Exhibit 10.29

 

PFI SUPPLEMENTAL

EXECUTIVE RETIREMENT PLAN

 

Effective March 12, 2002

 

The Prudential Executive Supplemental Retirement Plan was established by The
Prudential Insurance Company of America, effective as of April 14, 1998, for the
purpose of providing reasonable supplemental retirement benefits for certain
eligible employees (and their beneficiaries) whose retirement benefits under The
Prudential Merged Retirement Plan, the Supplemental Plan and such other plans or
arrangements sponsored by the Prudential Insurance Company of America are, in
the opinion of the Board of Directors of The Prudential Insurance Company of
America, inadequate. Effective March 12, 2002, Prudential Financial, Inc.
(“PFI”) adopted a substantially identical plan, for the same reasons, for
employees whose compensation is not regulated by the State of New Jersey. The
PFI Supplemental Executive Retirement Plan (the “Plan”) provides “Participants”
(and their beneficiaries) with one or more of the following categories of
benefits: (1) Mid-career Hire Benefits (as set forth in Article II); and
(2) Early Retirement Benefits (as set forth in Article III).

 

The Plan is intended to be, and shall be administered as, an unfunded plan
maintained for the purpose of providing deferred compensation for a select group
of management or highly compensated employees within the meaning of Title I of
ERISA (as defined below).

 

ARTICLE I

 

DEFINITIONS

 

The following terms shall have the meanings hereinafter set forth. Other terms
that are capitalized in the Plan shall be defined in the same manner as they are
defined in the Retirement Plan.

 

  1.1 “Account Based Plan” means a career average pension plan where benefits
are recorded and updated each plan year as an account or lump sum equivalent,
such as a cash balance pension plan or retirement equity pension plan
arrangement.

 

  1.2 “Board of Directors” means the Board of Directors of the Company.

 

  1.3 “Code” means the Internal Revenue Code of 1986, as amended.

 

  1.4 “Committee” means the Committee that has been appointed by the
Compensation Committee pursuant to Section 5.1 of the Plan.

 

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  1.5 “Compensation Committee” means the Compensation Committee of the Board of
Directors, as defined by the Company’s by-laws.

 

  1.6 “Company” means Prudential Financial, Inc. When referring to Company
employees or officers, it also means employees of members of the Controlled
Group whose compensation is not regulated under section 17B:18-52 of New Jersey
Statutes.

 

  1.7 “Controlled Group” means the Company and (i) each corporation which is a
member of a controlled group of corporations (within the meaning of
Section 414(b) of the Code) which includes the Company, (ii) each trade or
business (whether or not incorporated) which is under common control with the
Company (within the meaning of Section 414(c) of the Code), (iii) each
organization included in the same affiliated service group (within the meaning
of Section 414(m) of the Code) as the Company, and (iv) each other entity
required to be aggregated with the Company pursuant to regulations promulgated
under Section 414(o) of the Code. Any such entity shall be treated as part of
the Controlled Group only for the period while it is a member of the controlled
group or considered to be in a common control group.

 

  1.8 “Early Retirement Benefits” means benefits granted to Participants in
accordance with Article III of this Plan.

 

  1.9 “Eligibility Date” means the date the Participant is first eligible for a
benefit under the terms of Article II.

 

  1.10 “Expected Earnings” means base pay at the Hire Date plus annualized
target annual incentive bonus. If a Participant first becomes eligible for this
Plan after the first year of employment, Expected Earnings will mean the actual
base pay and annual incentive bonus payable for the full calendar year of
employment immediately prior to eligibility for the Plan.

 

  1.11 “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended.

 

  1.12 “Mid-career Hire Benefits” means benefits granted to Participants in
accordance with Article II of this Plan.

 

  1.13 “Hire Date” means the date employment with a member of the Controlled
Group starts.

 

  1.14 “Participant” means any salaried officer, senior officer, or employee of
the Company (including any life insurance companies controlled by the Company
which are Participating Affiliates and not regulated under section 17B:18-52 of
New Jersey Statutes) and their beneficiaries who has been designated as a
Participant in the Plan pursuant to the requirements of Articles II or III of
this Plan and has been granted an accrued benefit under Article II or Article
III of this Plan, but in each case only to the extent such accrued benefits have
been granted and have not yet been paid in full to such individuals.

 

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  1.15 “Plan” means this PFI Supplemental Executive Retirement Plan, as amended
from time to time.

 

  1.16 “Prior Employer” means an employer that is not a member of the Company’s
Controlled Group with which the person referred to had an employment
relationship immediately before a Participant’s Hire Date. Prior Employer
includes all entities of a group (i) each corporation which is a member of a
controlled group of corporations (within the meaning of Section 414(b) of the
Code) which includes the employer, (ii) each trade or business (whether or not
incorporated) which is under common control with the employer (within the
meaning of Section 414(c) of the Code), (iii) each organization included in the
same affiliated service group (within the meaning of Section 414(m) of the Code)
as the employer, and (iv) each other entity required to be aggregated with the
employer pursuant to regulations promulgated under Section 414(o) of the Code.
Any such entity shall be treated as part of such group only for the period while
it is a member of the controlled group or considered to be in a common control
group.

 

  1.17 “Prior Employer Plan” means one or more defined benefit pension plans
maintained by the Prior Employer, including an unfunded defined benefit plan
maintained by the Prior Employer for the purpose of providing deferred
compensation to a select group of management or highly compensated employees
within the meaning of Title I of ERISA and also including any written individual
defined benefit arrangement or agreement agreed to by the Prior Employer.

 

  1.18 “Prudential Cash Balance Plan” means the Prudential Cash Balance Pension
Plan Document component of The Prudential Merged Retirement Plan, a defined
benefit retirement plan maintained by The Prudential Insurance Company of
America for itself and Participating Affiliates, including the Company.

 

  1.19 “Prudential Traditional Retirement Plan” means the Prudential Traditional
Retirement Plan Document component of The Prudential Merged Retirement Plan, a
defined benefit retirement plan maintained by The Prudential Insurance Company
of America for itself and Participating Affiliates, including the Company.

 

  1.20 “Release” means a written release of rights and claims, from a
Participant, in favor of the Company, any Controlled Group member, and
individuals employed by or formerly employed by the Company and any Controlled
Group member, in a form that is satisfactory to, and approved by, the Committee.

 

  1.21 “Retirement Plan” means the Prudential Traditional Retirement Plan and
the Prudential Cash Balance Plan.

 

  1.22 “SERP Service” means service with the Company’s Controlled Group plus any
service with a Prior Employer. Service with the Company’s Controlled Group shall
be Credited Service under the Prudential Traditional Retirement Plan as to
benefits for Participants under that plan or Cash Balance Service under the
Prudential Cash Balance Plan as to

 

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benefits for participants under that plan. Service with the Prior Employer will
be service credited under the Prior Employer Plans, both qualified and unfunded
plans.

 

  1.23 “Supplemental Plan” means the Prudential Supplemental Retirement Plan, a
non-qualified deferred compensation plan maintained by The Prudential Insurance
Company of America for itself and Participating Affiliates.

 

  1.24 “Termination of Employment” means the voluntary or involuntary
termination of employment with all members of the Controlled Group for any
reason, including death.

 

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ARTICLE II

 

MID-CAREER HIRE BENEFITS

 

2.1 Eligibility. A salaried officer, senior officer, or employee of the Company
who: (A) meets requirements (1) through (7) below), and (B) is also designated
as eligible for Mid-career Hire Benefits under the Plan in a written resolution
either by the Compensation Committee which is subsequently and timely approved
by the Board of Directors, or by the Board of Directors (in the case of an
employee who is hired at, or becomes otherwise eligible after attaining, a pay
grade under the Prudential Compensation Plan of 1 through 3, or an investment
professional pay grade of 56A, or the equivalent, or to the extent otherwise
required by the by-laws of the Company), thereby becomes a Participant under the
Plan and is therefore eligible to accrue Mid-career Hire Benefits under this
Article II. Only a Controlled Group employee who is not an employee of a life
insurance company controlled by the Company and, therefore, not regulated under
section 17B:18-52 of New Jersey Statutes, will be eligible. By approval of any
designation by the Compensation Committee, or any designation made directly by
the Board of Directors, the Board of Directors has determined that the
retirement benefits otherwise available to such individuals under the Retirement
Plan, the Supplemental Plan and such other plans or arrangements sponsored by
the Company and its affiliates are inadequate, and the failure to provide such
benefits pursuant to the Plan would compromise the Company’s ability to hire and
retain such employee.

 

The requirements are as follows:

 

(1) He or she is a participant in the Retirement Plan as of the date of
designation of such person as a Participant under Article II of the Plan by the
Compensation Committee or Board of Directors, as applicable;

 

(2) He or she has a pay grade of 1 through 4 in the Prudential Compensation Plan
or investment professional grade of 56A, or the equivalent;

 

(3) He or she was actively employed by a Prior Employer immediately prior to
being hired by a member of the Controlled Group;

 

(4) He or she terminated his or her employment with such Prior Employer in order
to become an employee within the Controlled Group;

 

(5) As a result of such termination of employment with the Prior Employer, he or
she either (A) forfeits prior benefit accruals, or (B) loses the future benefit
accruals he or she would have earned had he or she remained employed by the
Prior Employer, in each case, under a Prior Employer Plan;

 

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(6) He or she requests in writing, as part of a negotiation with the Company
regarding the written terms of his or her employment by the Company, that the
Company agree to provide additional retirement benefits in recognition of the
loss of such Prior Employer Plan benefit accruals and/or future benefit
accruals; and

 

(7) He or she meets the terms of this Plan and any other additional or different
term or condition that the Compensation Committee (or in the case of an employee
who is hired at, or otherwise becomes eligible after attaining, a pay grade of 1
through 3, the Board of Directors) determines, in its sole discretion, should be
satisfied as a condition precedent or a condition subsequent to the receipt of
Mid-career Hire Benefits accrued under this Article II, including, but not
limited to, signing a Release; provided, that any additional or different term
or condition is set forth in the written resolution designating the employee as
eligible to accrue Mid-career Hire Benefits under the Plan.

 

2.2 Amount—Prudential Traditional Retirement Plan Participant. Except as
otherwise provided in section 2.4, below, the amount of the Mid-career Hire
Benefits for a Participant in the Prudential Traditional Retirement Plan shall
be an amount equal to the excess, if any, of (a) over (b) below:

 

  (a) Participant’s hypothetical accrued retirement benefits (including, if
applicable, early retirement benefits) under the Retirement Plan and
Supplemental Plan, calculated using SERP Service and stated as a single life
annuity.

 

  (b) The applicable offset in (1), (2) or (3), below, plus the Participant’s
benefit under the Retirement Plan and Supplemental Plan.

 

  (1) If benefits are provided under a Prior Employer Pension Plan as an annuity
or an Account Based Plan benefit for which no lump sum is available at or before
the date of benefit commencement under this Plan and:

 

  (A) Benefits under the Prior Employer Plan have commenced at the time the
benefit under this plan will commence—the offset is the annuity benefit being
paid to the participant from the Prior Employer Plan. The amount of offset will
increase or decrease upon, and co-extensive with, any changes in the amount of
benefit provided by the Prior Employer Plan that are known at the date of
Prudential benefit commencement. If any partial lump sum payment was previously
made, an additional offset for that payment will be calculated as if it were a
benefit from an Account Based Plan under paragraph (2), below.

 

  (B) Benefits under the Prior Employer Plan have not commenced at the time the
benefit under this plan will commence, but could commence at the participant’s
election—the offset is the normal

 

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form of annuity benefit available to the participant from the Prior Employer
Plan, assuming the Prior Employer Plan benefit commenced at the time the benefit
under this Plan will commence. The amount of the offset will increase or
decrease upon, and co-extensive with, any expected changes in the amount of
benefit provided by the Prior Employer Plan that are known at the date of
Prudential benefit commencement.

 

  (C) Benefits under the Prior Employer Plan cannot commence until after the
time the benefit under this plan will commence—the offset is the normal form of
annuity benefit available to the participant from the Prior Employer Plan, but
applied beginning as of the earliest date that the Prior Employer Plan benefit
can commence. The amount of offset will increase or decrease upon, and
co-extensive with, any expected changes in the amount of benefit provided by the
Prior Employer Plan that are known at the date of Prudential benefit
commencement.

 

  (2) If Prior Employer Plan benefits are provided by an Account Based Plan from
which lump sum is available at or before date of benefit commencement from this
Plan, the offset is a single life annuity, determined as follows:

 

  (A) Determine the lump sum payable from the Prior Employer Plan at the age
benefits commence under this Plan. If a lump sum has been previously paid,
increase the amount paid from the date of payment to benefit commencement date
using the Prudential Cash Balance Plan interest crediting rate in effect on the
Participant’s Termination of Employment (or other determination date).

 

  (B) Convert the lump sum determined in (A) to a single life annuity using
conversion assumptions provided in the Prudential Cash Balance Plan as of the
date of the determination.

 

  (3) If benefits are provided by both an annuity and Account Based Plan from
which lump sum is available at or before date of benefit commencement from this
Plan, the offset is the sum of the offsets calculated by applying paragraphs
(1) and (2), above, separately to each type of benefit.

 

2.3 Amount—Cash Balance Plan Participant. Except as otherwise provided pursuant
to section 2.4 below, the amount of the Mid-career Hire Benefits for a
Participant in the Prudential Cash Balance Plan shall be the sum of (i) a deemed
Opening Account Balance equal

 

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to the excess, if any, of (a) less the offsets in (b), plus (ii) the credits
described in (c) below. This sum will be maintained in an account, which may be
divided into appropriate sub-accounts.

 

  (a) Participant’s hypothetical Opening Account Balance determined as follows:

 

  (1) Expected Earnings;

 

  (2) Multiplied by Participant’s initial SERP Basic Credit Rate;

 

  (3) Multiplied by SERP Service as of the Hire Date; and

 

  (4) Multiplied by 2/3.

 

The SERP Basic Credit Rate is the percentage determined under Exhibit B of the
Prudential Cash Balance Plan calculated using SERP Service.

 

  (b) The sum of the applicable offset in (1) or (2) and the amount in (3),
below.

 

  (1) Account Based Plan of Prior Employer. If the Prior Employer Plan is an
Account Based Plan from which a lump sum is available as of a date at or before
the Hire Date, the offset is the lump sum payable from the Prior Employer Plan
at the Participant’s Hire Date (or, if later, the Eligibility Date). If a lump
sum was paid before the Hire Date (or, if later, the Eligibility Date),
determine the offset by increasing the amount paid from date of payment to age
at the applicable date using Prudential Cash Balance Plan crediting rate in
effect on the Hire Date (or, if later, the Eligibility Date).

 

  (2) Annuity or Account Based Plan with no Lump Sum payable. If the Prior
Employer Plan is an annuity-type plan or an Account Based Plan from which no
lump sum is available at or before the Hire Date (or, if later, the Eligibility
Date), the offset is the present value of benefits actually payable at age 65
from the Prior Employer Plan. The present value will be determined using the
normal form of benefit under the Prior Employer Plan or, if benefits have
commenced, the benefit being paid. Present value will be calculated using the
interest crediting rate methodology and mortality assumptions applicable under
The Prudential Cash Balance Plan at the date of calculation, but applied as of
the Hire Date (or, if later, the Eligibility Date).

 

  (3) Any account balance in the Prudential Cash Balance Plan and Supplemental
Plan at the Eligibility Date.

 

  (c) Additional Credits. Additional credits are the sum of the SERP Basic
Credit and the Interest Credit.

 

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  (1) The SERP Basic Credit is a monthly addition to the Participant’s account
equal to a Basic Credit calculated under section 3.3 of the Prudential Cash
Balance Plan, but using SERP Service, less the Basic Credit provided under the
Prudential Cash Balance Plan and Supplemental Plan for that month using normal
service crediting rules. These credits will continue during any period of
disability, calculated and applied in a manner and for a period similar to
section 3.5 of the Prudential Cash Balance Plan.

 

  (2) The Interest Credit is an addition to the account determined under section
3.4 of the Prudential Cash Balance Plan based on this Plan’s account value at
the beginning of the month.

 

2.4 The Board of Directors (or if applicable, the Compensation Committee), may,
in its sole discretion, specify pursuant to a written resolution that a
Participant’s Mid-career Hire Benefits under this Article shall be a different
amount than the amount as calculated in Section 2.2 or 2.3 above, provided, that
such resolution must set forth how such different amount shall be calculated and
further provide that such different amount shall be provided to such Participant
in lieu of any benefit that may otherwise be payable under Section 2.2 and 2.3.

 

2.5 The benefit determined under this Plan will be coordinated with any benefits
payable under a similar plan for employees of members of the Controlled Group
other than the Company, so that total benefits from all such plans will not be
higher than they would be if all benefits were provided under this Plan.

 

2.6 No benefit will be payable under this Plan unless the Participant, when
asked, supplies all information relating to service with the Prior Employer or
benefits under the Prior Employer Plan that the Committee deems necessary to
calculate the Participant’s benefit.

 

2.7 Coordination with Retiree Medical Benefits. If a Participant is not eligible
as a Retiree under the Medical Benefits provisions of The Prudential Welfare
Benefits Plan, or a successor plan (referred to as the “Medical Plan”), the
Board may approve an additional Medical Benefit Differential benefit. A
Participant will only be eligible for this Medical Benefit Differential provided
the Participant would qualify as a Retiree if the Participant’s SERP Service
under this Article were added to actual service used to determine Retiree
eligibility under the Medical Plan. The Medical Benefit Differential will be a
payment in an amount calculated by the Committee to equal, after a reasonable
allowance for taxes, the difference between (i) the contributions made under the
Medical Plan by a similarly situated actual Retiree who separated from service
at the same time and (ii) the contribution required for the Participant’s
continued participation in COBRA continuation coverage or, after exhaustion of
COBRA continuation, the Executive Medical Access Plan of The Prudential Welfare
Benefits Plan (or its equivalent) for which the Participant is eligible. If the
Executive Medical Access Plan is discontinued, the Medical Benefit Differential
will continue in the amount of the last contribution amount determined for a
Participant prior to that discontinuance. The Committee may also specify a
significantly lower, unvarying Medical Benefit Differential (including zero)
that will be payable if the Participant is eligible but at any time declines to
participate in the Executive Medical

 

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Access Plan. Notwithstanding any election under Article IV for the payment of
benefits other than as an annuity, the Medical Benefit Differential shall be
payable monthly, or on such other periodic basis as the Committee determines is
appropriate under the circumstances. The Medical Benefit Differential will
terminate when Medical Plan coverage provided to a similarly situated actual
Retiree would have terminated.

 

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ARTICLE III

 

EARLY RETIREMENT BENEFITS

 

3.1 Eligibility. Any salaried officer, senior officer, or employee of the
Company who meets requirements (1) through (5) (or if applicable, requirements
(1) through (6)) set forth below thereby becomes a Participant under the Plan
and therefore shall be eligible to accrue Early Retirement Benefits under this
Article III; provided, however, that the accrual of Early Retirement Benefits
under this Article and the payment of Early Retirement Benefits under this Plan
shall be conditioned upon the Participant’s signing a Release. By the provisions
of Section 3.1(5) below, or by such designation pursuant to Section 3.1(4)(c)
below, the Board of Directors has determined that the retirement benefits
otherwise available to such individuals under the Retirement Plan, the
Supplemental Plan and such other plans or arrangements sponsored by the Company
and its affiliates would be inadequate absent the provision of such Early
Retirement Benefits.

 

The requirements are as follows:

 

(1) He or she is a participant in the Retirement Plan as of the date of
designation of such person as a Participant under Article III of the Plan by the
Committee, Compensation Committee or Board of Directors, as applicable;

 

(2) He or she has reached his or her earliest possible retirement date as
defined under the Prudential Traditional Retirement Plan before incurring a
Termination of Employment either as a result of (A) attaining the first of the
month coincident with or following age 55 with 10 Years of Vesting Service, or
(B) attaining age 50 with 20 Years of Continuous Service and meeting all other
requirements set forth in Section 502(b) of the Prudential Traditional
Retirement Plan (or any successor provision);

 

(3) He or she has incurred an involuntary Termination of Employment (other than
by death, summary dismissal, or termination for cause) or has been requested by
the Company to agree to a Termination of Employment, in each case, while
employed at a pay grade under the Prudential Compensation Plan of grade 1
through 6 or an investment professional grade of 56 or 56A, or the equivalents;

 

(4) He or she is designated in a written officer’s certificate or written
resolution as eligible to accrue Early Retirement Benefits under Article III of
the Plan by one of the following —

 

  (a) The Committee, in its sole discretion, in the case of an employee at pay
grades 5 or 6 and investment professional grade 56, or their equivalents, or

 

  (b) The Compensation Committee, in its sole discretion, in the case of an
employee at grade 4 or grade 56A or their equivalents, or to the extent required
by the by-laws of the Company (to the extent that such by-laws are more
restrictive than the terms of this Plan), or

 

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  (c) The Board of Directors, in its sole discretion in the case of an employee
at grades 1 through 3, or their equivalent, or to the extent required by the
by-laws of the Company (to the extent that such by-laws are more restrictive
than the terms of this Plan);

 

(5) Such designation made in Section 3.1(4)(a) and (b) above is subsequently and
timely approved by the Board of Directors; and

 

(6) He or she meets the terms of this Plan and any other different or additional
term or condition that the Committee (or if applicable, the Compensation
Committee or the Board of Directors) determines, in its sole discretion, should
be satisfied as a condition precedent or a condition subsequent to the receipt
of Early Retirement Benefits under this Article III; provided, that any
different or additional term or condition is set forth in the written officer’s
certificate or resolution designating the employee as eligible to accrue Early
Retirement Benefits under the Plan.

 

3.2 Amount. (a) Except as otherwise provided pursuant to paragraph (b) below,
the amount of a Participant’s Early Retirement Benefits shall be an amount equal
to the excess, if any, of (i) less (ii) below:

 

  (i) Participant’s accrued retirement benefit under the Prudential Traditional
Retirement Plan, and related accrued benefits under Articles II, III and IV of
the Supplemental Plan, multiplied by an adjustment factor of 1.00, in the case
of a Participant who retires under the Retirement Plan before the Participant’s
Normal Retirement Date;

 

LESS

 

  (ii) Participant’s aggregate (A) accrued early retirement benefits under
Article XI of the Prudential Traditional Retirement Plan, and (B) related
benefits under Articles II, III, and IV of the Supplemental Plan, if any.

 

(b) The Committee (or if applicable, the Compensation Committee or the Board of
Directors), may, in its sole discretion, specify pursuant to a written officer’s
certificate or resolution, as the case may be, that a Participant’s Early
Retirement Benefits under this Article III shall be a lesser amount than the
amount set forth in Section 3.2 (a) above, provided, that such certificate or
resolution must set forth how such lesser amount shall be calculated and further
provide that such lesser amount shall be provided to such Participant in lieu of
any benefit that may otherwise be payable under this Section 3.2.

 

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3.3 Cash Balance Participant. In the event a Participant is covered under the
Prudential Cash Balance Plan but elects an annuity that includes a Grandfathered
Minimum Benefit (calculated under the Prudential Traditional Retirement Plan
formula), the Participant’s benefit relating to accruals prior to January 1,
2002 will be treated for purposes of applying section 3.2, above, as a benefit
under the Prudential Traditional Retirement Plan.

 

3.4 Coordination with Mid-career Hire Benefits. For participants granted
eligibility for benefits under Article II of this plan, the following apply for
purposes of this Article III:

 

  (a) Vesting Service and Continuous Service under section 3.1(2) shall be
calculated to include all SERP Service.

 

  (b) For calculating the amount under section 3.2, the following subparagraphs
will be substituted for subparagraphs (i) and (ii) of that section:

 

  (i) Participant’s hypothetical accrued retirement benefits determined under
section 2.2(a) without reduction for commencement before the Participant’s
Normal Retirement Date;

 

LESS

 

  (ii) Participant’s hypothetical accrued retirement benefits determined under
section 2.2(a).

 

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ARTICLE IV

 

PAYMENT OF BENEFITS

 

4.1 Vesting. A benefit described in Article II will be payable under this Plan
only if the Participant, at the time of Termination of Employment with all
members of the Controlled Group has five years of service with the Controlled
Group, or the Company incurs a change of ownership (within the meaning of
Internal Revenue Code section 280G(b)(2)(A)(i)). Years of service will be years
of Vesting Service determined under the portion of the Retirement Plan
benefiting the Participant.

 

4.2 Time and Form of Payment. (a) If a Participant has accrued any benefits
described in Article II or Article III of the Plan, such Participant (or his or
her beneficiary) shall begin receiving Plan payments on the date benefits
commence under the Supplemental Plan. Benefits payable under the Plan shall be
paid to the Participant (and his or her beneficiary) in the same form of benefit
and at the same time as the benefit payable to such Participant (and
beneficiary) under the Supplemental Plan (including any lump sum form of payment
under the Supplemental Plan). All optional forms will be actuarially equivalent
as of the date of commencement based upon the interest and actuarial
assumptions, or will be adjusted using appropriate reduction factors, as
prescribed under the Retirement Plan and Supplemental Plan at the date of
commencement.

 

(b) If a Participant has accrued any benefits described in Article II, but is
not eligible to receive benefits under the Retirement Plan or the Supplemental
Plan, such Participant shall be treated as if he or she had completed five years
of vesting service under the Retirement Plan and the Supplemental Plan solely
for purposes of determining the time and form of Plan payments under this Plan.

 

(c) If a Participant has accrued any benefits described in Article II or Article
III of the Plan, but dies before payment of Plan benefits commences under the
Plan, benefits shall be payable at the same time, in the same form and to the
same beneficiary as provided under the Supplemental Plan.

 

4.3 Release. Any benefits accrued under this Plan shall be null and void and not
be payable upon a Participant’s failure to give, or subsequent revocation of, a
Release. Any breach by a Participant of a Release shall give the Company the
right to the return of such benefits, as well as the reimbursement by the
Participant of any attorney fees and costs expended by the Company in enforcing
such right of return.

 

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ARTICLE V

 

ADMINISTRATION OF THE PLAN

 

5.1 Administration of the Plan. The Compensation Committee shall appoint a
Committee to administer the Plan, which shall be comprised of at least three
duly authorized officers of the Company. The Committee shall maintain such
procedures and records as will enable the Committee (or the Compensation
Committee or the Board of Directors, as the case may be) to determine the
Participants and their beneficiaries who are entitled to receive benefits under
the Plan and the amounts thereof.

 

5.2 General Powers of Administration. (a) The Committee shall have the exclusive
right, power, and authority to interpret, in its sole discretion, any and all of
the provisions of the Plan; and to consider and decide conclusively any
questions (whether of fact or otherwise) arising in connection with the
administration of the Plan or any claim for benefits arising under the Plan;
provided, however, that such right, power and authority shall be exercised by
the Compensation Committee or the Board of Directors to the extent otherwise
required by the Plan or the Company’s by-laws (to the extent that such by-laws
are more restrictive than the terms of this Plan). Any decision or action of the
Committee (or the Compensation Committee or the Board of Directors, as the case
may be) shall be conclusive and binding on the Company and the Participants.

 

(b) Provisions set forth in the Retirement Plan with respect to claims and
appeals procedures, and immunities of the Administrative Committee (as defined
in the Retirement Plan), shall also be applicable with respect to the Plan and
the Committee, except that all claim and appeals decisions shall be made by the
Committee or, as provided in subsection (a) for general powers of
administration, by the Compensation Committee or the Board of Directors.

 

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ARTICLE VI

 

AMENDMENT AND TERMINATION

 

6.1 Amendment or Termination of the Plan. The Company reserves the right to
amend or terminate the Plan in any respect and at any time; provided, however,
that the following conditions with respect to such amendment or termination must
be satisfied for such amendment or termination to be binding and in effect:

 

(1) Such amendment or termination must be made pursuant to a written resolution
of the Committee (or the Compensation Committee or the Board of Directors to the
extent otherwise required by the Plan or the Company’s by-laws (to the extent
that such by-laws are more restrictive than the terms of this Plan));

 

(2) Such amendment or termination resolution may not adversely affect the rights
of any Participant or beneficiary to receive benefits earned and accrued under
the Plan prior to such amendment or termination, nor may the terms of any such
amendment or termination be interpreted to provide that any benefits payable
hereunder that are subject to a Release or other term or condition shall not
continue to be subject to the terms of such Release, term or condition unless
the terms of such amendment or termination resolution so specify;

 

(3) Any such amendment resolution that would (A) remove any of the eligibility
criteria for Mid-career Hire Benefits (as set forth in Section 2.1 of the Plan)
or Early Retirement Benefits (as set forth in Section 3.1 of the Plan), or
(B) alter the formulae used, and thereby increase the amount of, Mid-career Hire
Benefits (as set forth in Section 2.2 and 2.3 of the Plan) or Early Retirement
Benefits (as set forth in Section 3.2(a) of the Plan), must be submitted to the
Compensation Committee for approval (and thereafter submitted to the Board of
Directors for review) before such amendment becomes effective.

 

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ARTICLE VII

 

GENERAL PROVISIONS

 

7.1 Participant’s Rights Unsecured and Unfunded. The Plan at all times shall be
entirely unfunded. No assets of the Company shall be required to be segregated
or earmarked to represent the liability for accrued benefits under the Plan. The
right of a Participant (or his or her beneficiary) to receive a payment
hereunder shall be an unsecured claim against the general assets of the Company.
All payments under the Plan shall be made from the general funds of the Company,
unless satisfied by other means.

 

7.2 No Guarantee of Benefits. Nothing contained in the Plan shall constitute a
guaranty by any member of the Controlled Group or any other person or entity
that the assets of the Company will be sufficient to pay any benefit hereunder.

 

7.3 No Enlargement of Employee Rights. Participation in the Plan shall not be
construed to give any Participant the right to be retained in the service of any
member of the Controlled Group.

 

7.4 Non-Alienation Provision. No interest of any person or entity in, or right
to receive a benefit or distribution under, the Plan shall be subject in any
manner to sale, transfer, assignment, pledge, attachment, garnishment, or other
alienation or encumbrance of any kind; nor may such interest or right to receive
a distribution be taken, either voluntarily or involuntarily for the
satisfaction of the debts of, or other obligations or claims against, such
person or entity, including claims for alimony, support, separate maintenance
and claims in bankruptcy proceedings.

 

7.5 Applicable Law. The Plan shall be construed and administered under the laws
of the State of New Jersey, except conflict of laws provisions or to the extent
that such laws are preempted by ERISA.

 

7.6 Taxes. To the extent required by law, amounts accrued under the Plan shall
be subject to federal social security and unemployment taxes during the year the
services giving rise to such amounts were performed (or, if later, when the
amounts are both determinable and not subject to a substantial risk of
forfeiture). The Company shall withhold from any payments made pursuant to the
Plan such amounts as may be required by federal, state or local law.

 

7.7 Excess Payments. If the compensation, years of service, age, or any other
relevant fact relating to any person is found to have been misstated, the Plan
benefit payable by the Company to a Participant or beneficiary shall be the Plan
benefit that would have been provided on the basis of the correct information.
Any excess payments due to such misstatement, or due to any other mistake of
fact or law, shall be refunded to the Company or withheld by it from any further
amounts otherwise payable under the Plan.

 

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7.8 No Impact on Other Benefits. Amounts accrued under the Plan shall not be
included in a Participant’s compensation for purposes of calculating benefits
under any other plan, program or arrangement sponsored by the any member of the
Controlled Group.

 

7.9 Data. Each Participant or beneficiary shall furnish the Committee with all
proofs of dates of birth and death and proofs of continued existence necessary
for the administration of the Plan, and the Company shall not be liable for the
fulfillment of any Plan benefits in any way dependent upon such information
unless and until the same shall have been received by the Committee in form
satisfactory to it.

 

7.10 Incapacity of Recipient. If a Participant or other beneficiary entitled to
a distribution under the Plan is living under guardianship or conservatorship,
distributions payable under the terms of the Plan to such Participant or
beneficiary shall be paid to his or her appointed guardian or conservator and
such payment shall be a complete discharge of any liability of the Company under
the Plan.

 

7.11 Usage of Terms and Headings. Words in the masculine gender shall include
the feminine and the singular shall include the plural, and vice versa, unless
qualified by the context. Any headings are included for ease of reference only,
and are not to be construed to alter the terms of the Plan.

 

The following officer of the Company attests that this is a true copy of the
Plan as adopted by the Board of Directors May 14, 2002.

 

 

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Date   Victor Y. Sim     Vice President of Total Compensation

 

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