EXECUTIVE INCENTIVE PLAN
(Effective January 1, 2002)
I. PURPOSE. The purpose of the Wyeth Executive Incentive Plan (the
"Plan") is to attract and retain highly qualified individuals as executive
officers; to obtain from each the best possible performance; to underscore
the importance to them of achieving particular business objectives
established for Wyeth; and to include in their compensation package a bonus
component which is intended to qualify as performance based compensation
under Section 162(m) of the Internal Revenue Code of 1986, as amended (the
"Code"), which compensation would be deductible by Wyeth under the Code.
II. DEFINITIONS. For the purposes of the Plan, the following terms
shall have the following meanings:
A. AWARDS. The cash awards made pursuant to the Plan.
B. BOARD OF DIRECTORS. The Board of Directors of the
C. COMMITTEE. The Compensation and Benefits Committee of the
Board of Directors or any successor thereto.
D. CONSOLIDATED EARNINGS. Consolidated net income for the year
for which an Award is made, adjusted to omit the effects of unusual and
infrequent items all as shown on the audited consolidated statement of
income of the Corporation and its subsidiaries as determined in
accordance with accounting principles generally accepted in the United
E. CORPORATION. Wyeth.
F. ELIGIBLE EMPLOYEE. An Employee who is a Principal Corporate
Officer of the Corporation.
G. EMPLOYEE. An individual who is on the active payroll of the
Corporation or a subsidiary of the Corporation at any time during the
period for which an Award is made.
H. PRINCIPAL CORPORATE OFFICER. The Chief Executive Officer
and any other officer of the Corporation who is so designated by the
Corporation. The term Principal Corporate Officer shall in all cases
include all of the Corporation's "covered employees" as defined in Code
III. EFFECTIVE DATE; TERM. The Plan is effective as of January 1, 2002
subject to approval by the Corporation's stockholders at the Corporation's 2002
Annual Meeting of Stockholders, and shall remain in effect until such time as it
shall be terminated by the Board of Directors.
IV. ELIGIBILITY FOR AWARDS. Awards for any period may be granted to
those Eligible Employees who are selected by the Committee. Such selections,
other than the selection of the Corporation's Chief Executive Officer or
Chairman (if an Eligible Employee) shall be made after considering the
recommendations of the Chief Executive Officer. The Committee shall also give
consideration to the contribution made by the Eligible Employee to achievement
of the Corporation's established objectives and such other matters as it shall
In the discretion of the Committee, Awards may be made to Eligible
Employees who have retired or whose employment has terminated after the
beginning of the year for which an Award is made, or to the designee or estate
of an Eligible Employee who died during such period.
V. DETERMINATION OF AMOUNTS OF AWARDS. Awards payable to any Eligible
Employee shall be contingent upon the Corporation having Consolidated Earnings.
The maximum Award payable with respect to any taxable year of the Corporation to
any Eligible Employee shall not exceed two-tenths of one percent of Consolidated
Earnings for such year. The amounts of Awards payable to Eligible Employees
shall be determined by the Committee acting in its discretion subject to the
maximum amounts set forth above. Such determinations, except in the case of any
Awards for the Chief Executive Officer and the Chairman, shall be made after
considering the recommendations of the Chief Executive Officer and such other
matters as the Committee shall deem relevant. The Committee, acting in its
discretion, may determine to pay a lesser award than the maximum specified
Awards may be made at any time following the end of the taxable year;
provided, however, that no Awards shall be made until the Committee receives
assurances from both the Corporation's Chief Financial Officer and its
independent accountants that the amount of such Award does not exceed the
applicable limitation under this Section V and the Committee certifies in
writing that such limitation under this Section V has not been exceeded.
VI. PAYMENT OF AWARDS. Awards under the Plan shall be paid currently in
cash, in a single sum payment, unless such payment is deferred pursuant to an
election made by the Eligible Employee in accordance with the terms of the
Wyeth Deferred Compensation Plan.
VII. SPECIAL AWARDS AND OTHER PLANS.
A. Nothing contained in the Plan shall prohibit the
Corporation or any of its subsidiaries from establishing other special
awards or incentive compensation plans providing for the payment of
incentive compensation to Employees (including Eligible Employees).
B. Payments of benefits provided to an Eligible Employee under
any stock, deferred compensation, savings, retirement or other employee
benefit plan are governed solely by the terms of such plans.
C. Awards made under the Plan to an Eligible Employee shall be
considered to be in lieu of and replace any award or payment such
Eligible Employee would otherwise have been entitled to receive under
the Wyeth Performance Incentive Award Program.
VIII. ADMINISTRATION, AMENDMENT AND INTERPRETATION OF THE PLAN.
A. Except as otherwise provided in the Plan, the Committee
shall administer the Plan. The Committee shall consist of not less than
three members of the Board of Directors. No director shall be eligible
to serve as a member of such Committee unless such person is a
"disinterested person" within the meaning of Rule 16b-3 of the General
Rules and Regulations under the Securities Exchange Act of 1934, as
amended, and an "outside director" within the meaning of Section 162(m)
of the Code. Committee members shall not be eligible to participate in
the Plan while members of the Committee. The Committee shall have full
power to construe and interpret the Plan, establish and amend rules and
regulations for its administration and perform all other acts relating
to the Plan, including the delegation of administrative
responsibilities, that it believes reasonable and proper and in
conformity with the purposes of the Plan.
B. The Committee shall have the right to amend the Plan from
time to time by item or to repeal it entirely or to direct the
discontinuance of Awards either temporarily or permanently; provided,
however, that (i) no amendment of the Plan shall operate to cancel,
without the consent of the Eligible Employee, an Award already made
hereunder, and (ii) no amendment of the Plan that (a) changes the
maximum Award payable to any Eligible Employee, as set forth in Section
V, or (b) materially amends the definition of Consolidated Earnings
shall be effective before approval by the affirmative vote of a
majority of shares voted at a meeting of the stockholders of the
C. Any decision made, or action taken, by the Committee
arising out of or in connection with the interpretation and/or
administration of the Plan shall be final, conclusive and binding on
all persons affected thereby.
IX. RIGHTS OF EMPLOYEES.
A. Neither the Plan, nor the adoption or operation of the
Plan, nor any documents describing or referring to the Plan (or any
part hereof) shall confer upon any Employee any right to continue in
the employ of the Corporation or a subsidiary of the Corporation.
B. No individual to whom an Award has been made or any other
party shall have any interest in any asset of the Corporation until
such amount has been paid or issued. To the extent that any party
acquires a right to receive payments under the Plan, such party shall
have the status of unsecured creditor of the Corporation with respect
to such right.
C. No right or interest of any Eligible Employee in the Plan
shall be assignable or transferable, or subject to any claims of any
creditor or subject to any lien.
A. All expenses and costs incurred in connection with the
operation of the Plan shall be borne by the Corporation, and no part
thereof (other than the amounts of Awards under the Plan) shall be
charged against the maximum limitation of Section V.
B. All Awards under the Plan are subject to withholding, where
applicable, for federal, state and local taxes.
C. Any provision of the Plan that is prohibited or
unenforceable shall be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions of the Plan.
D. The Plan and the rights and obligations of the parties to
the Plan shall be governed by, and construed and interpreted in
accordance with, the law of the State of New Jersey (without regard to
principles of conflicts of law).