Exhibit 10.50


 


 


Protein Design Labs, Inc.


 


Retiree Health Care Plan


 


 


Effective June 1, 2003


 

















 


TABLE OF CONTENTS


 


	
  SECTION I – ESTABLISHMENT AND PURPOSE

  	
   

  
	
   

  	
   

  	
   

  
	
  1.1

  	
  Establishment and Purpose

  	
   

  
	
  1.2

  	
  Exclusive Purpose

  	
   

  
	
  1.3

  	
  Effective Date

  	
   

  
	
  1.4

  	
  Plan Year

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION II - ELIGIBILITY

  	
   

  
	
   

  	
   

  	
   

  
	
  2.1

  	
  Eligibility

  	
   

  
	
  2.2

  	
  Participation

  	
   

  
	
  2.3

  	
  Contribution Requirements

  	
   

  
	
  2.4

  	
  Cessation of Participation

  	
   

  
	
  2.5

  	
  Extended Benefits

  	
   

  
	
  2.6

  	
  Newly Acquired Dependents

  	
   

  
	
  2.7

  	
  Special Enrollment

  	
   

  
	
  2.8

  	
  Qualified Medical Child Support Orders

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION III - BENEFITS

  	
   

  
	
   

  	
   

  	
   

  
	
  3.1

  	
  Benefits Provided

  	
   

  
	
  3.2

  	
  Changes in Benefits

  	
   

  
	
  3.3

  	
  Health Plan Defined

  	
   

  
	
  3.4

  	
  Amendment and Termination

  	
   

  
	
  3.5

  	
  Newborns’ and Mothers’ Health Protection
  Act of 1996

  	
   

  
	
  3.6

  	
  The Federal “Women’s Health & Cancer
  Rights Act of 1998” Requires Coverage of Treatment Related to Mastectomy

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION IV – ADMINISTRATION OF THE PLAN

  	
   

  
	
   

  	
   

  	
   

  
	
  4.1

  	
  Plan Sponsor and Plan Administrator

  	
   

  
	
  4.2

  	
  Named Fiduciary

  	
   

  
	
  4.3

  	
  Appointment of the Plan Administrator

  	
   

  
	
  4.4

  	
  Powers and Responsibilities

  	
   

  
	
  4.5

  	
  Allocation of Duties and Responsibilities

  	
   

  
	
  4.6

  	
  Benefits Provided

  	
   

  
	
  4.7

  	
  Expenses

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION V – HEALTH CLAIM PROCEDURES

  	
   

  
	
   

  	
   

  	
   

  
	
  5.1

  	
  Health Claims

  	
   

  
	
  5.2

  	
  When Health Claims Must Be Filed

  	
   

  
	
  5.3

  	
  Timing of Claim Decisions

  	
   

  



 

















 


	
  5.4

  	
  Claims Appeal Procedure

  	
   

  
	
  5.5

  	
  Timing of an Appeal

  	
   

  
	
  5.6

  	
  Timing of Notification of Benefit
  Determination on Review

  	
   

  
	
  5.7

  	
  Requirements for Medicaid

  	
   

  
	
  5.8

  	
  Privacy of Information

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION VI – GENERAL PROVISIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  6.1

  	
  Nonguarantee of Employment

  	
   

  
	
  6.2

  	
  Mailing Notices

  	
   

  
	
  6.3

  	
  Submitting Notices

  	
   

  
	
  6.4

  	
  Non-Assignability

  	
   

  
	
  6.5

  	
  No Guarantee of Tax Consequences

  	
   

  
	
  6.6

  	
  COBRA Applicability

  	
   

  
	
  6.7

  	
  Governing Law

  	
   

  
	
  6.8

  	
  Gender and Number

  	
   

  
	
  6.9

  	
  Official Document

  	
   

  
	
  6.10

  	
  Amendment or Modification

  	
   

  
	
  6.11

  	
  Plan Termination

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX
  A

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX
  B

  	
   

  



 

















 


SECTION I - ESTABLISHMENT AND PURPOSE


 


1.1                               Establishment and Purpose


 


Protein Design Labs, Inc. (PDL), hereby
establishes the Protein Design Labs, Inc. Retiree Health Care Plan (Plan) for
certain eligible former employees of PDL and their eligible dependents.  It is the intention of PDL that this Plan
qualify as an accident and health plan within the meaning of Section 105 of the
Internal Revenue Code (Code) and, to the extent the benefits provided under the
Plan are not discriminatory, that they be eligible for exclusion from gross
income under the Code.


 


1.2                               Exclusive Purpose


 


The exclusive purpose of this Plan is to
provide health-related benefits described herein for the eligible former
employees of PDL and their eligible family members.  No expenses payable under this Plan will be payable under any
other benefit plan of PDL.


 


1.3                               Effective Date


 


The original effective date of the Plan is
June 1, 2003


 


1.4                               Plan Year


 


The Plan Year is December 1 through November 30  of the following calendar
year.


 


1

















 


SECTION II -
ELIGIBILITY


 


2.1                               Retiree Eligibility


 


All officers with at least ten full years of
service and who were eligible to participate as employees in the PDL sponsored
health plans made available to the active employees of PDL, who elect to retire
under the terms of the then current PDL retirement requirements, shall become
participants in the plan on the later of the Effective Date of the Plan or,
upon their date of retirement.


 


2.2                               Eligible Dependents


 


For purposes of this Plan, eligible
dependents shall include only those persons who meet the PDL sponsored health
plan definition of dependents for purposes of the plan in which the employee
participated on the day before his/her date of retirement.


 


2.3                               Contribution Requirements


 


In the event that PDL requires contributions
toward the cost of this Plan, coverage under this plan shall not take effect
for persons for whom contributions are required, until such time as the
contribution requirements are met. Contributions, if any, are described in
Appendix A of this Plan.


 


2.4                               Cessation of Participation


 


Eligibility under this Plan shall terminate
upon the earliest of:


 


a)                                      the retiree meets the age requirements for
benefits under Title XVIII of Social Security Act (commonly known as Medicare);


b)                                     the date the retiree dies, except as
provided for under section 2.5 of this Plan;


c)                                      the date the retiree becomes covered under
another group health plan;


d)                                     the date required contributions cease to be
paid; and,


e)                                      the date the spouse or dependent of the
retiree ceases to meet the eligibility requirements under the PDL Health Plan.


 


2.5                               Survivor Benefits


 


In the event the retiree dies prior to
meeting the age requirements for benefits under Medicare, dependents covered
under this Plan on the retiree’s date of death shall remain eligible for
extended benefits under this Plan under the same terms and conditions as
applied on the date of the retiree’s death. In the event that PDL changes the
terms and conditions of this Plan, such changes shall apply to surviving
eligible dependents.


 


2.6                               Newly Acquired Dependents


 


In the event the retiree acquires dependents
while covered under this Plan, and said dependents meet the eligibility
requirements specified in the PDL Health Plan, these newly acquired dependents
shall become eligible to participate subject to the provisions of Section 2.7
of this Plan. Dependents (including spouses) acquired by a surviving spouse
shall not be eligible to participate in this Plan.


 


2.7                               Special Enrollment


 


Subject to the special open enrollment
periods of Section 9801 (f) of the Code, a covered retiree who acquires a
dependent as a result of marriage, birth, adoption or placement for adoption,
may be able to enroll dependents, provided that the retiree requests enrollment
within 30 days after the marriage, birth, adoption, or placement for adoption.
If the retiree fails to complete the


 


2

















 


enrollment process on a timely basis, the dependents
may be required to wait until the group’s next open enrollment to obtain
coverage the dependents also may be subject to additional limitations on the
coverage available at that time.


 


2.8                               Qualified Medical Child Support Orders


 


This Plan will also provide benefits as
required by any qualified medical child support order, as defined in ERISA
Section 609(a), and provide benefits to dependent children placed with
participants or beneficiaries for adoption under the same terms and conditions
as apply in the case of dependent children who are natural children of
participants or beneficiaries, in accordance with ERISA Section 609(c).  The Plan will provide a copy of its written
procedures to plan participants upon request.


 


3

















 


SECTION III -
BENEFITS


 


3.1                               Benefits Provided


 


A participant, who meets the eligibility
requirements of Section 2 of this Plan, shall be eligible to participate in the
PDL retiree Health Plan. The Benefits under this Plan shall be identical to
those provided under the health plans available to the eligible active
employees of PDL.


 


3.2                               Changes in Benefits


 


In the event that PDL changes the benefits
under its health plans, all such changes in benefits shall apply to this Plan
as of the effective date of the changes to the health plans available to the
eligible active employees of PDL.


 


3.3                               Health Plan Defined


 


For purposes of this Plan, the term health
plan shall include the PDL medical and dental plans available to the eligible
active employees of PDL.


 


3.4                               Amendment and Termination


 


In the event that PDL amends or terminates
this Plan, this Plan will reimburse participants for any benefits payable for
expenses incurred prior to the date of such amendment, modification or
termination.


 


3.5                               Newborns’ and Mothers’ Health Protection Act of 1996


 


Group health plans and health insurance
issuers generally may not, under federal law, restrict benefits for any
hospital length of stay in connection with childbirth for the mother or newborn
child to less than 48 hours following vaginal delivery, or less than 96 hours
following a cesarean section. However, Federal law generally does not prohibit
the mother’s or newborn’s attending provider, after consulting with the mother,
from discharging the mother or her newborn earlier than 48 hours (or 96 hours
as applicable). In any case plans and issuers may not, under Federal law,
require that a provider obtain authorization from the plan or the issuer for
prescribing a length of stay not in excess of 48 hours (or 96 hours).


 


3.6                               The
Federal “Women’s Health and Cancer Rights Act of 1988” requires coverage of
treatment related to mastectomy.


 


If a participant is eligible for mastectomy
benefits under this coverage and elects breast reconstruction in connection with
such mastectomy, the participant is also covered for the following:


 


1.                                       Reconstruction of the breast on which
mastectomy has been performed;


2.                                       Surgery and reconstruction on the other
breast to produce a symmetrical appearance;


3.                                       Prostheses; and,


4.                                       Treatment for physical complications of all
stages of mastectomy, including lymphademas.


 


Coverage for reconstructive breast surgery
may not be denied or reduced on the grounds that it is cosmetic in nature or
that it otherwise does not meet the coverage definition of “medically
necessary”. Benefits will be provided on the same basis as for any other
illness or injury under the relevant health plan.


 


4

















 


SECTION IV -
ADMINISTRATION OF THE PLAN


 


4.1                               Administration of the Plan


 


PDL is the Plan Sponsor and Plan
Administrator as defined by ERISA.


 


PDL shall have the duty and authority to
interpret and construe the Plan with regard to all questions of eligibility,
the status and rights of any person under the Plan, and the manner, time, and
amount of payment of any benefits under the Plan. Each Employee shall, from
time to time, upon request of PDL, furnish to PDL such data and information as
PDL shall require in the performance of its duties under the Plan.


 


PDL may adopt such rules and procedures, as
it deems desirable for the administration of the Plan, provided that any such
rules and procedures shall be consistent with provisions of the Plan and ERISA.


 


PDL shall discharge its duties with respect
to the Plan (i) solely in the interest of persons eligible to receive benefits
under the Plan, (ii) for the exclusive purpose of providing benefits to persons
eligible to receive benefits under the Plan and of defraying reasonable
expenses of administering the Plan and (iii) with the care, skill, prudence and
diligence under the circumstances then prevailing that a prudent person acting
in a like capacity and familiar with such matters would use in the conduct of
an enterprise of a like character with like aims.


 


4.2                               Named Fiduciary


 


Pursuant to ERISA Section 402 (a) (1), PDL is
named fiduciary of the Protein Design Labs, Inc.  Retiree Health Plan.


 


4.3                               Appointment of the Plan
Administrator


 


PDL shall designate the Plan Administrator
who shall administer PDL’s Plan. Such Plan Administrator may consist of an
individual, a committee of two or more individuals, whether or not, in either
such case, the individual or any of such individuals are Employees of PDL, a
consulting firm or other independent agent, or PDL itself.  The Plan Administrator shall be charged with
the full power and the responsibility for administering the Plan in all its
details.  If no Plan Administrator has
been appointed by PDL, or if the person designated as Plan Administrator by PDL
is not available to serve as such for any reason, PDL shall be deemed to be the
Plan Administrator.  The Plan
Administrator may be removed by PDL, or may resign by giving notice in writing
to PDL, and in the event of the removal, resignation, death or termination of
service by the Plan Administrator, PDL shall, as soon as practicable, appoint a
successor Plan Administrator, such successor thereafter to have all of the
rights, privileges, duties and obligations of the predecessor Plan
Administrator.


 


4.4                               Powers and Responsibilities


 


(a)                                  Administration of the Plan The Plan Administrator shall have all powers necessary to administer
this Plan, including the power to construe and interpret the Plan documents; to
decide all questions relating to an Employee’s eligibility to participate in
the Plan; to determine the amount, manner, and timing of any payment of
benefits or change in accordance with Section 5 of the Plan; and to appoint or
employ advisors, including legal counsel, to render advice with respect to any
of the Plan Administrator’s responsibilities under the Plan.  Any construction, interpretation, or
application of the Plan by the Plan Administrator shall be final, conclusive
and binding.  All actions by the Plan
Administrator shall be taken pursuant to uniform standards applied to all
persons similarly situated.  The Plan
Administrator shall have no power to add to, subtract from or modify any of the


 


5

















 


terms of the Plan, or to add to any benefits provided by the Plan, or
to waive or fail to apply any requirements of eligibility for a benefit under
the Plan.


 


(b)                                  Records and Reports The Plan Administrator shall be responsible for maintaining sufficient
records to reflect the compensation of each Participant for purposes of determining
the amount of compensation of each Participant under the Plan.  The Plan Administrator shall be responsible
for submitting all required reports and notifications relating to the Plan to
Participants or their Beneficiaries, the Internal Revenue Service and the
Department of Labor.


 


(c)                                  Rules and Decisions The Plan Administrator may adopt such rules as it deems necessary,
desirable or appropriate in the administration of the Plan.  All rules and decisions of the Plan
Administrator shall be applied uniformly and consistently to all Employees and
Participants in similar circumstances. 
When making a determination or calculation, the Plan Administrator may
rely upon all such information so finished, including the Participant’s, former
Participant’s or Beneficiary’s current mailing address.


 


4.5                               Allocation of Duties and
Responsibilities


 


The Plan Administrator may by written or
instrument designate persons other than the Plan Administrator to carry out any
of its duties or responsibilities under the Plan.  Any such duties or responsibilities thus allocated must be
described in the written instrument.  If
a person other than an Employee of (PDL) is so designated, such person must
acknowledge acceptance of the allocated duties and responsibilities in
writing.  All such instruments shall be
attached to, and made part of the Plan.


 


4.6                               Delegation of Authority


 


PDL also hereby appoints each group insurance
policy issuer (issuer) listed in Appendix A as a named fiduciary as defined by
ERISA Section 402 (a)(1), with such powers as may be necessary to determine the
benefits payable under the insurance policies and resolve all questions
pertaining to the applicability of the benefit provisions of the insurance
policies.


 


PDL hereby intends that each Issuer shall be
deemed to have compiled with the requirements of ERISA Act Section 503 (claims
procedure) in its exercise of its authority unless it has abused its discretion
hereunder by acting arbitrarily and capriciously.


 


4.7                               Expenses


 


PDL shall pay all expenses authorized and
incurred by the Plan Administrator in the administration of the Plan, unless by
agreement or common practice the Plan Administrator absorbs such expenses.


 


6

















 


SECTION V –
HEALTH CLAIM PROCEDURES


 


The procedures  outlined below must be
followed by Covered Persons (“claimants”) to obtain payment of health benefits
under this Plan.


 


5.1                               Health Claims


 


All claims and questions regarding health
claims should be directed to the Contract Administrator.  The Plan Administrator shall have final
authority for adjudicating all claims and a full review of the decision on such
claims in accordance with the following provisions and with the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”).  The Plan Administrator has delegated the
authority to the Contract Administrator subject to the Plan Administrator’s
right to make all final decisions to process claims in accordance with the Plan
Document and Summary Plan Description.


 


Each claimant claiming benefits under the
Plan shall be responsible for supplying, at such times and in such manner as
the Plan Administrator in its sole discretion may require, written proof that
the expenses were incurred or that the benefit is covered under the Plan.  If the Plan Administrator in its sole
discretion shall determine that the claimant has not incurred a covered expense
or that the benefit is not covered under the Plan, or if the claimant has
failed to furnish such proof as is requested, no benefits shall be payable
under the Plan.


 


Under the Plan, there are four types of
claims:  Urgent Pre-service, Non-urgent
pre-service, Concurrent Care and Post-service.


 


Pre-service
Claims:


 


A “Pre-service Claim” is a claim for a
benefit under the Plan where the Plan conditions receipt of the benefit, in
whole or in part, on approval of the benefit in advance of obtaining medical
care.


 


A “Pre-service Urgent Care Claim” is any
claim for medical care or treatment with respect to which the application of
the time periods for making non-urgent care determinations could seriously
jeopardize the life or health of the claimant or the claimant’s ability to
regain maximum function, or, in the opinion of a physician with knowledge of
the claimant’s medical condition, would subject the claimant to severe pain
that cannot be adequately managed without the care or treatment that is the
subject of the claim.


 


It is important to remember that, if a
claimant needs medical care for a condition which could seriously jeopardize
his life, there is no need to contact the Plan for prior approval. The claimant
should obtain such care without delay.


 


Further, if the Plan does not require
the claimant to obtain approval of a medical service prior to getting
treatment, then there is no “Pre-service Claim.”  The claimant simply follows the Plan’s procedures with respect to
any notice which may be required after receipt of treatment, and files the
claim as a Post-service Claim.


 


Concurrent
Claims:


 


A “Concurrent Claim” arises when the Plan has
approved an on-going course of treatment to be provided over a period of time
or number of treatments, and either (a) the Plan determines that the course of
treatment should be reduced or terminated, or (b) the claimant requests
extension of the course of treatment beyond that which the Plan has approved.


 


If the Plan does not require the
claimant to obtain approval of a medical service prior to getting
treatment, then there is no need to contact the Plan Administrator to request
an extension of a


 


7

















 


course of treatment.  The claimant simply follows the Plan’s
procedures with respect to any notice which may be required after receipt of
treatment, and files the claim as a Post-service Claim.


 


Post-service
Claims:


 


A “Post-service Claim” is a claim for a
benefit under the Plan after the services have been rendered.


 


5.2                               When
Health Claims Must Be Filed


 


Health claims  must be filed with the
Contract Administrator within 90 days of the date charges for the service were
incurred.  Benefits are based upon the
Plan’s provisions at the time the charges were incurred.  Charges are considered incurred when
treatment or care is given or supplies are provided.  Claims filed later than that
date shall be denied, unless it is shown that it was not reasonably possible to
file within 90 days, but in no event later than twelve (12 months from the date
on which covered charges were incurred.


 


A Pre-service Claim (including a Concurrent
Claim that also is a Pre-service Claim) is considered to be filed when the
request for approval of treatment or services is made and received by the Third
Party Administrator in accordance with the Plan’s procedures.  However, a Post-service Claim is considered
to be filed when the following information is received by the Contract
Administrator, together with a Form HCFA or Form UB92:


 


a.                                       The date of service;


b.                                      The name, address, telephone number and tax
identification number of the provider of the services or supplies;


c.                                       The place where the services were rendered;


d.                                      The diagnosis and procedure codes;


e.                                       The amount of charges;


f.                                         The name of the Plan;


g.                                      The name of the covered employee; and


h.                                      The name of the patient.


 


Upon receipt of this information, the claim
will be deemed to be filed with the Plan. 
The Contract Administrator will determine if enough information has been
submitted to adjudicate the claim.  If
not, the Contract Administrator may request more information.  The Contract Administrator must receive the
additional information within 45 days (48 hours in the case of Pre-service
Urgent Care Claims) from receipt by the claimant of the request for additional
information.  Failure to do so may result in claims being declined or benefits reduced.


 


5.3                               Timing of
Claim Decisions


 


The Plan Administrator shall notify the
claimant, in accordance with the provisions set forth below, of a denial (and,
in the case of Pre-service Claims and Concurrent Claims, of decisions that a
claim is payable in full) within the following timeframes:


 


Pre-service Urgent Care Claims:


 


a.                                       If the claimant has provided all of the
necessary information, as soon as possible, taking into account the medical
exigencies, but not later than 72 hours after receipt of the claim.


b.                                      If the claimant has not provided all of the
information needed to process the claim, then the claimant will be notified as
to what specific information is needed as soon as possible, but not later than
24 hours after receipt of the claim. 
The claimant will be notified of a determination of benefits as soon as
possible, but not later than 48 hours, taking into account the medical
exigencies, after the earliest of (i) the Plan’s receipt of the specified


 


8

















 


information, or (ii) the end of the period
afforded the claimant to provide the information.


 


Pre-service
Non-urgent Care Claims:


 


a.                                       If the claimant has provided all of the
information needed to process the claim, in a reasonable period of time
appropriate to the medical circumstances, but not later than 15 days after
receipt of the claim, unless an extension has been requested, then prior to the
end of the 15-day extension period.


 


b.                                      If the claimant has not provided all of the
information needed to process the claim, then the claimant will be notified as
to what specific information is needed as soon as possible, but not later than
5 days after receipt of the claim.  The
claimant will be notified of a determination of benefits in a reasonable period
of time appropriate to the medical circumstances, either prior to the end of
the extension period (if additional information was requested during the
initial processing period), or by the date agreed to by the Plan Administrator
and the claimant (if additional information was requested during the extension
period).


 


Concurrent
Claims:


 


a.                                       Plan Notice of Reduction or
Termination.  If the Plan Administrator
is notifying the claimant of a reduction or termination of a course of
treatment (other than by Plan amendment or termination), before the end of such
period of time or number of treatments. 
The claimant will be notified sufficiently in advance of the reduction
or termination to allow the claimant to appeal and obtain a determination on
review of that adverse benefit determination before the benefit is reduced or
terminated.


 


b.                                      Request by Claimant
Involving Urgent Care.  If the Plan Administrator receives a request
from a claimant to extend the course of treatment beyond the period of time or
number of treatments that is a claim involving Urgent Care, as soon as
possible, taking into account the medical exigencies, but not later than 24
hours after receipt of the claim, as long as the claimant makes the request at
least 24 hours prior to the expiration of the prescribed period of time or
number of treatments.   If the claimant
submits the request with less than 24 hours prior to the expiration of the
prescribed period of time or number of treatments, the request will be treated
as a claim involving Urgent Care and decided within the Urgent Care timeframe.


 


c.                                       Request by Claimant
Involving Non-urgent Care.  If the Plan Administrator receives a request
from the claimant to extend the course of treatment beyond the period of time
or number of treatments that is a claim not involving Urgent Care, the request
will be treated as a new benefit claim and decided within the timeframe
appropriate to the type of claim (either as a Pre-service Non-urgent Claim or a
Post-service Claim).


 


Post-service
Claims:


 


a.                                       If the claimant has provided all of the
information needed to process the claim, in a reasonable period of time, but
not later than 30 days after receipt of the claim, unless an extension has been
requested, then prior to the end of the 15-day extension period.


 


b.                                      If the claimant has not provided all of the
information needed to process the claim and additional information is requested
during the initial processing period, then the claimant will be notified of a
determination of benefits prior to the end of the extension period, unless
additional information is requested during the extension period, then the
claimant will be notified of the determination by a date agreed to by the Plan
Administrator and the claimant.


 


9

















 


Extensions –
Pre-service Urgent Care Claims.


 


No extensions are available in connection
with Pre-service Urgent Care Claims.


 


Extensions – Pre-service Non-urgent Care
Claims.


 


This period may be extended by the Plan for
up to 15 days, provided that the Plan Administrator both determines that such
an extension is necessary due to matters beyond the control of the Plan and
notifies the claimant, prior to the expiration of the initial 15-day processing
period, of the circumstances requiring the extension of time and the date by
which the Plan expects to render a decision.


 


Extensions –
Post-service Claims.


 


This period may be extended by the Plan for
up to 15 days, provided that the Plan Administrator both determines that such
an extension is necessary due to matters beyond the control of the Plan and
notifies the claimant, prior to the expiration of the initial 30-day processing
period, of the circumstances requiring the extension of time and the date by
which the Plan expects to render a decision.


 


Calculating
Time Periods.


 


The period of time within which a benefit
determination is required to be made shall begin at the time a claim is deemed
to be filed in accordance with the procedures of the Plan.


 


5.4                               Claims Appeal Procedure


 


Nature of
Denial


 


The notice of a denial of a claim shall be
written in a manner calculated to be understood by you and shall set forth:


 


a.                                       The specific reason for the denial;


b.                                      Specific references to the pertinent Plan
provisions on which the denial is based;


c.                                       A description of any additional material or
information necessary for the claimant to perfect the claim and an explanation
as to why such information is necessary; and,


d.                                      An explanation of the Plan’s claims
procedures.


 


5.5                               Timing of an Appeal


 


Pre-Service
Claims:  Special Rule


 


For Pre-service Urgent Care Claims, if the
claimant chooses to orally appeal, claimant may telephone the Senior Manager of
Human Resources at 510-574-1400.  To
file an appeal in writing, the claimant’s appeal must be addressed as follows
and faxed to the following number: 510-574-1447.


 


All Other
Claims


 


Within 180 days after the receipt of the
above material, the claimant shall have a reasonable opportunity to appeal the
claim denial to the Plan Administrator through the Contract Administrator for a
full and fair review.  The claimant or
his duly authorized representative may:


 


a.                                       Request a review upon written notice to the
Contract Administrator;


b.                                      Review pertinent documents; and,


c.                                       Submit issues and comments in writing.


 


10

















 


5.6                               Timing of Notification of Benefit Determination on Review


 


The Plan Administrator shall notify the
claimant of the Plan’s benefit determination on review within the following
timeframes:


 


Pre-service
Urgent Care Claims:  As soon as possible, taking
into account the medical exigencies, but not later than 72 hours after receipt
of the appeal.


 


Pre-service
Non-urgent Care Claims:  Within a reasonable period of
time appropriate to the medical circumstances, but not later than 30 days after
receipt of the appeal.


 


Concurrent
Claims:  The response will be made in the appropriate
time period based upon the type of claim – Pre-service Urgent, Pre-service
Non-urgent or Post-service.


 


Post-service
Claims:  Within a reasonable period of time, but not
later than 60 days after receipt of the appeal.


 


Calculating
Time Periods.  The period of time within which the Plan’s
determination is required to be made shall begin at the time an appeal is filed
in accordance with the procedures of this Plan, without regard to whether all
information necessary to make the determination accompanies the filing.


 


The decision of the Plan Administrator
through the Contract Administrator, shall be written and shall include specific
reasons for the decision, written in a manner calculated to be understood by
the claimant, with specific references to the pertinent Plan provisions on
which the decision is based.  Should you
receive an adverse determination of the appeal, you have the right to file a
second appeal.  The second appeal must
be filed no later than 30 days from the date indicated on the response letter
to the first appeal. The timing of response to the second appeal shall be made
in accordance with the same time guidelines as those outlined for the first
appeal.


 


5.7                               Requirements for Medicaid


 


To the extend required by Section 609 of
ERISA with respect to group health plans, effective August 10, 1993, payment of
benefits with respect to a Participant will be made in accordance with any
assignment of rights made by or on behalf of such Participant as required by a
state plan of medical assistance approved under Title XIX of the Social
Security Act pursuant to Section 1912(a)(1)(A) of such Act (as in effect on the
date of enactment of the Omnibus Budget Reconciliation Act of 1993). In
enrolling a Participant or in determining or making any payments for benefits
for benefits to or on behalf of the Participant, the fact that such Participant
is eligible for or is provided medical assistance under a state plan for
medical assistance under Title XIX of the Social Security Act will not be taken
into account for purposes of this Plan. To the extent that payment has been
made under a state plan for medical assistance approved under Title XIX of the
Social Security Act in any case in which the Plan, after applying the Plan’s
claims filing deadlines and other general procedures, has a legal liability to
make payments for items or services constituting such assistance, payment for
benefits under the Plan will be made in accordance with any state law which
provides that the state has acquired the rights of the Participant to such
payment for such items or services.


 


5.8                               Privacy of Information


 


In the administration of this Retiree Health
Care Plan, Protein Design Labs, Inc. may be required to use or disclose
protected information for purposes of paying or causing to be paid benefits
under this Plan. PDL has established the following policy regarding the use and
disclosure of protected information. PDL hereby agrees to:


 


11

















 


•                                          Not use or disclose information other than
as permitted or required by the plan document or by law;


•                                          Ensure that any agents to whom it provides
protected information agrees to the same restrictions and conditions that apply
to the plan sponsor;


•                                          Not use or disclose the information for
employment-related actions and decisions or in connection with any other
benefit or employee benefit plan of the plan sponsor;


•                                          Report to the group health plan any use or
disclosure inconsistent with plan provisions;


•                                          Make protected information available as
required under other privacy rule provisions;


•                                          Make internal practices and records
regarding protected information available to the HHS Secretary; and,


•                                          Where feasible, return or destroy all
protected information received from the group health plan when no longer needed
for the purpose for which disclosure was made.


 


12

















 


SECTION VI - GENERAL PROVISIONS


 


6.1                               Nonguarantee of Employment


 


Nothing contained in This Plan shall be
construed as a contract of employment between PDL and any Employee, or as a
right of any Employee to be continued in the employment of PDL, or as a
limitation of the right of PDL to discharge any of its Employees, with or
without cause.


 


6.2                               Mailing Notices


 


Notices, accountings and reports required to
be given by the Plan Administrator may be given by the Plan Administrator by
personal delivery or by mail addressed to the party involved at the last
address of such party recorded on the general address files of the plan
Administrator.  If given by mail, the
date of mailing shall be deemed to be the date as of which the same was given
or furnished to the addressee.  Any
notice required under the plan may be waived in writing by the person entitled
to such notice.


 


6.3                               Submitting Notices


 


All notices, designations and elections of
Participants shall be submitted to the Plan Administrator on forms and to the
address specified by the Plan Administrator.


 


6.4                               Non-Assignability


 


It is a condition of the Plan, and all rights
of each person eligible to receive benefits under the Plan shall be subject
thereto, that no right or interest of any such person in the Plan shall be
assignable or transferable in whole or in part, either directly or by operation
of law or otherwise, including, but not by way of limitation, exclusion, levy,
garnishment, attachment, pledge, or bankruptcy, but excluding devolution by
death or mental incompetence, and no right or interest of any such person in
the Plan shall be liable from, or subject to, any obligation or liability of
such person, including claims for alimony or the support of any spouse.


 


6.5                               No Guarantee of Tax
Consequences


 


Neither the Administrator nor (PDL) makes any
commitment or guarantee that any amounts paid to or for the benefit of a Participant
under the Plan will be excludible from the Participant’s gross income for
federal or state tax nor that any other favorable tax treatment will apply to
or be available to any Participant with respect to such amounts.  It shall be the obligation of each
Participant to determine whether each payment under this Plan is excludible
from the Participant’s gross income for federal and state tax purposes, and to
notify the Administrator if the Participant has reason to believe that any such
payment is not so excludible.


 


6.6                               COBRA Applicability


 


Under certain circumstances, this Plan may be
subject to the continuation of health care provisions of Section 4980B of the
Code as amended.


 


6.7                               Governing Law


 


The Plan is intended to constitute an
accident and health plan with the meaning of Section 105 of the Code.  To the extent not preempted by ERISA, this
Plan shall be construed in accordance with the Code and the laws of the State
of California.


 


13

















 


6.8                               Gender and Number


 


Whenever used in the Plan, words in the
masculine gender shall include masculine or feminine gender, and unless the
context otherwise requires, word in the singular shall include the plural, and
words in the plural shall include the singular.


 


6.9                               Official Document


 


This contains all of the operative provisions
of this Plan.  Any conflict between the
provisions of this document and any other document purporting to explain the
rights, benefits, or obligations of the parties hereunder shall be resolved in
favor of This Plan document.  In the
event that a tribunal of competent jurisdiction shall determine in a final
judgment or decree that one or more of the provisions of this Plan is invalid
due to the provisions of applicable law, this Plan shall be interpreted as if
the invalid language had been stricken from its provisions and the remainder of
the Plan document continued in full force and effect.


 


6.10                        Amendment or Modification


 


The Plan may at any time and from time to
time be amended or modified by written instrument  duly adopted by PDL. Other provisions of
this Plan notwithstanding, this Plan may be amended or modified only with regard to the
eligibility requirements contained in Section II, paragraphs 2.1 through 2.8 of this Plan document or in such
other manner as required by law to maintain the status of the Plan under the Internal Revenue Code or such other
applicable federal law.  Any such amendment, or modification shall become
effective on such date as PDL shall determine. No such amendment or modification, shall deprive any Participant of any
benefits payable for expenses
incurred prior to the date of such amendment or modification.


 


6.11                        Plan Termination


 


Protein Design Labs, Inc. and any successor
to PDL may terminate this Plan at any time in the  future for any reason, but only with regard
to employees who are not Participants in the Plan at the time of its termination. In the event of
Plan termination, the plan will remain in effect and subject to modification until such time as
all participants in the Plan at the time of its termination have ceased participation pursuant to the
provisions of Section 2.4 of this Plan.


 


IN WITNESS WHEREOF, the duly
authorized representative of PDL has executed this Plan
this           day
of                              ,
20     ,on behalf of Protein Design Labs, Inc. to
evidence the adoption of the Plan as set forth herein.


 


 


	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
				



 


14

















 


APPENDIX A


 


Eligibility


 


It is agreed that any termination
of the employment relationship between Dr. Laurence Korn and PDL, other than
for “Cause”, as such term is defined in Section 7(a) of that certain Special
Compensation and Continued Employment Agreement dated May 1, 2002 by and
between PDL and Dr. Korn, or as a result of Dr. Korn’s death, shall be deemed a
retirement under the plan.


 


15

















 


APPENDIX B


 


Protein Design Labs,
Inc., Retiree Health Care Plan


 


1.                                      Effective Date


 


This Plan shall take effect on June 1, 2003.


 


2.                                      Benefits


 


The
applicable benefits and coverage options provided under this Plan are set forth
in the Summary Description for each of PDL’s health and dental plan options
available to the active employees of PDL. The availability of coverage options
will be determined by PDL from time to time. A Participant who elects coverage
under an applicable plan option will receive the benefits provided by that
plan.


 


3.                                      Source of Benefits


 


Benefits
under any health plan whether insured or self insured will be provided and paid
solely by the Policy Issuer and pursuant to the terms the insurance policy or
service contract. PDL neither guarantees nor has any responsibility for the
quality of the health care or services provided or arranged by a Policy Issuer,
nor the level of benefits provided under any insurance policy or service
contract.


 


4.                                      Policy Issuers


 


	
  Issuers

  	
   

  	
  Policy Numbers

  	
   

  	
  Coverage

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  California
  Physician’s Service

  	
   

  	
  NH
  0017

  	
   

  	
  Medical
  Care (HMO)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  California
  Physician’s Service

  	
   

  	
  086455

  	
   

  	
  Medical
  Care (PPO)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Delta
  Dental Plan of California

  	
   

  	
  7396

  	
   

  	
  Dental
  Care

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Kaiser
  Permanente

  	
   

  	
  38513

  	
   

  	
  Medical
  Care

  	
   

  



 


5.                                      Monthly Contributions


 


	
   

  	
   

  	
  Retiree

  	
   

  	
  Dependents

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Retiree
  Health Plan

  	
   

  	
  none

  	
   

  	
  25%
  of premium for

  dependents

  	
   

  



 


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