under this Plan, then, for purposes of making any further payment of
any unpaid benefits under this Plan, such Participant's Beneficiary or
Beneficiaries shall be deemed to be the person or persons entitled to receive
the Participant's survivor and death benefits under the Pension Plan.
6.2 Payments During Incapacity. In the event a Participant (or
Beneficiary) is under mental or physical incapacity at the time of any payment
to be made to such Participant (or Beneficiary) pursuant to this Plan, any such
payment may be made to the conservator or other legally appointed personal
representative having authority over and responsibility for the person or
estate of such Participant (or Beneficiary), as the case may be, and for
purposes of such payment references in this Plan to the Participant (or
Beneficiary) shall mean and refer to such conservator or other personal
representative, whichever is applicable. In the absence of any lawfully
appointed conservator or other personal representative of the person or estate
of the Participant (or Beneficiary), any such payment may be made to any person
or institution that has apparent responsibility for the person and/or estate of
the Participant (or Beneficiary) as determined by the Committee. Any payment
made in accordance with the provisions of this Section 6.2 to a person or
institution other than the Participant (or Beneficiary) shall be deemed for all
purposes of this Plan as the equivalent of a payment to such Participant (or
Beneficiary), and the Sponsor shall have no further obligation or
responsibility with respect to such payment.
6.3 Prohibition Against Assignment. Except as otherwise
expressly provided in Section 6.1 and Section 6.2 hereof, the rights, interests
and benefits of a Participant under this Plan (a) may not be sold, assigned,
transferred, pledged, hypothecated, gifted, bequeathed or otherwise disposed of
to any other party by such Participant or any Beneficiary, executor,
administrator, heir, distributee or other person claiming under such
Participant, and (b) shall not be subject to execution, attachment or similar
process. Any attempted sale, assignment, transfer, pledge, hypothecation,
gift, bequest or other disposition of such rights,
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interests or benefits contrary to the foregoing provisions of this Section 6.3
shall be null and void and without effect.
6.4 Binding Effect. The Provisions of this Plan shall be
binding upon the Sponsor, the Participants and any successor-in- interest to
the Sponsor or to any Participant.
6.5 No Transfer of Interest. Benefits under this Plan shall be
payable solely from the general assets of the Sponsor and no person shall be
entitled to look to any source for payment of such benefits other than the
general assets of the Sponsor. The Sponsor shall have and possess all title
to, and beneficial interest in, any and all funds or reserves maintained or
held by the Sponsor on account of any obligation to pay benefits as required
under this Plan, whether or not earmarked by the Sponsor as a fund or reserve
for such purpose; any such funds, other property or reserves shall be subject
to the claims of the creditors of the Sponsor, and the provisions of this Plan
are not intended to create, and shall not be interpreted as vesting, in any
Participant, Beneficiary or other person, any right to or beneficial interest
in any such funds, other property or reserves. Nothing in this Section 6.5
shall be construed or interpreted as prohibiting or restricting the
establishment of a grantor trust within the meaning of Code Section 671 which
is unfunded for purposes of Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA,
from which benefits under this Plan may be payable.
6.6 Amendment or Termination of the Plan. The Board of
Directors may amend this Plan from time to time in any respect that it deems
appropriate or desirable, and the Board may terminate this Plan at any time;
provided, however, that any such Plan amendment or Plan termination shall not,
without a Participant's written consent, be given effect with respect to such
Participant to the extent such Plan amendment or Plan termination operates to
reduce or eliminate, in any material respect, such Participant's accrued Plan
benefit determined as set forth hereinbelow. For purposes of the preceding
sentence, the determination as to whether any Plan amendment or Plan
termination operates to reduce or eliminate, in any material respect, a
Participant's accrued Plan benefit shall be made at the time of, and not until,
such Participant's Termination. Accordingly, an amendment or termination of
the Plan shall be treated as reducing or eliminating a Participant's accrued
Plan benefit only if, and to the extent that, (a) the retirement benefit
(expressed as a single life annuity payable monthly) to which such Participant
would be entitled under the Pension Plan at the time of his actual Termination
if such retirement benefit were determined without regard to the limits imposed
by Code Section 415, is less than (b) the retirement benefit (expressed as a
single life annuity payable monthly) to which such Participant would be
entitled under the Pension Plan at the time of his actual Termination if such
retirement benefit were determined (i) by disregarding, for periods prior to
such Plan amendment or Plan termination, the limits imposed by Code Section
401(a)(17) (but only to the extent such periods are otherwise required to be
used under the Pension Plan benefit formula in order to calculate such
Participant's actual benefits under the Pension Plan), (ii) by taking into
account, as if paid in the year awarded, the amount of any compensation
deferred by such Participant prior to the Effective Date hereof under
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SKB's Management Bonus Plan, and (iii) by disregarding for all periods the
limits imposed by Code Section 415.
6.7 No Right to Employment. This Plan is voluntary on the part
of the Sponsor, and the Plan shall not be deemed to constitute an employment
contract between the Sponsor and any Participant, nor shall the adoption or
existence of the Plan or any provision contained in the Plan be deemed to be a
required condition of the employment of any Participant. Nothing contained in
this Plan shall be deemed to give any Participant the right to continued
employment with the Sponsor, and the Sponsor may terminate any Participant at
any time, in which case the Participant's rights arising under this Plan shall
be only those expressly provided under the terms of this Plan.
6.8 Notices. All notices, requests, or other communications
(hereinafter collectively referred to as "Notices") required or permitted to be
given hereunder or which are given with respect to this Plan shall be in
writing and may be personally delivered, or may be deposited in the United
States mail, postage prepaid and addressed as follows:
To the Sponsor Allergan, Inc.
or the Committee at: Attention: Supplemental Executive Benefit
Plan Committee
2525 Dupont Drive
Irvine, CA 92715-1599
To Participant at: The Participant's residential mailing address
as reflected in the Sponsor's employment
records
A Notice which is delivered personally shall be deemed given as of the date of
personal delivery, and a Notice mailed as provided herein shall be deemed given
on the second business day following the date so mailed. Any Participant may
change his address for purposes of Notices hereunder pursuant to a Notice to
the Committee, given as provided herein, advising the Committee of such change.
The Sponsor and/or the Committee may at any time change its address for
purposes of Notices hereunder pursuant to a Notice to all Participants, given
as provided herein, advising the Participants of such change.
6.9 Governing Law. This Plan shall be governed by, interpreted
under, and construed and enforced in accordance with the internal laws, and not
the laws pertaining to conflicts or choice of laws, of the State of California
applicable to agreements made and to be performed wholly within the State of
California.
6.10 Titles and Headings; Gender of Terms. Article and Section
headings herein are for reference purposes only and shall not be deemed to be
part of the substance of this Plan or in any way to enlarge or limit the
meaning or interpretation of any provision in this Plan. Use in this Plan of
the
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masculine, feminine or neuter gender shall be deemed to include each of the
omitted genders if the context so requires.
6.11 Severability. In the event that any provision of this
Plan is found to be invalid or otherwise unenforceable by a court or other
tribunal of competent jurisdiction, such invalidity or unenforceability shall
not be construed as rendering any other provision contained herein invalid or
unenforceable, and all such other provisions shall be given full force and
effect to the same extent as though the invalid and unenforceable provision was
not contained herein.
6.12 Tax Effect of Plan. The Sponsor does not warrant any tax
benefit nor any financial benefit under the Plan. Without limiting the
foregoing, the Sponsor and its directors, officers, employees and agents shall
be held harmless by the Participant from, and shall not be subject to any
liability on account of, any Federal or State tax consequences or any
consequences under ERISA of any determination as to the amount of Plan benefits
to be paid, the method by which Plan benefits are paid, the persons to whom
Plan benefits are paid, or the commencement or termination of the payment of
Plan benefits.
IN WITNESS WHEREOF, the Sponsor hereby executes this instrument,
evidencing the terms of the Allergan, Inc. Supplemental Retirement Income Plan
as restated this 23rd day of April, 1996.
ALLERGAN, INC.,
a Delaware corporation
By: /s/ Francis R. Tunney, Jr.
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Its: Secretary
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