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
