Exhibit 10.11

McKESSON CORPORATION
EXECUTIVE SURVIVOR BENEFITS PLAN

(Amended and Restated as of October 28, 2004)

 

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TABLE OF CONTENTS

             
A.
  PURPOSE     1  
 
           
B.
  ERISA PLAN     1  
 
           
C.
  PARTICIPATION     1  
 
           
D.
  SURVIVOR BENEFITS     2  
 
           
E.
  TERMINATION OF EMPLOYMENT OTHER THAN ON APPROVED RETIREMENT OR DEATH     3  
 
           
F.
  SPECIAL FORFEITURE RULES     4  
 
           
G.
  SOURCE OF PAYMENT     6  
 
           
H.
  MISCELLANEOUS     6  
 
           
I.
  ADMINISTRATION OF THE PLAN     7  
 
           
J.
  AMENDMENT OR TERMINATION OF THE PLAN     7  
 
           
K.
  CLAIMS AND APPEALS     7  
 
           
L.
  DEFINITIONS     9  
 
           
M.
  SUCCESSORS     10  
 
           
N.
  EXECUTION     10  

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McKESSON CORPORATION
EXECUTIVE SURVIVOR BENEFITS PLAN

(Amended and Restated as of October 28, 2004)

A. PURPOSE

     This Plan was established to enable the Company to attract and retain key
executive personnel by providing survivor benefits to Executives’ Beneficiaries.
This Plan amends, restates and supersedes the 1988 Executive Survivor Benefits
Plan. Since its original effective date, the Plan has been amended and restated
on various occasions. The amendment and restatement has been approved by the
Board as of October 28, 2004 and shall be effective as of such date except as
otherwise set forth below.

B. ERISA PLAN

     This Plan is a welfare benefit program intended primarily for a select
group of management or highly compensated employees of the Company. The Plan,
therefore, is covered by Title I of ERISA.

C. PARTICIPATION

     1. Selection by Compensation Committee. The Compensation Committee may
select, at its discretion and from time to time as it decides, the key
Executives who participate in this Plan. Participation in the Plan shall be
limited to those Executives of the Company who are selected by the Compensation
Committee. Selection of a key Executive to participate in the Plan may be
evidenced by the terms of his or her Employment Agreement, if any, with the
Company.

     2. Election Not to Participate. An Executive may elect not to participate
in this Plan at any time; such election shall be in writing and shall become
effective upon its receipt by the Administrator. No compensation or benefits in
lieu of this Plan shall be paid to an Executive who elects not to participate,
unless otherwise specifically approved by the Compensation Committee. An
election not to participate shall be irrevocable unless otherwise determined by
the Compensation Committee.

     3. Insurability. Executives selected by the Compensation Committee are not
automatically entitled to the benefits provided under this Plan. Each Executive
may be required to satisfy such requirements for insurability as the Company
shall establish from time to time, if any, before he is entitled to benefits
under this Plan.

     4. Addition and Removal of Participants. The Compensation Committee may, at
its discretion and at any time, designate additional Executives to participate
in the Plan and remove Executives from participation in the Plan. When an
Executive is removed from participation in the Plan by the Compensation
Committee, his or her benefits, if any, shall be determined under Section E.

     5. Relation to Other Plans. If an Executive participates in this Plan, he
or she shall

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not participate in any other survivor benefit or life insurance plan or similar
program solely for Company Executives unless otherwise specifically approved by
the Administrator in writing. For example, any Executive who participates in
this Plan shall not receive any life insurance benefits under the McKesson
Corporation 1984 Executive Insurance Plan, or its predecessor, the McKesson
Executive Benefit Plan. This provision shall not preclude the Executive’s
participation in any Company retirement plan, compensation plan, deferred
compensation plan, excess benefit plan, any group life insurance or survivor
benefit plan made generally available by the Company to all employees. This
provision shall not preclude the payment of survivor benefits which are earned
and payable under any Company retirement plan.

D. SURVIVOR BENEFITS

     1. Death of Executive While Employed. In the event of the death of an
Executive while employed by the Company and except as provided in Sections D.3
and D.4 below, the benefit provided by the Plan and payable to the Executive’s
Beneficiary as soon as practicable thereafter shall be a lump sum equal to the
lesser of (a) three times the Annual Base Salary of the Executive at the time of
death, or (b) $2,000,000. The benefit shall be provided to the Executive’s
Beneficiary either through the proceeds of life insurance owned by the Company
on the Executive’s life or as a lump sum cash payment from the general assets of
the Company. In the later case, the benefit amount shall be increased by
multiplying it by the Tax Factor. The application of this Section D.1 is
illustrated in Appendix I to the Plan.

     2. Death of Executive After Approved Retirement. In the event of the death
of an Executive after his or her Approved Retirement and except as provided in
Sections D.3 and D.4 below, the benefit provided by the Plan and payable to the
Executive’s Beneficiary as soon as practicable thereafter shall be a lump sum
equal to the lesser of (a) 1.5 times the Annual Base Salary of the Executive at
retirement, and (b) (i) $500,000 for an Executive who retires on or before
January 1, 1997, or (ii) $1,000,000 for an Executive who retires after
January 1, 1997. The benefit shall be provided to the Executive’s Beneficiary
either through the proceeds of life insurance owned by the Company on the
Executive’s life or as a lump sum cash payment from the general assets of the
Company. In the latter case, the benefit amount shall be increased by
multiplying it by the Tax Factor.

     3. Limitations on Benefits. No survivor benefits shall be paid under this
Section D in the following circumstances:

          a. The Administrator shall determine in his or her discretion that
Executive has provided false or misleading information regarding Executive’s
health or medical history that materially adversely affects the Company, or

          b. The Administrator shall determine in his or her discretion that
Executive has committed suicide.

     For purposes of this Section D.3, the Administrator in his or her
discretion may waive in writing the foregoing limitations in whole or in part,
and all determinations by the Administrator shall be final.

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     4. Executives Removed from Participation. Except as otherwise approved by
the Administrator in writing and at his or her sole discretion, no survivor
benefits shall be paid under this Section D to any Beneficiary of an Executive
(i) who has elected not to participate under Section C.2 or (ii) who has been
removed from Plan participation prior to his or her death, or (iii) subject to
Section E below, with respect to whom the Plan has been terminated prior to his
or her death.

     5. Designation of Beneficiary. A Participant may designate any person(s) or
any entity as his or her Beneficiary. Designation shall be in writing and shall
become effective only when filed with the Administrator. Such filing must occur
before the Participant’s death. A Participant may change the Beneficiary, from
time to time, by filing a new written designation with the Administrator.
Effective January 1, 2003, if the Participant fails to effectively designate a
Beneficiary in accordance with the Administrator’s procedures or the person
designated by the Participant is not living at the time the distribution is to
be made, then the Participant’s Beneficiary shall be the Participant’s surviving
spouse, if any, or, if there is no surviving spouse, the Participant’s surviving
children, if any, in equal shares, or if there are no surviving children, his or
her estate.

E. TERMINATION OF EMPLOYMENT OTHER THAN ON APPROVED RETIREMENT OR DEATH

     1. Basic Rule.

          a. In the event of the death of an Executive after his or her
termination of employment with the Company other than on Approved Retirement and
except as provided in Section E.2 below, the Company shall pay Executive’s
Beneficiary a lump sum equal to (i) an amount calculated using the formula in
Section D.2 above, subject to the limitations of Section D.3 above,
(ii) multiplied by the Executive’s Pro Rata Percentage, and (iii) reduced by the
amount provided in Section E.1.c below. Except as otherwise approved by the
Administrator in writing and at his or her sole discretion, final Annual Base
Salary shall be determined as of the date of the Executive’s termination of
employment, for purposes of this Section E.1.a. The application of this Section
E.1.a is illustrated in Appendix II to the Plan.

          b. In the event of the death of an Executive after the Executive has
been removed from Plan participation in accordance with Section C.4 (“removal”)
or with respect to whom the Plan has been terminated in accordance with
Section E (“Plan termination”) prior to his or her termination of employment,
and except as provided in Section E.2 below, the Company shall pay Executive’s
Beneficiary a sum equal to the amount calculated as provided in Section E.1.a
above, but treating the Executive’s date of “removal” or the date of the “Plan
termination”, whichever is applicable, as his or her date of termination of
employment for purposes of calculating his or her Pro Rata Percentage and his or
her final Annual Base Salary.

          c. Any amount determined under Section E.1.a or Section E.1.b shall be
reduced by any death or survivor benefit (other than a retirement benefit paid
under a tax qualified retirement plan) payable on account of service rendered by
the Executive to another employer after his or her termination of employment
with the Company.

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     2. Limitations on Benefits. No benefits shall be paid under Section E in
the following circumstances:

          a. The Executive is terminated for Cause, or

          b. The Executive has terminated his or her employment in violation of
his or her Employment Agreement, if any; termination is in violation of an
Employment Agreement if termination occurs before the end of the term of the
Employment Agreement and is not allowed by the Employment Agreement (e.g., for
“good reason”), or

          c. The Executive has not completed five or more years of participation
(whether or not consecutive) in this Plan and its predecessors, the McKesson
Corporation 1984 Executive Benefit Plan and the McKesson Corporation 1984
Management Benefit Plan; an Executive who would have completed five or more
years (i) if his or her employment was not terminated by the Company in
violation of his or her Employment Agreement or (ii) if his or her employment
was not terminated for “good reason” under such Agreement, shall be treated as
having such years of participation.

     3. Pro Rata Percentage. An Executive’s Pro Rata Percentage is the higher of
the following two percentages (but not exceeding 100%): the first percentage is
determined by dividing the number of the Executive’s whole months of employment
with the Company by the number of whole months from the date that the Executive
was first hired by the Company to the date that he will reach age 65, and
multiplied by 100. The second percentage is determined by multiplying 4.44% by
the number of his or her whole and partial years of completed employment with
the Company.

     4. Periods of Employment. For purposes of determining employment with the
Company, periods that would be disregarded under the Retirement Plan on account
of breaks in service shall be disregarded under this Section E.

     5. Other Agreements. If an Executive’s Employment Agreement provides for
higher survivor benefits than provided under this Section E, such higher benefit
shall be paid.

     6. Forfeiture on Other Terminations. Except as provided in this Section E,
and as provided elsewhere in this Plan with respect to the death of an
Executive, on the death of the Executive, an Executive or his or her Beneficiary
shall not be entitled to any additional benefits under this Plan, all
obligations of the Company to the Executive and his or her Beneficiary under
this Plan shall cease, and the Company shall have no further liability to the
Executive or any other person under this Plan.

F. SPECIAL FORFEITURE RULES

     Any other provisions of this Plan to the contrary notwithstanding, if the
Compensation Committee determines that any Executive engaged in any of the
actions described in F.2 below, the consequence set forth in F.1 below shall
result.

     1. Forfeiture of Benefits. To the extent that the benefit that otherwise
would be

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payable under the Plan upon the death of the Executive exceeds the benefit, if
any, that would have been payable if the Executive had died on November 1, 1993,
such excess portion shall be forfeited and shall not be payable under this Plan.
In no event shall the amount payable under the Plan with respect to any
Executive who was a participant in the Plan on October 27, 1993 be less than the
amount, if any, determined pursuant to Section J.

     2. Events Resulting in Forfeiture. The consequence described in F.1 above
shall apply if the Executive, either before or after termination of employment
with the Company:

          a. Accepts a position as a consultant to or an employee of a business
enterprise that is in direct competition with any line of business engaged in by
the Company at the time of the termination of the Executive’s employment.

          b. Discloses to others, or takes or uses for the Executive’s own
purpose or the purpose of others, any trade secrets, confidential information,
knowledge, data or know-how belonging to the Company and obtained by the
Executive during the term of the Executive’s employment, whether or not they are
the Executive’s work product. Examples of such confidential information or trade
secrets include (but are not limited to) customer lists, supplier lists, pricing
and cost data, computer programs, delivery routes, advertising plans, wage and
salary data, financial information, research and development plans, processes,
equipment, product information and all other types and categories of information
as to which the Executive knows or has reason to know that the Company intends
or expects secrecy to be maintained.

          c. Fails to promptly return all documents and other tangible items
belonging to the Company in the Executive’s possession or control, including all
complete or partial copies, recordings, abstracts, notes or reproductions of any
kind made from or about such documents or information contained therein, upon
termination of employment, whether pursuant to an Approved Retirement or
otherwise.

          d. Fails to provide the Company with at least 30 days’ written notice
prior to directly or indirectly engaging in, becoming employed by, or rendering
services, advice or assistance to any business in competition with the Company
or any of its subsidiaries. As used herein, “business in competition” means any
person, organization or enterprise which is engaged in or is about to become
engaged in any line of business engaged in by the Company at the time of the
termination of the Executive’s employment with the Company.

          e. Fails to inform any new employer, before accepting employment, of
the terms of this section and of the Executive’s continuing obligation to
maintain the confidentiality of the trade secrets and other confidential
information belonging to the Company and obtained by the Executive during the
term of the Executive’s employment with the Company.

          f. Induces or attempts to induce, directly or indirectly, any of the
Company’s customers, employees, representatives or consultants to terminate,
discontinue or cease working with or for the Company, or to breach any contract
with the Company, in order to work with or for, or enter into a contract with,
the Executive or any third party.

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          g. Engages in conduct which is not in good faith and which disrupts,
damages, impairs or interferes with the business, reputation or employees of the
Company.

     The Compensation Committee shall determine in its sole discretion whether
the Executive has engaged in any of the acts set forth in Sections F.2.a through
F.2.g above, and its determination shall be conclusive and binding on all
interested persons.

     Any provision of this Section which is determined by a court of competent
jurisdiction to be invalid or unenforceable shall be construed or limited in a
manner that is valid and enforceable and that comes closest to the business
objectives intended by such invalid or unenforceable provision, without
invalidating or rendering unenforceable the remaining provisions of this
Section.

G. SOURCE OF PAYMENT

     Amounts paid under Section D of this Plan may be paid from insurance policy
proceeds on the life of the Executive or from the general funds of the Company,
and each Executive and his or her Beneficiary shall be no more than an unsecured
general creditor of the Company with no special or prior right to any assets of
the Company for payment of any obligations hereunder. Nothing contained in this
Plan shall be deemed to create a trust of any kind for the benefit of any
Executive or Beneficiary, or create any fiduciary relationship between the
Company and any Executive or Beneficiary with respect to any assets of the
Company.

H. MISCELLANEOUS

     1. Withholding. The Executive or any Beneficiary shall make appropriate
arrangements with the Company for the satisfaction of any federal, state or
local income tax withholding requirements and social security or other employee
tax requirements applicable to the provision of benefits under this Plan. If no
such arrangements are made, the Company may provide, at its discretion, for such
withholding and tax payments as may be required.

     2. No Assignment. The benefits provided under this Plan and a Beneficiary’s
rights may not be alienated, assigned, transferred, pledged, or hypothecated by
any person, at any time, unless such benefits are payable from the proceeds of
an insurance policy. Such benefits shall be exempt from the claims of creditors
or other claimants and from all orders, decrees, levies, garnishments, or
executions to the fullest extent allowed by law.

     3. Applicable Law and Severability. The Plan hereby created shall be
construed, administered and governed in all respects in accordance with ERISA
and the laws of the State of California to the extent that the latter are not
preempted by ERISA. If any provision of this instrument shall be held by a court
of competent jurisdiction to be invalid or unenforceable, the remaining
provisions hereunder shall continue to be effective. If any provision this
amendment and restatement is deemed to be a “material modification” of this Plan
which would cause amounts deferred or accrued under this Plan prior to 2005 to
be subject to the deferred compensation provisions of section 885 of the
American Jobs Creation Act of 2004, if such legislation is enacted into law,
such provision shall be null, void and without effect retroactive to

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October 28, 2004.

I. ADMINISTRATION OF THE PLAN

     1. In General. The Plan shall be administered by the Executive Vice
President, Human Resources of McKesson. If the Executive Vice President, Human
Resources is an Executive participating in the Plan, then any discretionary
action he or she takes as Administrator which directly affects him or her as
Executive shall be specifically approved by the Compensation Committee. The
Administrator shall have the ultimate responsibility to interpret the Plan and
shall adopt such rules and regulations for carrying out the Plan as it may deem
necessary or appropriate. Decisions of the Administrator shall be final and
binding on all parties who have an interest in the Plan.

     2. Elections and Notices. All elections and notices made by an Executive
under this Plan shall be in writing and filed with the Administrator.

     3. Action By Board and Compensation Committee. The Board and Compensation
Committee may act under this Plan in accordance with their normal procedures and
practice, including, but not limited to, delegation of their authority to act
under this Plan.

J. AMENDMENT OR TERMINATION OF THE PLAN

     The Board may at any time amend, alter, modify or terminate the Plan. Such
action shall not reduce the benefits provided under this Plan with respect to
any Executive whose employment has terminated before such action. Also, such
action shall not reduce the benefits provided under this Plan with respect to
any Executive who is participating in the Plan at the time of such action below
the amount provided in Section E, treating for purposes of Section E the
amendment, alteration, modification, or termination which adversely affects the
Executive as though it were a termination of employment. An illustration of the
calculation of benefits in the event of termination of the Plan under this
Section J is attached as Appendix III.

K. CLAIMS AND APPEALS

     1. Informal Resolution of Questions. Any Participant or Beneficiary who has
questions or concerns about his or her benefits under the Plan is encouraged to
communicate with the Human Resources Department of McKesson. If this discussion
does not give the Participant or Beneficiary satisfactory results, a formal
claim for benefits may be made in accordance with the procedures of this
Section K.

     2. Formal Benefits Claim – Review by Executive Vice President, Human
Resources. A Participant or Beneficiary may make a written request for review of
any matter concerning his or her benefits under this Plan. The claim must be
addressed to the Executive Vice President, Human Resources, McKesson
Corporation, One Post Street, San Francisco, California 94104. The Executive
Vice President, Human Resources or his or her delegate (“Executive Vice
President”) shall decide the action to be taken with respect to any such request
and may require additional information if necessary to process the request. The
Executive Vice President shall review the request and shall issue his or her
decision, in writing, no later than 90

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days after the date the request is received, unless the circumstances require an
extension of time. If such an extension is required, written notice of the
extension shall be furnished to the person making the request within the initial
90-day period, and the notice shall state the circumstances requiring the
extension and the date by which the Executive Vice President expects to reach a
decision on the request. In no event shall the extension exceed a period of
90 days from the end of the initial period.

     3. Notice of Denied Request. If the Executive Vice President denies a
request in whole or in part, he or she shall provide the person making the
request with written notice of the denial within the period specified in
Section K.2. The notice shall set forth the specific reason for the denial,
reference to the specific Plan provisions upon which the denial is based, a
description of any additional material or information necessary to perfect the
request, an explanation of why such information is required, and an explanation
of the Plan’s appeal procedures and the time limits applicable to such
procedures, including a statement of the claimant’s right to bring a civil
action under Section 502(a) of ERISA following an adverse benefit determination
on review.

     4. Appeal to Executive Vice President.

          a. A person whose request has been denied in whole or in part (or such
person’s authorized representative) may file an appeal of the decision in
writing with the Executive Vice President within 60 days of receipt of the
notification of denial. The appeal must be addressed to: Executive Vice
President, Human Resources, McKesson Corporation, One Post Street, San
Francisco, California 94104. The Executive Vice President, for good cause shown,
may extend the period during which the appeal may be filed for another 60 days.
The appellant and/or his or her authorized representative shall be permitted to
submit written comments, documents, records and other information relating to
the claim for benefits. Upon request and free of charge, the applicant should be
provided reasonable access to and copies of, all documents, records or other
information relevant to the appellant’s claim.

          b. The Executive Vice President’s review shall take into account all
comments, documents, records and other information submitted by the appellant
relating to the claim, without regard to whether such information was submitted
or considered in the initial benefit determination. The Executive Vice President
shall not be restricted in his or her review to those provisions of the Plan
cited in the original denial of the claim.

          c. The Executive Vice President shall issue a written decision within
a reasonable period of time but not later than 60 days after receipt of the
appeal, unless special circumstances require an extension of time for
processing, in which case the written decision shall be issued as soon as
possible, but not later than 120 days after receipt of an appeal. If such an
extension is required, written notice shall be furnished to the appellant within
the initial 60-day period. This notice shall state the circumstances requiring
the extension and the date by which the Executive Vice President expects to
reach a decision on the appeal.

          d. If the decision on the appeal denies the claim in whole or in part
written notice shall be furnished to the appellant. Such notice shall state the
reason(s) for the denial,

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including references to specific Plan provisions upon which the denial was
based. The notice shall state that the appellant is entitled to receive, upon
request and free of charge, reasonable access to, and copies of, all documents,
records, and other information relevant to the claim for benefits. The notice
shall describe any voluntary appeal procedures offered by the Plan and the
appellant’s right to obtain the information about such procedures. The notice
shall also include a statement of the appellant’s right to bring an action under
Section 502(a) of ERISA.

          e. The decision of the Executive Vice President on the appeal shall be
final, conclusive and binding upon all persons and shall be given the maximum
possible deference allowed by law.

     5. Exhaustion of Remedies. No legal or equitable action for benefits under
the Plan shall be brought unless and until the claimant has submitted a written
claim for benefits in accordance with Section K.2, has been notified that the
claim is denied in accordance with Section K.3, has filed a written request for
a review of the claim in accordance with Section K.4, and has been notified in
writing that the Executive Vice President has affirmed the denial of the claim
in accordance with Section K.4.

L. DEFINITIONS

     For the purposes of the Plan, the following terms shall have the meanings
indicated:

     1. “Administrator” shall mean the person specified in Section I.

     2. “Annual Base Salary” shall mean the annualized rate of pay excluding
bonuses, incentive compensation and perquisites.

     3. “Approved Retirement” shall mean (i) any termination of employment with
the Company after attainment of age 62; (ii) any involuntary termination of
employment after both attainment of age 55 and completion of 15 Years of
Service; or (iii) any other termination of employment prior to (i) or (ii) above
(but not earlier than the Executive’s attainment of age 55 and completion of
five Years of Service) with the approval of the Compensation Committee.
Notwithstanding the foregoing, if an Executive’s written employment agreement so
requires or if the Board so decides, the Board may, in its sole discretion,
grant an Approved Retirement at any earlier termination of employment.

          Notwithstanding the foregoing, “Approved Retirement” shall not include
any termination for “cause,” which shall be determined as provided in
Section E.2.a hereof.

     4. “Beneficiary” shall mean the beneficiary or beneficiaries entitled to
death benefits under this Plan, as designated by Executive or otherwise provided
in Section D.5.

     5. “Board” shall mean the Board of Directors of McKesson.

     6. “Cause” shall mean the circumstances prescribed in the Executive’s
Employment Agreement, if any, or if there is no Employment Agreement, the
circumstances determined by the Compensation Committee.

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     7. “Company” shall mean McKesson and any member of its controlled group as
defined by Sections 414(b) and Section 414(c) of the Internal Revenue Code of
1986, as amended.

     8. “Compensation Committee” shall mean the Compensation Committee of the
Board.

     9. “Employment Agreement” shall mean the written contract of employment, if
any, between an Executive and the Company.

     10. “Executive” shall mean an employee of the Company selected by the
Compensation Committee to participate in this Plan pursuant to Section C.

     11. “ERISA” shall mean the Employee Retirement Income Security Act of 1974,
as amended.

     12. “McKesson” shall mean McKesson Corporation, a Delaware Corporation.

     13. “Participant” shall mean any Executive who is not otherwise excluded
from participation in the Plan pursuant to Sections C.2, C.3, C.4 or D.4 hereof.

     14. “Pro Rata Percentage” shall mean the percentage determined in
Section E.3.

     15. “Retirement Plan” shall mean the McKesson Corporation Retirement Plan.

     16. “Tax Factor” shall mean one divided by one minus the Top Marginal Rate
of Tax.

     17. “Top Marginal Rate of Tax” shall be the highest combined marginal
individual federal and state income tax rate, if any (giving effect to any
deduction then allowable for federal tax purposes for the state income tax) for
the year survivor benefits are paid to Executive’s Beneficiary under this Plan.
For example, if the highest marginal individual federal and state income tax
rates are 28% and 10% respectively and the state income tax is deductible for
federal tax purposes, the Top Marginal Rate would be 35.2% as follows: [($1.00 x
10% = $.10 state income tax)] + [($.90 federal taxable income of $1.00 - $.10
state income tax) x 28% = $.252 federal income tax] = $.352 total state and
federal tax, or 35.2%. For purposes of determining the Top Marginal Rate of Tax,
the Administrator in his or her discretion shall determine the highest marginal
individual federal and state income tax rates to be used (including without
limitation whether, and if so to what extent, surtaxes or similar taxes shall be
applicable, and what state income tax, if any, shall be applicable), and all
such determinations and all calculations made by the Administrator hereunder
shall be final.

M. SUCCESSORS

     This Plan shall be binding on the Company and any successors or assigns
thereto.

N.   EXECUTION

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     To record the amendment and restatement of the Plan by the Board of
Directors of McKesson Corporation at a meeting held on October 28, 2004.

 
McKESSON CORPORATION

     
By:
   

   

  Paul E. Kirincic

  Executive Vice President, Human Resources

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McKESSON CORPORATION

EXECUTIVE SURVIVOR BENEFITS PLAN

Appendix I

This Appendix illustrates the calculation of benefits under Section D.1 of the
Plan.

A. Assumptions

Executive is subject to California Income Tax.

Executive’s Annual Base Salary: $350,000

         

  Top Marginal Rate of Tax:    

      Top Federal Rate: 28.0%

      Top California Rate: 10.0%

  “Top Marginal Rate of Tax”:    

  .10 + [(1.0 - .10) x .28] = 35.2%              
 
       

  “Tax Factor”:    

  1/(1 - .352) = 1.543    

B. Survivor Benefit on Death Before Approved Retirement

         

  Lesser of (a) $2,000,000 or (b) (3 x $350,000)

  multiplied by                      
 
   

  Tax Factor
 
   

  equals                                  

  $1,050,000 x 1.543,

  which yields a benefit of:                           
 
   

  $1,620,150

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McKESSON CORPORATION

EXECUTIVE SURVIVOR BENEFITS PLAN

Appendix II

This Appendix illustrates the calculation of benefits under Section E.1.a of the
Plan.

An Executive is hired at age 50, his or her employment is terminated at age 60
and after January 1, 1997, and he otherwise qualifies for a benefit under
Section E. On the death of this Executive, a benefit will be paid to his or her
Beneficiary equal to the Pro Rata Percentage (see calculation below) times 1-1/2
times the Executive’s final Annual Base Salary at the date of his or her
termination of employment (or $1 million, if smaller) multiplied by the Tax
Factor, and reduced by any death or survivor benefit payable to a beneficiary of
the Executive on account of service rendered to another employer as provided in
Section E.1.c. If the above Executive’s Annual Base Salary was $300,000 at the
date of his or her termination of employment and the Tax Factor at the date the
benefit is paid is 1.543, the benefit payable to his or her Beneficiary would be
$462,900, calculated as follows:

The Executive’s Pro Rata Percentage is 66-2/3%, calculated as follows:

The greater of (a) number of whole months of employment divided by total whole
months from date of hire to age 65, or (b) 4.44% times whole and partial years
of completed employment, or 120 months/180 months = 66-2/3%, which is greater
than 4.44% x 10 years = 44.4%.

The Executive’s benefit is:

Pro Rata Percentage x [1-1/2 of Annual Base Salary (1-1/2 x $300,000 = $450,000)
or $1 million, if smaller] x Tax Factor

66-2/3% x $450,000 x 1.543 = $462,900.

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McKESSON CORPORATION

EXECUTIVE SURVIVOR BENEFITS PLAN

Appendix III

This Appendix illustrates the calculation of benefits in the event of
termination of the Plan under Section J.

     
A.
  Assumptions
 
   
 
  Executive’s age at date of hire: 40
 
  Executive’s age
 
       at date of termination of the Plan: 55
 
  Executive’s Annual Base Salary
 
       at date of termination of the Plan: $300,000
 
  Executive’s “Tax Factor” for the year
 
       benefits are paid (see Section L
 
       and Appendix I) 1.543
 
  Date of Termination: After January 1, 1997
 
   
B.
  Survivor Benefits Under Section D
 
   
 
  Under Section J, benefits are determined under Section D by treating the date
the Plan is terminated as the date the Executive terminated employment, as
follows:
 
   
 
  Pro Rata Percentage: 66-2/3%
 
   
 
  Greater of (a) whole months of service divided by total whole months from hire
to age 65 or (b) 4.44% times whole and partial years of service, a greater of
60% (180/300 = 60%) or 66-2/3% (4.44 x 15 years of service)
 
   
 
  Benefit: $452,900
 
   
 
  66-2/3% x (1-1/2 of $300,000, or $1 million if smaller) x "Tax Factor" (1.543)
 
   
 
       (66% x $450,000) x 1.543 =
 
       $300,000 x 1.543 =
 
       $462,900

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