McKesson 2005 Annual Report Download - page 151

Executive’s benefits shall be paid in the actuarially reduced form of a joint and 50% survivor annuity payable to the Executive and the
Executive’s spouse. With the approval of the Administrator, the Executive may elect, in writing, not to receive this form of benefit, but any
such election which provides a benefit for a beneficiary other than the Executive’s spouse must be approved in writing by the Executive’s
spouse to be effective. Such election shall become effective when filed with the Administrator and must be filed before the Executive’s
termination of employment with the Company.
3. Lump Sum Distribution. An Executive whose employment terminates by reason of an Approved Retirement on or after June 1, 1997,
may elect to have the actuarial equivalent value of his or her benefits paid in the form of a lump sum distribution in cash, where actuarial
equivalence is determined as follows: (i) the interest rate prescribed by the Pension Benefit Guaranty Corporation for purposes of determining
the present value of a lump sum distribution on plan termination for the month in which the Executive makes the lump sum distribution
election and (ii) a table based upon a fixed blend of 50 percent of male mortality rates and 50 percent of female mortality rates from the 1983
Group Annuity Mortality Table; provided, however, that effective October 28, 2004 the table shall be based on the 1994 Group Annuity
Reserving Table (1994 GAR).
An election of a lump sum form of distribution must be made at least 12 months prior to the Executive’s Approved Retirement (except that
an election made prior to January 1, 1997 shall be effective as to any Approved Retirement occurring during calendar year 1997) and shall be
void and of no effect if either of the following occurs: (a) the Executive’s employment with the Company does not terminate within 24 months
after the date on which the Executive made the election of a lump sum form of distribution; or (b) the Executive makes a new election under
this Section H.3 at least 12 months after the date of the Executive’s previous election under this Section H.3.
An Executive who is married at the time benefits become payable under this Section H.3 may not receive a lump sum form of distribution
unless the Executive’s spouse approves of the election in writing.
An Executive may elect a lump sum form of distribution less than 12 months prior to Approved Retirement, but in such event the amount of
the lump sum distribution shall be reduced by ten percent.
4. Additional Forms of Benefits. With the approval of the Administrator, the Executive may elect to receive his or her benefits in the form
of a single life annuity, a joint and survivor annuity with a 100% or 50% annuity to the surviving spouse, or a lump sum distribution or such
other form as permitted by the Administrator. All such forms of payment shall be the actuarial equivalent of the single life annuity with
actuarial equivalence determined pursuant to Section H.3. If the Executive is married, any such election must be approved in writing by the
Executive’s spouse to be effective, if it would provide the spouse with a benefit less than that provided under Section H.2. Prior to April 26,
1999, the Executive, with the approval of the Administrator, could elect to receive benefits in one of the actuarially equivalent benefit forms
permitted under the Retirement Plan or such other form as permitted by the Administrator.
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