Pension Plan (2002)Full Document 

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                                 ALLERGAN, INC.

                                  PENSION PLAN





















RESTATED
2001





                                TABLE OF CONTENTS


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ARTICLE I
NAME AND EFFECTIVE DATE ................................................................    1

1.1           Plan Name ................................................................    1
1.2           Effective Date of 2001 Restated Plan .....................................    1
1.3           Plan Purpose .............................................................    1
1.4           Plan Intended to Qualify .................................................    1

ARTICLE II
DEFINITIONS ............................................................................    2

2.1           Accrued Benefit ..........................................................    2
2.2           Active Participant .......................................................    2
2.3           Actuarial Equivalent .....................................................    2
2.4           Affiliated Company .......................................................    2
2.5           Age ......................................................................    2
2.6           Annuity Starting Date ....................................................    2
2.7           Average Earnings .........................................................    2
2.8           Beneficiary ..............................................................    3
2.9           Benefit Year .............................................................    3
2.10          Board of Directors .......................................................    3
2.11          Code .....................................................................    3
2.12          Committee ................................................................    3
2.13          Company ..................................................................    3
2.14          Earnings .................................................................    3
2.15          Effective Date ...........................................................    4
2.16          Eligibility Computation Period ...........................................    4
2.17          Eligible Employee ........................................................    5
2.18          Eligible Retirement Plan .................................................    5
2.19          Eligible Rollover Distribution ...........................................    5
2.20          Employee .................................................................    6
2.21          Employment Commencement Date .............................................    6
2.22          ERISA ....................................................................    6
2.23          Fund .....................................................................    6
2.24          Highly Compensated Employee ..............................................    7
2.25          Hour of Service ..........................................................    7
2.26          Investment Manager .......................................................    7
2.27          Leased Employee ..........................................................    7
2.28          Normal Retirement Date ...................................................    8
2.29          Participant ..............................................................    8
2.30          Period of Severance ......................................................    8
2.31          Plan .....................................................................    8





                                TABLE OF CONTENTS



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2.32          Plan Administrator .......................................................    8
2.33          Plan Year ................................................................    8
2.34          Primary Social Security Benefit ..........................................    8
2.35          Qualified Joint and Survivor Annuity .....................................    9
2.36          Reemployment Commencement date............................................    9
2.37          Severance ................................................................    9
2.38          Severance Date ...........................................................   10
2.39          Single Life Annuity ......................................................   10
2.40          SKB Plan .................................................................   10
2.41          Special Retirement Eligibility Date ......................................   10
2.42          Spin-Off Date ............................................................   10
2.43          Sponsor ..................................................................   10
2.44          Trust ....................................................................   11
2.45          Trustee ..................................................................   11
2.46          Vesting Year .............................................................   11

ARTICLE III
PARTICIPATION ..........................................................................   12

3.1           Participation as of Restatement Date .....................................   12
3.2           Other Eligible Employees .................................................   12

ARTICLE IV
ACCRUAL OF BENEFITS ....................................................................   13

4.1           Accrued Benefit Formula ..................................................   13
4.2           Minimum Accrued Benefit ..................................................   13
4.3           Accrued Benefit for Participants with Earnings in excess of $150,000
              prior to January 1, 1994 .................................................   13
4.4           Accrued Benefit for Participants Participating
              in the Voluntary Early Retirement Incentive Program ......................   14
4.5           Temporary Supplemental Monthly Benefit for Participants Participating
              in the Voluntary Early Retirement Incentive Program ......................   15

ARTICLE V
BENEFITS ...............................................................................   16

5.1           Normal Retirement ........................................................   16
5.2           Postponed Retirement .....................................................   16
5.3           Early Retirement .........................................................   16
5.4           Termination of Employment ................................................   18
5.5           Consent to Pension Payments ..............................................   19
5.6           Maximum Pension ..........................................................   19
5.7           Defined Benefit Fraction and Defined Contribution Fraction ...............   22


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5.8           Mandatory Commencement of Benefits .......................................   23
5.9           Reemployment .............................................................   24
5.10          Early Disability Retirement ..............................................   25
5.11          Other Disabled Participants ..............................................   25
5.12          Nonforfeitable Interest ..................................................   26
5.13          Compensation for Maximum Pension .........................................   26

ARTICLE VI
FORM OF PENSIONS .......................................................................   27

6.1           Unmarried Participants ...................................................   27
6.2           Married Participants .....................................................   27
6.3           Election of Optional Form of Benefit .....................................   27
6.4           Optional Forms of Benefit ................................................   28
6.5           Cash-Outs ................................................................   29

ARTICLE VII
PRE-RETIREMENT DEATH BENEFITS ..........................................................   30

7.1           Eligibility ..............................................................   30
7.2           Spousal Benefit ..........................................................   30
7.3           Alternative Death Benefit ................................................   31
7.4           Children's Survivor Benefit ..............................................   31
7.5           Waiver of Spousal Benefit ................................................   32

ARTICLE VIII
CONTRIBUTIONS...........................................................................   33

8.1           Company Contributions ....................................................   33
8.2           Source of Benefits .......................................................   33
8.3           Irrevocability ...........................................................   33

ARTICLE IX
ADMINISTRATION .........................................................................   34

9.1           Appointment of Committee .................................................   34
9.2           Transaction of Business ..................................................   34
9.3           Voting ...................................................................   34
9.4           Responsibility of Committee ..............................................   34
9.5           Committee Powers .........................................................   35
9.6           Additional Powers of Committee ...........................................   36
9.7           Periodic Review of Funding Policy ........................................   36
9.8           Claims Procedures ........................................................   36


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9.9           Appeals Procedures .......................................................   37
9.10          Limitation on Liability ..................................................   38
9.11          Indemnification and Insurance ............................................   38
9.12          Compensation of Committee and Plan Expenses ..............................   38
9.13          Resignation ..............................................................   38
9.14          Reliance Upon Documents and Opinions .....................................   38
9.15          Appointment of Investment Manager ........................................   39

ARTICLE X
AMENDMENT AND ADOPTION OF PLAN .........................................................   40

10.1          Right to Amend Plan ......................................................   40
10.2          Adoption of Plan by Affiliated Companies .................................   40

ARTICLE XI
TERMINATION AND MERGER .................................................................   41

11.1          Right to Terminate Plan ..................................................   41
11.2          Merger Restriction .......................................................   41
11.3          Effect on Trustee and Committee ..........................................   41
11.4          Effect of Reorganization, Transfer of Assets or Change in Control ........   41
11.5          Termination Restrictions .................................................   43

ARTICLE XII
TOP-HEAVY RULES ........................................................................   45

12.1          Applicability ............................................................   45
12.2          Definitions ..............................................................   45
12.3          Top-Heavy Status .........................................................   46
12.4          Minimum Benefit ..........................................................   48
12.5          Maximum Benefit ..........................................................   49
12.6          Minimum Vesting Rules ....................................................   49
12.7          Noneligible Employees ....................................................   50

ARTICLE XIII
RESTRICTION ON ASSIGNMENT OR OTHER ALIENATION OF PLAN BENEFITS .........................   51

13.1          General Restrictions Against Alienation ..................................   51
13.2          Qualified Domestic Relations Orders ......................................   51


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                                TABLE OF CONTENTS



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ARTICLE XIV
MISCELLANEOUS ..........................................................................   54

14.1          No Right of Employment Hereunder .........................................   54
14.2          Effect of Article Headings ...............................................   54
14.3          Limitation on Company Liability ..........................................   54
14.4          Interpretation ...........................................................   54
14.5          Withholding For Taxes ....................................................   54
14.6          California Law Controlling ...............................................   54
14.7          Plan and Trust as One Instrument .........................................   54
14.8          Invalid Provisions .......................................................   54
14.9          Counterparts .............................................................   54
14.10         Forfeitures ..............................................................   55
14.11         Facility of Payment ......................................................   55
14.12         Lapsed Benefits ..........................................................   55

APPENDIX A

APPENDIX B


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                                 ALLERGAN, INC.
                                  PENSION PLAN

                                    ARTICLE I
                             NAME AND EFFECTIVE DATE

         1.1      Plan Name. This document, made and entered into by Allergan,
Inc., a Delaware corporation ("Allergan") amends and restates in its entirety
the "Allergan, Inc. Pension Plan (Restated 1996)" and incorporates the First,
Second, Third, and Fourth Amendments made thereto, and shall be known hereafter
as the "Allergan, Inc. Pension Plan (Restated 2001)."

         1.2      Effective Date of 2001 Restated Plan. The Effective Date of
the Allergan, Inc. Pension Plan (Restated 2001), hereinafter referred to as the
"Plan," shall be January 1, 1997; provided, however, the amendments made to the
Plan to comply with the Economic Growth and Tax Relief Reconciliation Act of
2001 shall be effective January 1, 2002 unless otherwise specified in the Plan.

         1.3      Plan Purpose. The purpose of the Plan is to provide additional
retirement income to Eligible Employees of Allergan, and any Affiliated
Companies that are authorized by the Board of Directors of Allergan to
participate in the Plan for their future economic security. The Plan is fully
funded through Company contributions and the assets of the Plan shall be
administered, distributed, forfeited and otherwise governed by the provisions of
the Plan, which is to be administered by the Committee for the exclusive benefit
of Participants in the Plan and their Beneficiaries.

         1.4      Plan Intended to Qualify. The Plan is an employee benefit plan
that is intended to qualify under Code Section 401(a) as a qualified pension
plan so as to assure that the trust created under the Plan is tax exempt
pursuant to Code Section 501(a). The provisions of the Plan are intended to
comply with all changes to the qualification requirements made by the Uruguay
Round Agreements Act (GATT), the Uniformed Services Employment and Reemployment
Rights Act of 1994, the Small Business Job Protection Act of 1996, the Taxpayer
Relief Act of 1997, the Internal Revenue Service Restructuring and Reform Act of
1998, and the Community Renewal Tax Relief Act of 2000, including qualification
requirements that are effective for Plan Years beginning on or after January 1,
1999 (collectively referred to as the "GUST Amendments"), and the Economic
Growth and Tax Relief Reconciliation Act of 2001 ("EGTRRA"). It is further
intended that the EGTRRA provisions of the Plan are to be regarded as good faith
compliance with the requirements of EGTRRA and are to be construed in accordance
with EGTRRA and guidance issued thereunder.






                                   ARTICLE II
                                   DEFINITIONS

         2.1      Accrued Benefit. "Accrued Benefit" shall mean, for each
Participant, the amount of pension accrued by him or her under Article IV as of
the date of reference. An Accrued Benefit shall only be payable in accordance
with Articles V and VII.

         2.2      Active Participant. "Active Participant" shall mean a
Participant who is an Eligible Employee.

         2.3      Actuarial Equivalent. "Actuarial Equivalent" shall mean a
benefit of equal actuarial value under the assumptions set forth in Appendix A.

         2.4      Affiliated Company. "Affiliated Company" shall mean (i) any
corporation, other than the Sponsor, which is included in a controlled group of
corporations (within the meaning of Code Section 414(b)) of which the Sponsor is
a member, (ii) any trade or business, other than the Sponsor, which is under
common control (within the meaning of Code Section 414(c)) with the Sponsor,
(iii) any entity or organization, other than the Sponsor, which is a member of
an affiliated service group (within the meaning of Code Section 414(m)) of which
the Sponsor is a member, and (iv) any entity or organization, other than the
Sponsor, which is affiliated with the Sponsor under Code Section 414(o). An
entity shall be an Affiliated Company pursuant to this Section only during the
period of time in which such entity has the required relationship with the
Sponsor under clauses (i), (ii), (iii) or (iv) of this Section after the
Original Effective Date of the Plan.

         2.5      Age. "Age" shall mean a Participant's age at his or her most
recent birthday.

         2.6      Annuity Starting Date. "Annuity Starting Date" shall mean the
first day of the first period for which a Participant's pension is paid as an
annuity or as any other optional form of benefit.

         2.7      Average Earnings. "Average Earnings" shall mean, for each
Participant, 12 times the monthly average of his or her Earnings for the 60
consecutive months that yield the highest average. For purposes of this Section,
(i) nonconsecutive months interrupted only by months in which a Participant has
no Earnings shall be treated as consecutive and (ii) unless the Sponsor
expressly determines otherwise, and except as is expressly provided otherwise in
the Plan or in resolutions of the Board of Directors, amounts paid to a
Participant by a domestic Affiliated Company prior to the effective date on
which it became an Affiliated Company (that would have been Earnings if paid by
the Company) before he or she became a Participant shall be treated as Earnings
but only to the extent such Earnings when added to the Earnings actually paid by
the Company do not result in more than 60 consecutive months of Earnings. If a
Participant does not have Earnings for 60 consecutive months, his or her Average
Earnings shall be 12 times the monthly average of his or her Earnings. For
periods beginning on or after April 1, 2000, a partial month of employment shall
be taken into account only if doing so yields a higher monthly average.


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         2.8      Beneficiary. "Beneficiary" or "Beneficiaries" shall mean the
person or persons last designated by the Participant to receive the interest of
a deceased Participant.

         2.9      Benefit Year. "Benefit Year" shall mean a credit used to
measure a Participant's service in calculating his or her Accrued Benefit. Each
Participant shall be credited with a number of Benefit Years equal to 1/365th of
(i) the aggregate number of days between his or her Employment Commencement Date
(or Reemployment Commencement Date) of the Employee and the Severance Date which
immediately follows that Employment Commencement Date (or Reemployment
Commencement Date) and (ii) the aggregate number of days during a Period of
Severance of less than 30 days but in each case, disregarding any day such
Participant is not an Active Participant.

         2.10     Board of Directors. "Board of Directors" shall mean the Board
of Directors of the Sponsor (or its delegate) as it may from time to time be
constituted.

         2.11     Code. "Code" shall mean the Internal Revenue Code of 1986 and
the regulations thereunder. Reference to a specific Code Section shall be deemed
also to refer to any applicable regulations under that Section, and shall also
include any comparable provisions of future legislation that amend, supplement
or supersede that specific Section.

         2.12     Committee. "Committee" shall mean the committee to be
appointed under the provisions of Section 9.1 to administer the Plan.

         2.13     Company. "Company" shall mean collectively the Sponsor and
each Affiliated Company that adopts the Plan in accordance with Section 10.2.

         2.14     Earnings.  "Earnings" shall mean the following:


                  (a) Earnings shall include amounts paid during a Plan Year to
         an Employee by the Company for services rendered, including base
         earnings, commissions and similar incentive compensation, cost of
         living allowances earned within the United States of America, holiday
         pay, overtime earnings, pay received for election board duty, pay
         received for jury and witness duty, pay received for military service
         (annual training), pay received for being available for work, if
         required (call-in premium), shift differential and premium,
         sickness/accident related pay, vacation pay, vacation shift premium,
         and bonus amounts paid under the (i) Sales Bonus Program, (ii)
         Management Bonus Plan or Executive Bonus Plan, either in cash or in
         restricted stock, and (iii) group performance sharing payments, such as
         the "Partners for Success."

                  (b) Earnings shall include amounts of salary reduction elected
         by the Employee under a Code Section 401(k) cash or deferred
         arrangement or a Code Section 125 cafeteria plan, amounts deferred
         under the Executive Deferred Compensation Plan, and amounts paid to an
         Employee pursuant to a "split pay arrangement" between the Company and
         an Affiliated Company.



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                  (c) Earnings shall not include business expense
         reimbursements; Company gifts or the value of Company gifts; Company
         stock related options and payments; employee referral awards; flexible
         compensation credits paid in cash; special overseas payments,
         allowances and adjustments including, but not limited to, pay for cost
         of living adjustments and differentials paid for service outside of the
         United States, expatriate reimbursement payments, and tax equalization
         payments; forms of imputed income; long-term disability pay; payment
         for loss of Company car; Company car allowance; payments for patents or
         for writing articles; relocation and moving expenses; retention and
         employment incentive payments; severance pay; long-term incentive
         awards, bonuses or payments; "Impact Award" payments; "Employee of the
         Year" payments; "Awards for Excellence" payments; special group
         incentive payments and individual recognition payments which are
         nonrecurring in nature; tuition reimbursement; and contributions by the
         Company under the Plan or distributions hereunder, any contributions or
         distributions pursuant to any other plan sponsored by the Company and
         qualified under Code Section 401(a) (other than contributions
         constituting salary reduction amounts elected by the Employee under a
         Code Section 401(k) cash or deferred arrangement), any payments under a
         health or welfare plan sponsored by the Company, or premiums paid by
         the Company under any insurance plan for the benefit of Employees.

                  (d) For periods beginning on or after April 1, 2001, if a
         Participant is an Employee at any time during a month, Earnings for
         that month shall be the Earnings actually paid to the Participant
         during such month. For periods prior to April 1, 2001, a Participant
         shall be deemed to have no Earnings in any month in which he or she is
         not an Employee for the entire month.

                  (f) Earnings shall not exceed $200,000 ($150,000 for Plan
         Years beginning prior to January 1, 2002), as adjusted for
         cost-of-living increases in accordance with Code Section 401(a)(17)(B),
         for purposes of determining all benefits provided under the Plan. Any
         cost-of-living adjustments in effect for a calendar year shall apply to
         the Plan Year beginning with or within such calendar year. For purposes
         of determining benefits provided under the Plan in a Plan Year
         beginning on or after January 1, 2002, Earnings for any prior Plan Year
         shall not exceed $200,000.

         2.15     Effective Date. "Effective Date" of this restated Plan shall
mean January 1, 1997 except as provided herein or as otherwise required for the
Plan to continue to maintain its qualified status under Code Section 401(a). The
"Original Effective Date" of the Plan shall mean July 26, 1989.

         2.16     Eligibility Computation Period. "Eligibility Computation
Period" shall mean a 365 day period used for determining whether an Employee is
eligible to participate in the Plan. Each Employee shall be credited with (i)
the aggregate number of days between each Employment Commencement Date (or
Reemployment Commencement Date) of the Employee and the Severance Date which
immediately follows that Employment Commencement Date (or



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Reemployment Commencement Date) and (ii) the aggregate number of days during a
Period of Severance of less than twelve months.

         2.17     Eligible Employee. "Eligible Employee" shall mean an Employee
who is employed by the Company but not by a joint venture in which the Company
is a joint venturer; provided, that an Employee with respect to whom retirement
benefits have been the subject of good faith collective bargaining shall be an
Eligible Employee only to the extent a collective bargaining agreement relating
to him or her so provides. An Employee of the Company who is a Leased Employee
or who is neither a United States citizen nor a United States resident shall not
be an Eligible Employee. Notwithstanding the preceding sentence, for Plan Years
beginning prior to January 1, 1996, an Eligible Employee shall not include a
temporary employee classified as such by the Sponsor or an Affiliated
Company.(1)

         2.18     Eligible Retirement Plan. "Eligible Retirement Plan" shall
mean an individual retirement account or annuity described in Code Section
408(a) or 408(b) and a qualified retirement plan described in Code Section
401(a) or 403(a) that accepts Eligible Rollover Distributions. For Eligible
Rollover Distributions made after December 31, 2001, an Eligible Retirement Plan
shall also mean an annuity contract described in Code Section 403(b) and an
eligible plan described in Code Section 457(b) which is maintained by a state,
political subdivision of a state, or any agency or instrumentality of a state or
political subdivision of a state and which agrees to separately account for
amounts transferred into such plan from this Plan. The definition of Eligible
Retirement Plan shall also apply in the case of an Eligible Rollover
Distribution to a surviving spouse, or to a spouse or former spouse who is an
Alternate Payee under a Qualified Domestic Relations Order (as defined in
Article XIII); except, however, the definition of Eligible Retirement Plan shall
only mean an individual retirement account or annuity described in Code Section
408(a) or 408(b) in the case of an Eligible Rollover Distribution to a surviving
spouse prior to January 1, 2002.

         2.19     Eligible Rollover Distribution. "Eligible Rollover
Distribution" shall mean any distribution of all or any portion of the balance
to the credit of the Distributee, except that an Eligible Rollover Distribution
shall not include:

                  (a) any distribution that is one of a series of substantially
         equal periodic payments (not less frequently than annually) made for
         the life (or life expectancy) of the Distributee or the joint lives (or
         joint life expectancies) of the Distributee and the Distributee's

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