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WACHOVIA CORPORATION
EXECUTIVE LONG TERM DISABILITY INCOME PLAN
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GENERAL OVERVIEW
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The purpose of the Executive Long Term Disability Income Plan is to provide
long term disability income protection more commensurate with the pay
levels of the eligible executives.
o Eligible executives who elect to participate under the Executive Long Term
Disability Income Plan will be afforded with an individual disability
insurance policy currently issued by Provident Life and Accident Insurance
Company. The amount of coverage provided to an executive who participates
under the plan will be 66 2/3% of the base pay plus incentive pay of the
covered executive less amounts payable from the Wachovia group long term
disability plan. The cost of coverage is paid by Wachovia while the
individual is employed.
o The policy is owned by the individual executive and in the event the
participant terminates employment or retires, the individual may continue
the supplemental coverage at their own expense.
o Eligible executives who elect to participate in the plan will continue to
participate in the Company's group Long Term Disability plan at the 66 2/3%
level of coverage.
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SPECIFIC INFORMATION
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o Eligibility
- Executives whose base pay rate equals or exceeds $100,000 for the
first time may be presented for eligibility consideration to the
Management Resources and Compensation Committee (the "Committee")
periodically for confirmation. The Committee may also impose a service
requirement. It is anticipated that this periodic review will occur
annually, but the Committee reserves the right to request less
frequent updates.
- Executives who are offered participation and elect to participate
would be eligible to participate effective the first of the next
calendar year. The Committee reserves the right to permit an earlier
effective date for participation under the plan.
- If an executive declines to participate, his/her Choice Benefits long
term disability coverage will continue unchanged. If at a future time
the executive wishes to participate, he/she will have to wait until
the next enrollment opportunity.
o Coverage
- Executives who elect to participate under the Executive Insurance Plan
will be afforded an individual long term disability policy covering 66
2/3% of the sum of (1) base compensation and (2) the three year
average incentive compensation, less benefits payable from the
company's group long term disability plan at the 66 2/3% level of
coverage. Coverage in excess of the medical underwriting limit
established by the insurance company may require a physical
examination.
- The executive may elect to continue coverage in the event of
retirement or employment is terminated.
- If an executive's base pay and/or incentive would warrant the movement
into a category with a higher amount of coverage, such a change would
be considered at the next enrollment opportunity, but only with the
confirmation of the Committee.
o Premium Payments
- Wachovia is scheduled to pay premiums on behalf of the executive.
These annual premiums would be payable while the executive is employed
by Wachovia.
- The executive may elect to continue coverage at his or her own expense
in the event of retirement or termination of employment.
- If an executive leaves Wachovia, he/she will be responsible for the
ongoing payment of premiums
- All premiums paid by Wachovia will be considered as taxable income,
and as such, will be subject to withholding throughout the executive's
tax year.
o Policy Ownership
- The executive will be the owner of the policy.
- As a result of this ownership, the executive may exercise all options
afforded him/her, if any, under the policy.
o Underwriting
- The plan, as designed, is configured for guaranteed issue up to a
limit of $10,000 per month in addition to coverage provided by the
company's group disability plan. Underwriting may be required for
coverage in excess of this amount up to an overall maximum of $25,000
per month.
- However, if an executive declines coverage and later wishes to
participate, it is possible that guaranteed issue may not be available
and some underwriting may be required. If any additional cost is
incurred, as a result of such circumstances, Wachovia reserves the
right to only pay for the cost of the policy on a guaranteed issue
basis.
o Administration
- The Committee is hereby designated as the named fiduciary under this
plan. The Committee shall have the authority to control and manage the
operation and administration of this Plan, and it shall be responsible
for establishing and carrying out a funding policy and method
consistent with the objectives of this plan.
The Committee shall make all determinations as to the rights to
benefits under this Plan in accordance with the claims procedures set
forth in Section 503 of ERISA and the regulations thereunder, which
procedures are incorporated herein by this reference.
o Plan Changes
- The Committee reserves the right to amend, modify or terminate the
commitment by Wachovia to continue payment of premiums as described
above with at least 30 days notice to the affected participants.
Effective - October 1, 1997