{"id":40081,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/long-term-disability-benefit-equalization-plan-philip-morris.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"long-term-disability-benefit-equalization-plan-philip-morris","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/long-term-disability-benefit-equalization-plan-philip-morris.html","title":{"rendered":"Long-Term Disability Benefit Equalization Plan &#8211; Philip Morris Cos. Inc."},"content":{"rendered":"<pre>\n                                    PHILIP MORRIS\n                    LONG-TERM DISABILITY BENEFIT EQUALIZATION PLAN\n\n\n\n\n                              Effective January 1, 1989\n\n                   (As amended and in effect as of January 1, 1996)\n\n\n                                  TABLE OF CONTENTS\n\n                                                                     Page No.\n                                                                     --------\n\n\nPHILIP MORRIS LONG-TERM DISABILITY BENEFIT \n    EQUALIZATION PLAN - Preamble.....................................     1\n\n    ARTICLE I........................................................     2\n         DEFINITIONS.................................................     2\n              (a)  Committee.........................................     2\n              (b)  Compensation Limitation...........................     2\n              (c)  Disability Benefit Equalization Allowance or \n                   Allowance.........................................     2\n              (d)  Long-Term Disability Plan.........................     2\n              (e)  Plan..............................................     2\n              (f)  Retirement Allowance..............................     2\n\n    ARTICLE II.......................................................     3\n         DISABILITY BENEFIT EQUALIZATION ALLOWANCES..................     3\n              A.   Disability Benefit Equalization Allowances \n                   payable under this Plan...........................     3\n              B.   Commencement and termination of Disability \n                   Benefit Equalization Allowances...................     3\n\n    ARTICLE III......................................................     4\n         FUNDS FROM WHICH ALLOWANCES ARE PAYABLE.....................     4\n\n    ARTICLE IV.......................................................     5\n         THE CORPORATE EMPLOYEE BENEFIT COMMITTEE AND ITS \n              DELEGATEES.............................................     5\n\n    ARTICLE V........................................................     6\n         AMENDMENT AND DISCONTINUANCE OF THE PLAN....................     6\n\n    ARTICLE VI.......................................................     7\n         CHANGE IN CONTROL PROVISIONS................................     7\n              A.   In the event of a Change of Control...............     7\n              B.   Definition of Change of Control...................     7\n\n\n                                 PHILIP MORRIS\n                LONG-TERM DISABILITY BENEFIT EQUALIZATION PLAN\n\n\n         The Philip Morris Long-Term Disability Benefit Equalization Plan as \nhereinafter set forth shall govern the rights of an Employee or Disabled \nEmployee who is eligible for benefits on or after January 1, 1996 under the \nLong-Term Disability Plan and whose benefits under the Long-Term Disability \nPlan are or will in the future be limited by reason of Section 505 of the \nInternal Revenue Code of 1986, as amended from time to time.\n\n                                       1\n\n\n                                   ARTICLE I\n\n                                  DEFINITIONS\n\n         The following terms as used herein shall have the meanings set forth \nbelow.  All capitalized terms not defined below shall have the same meaning \nas in the Long-Term Disability Plan.\n\n    (a)  'Committee' shall mean the Corporate Employee Benefit Committee of \n         Philip Morris Companies Inc. charged with the administration of the \n         Plan as from time to time constituted.\n\n    (b)  'Compensation Limitation' shall mean the limitation of Section \n         505(b)(7) of the Code on the annual compensation of an Employee \n         which may be taken into account under the Long-Term Disability Plan. \n\n    (c)  'Disability Benefit Equalization Allowance' or 'Allowance' shall \n         mean the amount payable under the Plan to a former Employee in equal \n         monthly payments during a twelve (12) month period. \n\n    (d)  'Long-Term Disability Plan' shall mean the Philip Morris Long-Term \n         Disability Plan, effective February 1, 1974, as amended from time \n         to time.\n\n    (e)  'Plan' shall mean the Philip Morris Long-Term Disability Benefit \n         Equalization Plan described herein and in any amendments hereto. \n\n    (f)  'Retirement Allowance' shall mean the total amount payable under the \n         Retirement Plan and Benefit Equalization Plan during a twelve (12) \n         month period to a former Employee for life.  Any benefit payable to \n         the Employee in any other form shall be converted to a Retirement \n         Allowance in such manner as the Administrator deems fair and \n         equitable. \n\n                                       2\n\n                                  ARTICLE II\n\n                  DISABILITY BENEFIT EQUALIZATION ALLOWANCES\n\nA.  Disability Benefit Equalization Allowances payable under this Plan shall be\n    as follows:\n\n         (1)  The Disability Benefit Equalization Allowance payable to a \nDisabled Employee who is eligible for a Disability Allowance under Article \nII, A(1)(b) or A(1)(c)(i) of the Long-Term Disability Plan shall equal the \namount by which a Disability Allowance under such provisions of the Long-Term \nDisability Plan, if computed without regard to the Compensation Limitation, \nexceeds the amount of the Disability Allowance actually payable to the \nDisabled Employee under the Long-Term Disability Plan.\n\n         (2)  The Disability Benefit Equalization Allowance payable to a \nDisabled Employee who is eligible for a Disability Allowance under any other \nprovision of the Long-Term Disability Plan shall be computed in the same \nmanner as under the applicable provision of the Long-Term Disability Plan, \nprovided, however, that (a) in computing such Disability Benefit Equalization \nAllowance under Article II, A(1)(c)(ii) of the Long-Term Disability Plan, the \nRetirement Allowance referred to in said Article II, A(1)(c)(ii) shall be \ncomputed without regard to the Compensation Limitation with respect to the \ncompensation (as such term is defined in the Retirement Plan) of the Disabled \nEmployee, (b) in computing such Disability Benefit Equalization Allowance \nunder Article II, A(2)(c)(i) or (ii) of the Long-Term Disability Plan, the \nRetirement Allowance referred to in said Article II, A(2)(c)(i) and (ii) such \nDisabled Employee would have received shall be computed based on the \nassumptions set forth in said Article II, A(2)(c)(i) or (ii), but without \nregard to the Compensation Limitation and (c) the Disabled Employee's Pension \nOffset computed under Article I(v)(i)(A) and I(v)(ii)(A) of the Long-Term \nDisability Plan shall only be determined with respect to any Retirement \nAllowance payable under the Benefit Equalization Plan.  The amount of the \nDisability Benefit Equalization Allowance shall be reduced by the amount of \nthe Disability Allowance actually payable to the Disabled Employee under the \nLong-Term Disability Plan.\n\nB.  Commencement and termination of Disability Benefit Equalization Allowances:\n\n         A Disability Benefit Equalization Allowance payable to a Disabled \nEmployee shall commence and terminate simultaneously with, and be paid in \naccordance with the terms of the Long-Term Disability Plan.  An application \nfor a Disability Allowance under the Long-Term Disability Plan shall be \ndeemed an application for payment of a Disability Benefit Equalization \nAllowance under this Plan.\n\n                                       3\n\n\n                                  ARTICLE III\n\n                    FUNDS FROM WHICH ALLOWANCES ARE PAYABLE\n\n         The Company's obligations under this Plan shall not be funded. \nPayments of Allowances shall be made out of the general funds of the Company.\n\n                                       4\n\n\n                                  ARTICLE IV\n\n          THE CORPORATE EMPLOYEE BENEFIT COMMITTEE AND ITS DELEGATEES\n\n         The general administration of the Plan shall be vested in the \nCommittee and the Administrator.\n\n         All powers, rights, duties and responsibilities assigned to the \nCommittee and the Administrator under the Long-Term Disability Plan \napplicable to this Plan shall be the powers, rights, duties and \nresponsibilities of the Committee and the Administrator under the terms of \nthis Plan.\n\n                                       5\n\n\n                                   ARTICLE V\n\n                   AMENDMENT AND DISCONTINUANCE OF THE PLAN\n\n         The Board may, by resolution, from time to time, and at any time, \namend the Plan; provided, however, that authority to amend the Plan is \ndelegated to the following committees or individuals where approval of the \nPlan amendment or amendments by the shareholders of Philip Morris Companies \nInc. is not required:  (1) to the Committee, if the amendment (or amendments) \nwill not increase the annual cost of the Plan by $10,000,000, (2) to a \nmanagement committee for employee benefits, if the amendment (or amendments) \nwill not increase the annual cost of the Plan by $4,000,000, and (3) to the \nAdministrator, if the amendment (or amendments) will not increase the annual \ncost of the Plan by $500,000. \n\n         Any amendment to the Plan may effect a substantial change in the \nPlan, and may include (but shall not be limited to) any change deemed by the \nPhilip Morris Companies Inc. to be necessary or desirable to obtain tax \nbenefits under any existing or future laws or rules or regulations \nthereunder; provided, however, that no such amendment shall deprive any \nDisabled Employee of the Disability Benefit Equalization Allowance accrued to \nthe time of such amendment.\n\n         The Plan may be discontinued at any time by the Board; provided, \nhowever, that such discontinuance shall not deprive any Disabled Employee of \nhis Disability Benefit Equalization Allowance accrued to the time of such \ndiscontinuance.\n\n                                       6\n\n\n                                  ARTICLE VI\n\n                         CHANGE IN CONTROL PROVISIONS\n\nA.  In the event of a Change of Control, each Disabled Employee (including, \nfor purposes of this Article VI, an Employee who incurs a disability prior to \nthe Change in Control during the periods specified in Article II, A(1)(a) of \nthe Long-Term Disability Plan, irrespective of his eligibility at the time of \nthe Change in Control for disability benefits under the Social Security Act; \nprovided, however, such Disabled Employee subsequently becomes eligible for \ndisability benefits under the Social Security Act or becomes eligible for a \nDisability Allowance pursuant to Article II, A(1)(i) of the Long-Term \nDisability Plan, shall, upon the Change of Control, be entitled to a lump sum \nin cash, payable within 30 days of the Change of Control, equal to the \nactuarial equivalent of his Disability Benefit Equalization Allowance, \ndetermined using actuarial assumptions no less favorable than those used \nunder the Philip Morris Salaried Employees' Retirement Plan immediately prior \nto the Change of Control.\n\nB.  Definition of Change of Control\n\n    'Change of Control' shall mean the happening of any of the following \nevents: \n\n         (1)  The acquisition by any individual, entity or group (within the \n    meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of \n    1934, and amended (the 'Exchange Act')) (a 'Person') of beneficial \n    ownership (within the meaning of Rule 13d-3 promulgated under the \n    Exchange Act) of 20% or more of either (i) the then outstanding shares of \n    common stock of Philip Morris Companies Inc. (the 'Outstanding Company \n    Common Stock') or (ii) the combined voting power of the then outstanding \n    voting securities of Philip Morris Companies Inc. entitled to vote \n    generally in the election of directors (the 'Outstanding Company Voting \n    Securities'); provided, however, that the following acquisitions shall \n    not constitute a Change of Control: (i) any acquisition directly from \n    Philip Morris Companies Inc., (ii) any acquisition by Philip Morris \n    Companies Inc., (iii) any acquisition by any employee benefit plan (or \n    related trust) sponsored or maintained by Philip Morris Companies Inc. or \n    any corporation controlled by Philip Morris Companies Inc. or (iv) any \n    acquisition by any corporation pursuant to a transaction described in \n    clauses (i), (ii) and (iii) of paragraph (3) of this Section B; or \n\n         (2)  Individuals who, as of the date hereof, constitute the Board \n    (the 'Incumbent Board') cease for any reason to constitute at least a \n    majority of the Board; provided, however, that any individual becoming a \n    director subsequent to the date hereof whose election, or nomination for \n    election by the shareholders of Philip Morris Companies Inc., was \n    approved by a vote of at least a majority of the  \n\n                                       7\n\n\n    directors then comprising the Incumbent Board shall be considered as \n    though such individual were a member of the Incumbent Board, but \n    excluding, for this purpose, any such individual whose initial assumption \n    of office occurs as a result of an actual or threatened election contest \n    with respect to the election or removal of directors or other actual or \n    threatened solicitation of proxies or consents by or on behalf of a \n    Person other than the Board; or \n\n         (3)  Approval by the shareholders of Philip Morris Companies Inc. of \n    a reorganization, merger, share exchange or consolidation (a 'Business \n    Combination'), in each case, unless, following such Business Combination, \n    (i) all or substantially all of the individuals and entities who were the \n    beneficial owners, respectively, of the Outstanding Company Common Stock \n    and Outstanding Company Voting Securities immediately prior to such \n    Business Combination beneficially own, directly or indirectly, more than \n    80% of, respectively, the then outstanding shares of common stock and the \n    combined voting power of the then outstanding voting securities entitled \n    to vote generally in the election of directors, as the case may be, of \n    the corporation resulting from such Business Combination (including, \n    without limitation, a corporation which as a result of such transaction \n    owns Philip Morris Companies Inc. through one or more subsidiaries) in \n    substantially the same proportions as their ownership, immediately prior \n    to such Business Combination of the Outstanding Company Common Stock and \n    Outstanding Company Voting Securities, as the case may be, (ii) no Person \n    (excluding any employee benefit plan (or related trust) of Philip Morris \n    Companies Inc. or such corporation resulting from such Business \n    Combination) beneficially owns, directly or indirectly, 20% or more of, \n    respectively, the then outstanding shares of common stock of the \n    corporation resulting from such Business Combination or the combined \n    voting power of the then outstanding voting securities of such \n    corporation except to the extent that such ownership existed prior to the \n    Business Combination and (iii) at least a majority of the members of the \n    board of directors of the corporation resulting from such Business \n    Combination were members of the Incumbent Board at the time of the \n    execution of the initial agreement, or of the action of the Board, \n    providing for such Business Combination; or \n\n         (4)  Approval by the shareholders of Philip Morris Companies Inc. of \n    (i) a complete liquidation or dissolution of Philip Morris Companies Inc. \n    or (ii) the sale or other disposition of all or substantially all of the \n    assets of Philip Morris Companies Inc., other than to a corporation, with \n    respect to which following such sale or other disposition, (A) more than \n    80% of, respectively, the then outstanding shares of common stock of such \n    corporation and the combined voting power of the then outstanding voting \n    securities of such corporation entitled to vote generally in the election \n    of directors is then beneficially owned, directly or indirectly, by all \n    or substantially all of the individuals and entities who were the \n    beneficial owners, respectively, of the Outstanding Company Common Stock \n    and Outstanding Company Voting Securities immediately prior to such sale \n    or other disposition in substantially \n\n                                       8\n\n\n    the same proportion as their ownership, immediately prior to such sale or \n    other disposition, of the Outstanding Company Common Stock and \n    Outstanding Company Voting Securities, as the case may be, (B) less than \n    20% of, respectively, the then outstanding shares of common stock of such \n    corporation and the combined voting power of the then outstanding voting \n    securities of such corporation entitled to vote generally in the election \n    of directors is then beneficially owned, directly or indirectly, by any \n    Person (excluding any employee benefit plan (or related trust) of Philip \n    Morris Companies Inc. or such corporation), except to the extent that \n    such Person owned 20% or more of the Outstanding Company Common Stock or \n    Outstanding Company Voting Securities prior to the sale or disposition \n    and (C) at least a majority of the members of the board of directors of \n    such corporation were members of the Incumbent Board at the time of the \n    execution of the initial agreement, or of the action of the Board, \n    providing for such sale or other disposition of assets of Philip Morris \n    Companies Inc. or were elected, appointed or nominated by the Board. \n\n                                       9\n\n\n\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8510],"corporate_contracts_industries":[9424],"corporate_contracts_types":[9540,9539],"class_list":["post-40081","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-philip-morris-cos-inc","corporate_contracts_industries-food__diversified","corporate_contracts_types-compensation__benefits","corporate_contracts_types-compensation"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/40081","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=40081"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=40081"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=40081"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=40081"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}