Exhibit 10.3
AMENDED AND RESTATED
FOURTH SUPPLEMENTAL ANNUAL BENEFIT DETERMINATION
PURSUANT TO THE VF CORPORATION AMENDED AND
RESTATED SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
ARTICLE I. PURPOSE
The purpose of this Amended and Restated Fourth Supplemental Annual Benefit
Determination (the "Determination"), which is effective as of February 7, 2006,
is to provide to designated Participants a Supplemental Pension under the VF
Corporation Amended and Restated Supplemental Executive Retirement Plan (the
"SERP").
ARTICLE II. DEFINITIONS
As used herein, words and phrases shall have such meanings as are set forth in
the SERP, the VF Corporation Pension Plan ("Pension Plan"), and the VF
Corporation Deferred Compensation Plan (the "Deferred Compensation Plan").
"Committee" shall mean the Compensation Committee of the Board of Directors of
VF Corporation.
ARTICLE III. ELIGIBILITY FOR BENEFITS
The Supplemental Pension shall be payable to the Participant if his employment
ceases by reason of: 1) retirement on his Normal Retirement Date, 2) termination
of employment or 3) death while an Employee.
ARTICLE IV. SUPPLEMENTAL PENSION BENEFITS
4.01 Normal Retirement: The Participants in this Determination shall
receive the following Supplemental Pension payable at Normal or Late Retirement:
(a) The Normal Retirement Benefit otherwise payable to the Participant
under the Pension Plan computed without reduction for any compensation
deferred by the Participant under the Deferred Compensation Plan, but
without regard to the amount set forth in Appendix IV to the Pension
Plan for such Participant.
(b) The Supplemental Pension set forth in Section 4.01(a) shall be
reduced by any benefits payable to the Participant under the Pension
Plan.
4.02 Termination of Employment: The Supplemental Pension payable by
reason of the Participant's termination of employment shall be equal to the
benefit provided by Section 4.01 above multiplied by a fraction. The numerator
of this fraction shall be the number of full and part years of the Participant's
employment with the Corporation. The denominator of this fraction shall be the
number of full and part years of the Participant's employment as if the
Participant had been employed until Normal Retirement Date.
4.03 Death while an Employee: The Supplemental Pension payable upon
the death of the Participant while an Employee shall be as provided by Section
4.02.
4.04 Form of Supplemental Pension:
(a) Benefits Not Subject to Code Section 409A. This Section 4.04(a)
shall apply solely to the portion of a Participant's Supplemental
Pension which is not subject to the requirements of Section 409A of
the Code. The form of benefits payable to the Participant shall be the
form which has been elected under the Pension Plan unless the
Participant or Beneficiary has elected a different form under this
Determination. Except as otherwise provided in this Section 4.04(a),
payment of Supplemental Pension benefits hereunder shall commence at
the same time as the Participant's or Beneficiary's benefits commence
under the Pension Plan, and shall be subject to the same reductions
for commencement of payments prior to Normal Retirement Date as apply
to the recipient's benefits under the Pension Plan. Notwithstanding
the foregoing, a Participant may elect to receive in a lump sum the
actuarial present value of his or her Supplemental Pension under this
Determination, and if a Participant dies while employed, his or her
Beneficiary may elect to receive in a lump sum the actuarial present
value of the Participant's Supplemental Pension under this
Determination.
(b) Benefits Subject to Code Section 409A. This Section 4.04(b) shall
apply solely to the portion of a Participant's Supplemental Pension
which is subject to the requirements of Section 409A of the Code. The
Supplemental Pension shall be paid to the Participant in a lump sum in
cash. The lump sum payment shall be made to the Participant within 75
days following the Participant's Normal or Late Retirement under
Section 4.01 or termination of employment under Section 4.02, as
applicable; provided, however, that in the case of a Participant who
is a "specified employee" within the meaning of Section
409A(a)(2)(B)(i) of the Code, payment of such Participant's
Supplemental Pension shall not be made until the date which is six
months after the date of the Participant's separation from service
(or, if earlier, the date of death of the Participant). If a
Participant dies while employed, his or her Beneficiary shall, within
75 days following the Participant's death, receive in a lump sum the
actuarial present value of the Participant's Supplemental Pension
under this Determination.
(c) Present Value Calculation. In the case of an unmarried Participant
who dies while employed after the Board of Directors' adoption of
certain design modifications to the Pension Plan and the SERP on
December 9, 2003, the present value of his or her Supplemental Pension
under this Determination shall be determined as if such design
modifications had not been adopted. The lump sum actuarial present
value calculations shall be based on (i) an interest rate assumption
equal to, under Section 4.04(a), the expected rate of return on assets
for financial accounting purposes under the Pension Plan for the year
in which the lump sum payment is to be made and, under Section
4.04(b), the yield for the Moody's Aa corporate bond index as of the
last business day preceding the beginning of the calendar quarter in
which the lump sum payment is to be made (or would be made except for
the Participant's "specified employee" status), and (ii) the mortality
assumption set forth in the Pension Plan for purposes of calculating
lump sum payments.
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ARTICLE V. PARTICIPANTS
The Committee designates as Participants for purposes of this Determination any
Employees who participated at any time in the Deferred Compensation Plan,
provided, however, that any Employees who have been designated in any other SERP
Determination shall be excluded from this Determination to the extent that such
other Determination provides for the Supplemental Pension set forth above.
ARTICLE VI. VESTING
The Participant shall become vested in the Supplemental Pension payable pursuant
to this Determination upon satisfaction of the vesting period provided in the
SERP. Nothing in this Determination shall preclude the Board of Directors from
discontinuing eligibility to participate in the SERP and this Determination at
any time before the Participant shall become vested hereunder.
ARTICLE VII. ADOPTION
This Determination was originally approved and adopted by the Board of Directors
of the Corporation on February 13, 1990, to be effective as of January 1, 1985.
This Determination was amended and restated by the Board of Directors on and
effective as of February 7, 2006, in order (i) to preserve the favorable tax
treatment available to benefits earned and vested under the Determination on or
before December 31, 2004 in view of the enactment of Section 409A of the Code
and the issuance of regulations thereunder by the Department of the Treasury,
and (ii) with respect to all other benefits earned under the Determination, to
comply with the requirements of Section 409A and the regulations thereunder. The
Board of Directors reserves the right to amend the Determination, either
retroactively or prospectively, in whatever respect is required to achieve and
maintain compliance with the requirements of Section 409A of the Code and the
regulations thereunder.
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