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PRUDENTIAL SUPPLEMENTAL RETIREMENT PLAN

Addendum or Modifications

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PRUDENTIAL FINANCIAL INC | Prudential Insurance Company of America

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Title: PRUDENTIAL SUPPLEMENTAL RETIREMENT PLAN
Governing Law: New Jersey     Date: 2/27/2009
Industry: Insurance (Life)     Sector: Financial

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Exhibit 10.35

PRUDENTIAL SUPPLEMENTAL

RETIREMENT PLAN

(Amended and restated effective as of January 1, 2009,

except as otherwise provided herein)

The Prudential Supplemental Retirement Plan (the “Plan”) has been established by The Prudential Insurance Company of America, effective January 1, 1996, for the purpose of providing unfunded supplemental retirement benefits for certain eligible employees (and their beneficiaries) that cannot be provided by the Retirement Plan (as defined below) because of limits imposed by the Internal Revenue Code (“Code”). The Plan provides Participants (and their beneficiaries) with one or more of the following categories of benefits: (a) Supplemental Benefits ( i.e. , excluded compensation benefits, excess benefits, and deferred compensation benefits); (b) Special Early Retirement Benefits; (c) Death Benefits; and (d) ad hoc cost of living adjustments.

The portion of the Plan that provides excess benefits ( i.e. , benefits that, pursuant to Code section 415, may not be provided under a tax-qualified retirement plan) is intended to be, and shall be administered as, an excess benefit plan within the meaning of section 3(36) of ERISA (as defined below). The remainder of the Plan is intended to be, and shall be administered as, an unfunded plan maintained for the purpose of providing deferred compensation for a select group of management or highly compensated employees within the meaning of Title I of ERISA.

The Plan, as restated as of January 1, 1996, was a restatement of that portion of the prior programs that related to benefits under the Retirement Plan. That portion of the prior programs that related to benefits under the Canadian Retirement Plan was not affected by the restatement. Amounts accrued, but not yet paid under the prior programs on December 31, 1995, that were related to benefits under the Retirement Plan shall be paid under this Plan; provided that Participants who incurred a Termination of Employment prior to January 1, 1996 shall receive benefits in accordance with the terms of the prior programs in effect at such Termination of Employment.

The Plan, as restated as of January 1, 2001, is a restatement that reflects certain changes to the Retirement Plan, including implementation of a cash balance formula with respect to new hires and rehires on and after January 1, 2001, and implementation of an elective cash balance formula with respect to Eligible Employees who were employed on December 31, 2000, had accrued Benefits under the Prudential Traditional Retirement Plan, remained Employees through January 1, 2002, and elected to participate in the Prudential Cash Balance Plan. Amounts accrued, but not yet paid on December 31, 2000, that were related to benefits under the Prudential Traditional Retirement Plan shall be paid under this Plan; provided that Participants who incurred a Termination of Employment prior to January 1, 2001 shall receive benefits in accordance with the terms of the Plan in effect at such Termination of Employment.

The Plan, as restated as of June 30, 2003, reflects authorized changes to The Prudential Merged Retirement Plan effective through June 30, 2003 that affect the Plan and certain administrative changes or clarifications that have an insubstantial financial effect on Plan benefits and expenses.

The Plan, as restated as of December 1, 2003, and as further amended (collectively, the “December 1, 2003 Restatement”), reflected benefit payment changes needed to ease administration of tax withholding and reporting. The terms and conditions of the December 1, 2003 Restatement, to the extent such terms and conditions were applied in reasonable good faith compliance with Section 409A, govern the determination and the time and form of benefits payable to Participants (and their Beneficiaries) who either: (a) incurred a Termination of Employment during the period from December 1, 2003 to December 31, 2004 or (b) incurred a Termination of Employment after 2004 and commenced receiving payment of their benefits under the Plan prior to January 1, 2009.


The Plan, as restated effective as of January 1, 2009, reflects design changes authorized and intended to comply with Section 409A. Notwithstanding any other provision contained herein, this Plan shall be interpreted, operated and administered in a manner consistent with this intention. The restated Plan, as set forth herein, shall govern the determination and the time and form of benefits payable to Participants and their Beneficiaries who incurred a Termination of Employment after 2004 and have not commenced receiving payment of their benefits under the Plan prior to January 1, 2009 ( i.e. , excluding those who did not accrue any Benefits after December 31, 2004).

 

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Article I

DEFINITIONS

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

1.01 “Actuarial Equivalent” or “Actuarially Equivalent” means the equality of value as defined in the applicable component of the Retirement Plan.

1.02 “Agent” means a Prudential Representative or Special Agent, as such terms are defined in the Retirement Plan.

1.03 “Annuity Form” means the annuity form of payment set forth in Section 5.05.

1.04 “Beneficiary” means the natural, living person or persons determined in accordance with this Section 1.04 entitled to receive benefits payable under this Plan at the Participant’s death. In the event a Participant is married at the time of death, the Beneficiary shall be his or her spouse. Otherwise, the Beneficiary shall be the individual designated by the Participant by proper written request to the Company in accordance with the rules and procedures established by the Committee to receive death benefits under the Plan. In the event a Participant is unmarried and has not designated a Beneficiary under the Plan or the designated Beneficiary predeceases the Participant, the Beneficiary shall be: (a) the Participant’s child, or if there is more than one, each child, equally; (b) if there are no children, the Participant’s parent or parents, equally; or (c) if there are none of the foregoing, the Participant’s sibling, or if more than one, each sibling, equally. In the event that a deceased unmarried Participant is not survived by a child, parent or sibling, as provided in the immediately preceding sentence, no benefit shall be payable from this Plan in respect of such Participant.

1.05 “Benefits” means the Supplemental Benefits and Special Early Retirement Benefits, if any, payable to a Participant in accordance with Article V of the Plan.

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

1.07 “Canadian Retirement Plan” means The Prudential Insurance Company of America and Participating Affiliated Companies 1976 Retirement System for Canadian Employees, a defined benefit retirement plan maintained by the Company.

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

1.09 “Committee” means the Prudential Administrative Committee described in section 2413 of the Prudential Traditional Retirement Plan.

1.10 “Company” means The Prudential Insurance Company of America.

1.11 “Controlled Group” means the Company and (a) each corporation which is a member of a controlled group of corporations (within the meaning of Code section 414(b)) which includes the Company, (b) each trade or business (whether or not incorporated) which is under common

 

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control with the Company (within the meaning of Code section 414(c), (c) each organization included in the same affiliated service group (within the meaning of Code section 414(c)) as the Company, and (d) each other entity required to be aggregated with the Company pursuant to regulations promulgated under Code section 414(o). Any such entity shall be treated as part of the Controlled Group only for the period while it is a member of the controlled group or considered to be in a common control group.

1.12 “Date of Hire” means the date of a Participant’s first day of employment (including as an Agent) with the Company or any member of the Controlled Group.

1.13 “Death Benefits” means benefits that are payable upon the death of a Participant in accordance with Article VI of the Plan.

1.14 “Deferred Compensation Plan” means the Prudential Consolidated Deferred Compensation Plan, the Deferred Compensation Plan effective January 1, 2000, and any subsequent plans maintained by the Company for the purpose of (a) providing deferred compensation for a select group of management or highly compensated employees within the meaning of Title I of ERISA, and (b) permitting such employees to defer a portion or all of certain specified bonuses to a specified date or occurrence.

1.15 “Determination Date” means, solely for purposes of calculating the amount of any Benefits under the Plan, the Payment Date set forth in Article V; provided, however, such date shall be determined without regard to any 6-month delay in the event such Payment Date is based on the date of a Participant’s Separation from Service.

1.16 “Early Retirement Date” means the Early Retirement Date, as defined in the Retirement Plan.

1.17 “Employee” means a Home Office Employee or Agent.

1.18 “Employer” means the Company and each Participating Affiliated Company in the Retirement Plan.

1.19 “Employment Classification” means the classification of a Participant as an Agent or Home Office Employee on the books and records of the Employer as of the Status Date.

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

1.21 “Grandfathered Employee” means an Employee with the right to receive a Grandfathered Minimum Benefit under the Prudential Cash Balance Plan.

1.22 “Home Office Employee” means an Office Employee or Agency Distribution Field Management Employee, as such terms are defined in the Retirement Plan.

1.23 “Mandatory Payment Date” means one specified date that shall be determined by the Committee for each Participant on the basis of the Participant’s Employment Classification, as set forth below:

(a) For each Home Office Employee, the first of the month on or following the date such individual attains age sixty-five (65);

 

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(b) For each Agent with accrued Benefits under the Prudential Cash Balance Plan, the first of the month on or following the date such individual attains age sixty-five (65); or

(c) For each Agent with accrued Benefits under the Prudential Traditional Retirement Plan, the first of the month on or following the date that is the earlier of: (1) the date such individual attains age sixty-five (65); or (2) the later of: (i) the date such individual attains age sixty (60); or (ii) the date that is the thirtieth (30 th ) anniversary of the Status Date (as adjusted below); provided, however, for purposes of determining the specific anniversary date in this Section 1.23(c)(2)(ii), for each Participant hired prior to January 1, 2008, each of such Participant’s years of Service (as defined in the Retirement Plan) determined under the Retirement Plan as of January 1, 2008, shall count to reduce the number of anniversaries required above.

For example, if the Participant has 10 years of Service under the Retirement Plan on the Status Date (e.g., January 1, 2008), the date under this Section 1.23(c)(2)(ii) shall be adjusted to the twentieth (20 th ) anniversary of the Status Date.

1.24 “Original Payment Form” means the form of payment specified in Article V that would have been applicable to the Participant assuming that the Participant’s Determination Date was the Status Date.

1.25 “Participant” means an individual who has accrued benefits under Article II or Article III. An individual shall be a Participant only with respect to those benefits for which the individual satisfies applicable eligibility requirements. A Participant also includes an individual who has previously accrued Benefits under the terms of the Plan, but has not yet received all such accrued benefits.

1.26 “Payment Date” means the date for payment set forth in Section 5.01.

1.27 “Plan” means this Prudential Supplemental Retirement Plan, as amended from time to time.

1.28 “Prudential Cash Balance Plan” means the Prudential Cash Balance Pension Plan Document, a component of the Prudential Merged Retirement Plan.

1.29 “Prudential Merged Retirement Plan” means The Prudential Merged Retirement Plan, a defined benefit retirement plan maintained by the Company.

1.30 “PSI Plan” means the Prudential Securities Incorporated Cash Balance Pension Plan Document, a component of the Prudential Merged Retirement Plan.

1.31 “Prudential Traditional Retirement Plan” means The Prudential Traditional Retirement Plan Document, a component of the Prudential Merged Retirement Plan.

1.32 “Retirement Plan” means the Prudential Cash Balance Plan and the Prudential Traditional Retirement Plan, components of the Prudential Merged Retirement Plan.

 

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1.33 “Section 409A” means Code section 409A and applicable guidance issued thereunder.

1.34 “Separation from Service” or “Separates from Service” means a “separation from service” within the meaning of Section 409A.

1.35 “Senior Vice President” or “SVP” means the most senior vice president of Corporate Human Resources of the Company (or the successor to his or her Human Resource duties).

1.36 “Special Early Retirement Benefits” means benefits accrued by Participants in accordance with Article III of the Plan.

1.37 “Status Date” means the later of: (1) January 1, 2008 or (2) the Participant’s Date of Hire.

1.38 “Supplemental Benefits” means benefits accrued by Participants in accordance with Article II of the Plan.

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

1.40 “Transition Election” means an election to change the form of payment made by a Participant during the good faith transition period provided under Section 409A; provided, however, that in order to be given effect under the Plan, any such election must be made on or before December 31, 2008, in accordance with procedures and distribution rules established by the Committee for such elections, which procedures and distribution rules shall comply with the requirements for transition period elections under Section 409A.

 

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Article II

SUPPLEMENTAL BENEFITS

2.01 Eligibility . Each participant in the Retirement Plan who satisfies one or more of the following requirements is a Participant eligible to accrue Supplemental Benefits under this Article:

(a) a participant in the Retirement Plan whose retirement benefits under the Retirement Plan do not accrue or are reduced by reason of Code section 401(a)(17) (as reflected in the applicable provisions of the Retirement Plan);

(b) a participant in the Retirement Plan whose retirement benefits under the Retirement Plan do not accrue or are reduced by reason of Code section 415; or

(c) a participant in the Retirement Plan who defers payment of a portion of compensation from the Employer pursuant to (1) a Deferred Compensation Plan, or (2) effective January 1, 1989, the Prudential Supplemental Employee Savings Plan (or one of its predecessor plans, the Non-Qualified Deferred Compensation Plan) that would, but for the deferral of payment, constitute pensionable Earnings under the Retirement Plan (including any such compensation that would have constituted Earnings but would have exceeded the limit on compensation imposed by Code section 401(a)(17)).

2.02 Amount .

(a) If the Participant is to be paid in an Annuity Form, the amount of a Participant’s Supplemental Benefits under this Article II, shall be an amount equal to (c) plus (d) below, determined at the Determination Date based on the Original Payment Form and adjusted through Actuarially Equivalent factors to reflect the Annuity Form that is applicable to the Participant as of his or her Determination Date in accordance with the provisions of Article V hereof.

(b) If the Participant is to be paid in the form of a lump sum, the amount of a Participant’s Supplemental Benefits under this Article II shall be:

(1) For a Participant with accrued Benefits attributable to the Prudential Traditional Retirement Plan, the amount that is Actuarially Equivalent to an amount equal to the excess, if any, of (e) over (f) below based on the form of annuity that would apply to the Participant pursuant to Article V at the Determination Date, assuming the Participant had not elected a lump sum payment, determined at the Determination Date plus interest on that amount from the Determination Date at the rate used to determine the lump sum through the applicable Payment Date set forth in Article V; and

(2) For a Participant with accrued Benefits attributable to the Prudential Cash Balance Plan, the amount equal to the excess, if any, of (e) over (f) below on the applicable Payment Date set forth in Article V.

(c) Lifetime Benefit . The excess, if any, of (e) over (f) below, calculated based on the benefits payable after age 65.

 

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(d) Temporary Benefit . The excess, if any, of (e) over (f) below, calculated based on the benefits payable before age 65, less the amount in (c) above, adjusted to be Actuarially Equivalent to a single life annuity.

(e) Hypothetical Total Benefit . Such Participant’s hypothetical retirement benefits that would be payable under the Retirement Plan: (1) without regard to the limit on compensation imposed by Code section 401(a)(17) (as reflected in the applicable provisions of the Retirement Plan); (2) without regard to the limits on benefits imposed by Code section 415(b) (as reflected in the applicable provisions of the Retirement Plan); (3) without regard to the “QSERP Accrued Amount” under subsection 806(a) of the Prudential Traditional Retirement Plan, the “QSERP Pension Formula Amount” under subsection 806(b) of the Prudential Traditional Retirement Plan, and the “QSERP Enhanced Pension Benefit” under Section 2804 of the Prudential Traditional Retirement Plan (or any other amount determined with reference to them); (4) without regard to the “QSERP Credit Account” as defined in Section 3.1(e) of the Prudential Cash Balance Plan, the “QSERP Accrued Amount”, the “QSERP Enhanced Pension Benefit”, and the “QSERP Pension Formula Amount” in Section 1.44 of the Prudential Cash Balance Plan (or any other amount determined with reference to them); (5) by including as pensionable Earnings the amount of the deferred compensation under the Deferred Compensation Plan and the Prudential Supplemental Employee Savings Plan that would, but for the deferral of payment, constitute pensionable Earnings under the Retirement Plan (including such compensation that would have constituted Earnings had it not exceeded the limit on compensation imposed by Code section 401(a)(17) and determined without regard to the limits on benefits imposed by Code section 415(b)); and

(f) Hypothetical Qualified Benefit . Such Participant’s retirement benefits that would be payable under the Retirement Plan.

 

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Article III

SPECIAL EARLY RETIREMENT BENEFITS

3.01 Eligibility . Each participant in the Retirement Plan (a) who is entitled, under the terms of the Retirement Plan, to a benefit payable under the Prudential Traditional Retirement Plan or to a Subsidized Grandfathered Minimum Benefit payable under the Prudential Cash Balance Plan, (b) who retires directly from Employer service as an Office Employee on or after the first day of the month on or coinciding with or next following such Participant’s fifty-ninth (59 th ) birthday, (c) who could complete twenty-five (25) years of Continuous Service for the Employer before the first day of the month on or coinciding with or next following such Participant’s sixty-fifth (65 th ) birthday, and (d) whose last three consecutive years of Continuous Service were at a Job Grade under the Prudential Compensation Plan from 1 through 6 and/or a rank no lower than that of departmental vice president or managing director, or the equivalent of such grade or rank, is a Participant eligible to accrue Special Early Retirement Benefits under this Article. For a Participant in the Prudential Cash Balance Plan to receive such Special Early Retirement Benefits, the Participant must commence his or her Subsidized Grandfathered Minimum Benefit under the terms of the Prudential Cash Balance Plan in the Annuity Form.

3.02 Amount . The amount of a Participant’s Special Early Retirement Benefits, in the case of a Participant who retires before his or her Normal Retirement Date, shall be:

(a) If the Participant is to be paid in an Annuity Form, an amount equal to the excess, if any, of (c) over (d) below, determined at the Determination Date based on the Original Payment Form and adjusted through Actuarially Equivalent factors to reflect the Annuity Form that is applicable to the Participant as of his or her Determination Date in accordance with the provisions of Article V hereof;

(b) If the Participant is to be paid in the form of a lump sum:

(1) For a Participant with accrued Benefits attributable to the Prudential Traditional Retirement Plan, the amount that is Actuarially Equivalent to an amount equal to the excess, if any, of (c) over (d) below (but without adjustment for Actuarial Equivalence for any temporary benefits under the Prudential Traditional Retirement Plan) to the form of annuity that would apply to the Participant pursuant to Article V at the Determination Date, assuming the Participant had not elected a lump sum payment, determined at the Determination Date, plus interest on that amount from the Determination Date at the rate used to determine the lump sum through the applicable Payment Date set forth in Article V; and

(2) For a Participant with accrued Benefits attributable to the Prudential Cash Balance Plan, zero.

(c) Such Participant’s accrued Benefits after age 65 attributable to the Prudential Traditional Retirement Plan or Subsidized Grandfathered Minimum Benefit attributable to the Prudential Cash Balance Plan, accrued temporary benefits attributable to the Prudential Traditional Retirement Plan or Subsidized Grandfathered Minimum Benefit attributable to the Prudential Cash Balance Plan (adjusted to be Actuarially Equivalent to a single life annuity), and accrued Benefits under Article II of this Plan without reductions for early commencement of benefits, multiplied by the applicable adjustment factor in paragraphs (1), (2) or (3) set forth below:

(1) if the Participant retires on or after the first day of the month on or following the date he or she has both completed twenty-five (25) year of Continuous Service with the Employer and attained age sixty (60), the adjustment factor used in determining such benefits shall be equal to 1.00;

 

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(2) if the Participant retires on or after the first day of the month on or following the date he or she attains age sixty (60) and before he or she has completed twenty-five (25) years of Continuous Service with the Employer, the adjustment factor used in determining such benefits shall be equal to 1.00, reduced by 5/9 of 1.00% for each full month by which the Participant’s Determination Date precedes the first day of the month on or following the date such Participant would have completed twenty-five (25) years of Continuous Service with the Employer; or

(3) if the Participant retires on or after the first day of the month on or following the date he or she attains age fifty-nine (59) and prior to the first day of the month on or following the date he or she attains age sixty (60), the adjustment factor used in determining such benefits shall be equal to 1.00,

(i) reduced by 5/9 of 1.00% for each full month by which the Participant’s Determination Date precedes the first day of the month on or following the date such Participant would have completed twenty-five (25) years of Continuous Service with the Employer, but excluding any full months by which the Participant’s Determination Date precedes the first day of the month on or following attainment of age sixty (60), and

(ii) further reduced for each remaining full month, if any, by which the Participant’s Determination Date precedes the first day of the month on or following attainment of age sixty (60) by one-twelfth of the excess of: (A) the adjustment factor set forth in subparagraph (i) above, over (B) the adjustment factor applicable at age fifty-nine (59) under the Prudential Traditional Retirement Plan; and

(d) Such Participant’s accrued early retirement benefit after age 65 under Article XI of the Retirement Plan (or any successor provision) or Subsidized Grandfathered Minimum Benefit payable at early retirement under the Prudential Cash Balance Plan, accrued temporary benefits under the Prudential Traditional Retirement Plan or Subsidized Grandfathered Minimum Benefit under the Prudential Cash Balance Plan (adjusted to be Actuarially Equivalent to a single life annuity), and such Participant’s accrued Benefits under Article II of this Plan (as adjusted to reflect the early commencement of benefits).

 

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Article IV

DUAL BENEFITS

4.01 Applicable Provisions . If a Participant is entitled, under the terms of the Prudential Merged Retirement Plan, both to a benefit payable under the Prudential Traditional Retirement Plan and to a benefit payable under the Prudential Cash Balance Plan, Plan provisions applicable to Participants entitled to benefits payable under the Prudential Traditional Retirement Plan shall apply only with respect to Plan benefits calculated by reference to the Prudential Traditional Retirement Plan. Similarly, Plan provisions applicable to Participants entitled to benefits payable under the Prudential Cash Balance Plan shall apply only with respect to Plan benefits calculated by reference to the Prudential Cash Balance Plan.

4.02 Application of Qualified Plan Limitation to Dual Benefits . If a Participant is entitled to a benefit payable under more than one component of the Prudential Merged Retirement Plan as described above in Section 4.01, the limit on benefits imposed by Code section 415(b) (as reflected in the applicable provisions of the Retirement Plan) shall first be reduced by the value of any accrued retirement benefits the Participant is entitled to receive under the PSI Plan (the “Adjusted 415 Limit”) and then applied to calculate the Benefits payable to such Participant hereunder that are determined by reference to the Prudential Traditional Retirement Plan. Thereafter, the Adjusted 415 Limit, as further reduced to reflect the value of the Participant’s benefits under the Prudential Traditional Retirement Plan, shall be applied to calculate the Benefits payable to the Participant hereunder that are determined by reference to the Prudential Cash Balance Plan.

 

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Article V

PAYMENT OF BENEFITS

5.01 Time and Form of Distributions . If a Participant has accrued any Benefits described in Articles II and III of the Plan and is 100% vested (not including amounts 100% vested solely on account of the application of Code section 420 except to the extent set out in Section 8.01(c)) under the Retirement Plan (or is vested in this Plan pursuant to Section 8.01(c)), subject to an effective election under Section 5.04, the Participant’s Benefits shall be distributed subject to Section 5.09, based on the Participant’s Employment Classification, on the payment date set forth below (the “Payment Date”):

(a) Traditional Agents . Unless otherwise elected pursuant to Section 5.04(a), if the Participant is an Agent with accrued Benefits under the Prud


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