Exhibit 10.19

BENEFIT EQUALIZATION PLAN

Effective September 2, 1974

(As amended and in effect as of January 1, 2014)

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BENEFIT EQUALIZATION PLAN

TABLE OF CONTENTS

 
 
Page
ARTICLE I
DEFINITIONS
3
ARTICLE II
BENEFIT EQUALIZATION RETIREMENT ALLOWANCES
BENEFIT EQUALIZATION PROFIT-SHARING ALLOWANCES
AND BENEFIT EQUALIZATION COMBINED ALLOWANCES
18
ARTICLE III
FUNDS FROM WHICH ALLOWANCES ARE PAYABLE
32
ARTICLE IV
THE ADMINISTRATOR
33
ARTICLE V
AMENDMENT AND DISCONTINUANCE OF THE PLAN
34
ARTICLE VI
FORMS; COMMUNICATIONS
35
ARTICLE VII
INTERPRETATION OF PROVISIONS
36
ARTICLE VIII
CHANGE IN CONTROL PROVISIONS
37
EXHIBIT A:
ACTUARIAL ASSUMPTIONS USED TO CALCULATE A SINGLE SUM PAYMENT
40
APPENDIX 1:
TP EMPLOYEES
41
APPENDIX 2:
TAX ASSUMPTIONS
42
APPENDIX 3:
CALCULATION OF BENEFIT SECULAR TRUST AND
EXECUTIVE TRUST ARRANGEMENT PARTICIPANT
43

   

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BENEFIT EQUALIZATION PLAN

INTRODUCTION

The Benefit Equalization Plan governs the rights of an Employee whose benefit
under the Retirement Plan or the Profit-Sharing Plan, or both Qualified Plans,
is subject to one or more of the Statutory Limitations, or to the
nondiscrimination requirements of Section 401(a)(4) of the Code and the coverage
requirements of Section 410(b) of the Code.

The Plan was amended as of January 1, 2010, to include the participation of
salaried employees of UST LLC and its affiliates who were participants in the
UST LLC Retirement Income Plan for Salaried Employees (the substantive terms of
which are now in Part V of the Retirement Plan as a result of the merger of the
assets and liabilities of that plan with and into the assets and liabilities of
the Retirement Plan after the close of business on December 31, 2009). In
addition, effective as of January 1, 2010, the liabilities of the UST Inc.
Benefit Restoration Plan, UST Inc. Excess Retirement Benefit Plan and UST Inc.
Officers’ Supplemental Retirement Plan with respect to the limitations
applicable to plans qualified under Section 401(a) of the Code (e.g., Sections
401(a)(17) and 415 of the Code) have been merged into and assumed by the Plan.

The Plan as hereinafter set forth shall be effective with respect to Employees
who incur a Separation from Service on or after November 1, 2011, except as
otherwise provided herein. The rights of a person whose Separation from Service
or date of becoming an Inactive Participant is before November 1, 2011, shall be
governed by the provisions of the plan (or the plan, the liabilities of which
have been assumed by this Plan, in which such former employee participated on
the date of his termination of employment) as in effect on his Separation from
Service or date of becoming an Inactive Participant, as the case may be, except
to the extent that the Administrator has determined in his sole discretion to
administer the Plan in good faith compliance with Section 409A of the Code and
any then published guidance so as to not subject any Grandfathered Benefit
Equalization Retirement Allowance and Grandfathered Benefit Equalization
Profit-Sharing Allowance to Section 409A of the Code.

The Plan is comprised of four separate plans, programs or arrangements. Each
plan shall be treated as a separate plan, program or arrangement from the other
plans. One of the plans provides benefits to a Retired Employee (or his Spouse
or other Beneficiary) solely in excess of the Section 415 Limitations; the
second plan provides benefits to a Retired Employee (or his Spouse or other
Beneficiary) attributable solely to the Compensation Limitation; the third plan
provides benefits to a Retired Employee (or his Spouse or other Beneficiary)
because payment of the benefit from one or both of the Qualified Plans could
result in a failure to meet the nondiscrimination requirements of Section
401(a)(4) of the Code or the coverage requirements of Section 410(b) of the
Code; and the fourth plan provides benefits to a TP Employee who resumed active
participation in the Plan, effective January 1, 2008.

Notwithstanding anything to the contrary in the provisions of this Plan, (1) no
amounts shall be deemed credited or accrued under the Plan after December 31,
2004, to the extent the Administrator determines that the accrual, crediting or
payment of such amounts under the terms of the Plan or related arrangements
would risk subjecting Plan participants to taxation or

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penalties under Section 409A of the Code, and (2) the Plan terms applicable to
any amounts determined by the Administrator to be deferred compensation subject
to the requirements of such Section 409A may be modified by the Administrator to
the extent it deems necessary or appropriate to ensure compliance with such
requirements. The Administrator may take any such action with respect to some
participants but not others as it in its sole discretion deems appropriate under
the circumstances.

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ARTICLE I
DEFINITIONS

The following terms as used herein and in the Preamble shall have the meanings
set forth
below. Any capitalized term used herein or in the Preamble and not defined below
shall have the meaning set forth in the Retirement Plan or the Profit-Sharing
Plan, as the context may require.

(a)“Actuarial Equivalent” shall mean a benefit which is at least equivalent in
value to the benefit otherwise payable pursuant to the terms of the Plan, based
on the actuarial principles and assumptions set forth in Exhibit I to the
Retirement Plan.

(b)“After-Tax BEP Combined Allowance” shall mean the amount by which (i) the TP
Employee’s Gross After-Tax BEP Combined Allowance exceeds (ii) his Trust Account
TP Value.

(c)“Allowance” or “Allowances” shall mean a Benefit Equalization Retirement
Allowance, determined under ARTICLE IIA of the Plan, a Benefit Equalization
Profit-Sharing Allowance, determined under ARTICLE IIB of the Plan and a Benefit
Equalization Combined Allowance determined under ARTICLE IIC of the Plan.

(d)“Assumed Trust Account TP” shall mean the assumed trust account established
pursuant to a TP Employee’s Supplemental Enrollment Agreement.

(e)
“Beneficiary” shall mean:

(i)In the case of a Retired Employee who is to receive all or a portion of his
Benefit Equalization Retirement Allowance or Benefit Equalization Combined
Allowance after his Separation from Service in a Single Sum Payment pursuant to
ARTICLE IIE(1)(a), IIE(1)(b) or IIE(1)(c)(ii) of the Plan, but who dies after
his Separation from Service and before such Single Sum Payment is made, the
Beneficiary of such Single Sum Payment shall be the Spouse to whom he was
married on the date of death; provided, however, that if the Retired Employee is
not married on the date of his death, the Beneficiary of such Single Sum Payment
shall be the Retired Employee’s estate.

(ii)In the case of a Grandfathered Employee who is a Secular Trust Participant
who has elected pursuant to ARTICLE IIE(3) of the Plan to receive, after his
Separation from Service, that portion of his Benefit Equalization Combined
Allowance equal to the Grandfathered Benefit Equalization Retirement Allowance
in the form of an Optional Payment described in ARTICLE I(dd)(i)(2) or (3) of
the Plan, the person or persons designated by the Grandfathered Employee to
receive (or who, pursuant to the terms of such Optional Payment, will receive)
after his death a benefit according to the option elected by the Grandfathered
Employee.

(iii)In the case of an Employee or Retired Employee who has been credited with a
Benefit Equalization Profit-Sharing Allowance and who dies prior to the payment
of such Benefit Equalization Profit-Sharing Allowance (or prior to the payment
of the then remaining balance of such Benefit Equalization Profit-Sharing
Allowance in the case of a Grandfathered

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Employee who has elected pursuant to ARTICLE IIF(3) of the Plan to receive that
portion of his Benefit Equalization Profit-Sharing Allowance equal to the
Grandfathered Benefit Equalization Profit-Sharing Allowance in the form of an
Optional Payment described in ARTICLE I(dd)(ii) of the Plan), the Beneficiary of
such Benefit Equalization Profit-Sharing Allowance (or remaining balance
thereof) shall be the beneficiary or beneficiaries of such former Employee who
is or are to receive the balance in such former Employee’s account under the
Profit-Sharing Plan.

Notwithstanding the foregoing provisions of this Article I(e), if the value of
the Trust Account TP is greater than the TP Employee’s Gross After-Tax BEP
Combined Allowance, then the Beneficiary of any such excess shall be the
beneficiary as determined pursuant to the terms of the Trust Account TP.

(f)“Benefit Equalization Combined Allowance” shall mean the benefit determined
under ARTICLE IIC of the Plan and payable at the times and in the form set forth
in ARTICLE IIE of the Plan. The Benefit Equalization Combined Allowance shall be
comprised of the Grandfathered Benefit Equalization Retirement Allowance, if
any, and the remaining portion of such Allowance.

(g)“Benefit Equalization Joint and Survivor Allowance” shall mean the total
amount that would be payable during a twelve (12) month period as a reduced
Benefit Equalization Retirement Allowance or Benefit Equalization Combined
Allowance to a Retired Employee for life and after his death the amount payable
to his Spouse for life equal to one-half of the reduced Benefit Equalization
Retirement Allowance or Benefit Equalization Combined Allowance payable to the
Retired Employee (regardless of whether such form of benefit was available to
such Retired Employee and his Spouse), or in such other amount as described in
ARTICLE IIC(2) of the Plan, which together shall be the Actuarial Equivalent of
the Benefit Equalization Retirement Allowance or Benefit Equalization Combined
Allowance of the Retired Employee.

(h)“Benefit Equalization Profit-Sharing Allowance” or “Profit-Sharing Allowance”
shall mean:

(i)    with respect to Allowances other than a Benefit Equalization Combined
Allowance, the benefit determined under ARTICLE IIB of the Plan and payable at
the times and in the forms set forth in ARTICLE IIF of the Plan; and

(ii)    with respect to a Benefit Equalization Profit-Sharing Allowance that is
a portion of the Benefit Equalization Combined Allowance, the benefit determined
under ARTICLE IIC of the Plan and payable at the times and in the forms set
forth in ARTICLE IIF of the Plan.

The Benefit Equalization Profit-Sharing Allowance shall be comprised of the
Grandfathered Benefit Equalization Profit-Sharing Allowance, if any, and the
remaining portion of such Allowance. The Benefit Equalization Profit-Sharing
Allowance shall not include a UST Employee’s UST Plan Benefit.

(i)“Benefit Equalization Retirement Allowance” shall mean the benefit determined
under ARTICLE IIA of the Plan and payable at the times and in the forms set
forth in

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ARTICLE IIF of the Plan. The Benefit Equalization Retirement Allowance shall be
comprised of the Grandfathered Benefit Equalization Retirement Allowance, if
any, and the remaining portion of such Allowance. The Benefit Equalization
Retirement Allowance shall not include a UST Employee’s UST Plan Benefit.

(j)
“Benefit Equalization Survivor Allowance” shall mean the benefit payable to:

(i)
the Spouse of a Deceased Employee; and

(ii)
the Spouse of a deceased Retired Employee;

in an amount equal to one-half of the reduced Benefit Equalization Retirement
Allowance or Benefit Equalization Combined Allowance which would have been
payable in the form of a Benefit Equalization Joint and Survivor Allowance to
the Deceased Employee or deceased Retired Employee (regardless of whether such
form of benefit was available to such Deceased Employee or deceased Retired
Employee), or in such other amount as described in ARTICLE IIC(2) of the Plan.

(k)“BEP Benefit Commencement Date” shall mean the date specified in clause (1),
(2), or (3) below, as applicable to the relevant Allowance. All such Allowances
not paid in a Single Sum Payment are paid in arrears so that the actual date of
payment shall be the first day of the calendar month next succeeding the BEP
Benefit Commencement Date.

(1)(i)     Except as provided in clauses (ii), (iii), (iv) and (v) of this
ARTICLE I(k)(1) of the Plan, the BEP Benefit Commencement Date of the Benefit
Equalization Retirement Allowance and Benefit Equalization Combined Allowance
shall be the Payment Date, but not later than the Latest Payment Date.

(ii)(A)     Except as provided in clauses (B) and (C) of this ARTICLE
I(k)(1)(ii) of the Plan, the BEP Benefit Commencement Date of that portion of a
Benefit Equalization Combined Allowance that is the Grandfathered Benefit
Equalization Retirement Allowance payable in the form of an Optional Payment
pursuant to an election under ARTICLE IIE(3) of the Plan to a Grandfathered
Retired Employee shall be the Benefit Commencement Date of the Grandfathered
Retired Employee’s Full, Deferred or Early Retirement Allowance under the
Retirement Plan.

(B)The BEP Benefit Commencement Date of that portion of a Benefit Equalization
Combined Allowance that is the Grandfathered Benefit Equalization Retirement
Allowance payable in the form of an Optional Payment with respect to a
Grandfathered Retired Employee who voluntarily retires within the one (1) year
period following the date of the filing of his application for an Optional
Payment with the Administrator pursuant to ARTICLE IIE(3) of the Plan, or whose
employment is terminated for misconduct (as determined by the Management
Committee) within such one (1) year period, shall be the first day of the month
following the expiration of the one (1) year period following the date of the
filing of his application for an Optional Payment.

(C)The BEP Benefit Commencement Date of the benefit payable pursuant to ARTICLE
IIE(3)(f) of the Plan to the Beneficiary of a Grandfathered Retired

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Employee who died after his Date of Retirement and prior to his BEP Benefit
Commencement Date shall be the first day of the month following the death of the
deceased Grandfathered Retired Employee.

(iii)The BEP Benefit Commencement Date of (A) that portion of a Benefit
Equalization Combined Allowance that is the Grandfathered Benefit Equalization
Retirement Allowance payable to a Retired TP Employee and (B) that portion of a
Benefit Equalization Retirement Allowance that is the Grandfathered Benefit
Equalization Retirement Allowance payable to a Grandfathered Retired Employee,
who in each case is only eligible for a Vested Retirement Allowance at his
Separation from Service, shall be the Benefit Commencement Date of the Retired
Employee’s Vested Retirement Allowance under the Retirement Plan.

(iv)The BEP Benefit Commencement Date of any Benefit Equalization Retirement
Allowance described in ARTICLE IIA(1)(e) of the Plan and of any Benefit
Equalization Combined Allowance described in ARTICLE IIC(1)(e) of the Plan shall
be the benefit commencement date of such Allowance as set forth in the General
Release Agreement; provided, however, that if no time of payment is specified,
the BEP Benefit
Commencement Date shall be the Payment Date, but no later than the 15th day of
the third month following the end of the Employee’s Participating Company first
taxable year in which the right is no longer subject to a substantial risk of
forfeiture; provided, however, that no such Benefit Equalization Retirement
Allowance or Benefit Equalization Combined Allowance shall change either the
time or form of payment of the Allowance (including a Grandfathered Benefit
Equalization Retirement Allowance) otherwise payable pursuant to the terms of
the Plan.

(v)The BEP Benefit Commencement Date of that portion of a Benefit Equalization
Combined Allowance that is the Grandfathered Benefit Equalization Profit-
Sharing Allowance that is payable in the form of an Optional Payment pursuant to
an election under ARTICLE IIF(3) of the Plan to a TP Employee shall be the date
specified in the application.

(2)(i)     (A) Except as provided in clause (B) of this ARTICLE I(k)(2)(i) of
the Plan, the BEP Benefit Commencement Date of the Benefit Equalization
Profit-Sharing Allowance (other than the Benefit Equalization Profit-Sharing
Allowance of a TP Employee which shall be paid as part of the Benefit
Equalization Combined Allowance pursuant to ARTICLE I(k)(1) of the Plan) shall
be the Payment Date, but not later than the Latest Payment Date.

(B)The BEP Benefit Commencement Date of that portion of a Benefit Equalization
Profit-Sharing Allowance that is the Grandfathered Benefit Equalization
Profit-Sharing Allowance that is payable in the form of an Optional Payment
pursuant to an election under ARTICLE IIF(3) of the Plan to a Grandfathered
Retired Employee shall be the date specified in the application.

(3)(i)     (A) Except as provided in clause (B) of this ARTICLE I(k)(3)(i), the
BEP Benefit Commencement Date of the Benefit Equalization Survivor Allowance

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payable to the Spouse of a Deceased Employee or deceased Retired Employee shall
be the Survivor Allowance Payment Date, but not later than the Survivor
Allowance Latest Payment Date.

(B)    The BEP Benefit Commencement Date of that portion of the Benefit
Equalization Survivor Allowance that is derived from (i) the Grandfathered
Benefit Equalization Retirement Allowance portion of the Benefit Equalization
Combined Allowance or (ii) the Grandfathered Benefit Equalization Retirement
Allowance that is payable to:

(1)
the Spouse of a Grandfathered Deceased Employee; or

(2)
the Spouse of a deceased Grandfathered Retired Employee,

shall, in each case, be the Benefit Commencement Date of the Survivor Allowance
payable to such Spouse under the Retirement Plan, provided that the Spouse may
elect in accordance with the provisions of Paragraphs G2.05(c) and (d)(2) of
Part I of the Retirement Plan, as applicable to the Spouse, that the BEP Benefit
Commencement Date be the first day of any month thereafter, but not later than
the later of (i) the first day of the second calendar month following the month
in which the Grandfathered Deceased Employee or deceased Grandfathered Retired
Employee died (or if his date of birth was on the first day of a calendar month,
the first day of the calendar month next following the calendar month in which
the Grandfathered Deceased Employee or deceased Grandfathered Retired Employee
died), or (ii) the date that would have been the Grandfathered Deceased
Employee’s or deceased Grandfathered Retired Employee’s Unreduced Early
Retirement Benefit Commencement Date.

(l)“Change in Circumstance” shall mean, with respect to a Grandfathered Employee
or Grandfathered Retired Employee who is a Secular Trust Participant:

(i)    the marriage of the Grandfathered Employee or Grandfathered Retired
Employee;

(ii)    the divorce of the Grandfathered Employee or Grandfathered Retired
Employee from his spouse (determined in accordance with applicable state law),
provided:

(1)
such spouse was the Beneficiary who is to receive an Optional Payment, or

(2)
the Grandfathered Employee or Grandfathered Retired Employee elected pursuant to
ARTICLE IIE(3) of the Plan to receive an Optional Payment pursuant to ARTICLE
I(dd)(i) of the Plan;

(iii)    the death of the Beneficiary designated by the Grandfathered Employee
or Grandfathered Retired Employee to receive an Optional Payment after the death
of the Grandfathered Retired Employee; or

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(iv)    a medical condition of the Beneficiary, based on medical evidence
satisfactory to the Administrator, which is expected to result in the death of
the Beneficiary within five (5) years of the filing of an application for change
in Optional Payment method pursuant to ARTICLE IIE(3) or ARTICLE IIF(3) hereof.

(m)“Code” means the Internal Revenue Code of 1986, as amended from time to time.

(n)“Company” shall mean Altria Client Services Inc. Altria Client Services Inc.
is the sponsor of the Plan.

(o)“Compensation” shall have the same meaning as in the applicable Part of the
Retirement Plan, except that in computing the Retirement Allowance and Benefit
Equalization Retirement Allowance of an Employee in salary bands A and B who was
not age fifty-five (55) or older at December 31, 2006, Compensation for Plan
years on and after January 1, 2007, shall mean the lesser of his (i) base
salary, plus annual incentive award, and (ii) base salary, plus annual incentive
award at a business rating of 100 and individual performance rating of
“Exceeds”.

(p)“Compensation Limitation” shall mean the limitation of Section 401(a)(17) of
the Code on the annual compensation of an Employee which may be taken into
account under the Qualified Plans.

(q)“Earned and Vested” shall mean, when referring to an Allowance or any portion
of an Allowance, an amount that, as of January 1, 2005, is not subject to a
substantial risk of forfeiture (as defined in Treasury Regulation Section
1.83-3(c)) or a requirement to perform future services.

(r)“Employee” shall mean any person employed by a Participating Company who has
accrued a benefit under the Retirement Plan or the Profit-Sharing Plan, but
whose entire accrued benefit, if computed without regard to the Statutory
Limitations, cannot be paid under the Retirement Plan or the Profit-Sharing
Plan, or either of such Qualified Plans, as a result of the Statutory
Limitations, provided that an Employee shall not include a TP Employee, but only
with respect to those calendar years in which he was a participant in such
arrangement. An Employee shall include a UST Employee but only with respect to
any benefit earned under the Profit-Sharing Plan on or after January 1, 2010,
and disregarding any part of the UST Employee’s UST Plan Benefit earned on and
after such date.

(s)“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time.

(t)“Grandfathered Benefit Equalization Joint and Survivor Allowance” shall mean
the total amount that would be payable during a twelve (12) month period as a
reduced Grandfathered Benefit Equalization Retirement Allowance to a
Grandfathered Retired Employee for life and after his death the amount payable
to his Spouse for life equal to one-half of the reduced Grandfathered Benefit
Equalization Retirement Allowance payable to the Grandfathered Retired Employee,
which together shall be the Actuarial Equivalent of (i) that portion of the

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Benefit Equalization Combined Allowance that is the Grandfathered Benefit
Equalization Retirement Allowance, or (ii) that portion of the Benefit
Equalization Retirement Allowance that is the Grandfathered Benefit Equalization
Retirement Allowance of the Retired Grandfathered Employee.

(u)“Grandfathered Benefit Equalization Optional Payment Allowance” shall mean,
with respect to a Grandfathered Retired Employee who is a Secular Trust
Participant, the total amount of the Grandfathered Benefit Equalization
Retirement Allowance payable during a twelve (12) month period in accordance
with one of the payment methods described in Paragraph G2.04(d) of Part I of the
Retirement Plan and designated by the Grandfathered Retired Employee in his
application for an Optional Payment under ARTICLE IIE(3) of the Plan, pursuant
to which the Grandfathered Retired Employee receives for life after his Date of
Retirement a reduced Grandfathered Benefit Equalization Retirement Allowance in
equal monthly payments for life and after his death after his Date of Retirement
his Beneficiary receives for life a benefit in equal monthly payments according
to the option elected by the Grandfathered Retired Employee, which together
shall be the Actuarial Equivalent of the Grandfathered Benefit Equalization
Retirement Allowance payable in equal monthly payments for the life of the
Grandfathered Retired Employee after his Date of Retirement.

(v)
“Grandfathered Benefit Equalization Profit-Sharing Allowance” shall mean

(i) that portion of a Grandfathered Retired Employee’s Benefit Equalization
Combined Allowance that is the Benefit Equalization Profit-Sharing Allowance, or
(ii) that portion of a Grandfathered Retired Employee’s Benefit Equalization
Profit-Sharing Allowance that is the Benefit Equalization Profit-Sharing
Allowance, in each case as of December 31, 2004, the right to which is Earned
and Vested as of December 31, 2004, plus any future contributions to the
account, the right to which was Earned and Vested as of December 31, 2004, but
only to the extent such contributions are actually made, plus earnings (whether
actual or notional) attributable to such Grandfathered Benefit Equalization
Profit-Sharing Allowance as of December 31, 2004, or to such income.

(w)“Grandfathered Benefit Equalization Retirement Allowance” shall mean the
present value of (i) that portion of the Benefit Equalization Combined
Allowance, or (ii) that portion of the Benefit Equalization Retirement
Allowance, in each case earned to December 31, 2004, to which the Grandfathered
Employee or Retired Grandfathered Employee would have been entitled under the
Plan if he had voluntarily terminated services without cause on or before
December 31, 2004, and received payment of such benefit on the earliest
permissible date following termination of employment in the form with the
greatest value, expressed for purposes of this calculation as a single life
annuity commencing at age 65; provided, however, that for any subsequent year
such Grandfathered Benefit Equalization Retirement Allowance may increase to
equal the present value of such portion of his benefit the Grandfathered
Employee or Grandfathered Retired Employee actually becomes entitled to, in the
form and at the time actually paid, determined in accordance with the terms of
the Plan (including applicable Statutory Limitations) as in effect on October 3,
2004, without regard to any further services rendered by the Grandfathered
Employee or Grandfathered Retired Employee after December 31, 2004, or any other
events affecting the amount of or the entitlement to benefits (other than an
election with respect to the time and form of an available benefit).

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In computing that portion of the Benefit Equalization Combined Allowance or
Benefit Equalization Retirement Allowance that is the Grandfathered Benefit
Equalization Retirement Allowance of a Grandfathered Employee who is eligible
for an Early Retirement Allowance, whether reduced or unreduced (but is not
eligible for a Full or Deferred Retirement Allowance) under the Retirement Plan
as of the Grandfathered Employee’s Separation from Service, or, in the
discretion of the Administrator, the end of the Grandfathered Employee’s policy
severance, such Grandfathered Benefit Equalization Retirement Allowance shall be
the Actuarial Equivalent of that portion of the Grandfathered Employee’s Benefit
Equalization Combined Allowance or Benefit Equalization Retirement Allowance
that is the Grandfathered Benefit Equalization Retirement Allowance, computed as
though such benefit were payable under the terms of the Retirement Plan in the
form of a Retirement Allowance commencing on the first day of the month
coincident with or next following the Grandfathered Employee’s Separation from
Service or, in the discretion of the Administrator, the end of the Grandfathered
Employee’s policy severance; provided, however, that solely for purposes of
determining the early retirement factor to be applied in determining the
Actuarial Equivalent of such benefit, the earliest date on which the
Grandfathered Employee shall be treated as being entitled to an unreduced
benefit under the Retirement Plan for purposes of Exhibit 1 to the Retirement
Plan shall be the earliest date on which the Grandfathered Employee would have
been entitled to an unreduced benefit if the Grandfathered Employee had
voluntarily terminated employment on December 31, 2004.

(x)“Grandfathered Deceased Employee” shall mean a Grandfathered Employee who
died while he was an Employee at a time when he had a nonforfeitable right to
any portion of his Benefit Equalization Retirement Allowance.

(y)
“Grandfathered Employee” shall mean:

(i)    an Employee who is entitled to that portion of his Benefit Equalization
Combined Allowance or Benefit Equalization Retirement Allowance that is the
Grandfathered Benefit Equalization Retirement Allowance that was Earned and
Vested; or

(ii)    an Employee who is entitled to that portion of his Benefit Equalization
Combined Allowance or Benefit Equalization Profit-Sharing Allowance that is the
Grandfathered Benefit Equalization Profit-Sharing Allowance,

and who, in either instance, is a participant in the executive trust or is a
Secular Trust Participant.

(z)
“Grandfathered Retired Employee” shall mean:

(i)    a Grandfathered Employee who has retired and is eligible for that portion
of his Benefit Equalization Combined Allowance or Benefit Equalization
Retirement Allowance that is the Grandfathered Benefit Equalization Retirement
Allowance that was Earned and Vested; and

(ii)    a Grandfathered Employee who has retired and is eligible for that
portion of his Benefit Equalization Combined Allowance or Benefit Equalization
Profit- Sharing Allowance that is the Grandfathered Benefit Equalization
Profit-Sharing Allowance.

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(aa)     “Gross After-Tax BEP Combined Allowance” shall be equal to the amount
that would remain if income taxes (determined as if withholding for federal,
state and local income taxes were effected at the rates specified in Appendix
2), but disregarding any withholding for the TP Employee’s share of employment
taxes, were withheld on the sum of (i) that portion of the TP Employee’s Benefit
Equalization Combined Allowance that is not the Grandfathered Benefit
Equalization Retirement Allowance and (ii) that portion of the TP Employee’s
Benefit Equalization Combined Allowance that is not the Grandfathered Benefit
Equalization Profit- Sharing Allowance.

(bb)    “Latest Payment Date” shall mean the later of:

(i)December 31st of the year in which the Payment Date occurs, and
(ii)the fifteenth day of the third month following the Payment Date.
(cc)    “Optional Payment” shall mean:
(i)the following optional forms in which that portion of a Benefit Equalization
Combined Allowance that is the Grandfathered Benefit Equalization Retirement
Allowance of a Grandfathered Retired Employee who is a Secular Trust Participant
may be paid:

(1)
in equal monthly payments for the life of the Grandfathered Retired Employee;

(2)
a Grandfathered Benefit Equalization Joint and Survivor Allowance; or

(3)
a Grandfathered Benefit Equalization Optional Payment Allowance; and

(ii)in the case of that portion of a Benefit Equalization Combined Allowance
that is the Grandfathered Benefit Equalization Profit-Sharing Allowance of a
Grandfathered Employee or Grandfathered Retired Employee, any of the methods of
distribution permitted under ARTICLE VI of the Profit-Sharing Plan (other than a
Single Sum Payment payable at the BEP Benefit Commencement Date described in
ARTICLE I(k)(2)(i)(A) of the Plan) and in the event the Grandfathered Employee
or Grandfathered Retired Employee dies before distribution of that portion of
his Benefit Equalization Combined Allowance or Benefit Equalization
Profit-Sharing Allowance that is the Grandfathered Benefit Equalization
Profit-Sharing Allowance is made, commences to be made or is fully distributed,
to his Beneficiary in accordance with the method of distribution designated by
such Grandfathered Employee or Grandfathered Retired Employee; provided however,
that payment to a Beneficiary who is not the Spouse of the Grandfathered
Employee or Grandfathered Retired Employee shall be made no later than one (1)
year following the death of the Grandfathered Employee or Grandfathered Retired
Employee.

Any election to receive an Optional Payment with respect to any Allowance or
Allowances under the Plan shall be independent of any election with respect to
benefits

11

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payable under the Retirement Plan, the Profit-Sharing Plan, or any other plan of
a member of the Controlled Group.

(dd)    “Payment Date” shall mean:

(i)With respect to payment of a benefit under the Plan other than a UST Plan
Benefit, the first day of the third calendar month following the month in which
the Employee Separates from Service; and

(ii)In all cases of a payment due under the Plan with respect to a UST Plan
Benefit on behalf of a UST Employee that would have been payable pursuant to
Part V of the Retirement Plan but for the Statutory Limitations or for any other
reason but that are payable pursuant to the provisions of the Plan, the Payment
Date shall mean the first of the month following the latest of:

(A)
January 31, 2009,

(B)
the UST Employee’s Separation from Service, or

(C)
the UST Employee’s attainment of age fifty-five (55);

if the UST Employee dies after the Payment Date but before actual payment is
made, the Payment Date shall be the day following the date of death, but no
later than December 31st of the year in which the UST Employee dies.

Notwithstanding the foregoing, in all cases of a Separation from Service other
than on account of death, the Payment Date in the case of a Specified Employee
shall be the first day of the seventh calendar month following the date that
such Specified Employee Separates from Service.

(iii)With respect to a payment under the Plan to an individual other than the
Employee pursuant to the terms of a domestic relations order (as defined in
Section 414(p)(1)(B) of the Code), the Payment Date shall be the date necessary
to fulfill such domestic relations order.

(iv)With respect to the Benefit Equalization Profit-Sharing Allowance credited
pursuant to ARTICLE IIB(1), IIB(2)(a), IIB(2)(c), and IIC(1)(a)(ii) for the year
in which the Employee Separates from Service, the Payment Date for such amount
shall mean the date on which such amount is credited in the year following the
year in which the Employee Separates from Service, and the Payment Date shall be
no later than June 30 of such year.

(ee)    “Plan” shall mean the Benefit Equalization Plan described herein and in
any amendments hereto.

(ff)    “Profit-Sharing Plan” shall mean the Deferred Profit-Sharing Plan for
Salaried Employees, effective January 1, 1956, and as amended from time to time.

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(gg)    “Qualified Plans” shall mean the Retirement Plan and the Profit-Sharing
Plan.

(hh)     “Retired Employee” shall mean a former Employee who is eligible for or
in receipt of, an Allowance. A Retired Employee shall cease to be such when he
has received all of the Allowances payable to him under the Plan.

(ii)“Retired TP Employee” shall mean a former TP Employee who is eligible for or
in receipt of, an Allowance pursuant to ARTICLE IIC of the Plan. A Retired TP
Employee shall cease to be such when he has received all of the Allowances
payable to him under the Plan.

(jj)     “Retirement Plan” shall mean Parts I and II of the Altria Retirement
Plan, effective as of September 1, 1978, and as amended from time to time.

(kk)    “Section 415 Limitations” shall mean:

(i)in the case of the Retirement Plan, the limitations on benefits applicable to
defined benefit plans set forth in Section 415 of the Code and the Treasury
Regulations promulgated thereunder, and

(ii)in the case of the Profit-Sharing Plan, the limitations on contributions
applicable to defined contribution plans set forth in Section 415 of the Code
and the Treasury Regulations promulgated thereunder.

(ll)    “Secular Trust Participant” shall mean a Grandfathered Employee who
signed an enrollment agreement to participate in the secular trust arrangement.

(mm)    “Separation from Service,” “Separates from Service” or “Separated from
Service” shall each have the same meaning as the term “separation from service”
in Treasury Regulation Section 1.409A-1(h)(1); provided, however, that with
respect to the payment of any Grandfathered Allowance that is not subject to
Section 409A of the Code, such terms shall mean the date that the Employee
terminated his services as an Employee with his Participating Company and each
other member of the Controlled Group.

(nn) “Single Sum Payment” shall mean payment of a benefit or portion of a
benefit in a single payment to a Retired Employee, or to the Spouse or other
Beneficiary of an Employee, Deceased Employee or deceased Retired Employee. A
Single Sum Payment shall be (i) the Actuarial Equivalent of all or that portion
of the Benefit Equalization Retirement Allowance or Benefit Equalization
Combined Allowance payable in equal monthly payments during a twelve (12) month
period for the life of the Retired Employee, and (ii) the Actuarial Equivalent
of the (or portion of the) Benefit Equalization Survivor Allowance payable in
equal monthly payments during a twelve (12) month period for the life of the
Spouse of the Deceased Employee or deceased Retired Employee, in each case using
the actuarial principles and assumptions set forth in EXHIBIT A to the Plan;
provided, however, that a Single Sum Payment with respect to a Grandfathered
Employee who is a Secular Trust Participant shall equal the greater of (i) the
amount determined pursuant to the foregoing provisions of this ARTICLE I(nn) and
(ii) the amount required to purchase a single life annuity (or, for purposes of
a secular trust participant, a Benefit Equalization Joint and Survivor
Allowance) equal to the benefit otherwise identified

13

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under the Plan from a licensed commercial insurance company, as determined in
the sole discretion of the Administrator.

(i)A Single Sum Payment shall be the exclusive form of distribution of the
Benefit Equalization Retirement Allowance (including payments with respect to
benefits earned under the UST Plans), except with respect to:

(1)that portion of the Benefit Equalization Retirement Allowance derived solely
from the Grandfathered Benefit Equalization Retirement Allowance and that is
payable to a Grandfathered Retired Employee who is only eligible for a Vested
Retirement Allowance at his Separation from Service; and

(2)that portion of the Benefit Equalization Retirement Allowance derived solely
from the Grandfathered Benefit Equalization Retirement Allowance and that is
payable to a Grandfathered Retired Employee who is a Secular Trust Participant
who has timely elected to receive after his Date of Retirement that portion of
his Benefit Equalization Retirement Allowance equal to the Grandfathered Benefit
Equalization Retirement Allowance in the form of an Optional Payment pursuant to
ARTICLE IIE(3)(a) of the Plan and which election does not cease to be of any
force and effect pursuant to ARTICLE IIE(3)(d) of the Plan.

(ii)A Single Sum Payment shall be the exclusive form of distribution of the
Benefit Equalization Combined Allowance, except with respect to:

(1)    that portion of the Benefit Equalization Combined Allowance derived
solely from the Grandfathered Benefit Equalization Retirement Allowance and that
is payable to a Grandfathered Retired Employee who is only eligible for a Vested
Retirement Allowance at his Separation from Service; and

(2)    that portion of the Benefit Equalization Combined Allowance derived
solely from the Grandfathered Benefit Equalization Retirement Allowance and that
is payable to a Grandfathered Retired Employee who has timely elected to receive
after his Date of Retirement that portion of his Benefit Equalization Combined
Allowance equal to the Grandfathered Benefit Equalization Retirement Allowance
in the form of an Optional Payment pursuant to ARTICLE IIE(3)(a) of the Plan and
which election does not cease to be of any force and effect pursuant to ARTICLE
IIE(3)(d) of the Plan.

(iii)A Single Sum Payment shall be the exclusive form of distribution of the
Benefit Equalization Survivor Allowance, except with respect to that portion of
the Benefit Equalization Survivor Allowance derived solely from that portion of
the Benefit Equalization Combined Allowance or Benefit Equalization Retirement
Allowance that is the Grandfathered Benefit Equalization Retirement Allowance

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payable to the Spouse of a Grandfathered Deceased Employee or the Spouse of a
deceased Grandfathered Retired Employee.

(iv)A Single Sum Payment shall be the exclusive form of distribution of the
Benefit Equalization Profit-Sharing Allowance, except with respect to that
portion of the Benefit Equalization Combined Allowance or Benefit Equalization
Profit- Sharing Allowance that is the Grandfathered Benefit Equalization
Profit-Sharing Allowance payable to a Grandfathered Retired Employee who is a
Secular Trust Participant who has timely elected to receive after his Date of
Retirement that portion of his Benefit Equalization Profit-Sharing Allowance
equal to the Grandfathered Benefit Equalization Profit-Sharing Allowance in the
form of an Optional Payment pursuant to ARTICLE IIF(3) of the Plan.

(oo)     “Specified Employee” shall have the meaning given in Treasury
Regulation Section 1.409A-1(i).

(pp)    “Statutory Limitations” shall mean:

(i)
the Section 415 Limitations, and

(ii)
the Compensation Limitation.

(qq)     “Supplemental Enrollment Agreement” shall mean the most recent of any
Supplemental Employee Grantor Trust Enrollment Agreements and Supplemental Cash
Enrollment Agreements between a TP Employee and a Participating Company or their
affiliates or predecessors.

(rr)    “Survivor Allowance Latest Payment Date” shall mean the later of:

(i)December 31st of the year in which the Survivor Allowance Payment Date
occurs, or

(ii)the fifteenth day of the third month following the Survivor Allowance
Payment Date.

(ss)     “Survivor Allowance Payment Date” shall mean the first day of the third
calendar month following the month in which the Deceased Employee or deceased
Retired Employee died.

(tt)    “TP Employee” shall mean an Employee identified in Appendix 1, as a
result of his participation in the target payment program for the calendar years
2005 through 2007.

(uu)     “Trust Account TP” shall mean the trust subaccount established pursuant
to a Employee’s Supplemental Enrollment Agreement and to which target payments
have been credited.

(vv)
“Trust Account TP Value” shall mean,

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(i)with respect to a TP Employee for whom a Trust Account TP has been
established, the sum of the amounts credited to the TP Employee’s Assumed Trust
Account TP and Trust Account TP as of the earlier of the date:

(1)on which the TP Employee’s Trust Account TP is terminated and distributed in
accordance with the procedures established by the Administrator,

(2)that is 60 days after the TP Employee’s Separation from Service, or

(3)
on which a Change in Control occurs, and

(ii)with respect to a TP Employee for whom a Trust Account TP has not been
established, the amounts credited to the TP Employee’s Assumed Trust Account TP
as of the earlier of the date:

(1)
of the TP Employee’s Separation from Service, or

(2)
on which a Change in Control occurs,

in each case, reduced by the estimated amount of any taxes that would be
attributable to income or assumed income from these accounts assuming
liquidation of the accounts as of the applicable determination date set out
above, but which have not been paid or deducted from these accounts, calculated
using the income tax rate assumptions set forth in Appendix 2 and disregarding
any withholding for the TP Employee’s share of employment taxes.

(ww)     “UST Plan Benefit” shall mean the benefit earned by a UST Employee
under the terms of the UST Plans as in effect on December 31, 2009, (including
the provisions of the UST LLC Retirement Income Plan for Salaried Employees that
ceased the earning of any service used to compute the amount of a UST Employee’s
benefits as of December 31, 2009), including any increase in such benefit as a
result of Compensation paid after December 31, 2009, and vesting service
completed after December 31, 2009, that is used to determine if the UST Employee
is eligible for any early retirement subsidy.

(xx)“UST Employee” shall mean an Employee who has accrued a UST Plan Benefit.
(yy)    “UST Plans” shall mean:
(i)the UST Inc. Benefit Restoration Plan, as amended and in effect immediately
prior to the merger of that portion of its liabilities allocable to benefits
that were payable from the Benefit Restoration Plan solely as a result of the
limitations on compensation under Section 401(a)(17) of the Code into the
liabilities of the Plan;

(ii)the UST Inc. Excess Retirement Benefit Plan, as amended and in effect
immediately prior to the merger of its liabilities into the liabilities of the
Plan; and

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(iii)the UST Inc. Officers’ Supplemental Retirement Plan, as amended and in
effect immediately prior to the merger of its liabilities into the liabilities
of the Plan.

The masculine pronoun shall include the feminine pronoun unless the context
clearly requires otherwise.

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ARTICLE II

BENEFIT EQUALIZATION RETIREMENT ALLOWANCES, BENEFIT EQUALIZATION PROFIT-SHARING
ALLOWANCES AND BENEFIT EQUALIZATION COMBINED ALLOWANCES

A.
Benefit Equalization Retirement Allowances and other benefits payable under this
Plan with respect to a Retired Employee who was not a TP Employee shall be as
follows:

(1)(a)     Subject to the provisions of subparagraphs (b), (c), and (d) of this
ARTICLE IIA(1), the Benefit Equalization Retirement Allowance with respect to a
Retired Employee who was not a TP Employee shall equal the sum of (i) and (ii)
below:

(i)the amount by which the Retirement Allowance under the Retirement Plan
accrued to the Date of Retirement, if computed without regard to the Statutory
Limitations, exceeds the amount of the Retirement Allowance actually payable
under the Retirement Plan, plus

(ii)in the case of a Retired Employee who is eligible to receive an enhanced
benefit under the Qualified Plan (such as a benefit payable pursuant to a
voluntary early retirement program or a shutdown benefit), but whose additional
accrued benefit resulting solely from participation in such program or benefit
may not be paid from the Qualified Plan because of the nondiscrimination
requirements of Section 401(a)(4) of the Code, or the coverage requirements of
Section 410(b) of the Code, the amount of such additional accrued benefit
payable to such Retired Employee solely as a result of his participation in such
program or benefit.

(b)In no event shall any increase in a Grandfathered Employee’s Benefit
Equalization Retirement Allowance resulting from an amendment to the Retirement
Plan to add or remove a subsidized benefit, change the time and form of payment
of the Benefit Equalization Retirement Allowance earned prior to the date of
such amendment.

(c)In the event that all or any portion of the Benefit Equalization Retirement
Allowance with respect to the Retired Employee described in ARTICLE IIA(1)(a) of
the Plan is paid in a Single Sum Payment in accordance with the provisions of
ARTICLE IIE prior to the Retired Employee’s Benefit Commencement Date under the
Retirement Plan, the amount of such Benefit Equalization Retirement Allowance
shall equal the amount by which the Retirement Allowance under the Retirement
Plan accrued to the Date of Retirement, if computed without regard to the
Statutory Limitations, is reasonably estimated by the Administrator to exceed
the amount of the Retirement Allowance which is projected by the Administrator
to be actually payable under the Retirement Plan.

(d)In the event that all or any portion of the Benefit Equalization Retirement
Allowance with respect to a Retired Employee described in ARTICLE IIA(1)(a) of
the Plan is paid in a Single Sum Payment in accordance with the provisions of
ARTICLE IIE prior to the date the Retired Employee shall have specified on his
application for

18

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retirement as the Benefit Commencement Date of his Retirement Allowance under
the Retirement Plan, the Single Sum Payment shall be calculated based on the
assumption that the Retired Employee elected to receive a Retirement Allowance
at his Unreduced Early Retirement Benefit Commencement Date or Unreduced Vested
Retirement Benefit Commencement Date, as applicable to the Retired Employee.

(e)If, as a result of the execution of a General Release Agreement (and not
revoking it), (A) an Employee first obtains a legally binding right to payment
of an increase in his Benefit Equalization Retirement Allowance, (B) as of the
first date the Employee obtains a legally binding right to such increase it is
subject to a substantial risk of forfeiture (within the meaning of Treasury
Regulation Section 1.409A-1(d)), then the amount of such increase in the Benefit
Equalization Retirement Allowance with respect to such Employee shall be the
amount as set forth in the General Release Agreement and shall be payable at the
BEP Benefit Commencement Date specified in ARTICLE I(k)(1)(iv) of the Plan
provided, however that no such increase in an Employee’s Benefit Equalization
Allowance shall change either the time or form of payment of the Grandfathered
Benefit Equalization Retirement Allowance of a Grandfathered Employee otherwise
payable pursuant to the terms of the Plan. The provisions of this paragraph are
in lieu of, and not in addition to, the benefits provided pursuant to the
provisions of ARTICLE IIA(1)(a)(ii) of the Plan.

(2)
The Spouse of

(a)a Deceased Employee (other than a TP Employee), or

(b)a deceased Retired Employee (other than a deceased Retired TP Employee and a
Grandfathered Retired Employee who is a Secular Trust Participant who made an
election for a Grandfathered Benefit Equalization Optional Payment Allowance and
designated a Beneficiary other than his Spouse) who has died after his Date of
Retirement and before his BEP Benefit Commencement Date, or

(c)a Grandfathered Retired Employee who is a Secular Trust Participant whose
request for an Optional Payment pursuant to ARTICLE I(dd)(i)(2) or (3) of the
Plan with respect to that portion of his Benefit Equalization Retirement
Allowance that is the Grandfathered Benefit Equalization Allowance has been
granted by the Administrator, but who has died after his Date of Retirement and
before his BEP Benefit Commencement Date,

shall, in each case, be eligible to receive a Benefit Equalization Survivor
Allowance.

B.
Benefit Equalization Profit-Sharing Allowances payable under this Plan shall be
as follows:

(1)    The Benefit Equalization Profit-Sharing Allowance with respect to an
Employee who is not a TP Employee or a Match-Eligible Employee shall equal the
amounts which would have been credited, but were not credited to his Company
Account in the Profit-Sharing Plan as a result of the Statutory Limitations.

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(2)    The Benefit Equalization Profit-Sharing Allowance with respect to an
Employee who is a Match-Eligible Employee, but who is not a TP Employee shall
equal the sum of (a), (b) and (c) below:

(a)the amounts which would have been credited, but were not credited to his
Company Account in the Profit-Sharing Plan as a result of the Statutory
Limitations, plus

(b)beginning with the first calendar year for which the Match-Eligible Employee
is eligible for an allocation of the Contribution to his Company Account in the
Profit-Sharing Plan and for each year thereafter, provided that the
Match-Eligible Employee receives a Company Contribution to his Company Account
for each such year, the amount of Company Match Contributions that could not be
made to the Profit- Sharing Plan for such calendar year as a result of the
Statutory Limitations, assuming that the Match-Eligible Employee elected to make
Salary Reduction Contributions, After-Tax Contributions, or a combination of
Salary Reduction Contributions and After-Tax Contributions of three percent (3%)
of such Match-Eligible Employee’s Compensation for such Plan Year, plus

(c)the amounts which would have been credited, but were not credited to his
Supplemental Company Contribution Account in the Profit-Sharing Plan as a result
of the Statutory Limitations.

In order to be eligible for the portion of the Benefit Equalization
Profit-Sharing Allowance payable under subsection (2)(b) for a Plan Year, the
Match-Eligible Employee must have made the maximum dollar amount of Elective
Contributions (including Catch-up Contributions, if applicable to the
Match-Eligible Employee) for such Plan Year, as described in Section 402(g)(1)
of the Code.

(3)    The amounts credited pursuant to ARTICLE IIB(2)(a) and (c) shall be
deemed credited on the same date as the Company Contribution is made to the
Profit-Sharing Plan. The amounts credited pursuant to ARTICLE IIB(2)(b) shall be
deemed credited on January 1 immediately succeeding the calendar year for which
such Company Match Contributions could not be made to the Profit-Sharing Plan,
except in the case of the year in which the Employee Separates from Service, in
which case the amounts shall be deemed credited on the date of the Employee’s
Separation from Service. All such amounts shall be deemed to have been invested
in Part C of the Fund (as defined in the Profit-Sharing Plan) and valued in
accordance with the provisions of the Profit-Sharing Plan.

C.
Benefit Equalization Combined Allowances payable under this Plan shall be as
follows:

(1)    (a)     Subject to the provisions of subparagraphs (b), (c), and (d) of
this ARTICLE IIC of the Plan, the Benefit Equalization Combined Allowance of a
TP Employee shall be equal to the sum of clauses (i) and (ii) and subject to the
proviso in clause (iii):

(i)    the amount by which the Full, Deferred, Early or Vested Retirement
Allowance under the Retirement Plan accrued to the Date of Retirement, expressed
in the form of a Retirement Allowance, if computed

20

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without regard to the Statutory Limitations, exceeds the amount of the Full,
Deferred, Early or Vested Retirement Allowance actually payable under the
Retirement Plan, expressed in the form of a Retirement Allowance.

(A)In computing the amount under ARTICLE IIC(1)(a)(i) with respect to a TP
Employee who is eligible for a Full, Deferred or Vested Retirement Allowance,
but is not eligible for an Early Retirement Allowance as of the TP Employee’s
Separation from Service or, if later, the end of the TP Employee’s policy
severance, such Full, Deferred or Vested Allowance shall equal the Actuarial
Equivalent of the TP Employee’s Benefit Equalization Combined Allowance
(assuming that it is payable in monthly payments for the lifetime of the TP
Employee), computed as though such Allowance were payable under the terms of the
Retirement Plan as a Retirement Allowance at the later of age sixty-five (65),
the age of the TP Employee at his Separation from Service or, if later, the end
of the TP Employee’s policy severance.

(B)In computing the amount under ARTICLE IIC(1)(a)(i) with respect to a TP
Employee who is eligible for an Early Retirement Allowance, whether reduced or
unreduced, but is not eligible for a Full, Deferred or Vested Retirement
Allowance, as of the TP Employee’s Separation from Service or, if later, the end
of the TP Employee’s policy severance, such Early Retirement Allowance shall be
the Actuarial Equivalent of the TP Employee’s Benefit Equalization Combined
Allowance (assuming that it is payable in monthly payments for the lifetime of
the Employee), computed as though such Allowance were payable under the terms of
the Retirement Plan as a Retirement Allowance commencing on the first day of the
month coincident with or next following the Employee’s Separation from Service,
or, if later, at the end of the Employee’s policy severance. If such Allowance
is to be paid in a Single Sum Payment, such Early Retirement Allowance shall
equal the present value of such Allowance that would be payable to the former TP
Employee as of the first day of the month coincident with or next following the
Employee’s Separation from Service, or, if later, at the end of the Employee’s
policy severance date, determined as of the first day of the month following the
month in which the former TP Employee Separated from Service (or died, in the
case of a payment to the Spouse of the deceased TP Employee); plus

(ii)    the amount which would have been credited, but were not credited to his
Company Account in the Profit-Sharing Plan as a result of the Statutory
Limitations; and

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(iii)    provided, however, that, that portion of a TP Employee’s Benefit
Equalization Combined Allowance which is not his Grandfathered Benefit
Equalization Retirement Allowance and Grandfathered Benefit Equalization
Profit-Sharing Allowance shall equal the amount of the TP Employee’s After-Tax
BEP Combined Allowance converted to a pre-tax amount. Such pre-tax amount shall
equal an amount sufficient to cause the amount remaining after withholding of
income taxes (determined as if withholding for federal, state and local income
taxes were effected at the rates specified in Appendix 2), but disregarding any
withholding for the TP Employee’s share of employment taxes, to equal the
After-Tax BEP Combined Allowance.

(iv)    Sample calculations of a TP Employee’s Benefit Equalization Combined
Allowance are set forth in Appendix 3.

(b)In no event shall any increase in a TP Employee’s Benefit Equalization
Combined Allowance resulting from an amendment to the Retirement Plan to add or
remove a subsidized benefit, change the time and form of payment of the Benefit
Equalization Combined Allowance earned prior to the date of such amendment.

(c)In the event that all or any portion of the Benefit Equalization Combined
Allowance with respect to the Grandfathered Retired Employee described in
ARTICLE IIC(1)(a) of the Plan is paid in a Single Sum Payment in accordance with
the provisions of ARTICLE IIE(1)(b) of the Plan prior to the TP Employee’s
Benefit Commencement Date under the Retirement Plan, the amount of such Benefit
Equalization Combined Allowance shall equal the amount by which the Retirement
Allowance under the Retirement Plan accrued to the Date of Retirement, if
computed without regard to the Statutory Limitations, is reasonably estimated by
the Administrator to exceed the amount of the Retirement Allowance which is
projected by the Administrator to be actually payable under the Retirement Plan.

(d)In the event that all or any portion of the Benefit Equalization Combined
Allowance with respect to a Retired TP Employee described in ARTICLE IIC(1)(a)
of the Plan is paid in a Single Sum Payment in accordance with the provisions of
ARTICLE IIE(1)(b) of the Plan prior to the date the Retired TP Employee shall
have specified on his application for retirement as the Benefit Commencement
Date of his Retirement Allowance under the Retirement Plan, the Single Sum
Payment shall be calculated based on the assumption that the Retired TP Employee
elected to receive a Retirement Allowance at his Unreduced Early Retirement
Benefit Commencement Date or Unreduced Vested Retirement Benefit Commencement
Date, as applicable to the Retired TP Employee.

(e)If, as a result of the execution of a General Release Agreement (and not
revoking it), (A) a TP Employee first obtains a legally binding right to payment
of an increase in his Benefit Equalization Combined Allowance, (B) as of the
first date the TP Employee obtains a legally binding right to such increase it
is subject to a substantial risk of forfeiture (within the meaning of Treasury
Regulation Section 1.409A-1(d)), then the

22

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amount of such increase in the Benefit Equalization Combined Allowance with
respect to such TP Employee shall be the amount as set forth in the General
Release Agreement and shall be payable at the BEP Benefit Commencement Date
specified in ARTICLE I(k)(1)(iv) of the Plan, provided, however that no such
increase in a TP Employee’s Benefit Equalization Combined Allowance shall change
either the time or form of payment of that portion of the TP Employee’s Benefit
Equalization Combined Allowance allocable to the Grandfathered Benefit
Equalization Retirement Allowance and Grandfathered Benefit Equalization
Profit-Sharing Allowance otherwise payable pursuant to the terms of the Plan.

(2)    The Spouse of a TP Employee or deceased Grandfathered Retired Employee
who dies before his Benefit Equalization Combined Allowance is paid shall be
eligible to receive that portion of the Grandfathered Employee’s or deceased
Grandfathered Retired Employee’s Benefit Equalization Combined Allowance that is
the Benefit Equalization Survivor Allowance, provided that, with respect to that
portion of his Benefit Equalization Combined Allowance allocable to his
Grandfathered Benefit Equalization Retirement Allowance, the deceased
Grandfathered Retired Employee did not make an election for a Grandfathered
Benefit Equalization Optional Payment Allowance and designated a Beneficiary
other than his Spouse; and, provided, further, that with respect to that portion
of his Benefit Equalization Combined Allowance that is not the Grandfathered
Benefit Equalization Retirement Allowance, such Benefit Equalization Survivor
Allowance shall be the amount calculated as follows:

(a)Determine the amount, if any, by which (i) the Grandfathered Employee’s Trust
Account TP Value exceeds (ii) the amount calculated under ARTICLE IIC(3)(a)
below.

(b)If the TP Employee dies before terminating employment with the Controlled
Group, determine one half of the amount that would be that portion of the
Grandfathered Employee’s Benefit Equalization Combined Allowance that is not the
Grandfathered Benefit Equalization Retirement Allowance if (i) the TP Employee
had survived and had a Separation from Service on his date of death and (ii) the
term Benefit Equalization Joint and Survivor Allowance were substituted for the
term Retirement Allowance in each place that such term appears in ARTICLE
IIA(1)(a) of the Plan.

(c)Determine the amount that would remain if income taxes (determined as if
withholding for federal, state and local income taxes were effected at the rates
specified in Appendix 2, but disregarding any withholding for the Grandfathered
Employee’s share of employment taxes) were withheld on the amount determined
under ARTICLE IIC(2)(b).

(d)If the TP Employee dies after terminating employment with the Controlled
Group but before his BEP Benefit Commencement Date, determine the amount that
would remain if income taxes (determined as if withholding for federal, state
and local income taxes were effected at the rates specified in Appendix 2), but
disregarding any withholding for the Grandfathered Employee’s share of
employment taxes, were withheld on that portion of the Grandfathered

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Employee’s Benefit Equalization Combined Allowance that is not the Grandfathered
Benefit Equalization Retirement Allowance.

(e)The portion of the Benefit Equalization Survivor Allowance that is not the
Grandfathered Benefit Equalization Retirement Allowance shall equal an amount
sufficient to cause the amount remaining after withholding of income taxes
(determined as if withholding for federal, state and local income taxes were
effected at the rates specified in Appendix 2, but disregarding any withholding
for the Grandfathered Employee’s share of employment taxes) to equal:

(i)If the TP Employee dies before terminating employment with the Controlled
Group, the amount by which (i) the amount determined under ARTICLE IIC(2)(c) of
the Plan exceeds (ii) the remaining Trust Account TP Value, if any, determined
under ARTICLE IIC(2)(a) of the Plan; or

(ii)If the TP Employee dies after terminating employment with the Controlled
Group but before his BEP Benefit Commencement Date, the amount by which (i) the
amount determined under ARTICLE IIC(2)(d) of the Plan exceeds (ii) the remaining
Trust Account TP Value, if any, determined under ARTICLE IIC(2)(a) of the Plan.

(3)    If a Grandfathered Employee dies before his Benefit Equalization Combined
Allowance has been paid, the Grandfathered Employee’s Beneficiary shall be
eligible to receive that portion of his Benefit Equalization Combined Allowance
allocable to his Benefit Equalization Profit-Sharing Allowance; provided that
the portion of such Allowance that is not the Grandfathered Benefit Equalization
Profit-Sharing Allowance shall be in an amount calculated as follows:

(a)Determine the amount that would remain if income taxes (determined as if
withholding for federal, state and local income taxes were effected at the rates
specified in Appendix 2, but disregarding any withholding for the Grandfathered
Employee’s share of employment taxes) were withheld on that portion of the
Grandfathered Employee’s Benefit Equalization Profit-Sharing Allowance that is
not the Grandfathered Benefit Equalization Profit-Sharing Allowance.

(b)Determine the amount, if any, by which (i) the amount determined under
ARTICLE IIC(3)(a) exceeds (ii) the Grandfathered Employee’s Trust Account TP
Value.

(c)The portion of such Benefit Equalization Profit-Sharing Allowance that is not
the Grandfathered Benefit Equalization Profit-Sharing Allowance payable under
this ARTICLE IIC(3) shall equal an amount sufficient to cause the amount
remaining after withholding of income taxes (determined as if withholding for
federal, state and local income taxes were effected at the rates specified in
Appendix 2, but disregarding any withholding for the Grandfathered Employee’s
share of employment taxes) to equal the amount, if any, determined under ARTICLE
IIC(3)(b).

(4)    The Beneficiary of a Grandfathered Retired Employee whose request for an
Optional Payment in the form of a Grandfathered Benefit Equalization Optional
Payment

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Allowance has been granted by the Administrator, but who dies after his Date of
Retirement and prior to his BEP Benefit Commencement Date shall be eligible to
receive that portion of the Grandfathered Benefit Equalization Optional Payment
Allowance elected by the Grandfathered Retired Employee which is payable after
the death of the Grandfathered Retired Employee.

(5)    The Spouse of a Grandfathered Retired Employee whose request for an
Optional Payment pursuant to clauses (2) or (3) of ARTICLE I(dd)(i) of the Plan
with respect to that portion of his Benefit Equalization Retirement Allowance
that is the Grandfathered Benefit Equalization Allowance has been granted by the
Administrator, but who dies after his Date of Retirement and prior to his BEP
Benefit Commencement Date, shall be eligible to receive a Benefit Equalization
Survivor Allowance.

D.
UST Plan Benefit payable under this Plan shall be as follows:

(1)    The UST Plan Benefit of a UST Employee who is not a UST Supplemental
Retirement Participant shall be paid in a Single Sum Payment on the Payment Date
specified in ARTICLE I(ee)(ii)(1).

(2)    The UST Plan Benefit of a UST Supplemental Retirement Participant shall
be paid in a Single Sum Payment on the Payment Date specified in ARTICLE
I(ee)(ii)(2).

E.
BEP Benefit Commencement Date and termination of Benefit Equalization Combined
Allowances and Benefit Equalization Retirement Allowances payable in the form of
an Optional Payment:

(1)    (a)     The Benefit Equalization Retirement Allowance payable pursuant to
ARTICLE IIA(1)(a) of the Plan shall be distributed in a Single Sum Payment on
the BEP Benefit Commencement Date specified in ARTICLE I(k)(1)(i). If a Retired
Employee described in ARTICLE IIA(1)(a) dies after his Date of Retirement and
before payment of his Benefit Equalization Retirement Allowance is paid in a
Single Sum Payment, his Beneficiary shall receive a Single Sum Payment on the
Benefit Commencement Date specified in ARTICLE I(k)(1)(i).

(b)Except as provided in ARTICLE IIE(1)(c) below, the Benefit Equalization
Combined Allowance payable pursuant to ARTICLE IIC(1) of the Plan shall be
distributed to a Grandfathered Retired Employee who is eligible for an Early,
Full or Deferred Retirement Allowance in a Single Sum Payment on the Benefit
Commencement Date specified in ARTICLE I(k)(1)(i). If the Grandfathered Retired
Employee dies after his Date of Retirement and before payment of his Benefit
Equalization Combined Allowance is paid in a Single Sum Payment, his Beneficiary
shall receive a Single Sum Payment on the Benefit Commencement Date specified in
ARTICLE I(k)(1)(i) of the Plan.

(c)The Benefit Equalization Combined Allowance payable pursuant to ARTICLE
IIC(1) of the Plan shall be distributed to a Grandfathered Retired Employee who
is only eligible for a Vested Retirement Allowance at his Separation from
Service, as follows:

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(i)that portion of the Benefit Equalization Combined Allowance that is the
Grandfathered Benefit Equalization Allowance shall be distributed in accordance
with the Grandfathered Retired Employee’s BEP Benefit Commencement Date
described in ARTICLE I(k)(1)(iii) of the Plan and shall be paid in the same form
of Optional Payment which the Grandfathered Retired Employee’s Vested Retirement
Allowance is paid from the Retirement Plan; and

(ii)that portion of the Benefit Equalization Combined Allowance that is not the
Grandfathered Benefit Equalization Allowance shall be distributed to the Retired
Employee in a Single Sum Payment on the Benefit Commencement Date specified in
ARTICLE I(k)(1)(i) of the Plan.

(2)    If any Benefit Equalization Retirement Allowance or Benefit Equalization
Combined Allowance payable in a Single Sum Payment is paid after the first day
of the third calendar month following the month in which the Retired Employee
Separates from Service, interest shall be credited on such amount from the first
day of the third calendar month following the month in which the Retired
Employee Separates from Service to the last day of the month preceding the month
in which payment is made. Interest will be credited at the applicable federal
short-term rate under Code section 1274(d), applying monthly compounding, as in
effect for the month immediately preceding the month of payment.

(3)    (a)    A Grandfathered Retired Employee who is a Secular Trust
Participant who is eligible to retire on a Full, Deferred or Early Retirement
Allowance at his Separation from Service may make application to the
Administrator to receive an Optional Payment with respect to that portion of his
Benefit Equalization Combined Allowance allocable to his Grandfathered Benefit
Equalization Retirement Allowance in lieu of the Single Sum Payment otherwise
payable after his Date of Retirement. The application for an Optional Payment
shall specify:

(i)    the form in which such Optional Payment is to be paid;

(ii)    the Beneficiary, if any, who will receive benefits after the death of
the Grandfathered Retired Employee; and

(iii)
the BEP Benefit Commencement Date.

(b)In the case of a Grandfathered Retired Employee who eighteen (18) months
prior to attaining the age of sixty-five (65) years could be compulsorily
retired by his Participating Company upon attaining the age of sixty-five (65)
years pursuant to Section 12(c) of the Age Discrimination in Employment Act, any
application for an Optional Payment must be filed with the Administrator more
than one (1) year preceding the date the Grandfathered Retired Employee attains
the age of sixty-five (65) years.

(c)The Administrator may grant or deny any such application in its sole and
absolute discretion. Except as provided in Subparagraphs (d)(i) and (f) of this
ARTICLE IIE, a Grandfathered Retired Employee shall not receive that portion of
his Benefit Equalization Combined Allowance that is the Grandfathered Benefit
Equalization Retirement Allowance in the form of a Single Sum Payment after the
Administrator has

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granted the Grandfathered Retired Employee application for an Optional Payment.
In the event the Grandfathered Retired Employee incurs a Change in Circumstance
on or after the date of the filing of the application for an Optional Payment
and prior to his BEP Benefit Commencement Date, the Grandfathered Retired
Employee may file an application with the Administrator within ninety (90) days
of the Change in Circumstance, but in no event later than his BEP Benefit
Commencement Date, to change the form of Optional Payment, or to change the
Beneficiary who is to receive a benefit after the death of the Grandfathered
Retired Employee in accordance with the Optional Payment method originally filed
with the Administrator.

(d)
An application for an Optional Payment shall be of no force and effect if:

(i)the Grandfathered Retired Employee does not retire on a Full, Deferred or
Early Retirement Allowance;

(ii)the Grandfathered Retired Employee incurs a disability at any time before
the date his Optional Payment commences to be made which causes him to be
eligible for benefits under the Long-Term Disability Plan for Salaried
Employees; or

(iii)the Grandfathered Retired Employee is retired for ill health or disability
under Paragraph S2.03(b) of Part II of the Retirement Plan.

(e)In the event the application for an Optional Payment is of no force and
effect as a result of an event described in clauses (ii) or (iii) of ARTICLE
IIE(3)(d) of the Plan, payment of that portion of the Grandfathered Retired
Employee’s Benefit Equalization Combined Allowance that is the Grandfathered
Benefit Equalization Retirement Allowance shall be made in a Single Sum Payment
pursuant to ARTICLE I(k)(1) of the Plan on the Payment Date, but not later than
the Latest Payment Date, but otherwise such application for an Optional Payment
shall be effective on the Grandfathered Retired Employee’s Date of Retirement on
a Full, Deferred or Early Retirement Allowance and the Grandfathered Retired
Employee’s benefits shall commence on the BEP Benefit Commencement Date
specified in ARTICLE I(k)(1)(ii)(A) of the Plan; provided, however, that if
within the one (1) year period following the date of the filing of the
application with the Administrator the Grandfathered Retired Employee
voluntarily retires or his employment is terminated for misconduct (as
determined by the Administrator) by any member of the Controlled Group, the
Optional Payment shall be reduced by one percent (1%) for each month (or portion
of a month) by which the month in which the Grandfathered Retired Employee’s
termination of employment precedes the first anniversary of the filing of the
application with the Administrator and his benefits shall commence in the BEP
Benefit Commencement Date specified in ARTICLE I(k)(1)(ii)(B) of the Plan.

(f)If a Grandfathered Retired Employee whose request for an Optional Payment in
the form of a Grandfathered Benefit Equalization Optional Payment Allowance has
been granted by the Administrator dies after his Date of Retirement and prior to
his BEP Benefit Commencement Date, his Beneficiary shall be eligible to receive

27

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that portion of the Grandfathered Benefit Equalization Optional Payment
Allowance elected by the Grandfathered Retired Employee which is payable after
the death of the Grandfathered Retired Employee.

(g)
Notwithstanding the preceding provisions of this Paragraph E,

(i)    the Administrator may cause the distribution of that portion of the
Benefit Equalization Combined Allowance that is the Grandfathered Benefit
Equalization Retirement Allowance to any group of similarly situated
Grandfathered Retired Employees (or their Spouses or other Beneficiaries) in a
Single Sum Payment or as an Optional Payment; and

(ii)    the Administrator shall distribute that portion of an Employee’s Benefit
Equalization Combined Allowance that is the Grandfathered Benefit Equalization
Retirement Allowance in a Single Sum Payment if such portion of the Benefit
Equalization Combined Allowance payable in equal monthly payments is not more
than $250 per month.

(4)    The Benefit Equalization Survivor Allowance payable pursuant to ARTICLE
IIA(2)(a) and ARTICLE IIC(2) of the Plan shall be paid in a Single Sum Payment
on the BEP Benefit Commencement Date described in ARTICLE I(k)(3)(i)(A)
provided, however, that the portion of the Benefit Equalization Survivor
Allowance that is derived from the Grandfathered Benefit Equalization Retirement
Allowance shall be paid on the BEP Benefit Commencement Date described in
ARTICLE I(k)(3)(i)(B).

F.
Commencement and termination of Benefit Equalization Profit-Sharing Allowances:

(1)    The Benefit Equalization Profit-Sharing Allowance payable pursuant to
ARTICLE IIB(1) of the Plan shall be distributed to the Retired Employee in a
Single Sum Payment on the Payment Date, but not later than the Latest Payment
Date, unless, solely in the case of a Grandfathered Retired Employee, the
Administrator has approved his election to have distribution of that portion of
his Benefit Equalization Combined Allowance or Benefit Equalization
Profit-Sharing Allowance that is the Grandfathered Benefit Equalization
Profit-Sharing Allowance made in accordance with ARTICLE IIF(3) of the Plan.

(2)    If an Employee or Retired Employee dies before his Single Sum Payment has
been paid and without having the approval by the Administrator for payment of
that portion of his Benefit Equalization Combined Allowance or Benefit
Equalization Profit-Sharing Allowance that is the Grandfathered Benefit
Equalization Profit-Sharing Allowance in the form of an Optional Payment, the
Single Sum Payment otherwise payable to the Employee or Retired Employee shall
be paid to his Beneficiary on the Payment Date, but not later than the Latest
Payment Date.

(3)    If any Benefit Equalization Profit-Sharing Allowance payable in a Single
Sum Payment is paid after the first day of the third calendar month following
the month in which the Retired Employee Separates from Service, interest shall
be credited on such amount from the first day of the third calendar month
following the month in which the Retired Employee Separates from Service to the
last day of the month preceding the month in which payment is

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made. Interest will be credited at the applicable federal short-term rate under
Code section 1274(d), applying monthly compounding, as in effect for the month
immediately preceding the month of payment.

(4)    (a)    A Grandfathered Employee who is a Secular Trust Participant may
make an application to the Administrator to receive an Optional Payment with
respect to that portion of his Benefit Equalization Combined Allowance or
Benefit Equalization Profit-Sharing Allowance that is the Grandfathered Benefit
Equalization Profit-Sharing Allowance in lieu of the Single Sum Payment
otherwise payable to him on the Benefit Commencement Date specified in ARTICLE
I(k)(2) after he becomes a Grandfathered Retired Employee. The application for
an Optional Payment shall specify:

(i)    the form in which such Optional Payment is to be paid; and

(ii)    the Beneficiary who will receive the balance of that portion of his
Benefit Equalization Combined Allowance or Benefit Equalization Profit-Sharing
Allowance that is the Grandfathered Benefit Equalization Profit-Sharing
Allowance after the death of the Grandfathered Employee or Grandfathered Retired
Employee.

(b)In the case of a Grandfathered Employee who eighteen (18) months prior to
attaining the age of sixty-five (65) years could be compulsorily retired by his
Participating Company upon attaining the age of sixty-five (65) years pursuant
to Section 12(c) of the Age Discrimination in Employment Act, any application
for an Optional Payment must be filed with the Administrator more than one (1)
year preceding the date the Grandfathered Employee attains the age of sixty-five
(65) years.

(c)The Administrator may grant or deny any such application in its sole and
absolute discretion. A Grandfathered Employee shall not receive that portion of
his Benefit Equalization Combined Allowance or Benefit Equalization
Profit-Sharing Allowance that is the Grandfathered Benefit Equalization
Profit-Sharing Allowance in the form of a Single Sum Payment after the
Administrator has granted the Grandfathered Employee’s application for an
Optional Payment. In the event the Grandfathered Employee or Grandfathered
Retired Employee has elected to receive his Optional Payment over the joint life
expectancies of he and his Beneficiary and incurs a Change in Circumstance
described in ARTICLE I(l)(ii), ARTICLE I(l)(iii), or ARTICLE I(l)(iv) of the
Plan on or after the date of the filing of the application and prior to the date
his Optional Payment commences to be paid, the Grandfathered Employee or
Grandfathered Retired Employee may file an application with the Administrator
within ninety (90) days of the Change in Circumstance, but in no event later
than the date his Optional Payment is scheduled to commence to be paid to
designate a new Beneficiary or elect to receive his Optional Payment over the
life expectancy of the Grandfathered Employee or Grandfathered Retired Employee.

(d)If within the one (1) year period following the date of the filing of the
application for an Optional Payment with the Administrator, the Grandfathered
Employee voluntarily retires (other than for ill health or disability under
Paragraph S2.03(b) of Part

29

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II of the Retirement Plan), voluntarily terminates his employment with his
Participating Company (other than for a disability which causes him to be
eligible for benefits under the Long-Term Disability Plan for Salaried
Employees), or his employment is terminated for misconduct (as determined by the
Administrator) by any member of the Controlled Group, the Optional Payment shall
be reduced in the same manner as specified in ARTICLE IIE(3)(e) hereof.

(e)If a Grandfathered Retired Employee dies after he Separates from Service and
prior to the date his Grandfathered Benefit Equalization Profit-Sharing
Allowance is paid or commences to be paid, payment shall be made to his
Beneficiary commencing in the form and on the date specified in the application.

(5)
Notwithstanding the preceding provisions of this Paragraph F:

(a)the Administrator may cause the distribution of that portion of the Benefit
Equalization Combined Allowance or Benefit Equalization Profit-Sharing Allowance
that is the Grandfathered Benefit Equalization Profit-Sharing Allowance to any
group of similarly situated Beneficiaries in a Single Sum Payment or as an
Optional Payment; and

(b)the Administrator shall distribute a Grandfathered Employee’s or
Grandfathered Retired Employee’s Benefit Equalization Profit-Sharing Allowance
in a Single Sum Payment if the value of such Benefit Equalization Profit-Sharing
Allowance is not more than $10,000.

(c)The Administrator may accelerate the payment of all or any portion of a
Benefit Equalization Profit-Sharing Allowance (other than the Benefit
Equalization Profit-Sharing Allowance of a Grandfathered Employee) to an
individual other than the Retired Employee to the extent necessary to fulfill a
domestic relations order (as defined in Section 414(p)(1)(B) of the Code).

G.
Application or Notification for Payment of Allowances:

An application for retirement pursuant to Paragraph G2.07 of Part I and
Paragraph S2.07 of Part II of the Retirement Plan shall be deemed notification
to the Administrator of the BEP Benefit Commencement Date of a Benefit
Equalization Retirement Allowance, Benefit Equalization Combined Allowance (or
other benefit) in accordance with the terms of this Plan. In the event a
Grandfathered Employee shall not have elected an Optional Payment method with
respect to his Grandfathered Benefit Equalization Retirement Allowance, any such
notification shall specify the Beneficiary to whom payment of the Single Sum
Payment shall be made in the event the Employee dies after his Date of
Retirement and prior to his BEP Benefit Commencement Date.

An Employee or Retired Employee (or Beneficiary) shall make application to the
Administrator (or his delegate) for distribution of Benefit Equalization
Profit-Sharing Allowance under this Plan.

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Notwithstanding the foregoing provisions of this Paragraph G, payment shall be
made on the BEP Benefit Commencement Date applicable to the Employee or former
Employee, regardless of whether an application is or is not filed.

H.
Allocation of Payments:

(1)    The Administrator may use any reasonable method, as determined in his
sole discretion, to designate amounts paid under the Plan to a TP Employee (or
Spouse or other Beneficiary) as a Benefit Equalization Retirement Allowance
(other than that portion that is the Grandfathered Benefit Equalization
Retirement Allowance) and Benefit Equalization Profit- Sharing Allowance (other
than that portion that is the Grandfathered Benefit Equalization Profit- Sharing
Allowance) and to allocate benefits among the plans, programs and arrangements
that constitute the Plan as described herein.

(2)    The Administrator may make payment of all or a portion of a Benefit
Equalization Profit-Sharing Allowance to an individual other than the Retired
Employee to the extent necessary to fulfill a domestic relations order (as
defined in Section 414(p)(1)(B) of the Code) and the amount of the Allowance
payable to the Retired Employee shall be reduced to the extent necessary to
reflect such payment.

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ARTICLE III

FUNDS FROM WHICH ALLOWANCES ARE PAYABLE

Individual accounts shall be established for the benefit of each Employee and
Retired Employee (or Beneficiary) under the Plan. Any benefits payable from an
individual account shall be payable solely to the Employee, Retired Employee (or
Beneficiary) for whom such account was established. The Plan shall be unfunded.
All benefits intended to be provided under the Plan shall be paid from time to
time from the general assets of the Employee’s or Retired Employee’s
Participating Company and paid in accordance with the provisions of the Plan;
provided, however, that the Participating Companies reserve the right to meet
the obligations created under the Plan through one or more trusts or other
agreements. In no event shall any such trust or trusts be outside of the United
States. The contributions by each Participating Company on behalf of its
Employees and Retired Employees to the individual accounts established pursuant
to the provisions of the Plan, whether in trust or otherwise, shall be in an
amount which such Participating Company, with the advice of an actuary,
determines to be sufficient to provide for the payment of the benefits under the
Plan.

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ARTICLE IV

THE ADMINISTRATOR AND MANAGEMENT COMMITTEE

The general administration of the Plan shall be vested in the Administrator.

All powers, rights, duties and responsibilities assigned to the Administrator
and the Management Committee under the Retirement Plan applicable to this Plan
shall be the powers, rights, duties and responsibilities of the Administrator
and the Management Committee under the terms of this Plan, except that the
Administrator and Management Committee shall not be a fiduciary (within the
meaning of Section 3(21) of ERISA) with respect to any portion or all of the
Plan which is intended to be exempt from the requirements of ERISA pursuant to
Section 4(b)(5) of ERISA or which is described in Section 401(a)(1) of ERISA and
exempt from the requirements of Part 4 of Title I of ERISA.

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ARTICLE V

AMENDMENT AND
DISCONTINUANCE OF THE PLAN

The Board may, from time to time, and at any time, amend the Plan; provided,
however, that authority to amend the Plan is delegated to the following
committees or individuals where approval of the Plan amendment or amendments by
the shareholders of Altria Group, Inc. is not required: (1) to the Corporate
Employee Benefit Committee, if the amendment (or amendments) will not increase
the annual cost of the Plan by $10,000,000 and (2) to the Administrator, if the
amendment (or amendments) will not increase the annual cost of the Plan by
$500,000.

Any amendment to the Plan may effect a substantial change in the Plan and may
include (but shall not be limited to) any change deemed by the Company to be
necessary or desirable to obtain tax benefits under any existing or future laws
or rules or regulations thereunder; provided, however, that no such amendment
shall deprive any Employee, Retired Employee (or Beneficiary) of any Allowances
accrued at the time of such amendment.

The Plan may be discontinued at any time by the Board; provided, however, that
such discontinuance shall not deprive any Employee, Retired Employee (or
Beneficiary) of any Allowances accrued at the time of such discontinuance.

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ARTICLE VI

FORMS; COMMUNICATIONS

The Administrator shall provide such appropriate forms as it may deem expedient
in the administration of the Plan and no action to be taken under the Plan (for
which a form is so provided) shall be valid unless upon such form. Any Plan
communication may be made by electronic medium to the extent allowed by
applicable law. The Administrator may adopt reasonable procedures to enable an
Employee or Retired Employee to make an election using electronic medium
(including an interactive telephone system and a website on the Intranet).

All communications concerning the Plan shall be in writing addressed to the
Administrator at such address as may from time to time be designated. No
communication shall be effective for any purpose unless received by the
Administrator.

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ARTICLE VII
INTERPRETATION OF PROVISIONS

The Administrator shall have the full power and authority to grant or deny
requests for
payment of a Benefit Equalization Retirement Allowance or Benefit Equalization
Combined Allowance in accordance with a form of distribution authorized under
the Retirement Plan and to grant or deny requests for payment of a Benefit
Equalization Profit-Sharing Allowance in accordance with a form of distribution
authorized under the Profit-Sharing Plan to the extent permitted under Section
409A of the Code. The Management Committee for Employee Benefits shall have the
full power and authority to grant or deny requests for payment of a Benefit
Equalization Retirement Allowance, Benefit Equalization Combined Allowance or
Benefit Equalization Profit-Sharing Allowance by the Administrator.

The Administrator shall have full power and authority with respect to all other
matters arising in the administration, interpretation and application of the
Plan, including discretionary authority to construe plan terms and provisions,
to determine all questions that arise under the Plan such as the eligibility of
any employee of a Participating Company to participate under the Plan; to
determine the amount of any benefit to which any person is entitled to under the
Plan; to make factual determinations and to remedy any ambiguities,
inconsistencies or omissions of any kind.

The Plan is intended to comply with the applicable requirements of Section 409A
of the Code. Accordingly, where applicable, this Plan shall at all times be
construed and administered in a manner consistent with the requirements of
Section 409A of the Code and applicable regulations without any diminution in
the value of benefits.

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ARTICLE VIII

CHANGE IN CONTROL PROVISIONS

A.
In the event of a Change in Control, each Employee shall be fully vested in his
Allowances and any other benefits accrued through the date of the Change in
Control (“Accrued Benefits”). Each Employee (or his Beneficiary) shall, upon the
Change in Control, be entitled to a lump sum in cash, payable within thirty (30)
days of the Change in Control, equal to the Actuarial Equivalent of his Accrued
Benefits, determined using actuarial assumptions no less favorable than those
used under the Supplemental Management Employees’ Retirement Plan immediately
prior to the Change in Control.

B.
Definition of Change in Control.

(1)“Change in Control” shall mean the happening of any of the following events
with respect to a Grandfathered Benefit Equalization Retirement Allowance and
Grandfathered Benefit Equalization Profit-Sharing Allowance:

(a)The acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, and amended
(the “Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning
of Rule 13d- 3 promulgated under the Exchange Act) of 20% or more of either (i)
the then outstanding shares of common stock of Altria Group, Inc. (the
“Outstanding Company Common Stock”) or (ii) the combined voting power of the
then outstanding voting securities of Altria Group, Inc. entitled to vote
generally in the election of directors (the “Outstanding Company Voting
Securities”); provided, however, that the following acquisitions shall not
constitute a Change in Control: (i) any acquisition directly from Altria Group,
Inc., (ii) any acquisition by Altria Group, Inc., (iii) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by Altria
Group, Inc. or any corporation controlled by Altria Group, Inc. or (iv) any
acquisition by any corporation pursuant to a transaction described in clauses
(i), (ii) and (iii) of paragraph (3) of this Section B; or

(b)Individuals who, as of the date hereof, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board;
provided, however, that any individual becoming a director subsequent to the
date hereof whose election, or nomination for election by Altria Group, Inc.’s
shareholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or

(c)Approval by the shareholders of Altria Group, Inc. of a reorganization,
merger, share exchange or consolidation (a “Business Combination”), in each
case, unless, following such Business Combination, (i) all or substantially all
of the individuals and entities who were the beneficial owners, respectively, of
the Outstanding Company

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Common Stock and Outstanding Company Voting Securities immediately prior to such
Business Combination beneficially own, directly or indirectly, more than 80% of,
respectively, the then outstanding shares of common stock and the combined
voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns Altria Group, Inc.
through one or more subsidiaries) in substantially the same proportions as their
ownership, immediately prior to such Business Combination of the Outstanding
Company Common Stock and Outstanding Company Voting Securities, as the case may
be, (ii) no Person (excluding any employee benefit plan (or related trust) of
Altria Group, Inc. or such corporation resulting from such Business Combination)
beneficially owns, directly or indirectly, 20% or more of, respectively, the
then outstanding shares of common stock of the corporation resulting from such
Business Combination or the combined voting power of the then outstanding voting
securities of such corporation except to the extent that such ownership existed
prior to the Business Combination and (iii) at least a majority of the members
of the board of directors of the corporation resulting from such Business
Combination were members of the Incumbent Board at the time of the execution of
the initial agreement, or of the action of the Board, providing for such
Business Combination; or

(d)Approval by the shareholders of Altria Group, Inc. of (i) a complete
liquidation or dissolution of Altria Group, Inc. or (ii) the sale or other
disposition of all or substantially all of the assets of Altria Group, Inc.,
other than to a corporation, with respect to which following such sale or other
disposition, (A) more than 80% of, respectively, the then outstanding shares of
common stock of such corporation and the combined voting power of the then
outstanding voting securities of such corporation entitled to vote generally in
the election of directors is then beneficially owned, directly or indirectly, by
all or substantially all of the individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company Common Stock and Outstanding
Company Voting Securities immediately prior to such sale or other disposition in
substantially the same proportion as their ownership, immediately prior to such
sale or other disposition, of the Outstanding Company Common Stock and
Outstanding Company Voting Securities, as the case may be, (B) less than 20% of,
respectively, the then outstanding shares of common stock of such corporation
and the combined voting power of the then outstanding voting securities of such
corporation entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by any Person (excluding any
employee benefit plan (or related trust) of Altria Group, Inc. or such
corporation), except to the extent that such Person owned 20% or more of the
Outstanding Company Common Stock or Outstanding Company Voting Securities prior
to the sale or disposition and (C) at least a majority of the members of the
board of directors of such corporation were members of the Incumbent Board at
the time of the execution of the initial agreement, or of the action of the
Board, providing for such sale or other disposition of assets of Altria Group,
Inc. or were elected, appointed or nominated by the Board.

(2)“Change in Control” shall mean the happening of any of the events specified
in Treasury Regulation Section 1.409A- 3(i)(5)(v), (vi) and (vii) with respect
to a Benefit

38

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Equalization Retirement Allowance, Benefit Equalization Profit-Sharing Allowance
and that portion of a Benefit Equalization Combined Allowance that is not a
Grandfathered Benefit Equalization Retirement Allowance and that portion of a
Benefit Equalization Combined Allowance that is not a Grandfathered Benefit
Equalization Profit-Sharing Allowance. For purposes of determining if a Change
in Control has occurred, the Change in Control event must relate to a
corporation identified in Treasury Regulation Section 1.409A- 3(i)(5)(ii),
provided, however, that (i) the spin-off of the shares of Philip Morris
International Inc. to the shareholders of Altria Group, Inc. shall not be
considered to be a Change in Control and (ii) any change in the Incumbent Board
coincident with such spin-off shall not be considered to be a Change in Control.

39

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EXHIBIT A

ACTUARIAL ASSUMPTIONS USED TO CALCULATE A SINGLE SUM PAYMENT

The applicable interest rate for determining a Single Sum Payment shall be the
three-tiered segment rates under Section 417(e)(3)(C) of the Code, taking the
average of such rates in effect for each of the 24 months preceding the
Employee’s Date of Retirement, less ½ of 1%. The applicable mortality table for
determining a Single Sum Payment shall be the mortality table specified in
Section 417(e)(3)(B) of the Code.

ACTUARIAL ASSUMPTIONS USED TO CALCULATE A SINGLE SUM PAYMENT UNDER UST PLANS

The applicable mortality table and interest rate for determining a Single Sum
Payment with respect to the UST Plans shall be the mortality table prescribed by
the Secretary of the Treasury under Section 417(e)(3)(B) of the Code, as in
effect on the date the Participant terminates employment, and the annual rate of
interest on 30-year Treasury Securities as specified by the Commissioner of
Internal Revenue for the second full month preceding the month in which the
Participant Separates from Service.

40

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APPENDIX 1

TP EMPLOYEES

(1)
 
Martin Barrington
 
(2)
 
Timothy Beane
Separated from Service January 31, 2011
(3)
 
Kevin P. Benner
Separated from Service March 31, 2010
(4)
 
David R. Beran
 
(5)
 
Nancy Brennan
Separated from Service March 31, 2012
(6)
 
Peter C. Faust
Separated from Service February 29, 2012
(7)
 
Christopher L. Irving
Separated from Service March 2, 2009
(8)
 
Craig A. Johnson
 
(9)
 
Denise Keane
 
(10)
 
Douglas B. Levene
Separated from Service February 16, 2010
(11)
 
Henry P. Long, Jr.
Separated from Service December 31, 2011
(12)
 
John J. Mulligan
 
(13)
 
John R. Nelson, Jr.
 
(14)
 
Peter P. Paoli
Separated from Service November 30, 2012
(15)
 
Daniel W. Riegel
Separated from Service June 30, 2011
(16)
 
Nancy S. Rights
Separated from Service March 1, 2009
(17)
 
Alex T. Russo
 
(18)
 
Brian Schuyler
Separated from Service January 15, 2012
(19)
 
Steven P. Seagriff
Separated from service July 31, 2014
(20)
 
John M. Spera
 
(21)
 
Michael E. Szymanczyk
Separated from Service May 31, 2012
(22)
 
Linda Warren
Separated from Service February 24, 2012
(23)
 
Ross M. Webster
Separated from Service February 29, 2012
(24)
 
Howard A. Willard
 

41

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APPENDIX 2

TAX ASSUMPTIONS

Federal income tax rate: The highest marginal Federal income tax rate as
adjusted for the Federal deduction of state and local taxes and the phase out of
Federal deductions under current law (or as adjusted under any subsequently
enacted similar provisions of the Internal Revenue Code).

State income tax rate:    Except with respect to additional benefits
attributable to the provisions of a Grandfathered Employee’s Designation of
Participation, the highest adjusted marginal state income tax rate based on a
Grandfathered Employee’s state of residence on the date of the Grandfathered
Employee’s Separation from Service. With respect to those additional benefits
that are attributable to the provisions of a Grandfathered Employee’s
Designation of Participation, the highest marginal state income tax rate based
on the state in which the Grandfathered Employee is or was employed by a
Participating Company on the date of his Separation from Service.

Local income tax rate:    Except with respect to additional benefits
attributable to the provisions of a Grandfathered Employee’s Designation of
Participation, the highest adjusted marginal local income tax rate (taking into
account the Grandfathered Employee’s resident or nonresident status) based on
the Grandfathered Employee’s locality of residence on the date of the
Grandfathered Employee’s Separation from Service. With respect to those
additional benefits that are attributable to the provisions of a Grandfathered
Employee’s Designation of Participation, the highest marginal state income tax
rate (taking into account the Grandfathered Employee’s resident or nonresident
status) based on the locality in which the Grandfathered Employee is or was
employed by a Participating Company on the date of his Separation from Service.

Exception:    In the case of a Grandfathered Employee who is an expatriate
actively employed by a Participating Company and subject to United States
taxation for all purposes, income taxes shall generally be computed as follows:
Expatriate taxes will be calculated assuming the highest marginal Federal income
tax rate as adjusted for the Federal deduction of state and local taxes and the
phase-out of Federal deductions under current law (or as adjusted under any
subsequently enacted similar provisions of the Code). The applicable state and
local tax rates will be adjusted to reflect a Grandfathered Employee’s
expatriate status to the extent appropriate.

Capital gains: The ordinary income or capital gains character of items of trust
investment income or deemed investment income shall be taken into account as
relevant.

The above principles shall generally be applied in determining tax-rate
assumptions for the relevant purpose, but the Administrator shall have the
authority in its discretion to alter the assumptions made as deemed appropriate
to take into account particular facts and circumstances.

42

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APPENDIX 3

CALCULATION OF BENEFIT
EXECUTIVE TRUST ARRANGEMENT PARTICIPANT

1.Calculate Pension benefit payable in form of single life annuity as of Normal
Retirement Date, based on benefit earned to:
•
December 31, 2004 (Grandfathered Benefit)

•
December 31, 2007 (End of Target Payment Program)

•
Date of retirement/termination

2.As of each of the above three dates allocate benefits between the qualified
plan and the BEP
a.
Determine Qualified Plan Benefit payable at Normal Retirement Date

b.
Determine entire (Unlimited) benefit payable at Normal Retirement Date

c.
Determine portion payable from BEP (Subtract 2a from 2b)

d.
Apply early retirement factor

•
For terminations prior to age 55, use age 55 factor (.40)

•
For terminations on or after age 55, use expected retirement age

•
Use early retirement factor for Grandfathered Benefit based on age on 12/31/04

e.
Determine BEP benefit at Benefit Commencement Date

•
For terminations prior to age 55, assume age 55

•
For terminations on or after age 55, use expected retirement age

3.
Calculate “top-up” payment for Grandfathered Benefits from funding account

a.Determine applicable early retirement factor (using employee’s age on 12/31/04
and assuming, in the case of an employee under age 55 at termination, that
he/she will elect to receive benefits at age 55
b.Calculate Grandfathered Benefit with early retirement factor growth (each Item
1 times 3a).
c.
Calculate lump sum value payable at age 55 on a before-tax and after-tax basis

d.Ascertain Grandfathered Deferred Profit-Sharing BEP balance (deemed to be
distributed at termination of employment)
•
Use balance as of most recent year end

•
Add any contributions (Company and Company-Match), plus earnings

•
Ascertain after-tax value

e.
Calculate “top-up” payment for Grandfathered Benefit from funding account

i.Ascertain estimated funding account balance at termination of employment
(after-tax)
ii.Subtract funding account assets used to satisfy Grandfathered DPS BEP (Item
3d)

43

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iii.Determine if any “top-up” payment needed to satisfy any remaining
Grandfathered DPS BEP liability (after-tax)
iv.Balance of any funding account assets to be used for future Grandfathered
Pension BEP (assumed to be at age 55)
v.
Balance as of date of termination and projected to age 55

vi.
Determined on pre-tax and after-tax basis

•
Ascertain pre-tax and after-tax lump sum value of Grandfathered Pension BEP at
age 55

•
Subtract 3(e)(iv) (after-tax) from 3c (after-tax)

4.
Ascertain Post 2004 BEP Pension and DPS Plan Benefit

i.
As of December 31, 2004 ($0)

ii.
As of date of termination

iii.
Compute as annuity and pre-tax and after-tax lump sum values

a.Estimate Post 2004 DPS BEP Account as of date of termination
i.Total hypothetical BEP DPS contributions made via target payments in 2006,
2007 and 2008 and add earnings
ii.
Convert to after-tax amount

iii.Add post-target payment DPS BEP contributions and convert to after-tax
amount
iv.Total 4(a)(ii) and 4(a)(iii) to determine Post 2004 DPS BEP Account
b.Determine total Post 2004 BEP Pension and DPS Plan Benefit as of date of
termination for “top-up” payment
i.    Sum of 4(ii) and 4(a)(iv) equals 4(b)
ii.
Ascertain estimated target payment account balance (after-tax)

iii.    Subtract 4(b)(ii) from 4(b)(i) to ascertain estimated “top-up” payment

44

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EXECUTIVE TRUST ARRANGEMENT
Your Estimated Retirement Benefits Under the BEP
Assuming Projected Plan Interest Rate and Current Federal Tax Rate (35%)
Name:
     
 
Assumed Retirement Date:
     
Date of Birth:
     
 
Assumed Retirement Age:
     
Date of Hire:
     
 
Final Average Earnings:
     
Normal Retirement Age:
     
 
 
 

1.
Your Estimated Retirement Benefits at your Assumed Retirement Age:

Your total pension benefit is determined at your Normal Retirement Age (Age 65),
without regard to any IRS limits. Your benefits are pre-tax amounts.
 
Annual Annuities
1a.)
Total Pension Benefit unreduced for early commencement
$     
 
 
 
Your Retirement Plan (i.e., tax qualified pension plan) benefit is determined
reflecting IRS limits
 
1b.)
Retirement Plan Benefit at age 65
$     
 
 
 
The difference between your total pension benefit and your Retirement Plan
benefit
 
1c.)
Total BEP Pension Benefit at age 65 = 1a.) - 1b.)
$     
 
 
 
If you retire at the Assumed Retirement Age, your benefits may be reduced for
early commencement
 
1d.)
Adjustment for early benefit commencement
     %
1e.)
Total BEP Pension Benefit at Assumed Retirement Age = 1c.) x 1d.)
$     
 
 
 

2.
Your Estimated Grandfathered BEP Benefits

Your Grandfathered BEP Benefits were accrued as of 12/31/2004 prior to a law
change and are only payable as a lump sum. The annuity is shown for illustrative
purposes only. Your Funding Payment account balance offsets the after-tax value
of your Grandfathered BEP Benefits.
 
 
 
Annual Annuities
Lump Sums
 
 
 
 
Pre-tax
After-tax
 
2f.)
Grandfathered BEP Pension Benefit at Assumed Retirement Age
$      
$      
$      
 
2g.)
Grandfathered BEP DPS Balance - reflects estimated earnings through your Assumed
Retirement Date
     
$      
$      
 
In order to compare your benefits to the amounts that you have already received,
your total Grandfathered BEP benefit is shown only as an after-tax amount.
 
 
 
 
2h.)
Total Grandfathered BEP Benefit = 2f.) + 2g.)
 
 
$      
 
 
 
 
 
 
 
If you have a trust, your Funding Payment trust account balance will be
distributed to you after your termination of employment.
 
 
 
 
2i.)
Estimated Funding Payment Asset Balance at Assumed Retirement Age
 
 
$      
 
 
 
 
 
 
 
The difference between your after-tax Grandfathered BEP Benefit and your Funding
Payment Asset Balance will be paid to you from Company assets. This payment will
include an amount to cover the taxes that you will owe on the payment.
 
`
 
 
2j.)
Estimated Grandfathered BEP Payment at Assumed Retirement Age = 2h.) - 2i.)
 
$      
$
 

45

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3.
Your Estimated BEP Benefits

Your Ongoing BEP Benefits reflect all of your service for pension purposes and
DPS contributions for service after 12/31/2004 but also take into account the
amounts paid to you as Target Payments. These benefits are offset by your
Grandfathered BEP Benefits. This amount is only payable as a lump sum. The
annuity is shown for illustrative purposes only.
 
 
Annual Annuities
Lump Sums
 
 
 
Pre-tax
After-tax
3k.)
Ongoing BEP Pension Benefit at Assumed Retirement Age = 1e.) - 2f.)
$      
$      
$      
3l.)
Ongoing BEP DPS Balance for Post-2004 Accruals - reflects estimated earnings and
contributions through your Assumed Retirement Date (includes amounts in your
Target Payments received in lieu of BEP DPS contributions)
     
$      
$      
 
 
 
 
In order to compare this amount to your Target Payments, it is shown only as an
after-tax amount.
 
 
 
3m.)
Total = 3k.) + 3l.)
 
 
$     
 
 
 
 
 
If you have a trust, your Target Payment trust account balance will be
distributed to you after your termination of employment.
 
 
 
3n.)
Estimated Target Payment Asset Balance at Assumed Retirement Age
 
 
$      
 
 
 
 
 
The difference between your after-tax Total and your Target Payment Asset
Balance will be your Ongoing BEP Benefit, which will be paid to you from Company
assets. This payment will include an amount to cover the taxes that you will owe
on the payment.
 
 
 
3o.)
Estimated Ongoing BEP Benefit at Assumed Retirement Age = 3m.) - 3n.)
 
$      
$      

[executivetrust.jpg]

46

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4. Your Estimated Total Payments
Your estimated total Company Payment includes the sum of your Grandfathered BEP
Payment and your Ongoing BEP Benefit.
Lump Sums
 
 
Pre-tax
After-tax
4p.)
Estimated Total Company Payment = 2j.) + 3o.)
$     
$     
 
 
 
 
If you have a trust, you will also receive a distribution of your trust account
balances after your termination of employment. Since you paid taxes on the
payments when they were deposited into your trust, your trust balances are on an
after-tax basis.
 
 
4q.)
Estimated Asset Balance at Assumed Retirement Date = 2i.) + 3n.) [Note: Only
your trust balances, if any, will be distributed to you. Any assumed assets that
are included in this amount will not be distributed to you.]
 
$     
 
 
 
 
So, the total amount after taxes for retirement is 4p.) + 4q.)
 
$     

Assumptions:
·
Actual monthly pay history through [date] as provided by Altria. Current 2011
base rate is equal to $      and is assumed to be constant for the remainder of
the projection period. Actual IC earned in 2010 and paid in 2011 is $      as
provided by Altria. IC is projected to remain constant each February during the
projection period.
·
Estimated lump sum value of the grandfathered BEP benefit is based on the
greater of: (1) the lump sum value based on interest rates projected to the
assumed retirement date assuming current corporate bonds remain level in future
months (seg rate 1/ seg rate 2/ seg rate 3) reflecting the 50 basis point
reduction in published rates using Altria's current BEP lump sum basis, and (2)
the lump sum value based on the 12/31/2004 lump sum basis including an interest
rate of 4.4842%. The lump sum value of the grandfathered BEP benefit reflects
the basis as described in (1). The lump sum for ongoing BEP benefits reflects
the basis as described in (1). Caution should be used when evaluating lump sums
and understand that they could be significantly higher or lower depending on
movements in the capital markets.
·
Actual BEP DPS balance as of [date] with 6% annual rate of return on BEP DPS
contributions to assumed retirement date.
·
Actual ETA asset balances as of [date] with 3% annual after-tax rate of return
to assumed retirement date.
·
Future BEP DPS contribution rate = 15%.
·
Tax rate = 38.74%. Your pre-tax Total Company Payment at your actual retirement
date will be subject to the income tax withholding rates in effect at that time,
as well as the applicable FICA tax rates which are scheduled to increase by 0.9%
in 2013.

 
Note:
Estimated benefits and payments are determined based on the assumptions
described above. Actual results may vary based on actual experience.
Does not constitute a guarantee of employment. The Company reserves the right to
change the plans and programs in the future.

October 2011

47

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SECULAR TRUST PROGRAM
Your Estimated Retirement Benefits Under the BEP
Assuming Projected Plan Interest Rate and Current Federal Tax Rate (35%)

Name:
     
 
Assumed Retirement Date:
     
Date of Birth:
     
 
Assumed Retirement Age:
     
Date of Hire:
     
 
Final Average Earnings:
     
Normal Retirement Age:
     
 
 
 

1. Your Estimated Retirement Benefits at your Assumed Retirement Age:
Your total pension benefit is determined at your Normal Retirement Age (Age 65),
without regard to any IRS limits. Your benefits are pre-tax amounts.
Annual Annuities
1a.)
Total Pension Benefit unreduced for early commencement
$     
 
 
 
Your Retirement Plan (i.e., tax qualified pension plan) benefit is determined
reflecting IRS limits
 
1b.)
Retirement Plan Benefit at age 65
$     
 
 
 
The difference between your total pension benefit and your Retirement Plan
benefit
 
1c.)
Total BEP Pension Benefit at age 65 = 1a.) - 1b.)
$     
 
 
 
If you retire at the Assumed Retirement Age, your benefits may be reduced for
early commencement
 
1d.)
Adjustment for early benefit commencement
     %
1e.)
Total BEP Pension Benefit at Assumed Retirement Age = 1c.) x 1d.)
$     
 
 
 

2. Your Estimated Grandfathered BEP Benefits

Your Grandfathered BEP Benefits were accrued as of 12/31/2004 prior to a law
change and are payable as either a lump sum or monthly annuity. For purposes of
this illustration, it is assumed that you will take a lump sum of your
Grandfathered BEP benefits. Your Funding Payment account balance offsets the
after-tax value of your Grandfathered BEP Benefits.
 
 
Annual Annuities
Lump Sums
 
 
 
Pre-tax
After-tax
2f.)
Grandfathered BEP Pension Benefit at Assumed Retirement Age
$      
$      
$      
2g.)
Grandfathered BEP DPS Balance - reflects estimated earnings through your Assumed
Retirement Date
     
$      
$      
In order to compare your benefits to the amounts that you have already received,
your total Grandfathered BEP benefit is shown only as an after-tax amount.
 
 
 
2h.)
Total Grandfathered BEP Benefit = 2f.) + 2g.)
 
 
$      
 
 
 
 
 
If you have a trust, your Funding Payment trust account balance will be
distributed to you after your termination of employment.
 
 
 
2i.)
Estimated Funding Payment Asset Balance at Assumed Retirement Age
 
 
$      
 
 
 
 
 
The difference between your after-tax Grandfathered BEP Benefit and your Funding
Payment Asset Balance will be paid to you from Company assets. This payment will
include an amount to cover the taxes that you will owe on the payment.
 
 
 
2j.)
Estimated Grandfathered BEP Payment at Assumed Retirement Age = 2h.) - 2i.)
 
$      
$      

48

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3. Your Estimated BEP Benefits

Your Ongoing BEP Benefits reflect all of your service for pension purposes and
DPS contributions for service after 12/31/2004 but also take into account the
amounts paid to you as Target Payments. These benefits are offset by your
Grandfathered BEP Benefits. This amount is only payable as a lump sum. The
annuity is shown for illustrative purposes only.
 
 
Annual Annuities
Lump Sums
 
 
 
Pre-tax
After-tax
3k.)
Ongoing BEP Pension Benefit at Assumed Retirement Age = 1e.) - 2f.)
$      
$      
$      
3l.)
Ongoing BEP DPS Balance for Post-2004 Accruals - reflects estimated earnings and
contributions through your Assumed Retirement Date (includes amounts in your
Target Payments received in lieu of BEP DPS contributions)
     
$      
$      
In order to compare this amount to your Target Payments, it is shown only as an
after-tax amount.
 
 
 
3m.)
Total = 3k.) + 3l.)
 
 
$      
 
 
 
 
 
If you have a trust, your Target Payment trust account balance will be
distributed to you after your termination of employment.
 
 
 
3n.)
Estimated Target Payment Asset Balance at Assumed Retirement Age
 
 
$      
 
 
 
 
 
The difference between your after-tax Total and your Target Payment Asset
Balance will be your Ongoing BEP Benefit, which will be paid to you from Company
assets. This payment will include an amount to cover the taxes that you will owe
on the payment.
 
 
 
3o.)
Estimated Ongoing BEP Benefit at Assumed Retirement Age = 3m.) - 3n.)
 
$      
$      

[seculartrusta02.jpg]

49

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4. Your Estimated Total Payments
 
 
 
 
Your estimated total Company Payment includes the sum of your Grandfathered BEP
Payment and your Ongoing BEP Benefit
 
 
Lump Sums
 
Pre-tax
After-tax
4p.) Estimated Total Company Payment-2j.) + 3o.)
$     
$     
 
 
 
If you have a trust, you will also receive a distribution of your trust account
balances after your termination of employment. Since you paid taxes on the
payments when they were deposited into your trust, your trust balances are on an
after-tax basis.
 
 
4q.) Estimated Asset Balance at Assumed Retirement Date = 2i.) + 3n.) [Note:
Only your trust balances, if any, will be distributed to you. Any assumed assets
that are included in this amount will not be distributed to you.]
 
$     
 
 
 
So, the total amount after taxes for retirement is 4p.) + 4q.)
 
$     
 
 
 

 
 
Assumptions:
·
No future salary increases. Reflects limited IC for certain years as applicable.
·
Estimated lump sum value of the grandfathered BEP benefit is based on the
greater of: (1) the lump sum value based on interest rates projected to the
assumed retirement date assuming current corporate bonds remain level in future
months (seg rate 1 / seg rate 2 / seg rate 3) reflecting the 50 basis point
reduction in published rates using Altria's current BEP lump sum basis, and (2)
the lump sum value based on the 12/31/2004 lump sum basis including an interest
rate of 4.4842%. The lump sum value of the grandfathered BEP benefit reflects
the basis as described in (2). The lump sum for ongoing BEP benefits reflects
the estimated value of annuity purchase.
·
Actual BEP DPS balance as of [date] with 6% annual rate of return on BEP DPS
contributions for the remainder of 2010 and beyond.
·
Actual Secular Trust asset balances as of [date] with 3% annual year after-tax
rate of return for the remainder of 2010 and beyond.
·
Future BEP DPS contribution rate = 15%.
·
Tax rate = 38.74%. Your pre-tax Total Company Payment at your actual retirement
date will be subject to the income tax withholding rates in effect at that time,
as well as the applicable FICA tax rates which are scheduled to increase by 0.9%
in 2013.

 
Note:
Estimated benefits and payments are determined based on the assumptions
described above. Actual results may vary based on actual experience.
Does not constitute a guarantee of employment. The Company reserves the right to
change the plans and programs in the future.

October 2011

50