EXHIBIT 10.3
WALGREEN CO. MANAGEMENT
INCENTIVE PLAN
(As amended and restated effective
September 1, 2008)
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Purpose : The purpose of the Walgreen Co.
Management Incentive Plan (the "Plan") is to provide special
incentive and motivation to management-level employees through
annual bonuses.
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Definitions : Whenever used in the Plan, the
following terms shall have the meanings set forth below, unless the
context clearly provides otherwise:
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The term "Base
Salary" shall mean the base salary paid during the fiscal year to a
Participant, and any such base salary earned but deferred or
reduced pursuant to a Company Section 401(k) plan, or Section 125
plan, or another Company deferral plan. The term Base
Salary does not include any incentive or performance bonuses,
Christmas bonus, stock purchase discounts, or other fringe benefits
or supplementary remuneration.
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The term
"Committee" shall mean the Compensation Committee of the Board of
Directors of the Company.
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The term
"Company" shall mean Walgreen Co., an Illinois corporation, and all
wholly-owned subsidiaries of Walgreen Co.
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The term
“Disability” shall mean total disability as determined
by the Committee, consistent with how the Company determines
whether termination of employment is upon disability for other
benefit plan purposes.
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The term
"Employee" shall mean any employee of the Company, including, but
not limited to, the officers of Walgreen Co. Employee
shall not include any person who is not classified as an employee
in the common law sense in the records of the Company, even if
those records are subsequently determined to have been in error or
the person is subsequently reclassified as an
employee. For example, no person shall be considered to
be an Employee for any period of time during which he or
she: (1) is a leased employee; (2) is an independent
contractor; or (3) is otherwise not classified as an employee in
the records of the Company.
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The term
"Extraordinary Items" shall mean significant transactions that are
different from the typical or customary business transactions and
are not expected to occur frequently as determined by the informed
professional judgment of the Chief Financial Officer of the Company
after taking into consideration all the facts involved in a
particular situation and the objectives of the Plan.
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The term
"Individual Adjustment" shall mean the amount of any increase or
reduction in the bonus share that would otherwise be allocated to a
Participant.
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The term
"Participant" shall mean any Employee who participates in and is
eligible to receive incentive compensation pursuant to paragraph 3
of the Plan.
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The term "Plan
Year" shall mean the fiscal year of Walgreen Co., which runs from
September 1 to the following August 31.
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The term
“Retirement” shall mean termination of employment from
the Company in good standing, as determined by the Committee or its
delegates, and after having attained at least age 55 and at least
10 years of continuous service.
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The term
"Salary Grade" shall mean the salary grades to which job positions
are assigned under the Walgreen Co. Salary Administration
Program. To the extent such Program is revised,
references hereunder to Salary Grade and specific Salary Grade
levels shall be appropriately adjusted by the Committee or its
delegates to reflect such revised Program.
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Eligibility
and Participation : The Committee shall have the
authority and discretion to determine the class or classes of
Employees eligible to participate in the Plan for any Plan
Year. As of the effective date of this amended and
restated Plan, the following categories of Employees shall be
eligible to participate in the Plan:
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Any Employee
whose job position is within Salary Grades 12 and above or their
equivalent and is not covered by another Company management
incentive plan; and
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Any other
Employee who is approved for participation by the Committee, based
on the recommendation of Company management that he or she is in a
position to make a substantial contribution to the success of the
Company by exceptional service in a supervisory or staff
position.
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The Committee
shall also have the authority to approve or deny Plan participation
to any individual Employee. No Employee shall have a
contractual right to receive any incentive award or payment, as all
awards and payments are ultimately subject to the approval and
authorization of the Committee.
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Determination of Bonuses : Participant bonuses for each Plan
Year shall be determined as follows:
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Prior to the
beginning of the Plan Year, or as early in the Plan Year as is
practical considering the circumstances, management will recommend
for Committee approval the bonus structure and accompanying details
for that Plan Year. Such recommendation shall cover the
following areas and any other pertinent bonus
provisions:
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The class or
class of employees eligible to participate in the Plan for such
Plan Year.
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The performance
measure or measures upon which bonuses shall be based, and the
extent to which such measures shall be based on Company, division,
or business unit performance, or some combination
thereof. The application of such performance measures
may vary among different categories of employees.
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