McKesson 2005 Annual Report Download - page 174

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7. “Company” shall mean McKesson and any member of its controlled group as defined by Sections 414(b) and Section 414(c) of the
Internal Revenue Code of 1986, as amended.
8. “Compensation Committee” shall mean the Compensation Committee of the Board.
9. “Employment Agreement” shall mean the written contract of employment, if any, between an Executive and the Company.
10. “Executive” shall mean an employee of the Company selected by the Compensation Committee to participate in this Plan pursuant to
Section C.
11. “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.
12. “McKesson” shall mean McKesson Corporation, a Delaware Corporation.
13. “Participant” shall mean any Executive who is not otherwise excluded from participation in the Plan pursuant to Sections C.2, C.3, C.4
or D.4 hereof.
14. “Pro Rata Percentage” shall mean the percentage determined in Section E.3.
15. “Retirement Plan” shall mean the McKesson Corporation Retirement Plan.
16. “Tax Factor” shall mean one divided by one minus the Top Marginal Rate of Tax.
17. “Top Marginal Rate of Tax” shall be the highest combined marginal individual federal and state income tax rate, if any (giving effect to
any deduction then allowable for federal tax purposes for the state income tax) for the year survivor benefits are paid to Executive’s
Beneficiary under this Plan. For example, if the highest marginal individual federal and state income tax rates are 28% and 10% respectively
and the state income tax is deductible for federal tax purposes, the Top Marginal Rate would be 35.2% as follows: [($1.00 x 10% = $.10 state
income tax)] + [($.90 federal taxable income of $1.00 - $.10 state income tax) x 28% = $.252 federal income tax] = $.352 total state and federal
tax, or 35.2%. For purposes of determining the Top Marginal Rate of Tax, the Administrator in his or her discretion shall determine the highest
marginal individual federal and state income tax rates to be used (including without limitation whether, and if so to what extent, surtaxes or
similar taxes shall be applicable, and what state income tax, if any, shall be applicable), and all such determinations and all calculations made
by the Administrator hereunder shall be final.
M. SUCCESSORS
This Plan shall be binding on the Company and any successors or assigns thereto.
10
N. EXECUTION