Exhibit 10.8
AMENDED AND RESTATED
TENTH 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 Tenth 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 Mid-Term
Incentive Plan and VF 2004 Mid-Term Incentive Plan (collectively, the "Mid-Term
Incentive Plan"), which are implemented under the VF 1996 Stock Compensation
Plan. "Committee" shall mean the Compensation Committee of the Board of
Directors of VF Corporation, or any successor committee thereto.
ARTICLE III. ELIGIBILITY FOR BENEFITS.
The Supplemental Pension shall be payable to the Participant if his or her
employment ceases by reason of: 1) retirement on his or her 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 maximum
contribution, benefit or compensation limitations imposed by ERISA or
the Code on the Corporation and including in the Normal Retirement
Benefit calculation any compensation deferred by Participant, but
without regard to the amount set forth in Appendix IV to the Pension
Plan for the Participant, and by including as Compensation for
purposes of the Pension Plan: (i) for each Performance Cycle under the
Mid-Term Incentive Plan through the Performance Cycle commencing with
the Corporation's 2003 fiscal year, the fair market value of 100% of
the Stock Units earned by the Participant as PeRS for such Performance
Cycle; and (ii) for each Performance Cycle under the Mid-Term
Incentive Plan commencing with or after the Corporation's 2004 fiscal
year, the fair market value of the number of Stock Units earned by the
Participant as PRSUs for such Performance Cycle determined by
multiplying the total number of
Stock Units earned by the Participant as PRSUs for the Performance
Cycle by the percentage of the Participant's Target PRSUs for that
Performance Cycle designated by the VF Pension Plan Committee as
potentially includible under this Determination as Compensation for
purposes of the Pension Plan formula. The fair market value of such
Stock Units shall be determined as of the last day of the Performance
Cycle for which such Stock Units are earned; provided, however, that
in the event of the Participant's Termination of Employment prior to
the Earning Date for a Performance Cycle, the fair market value of
such Stock Units shall be determined (x) as of the last day of the
Corporation's fiscal year which includes the Proration Date for
situations governed by Section 8(a)(i), (ii) or (iii) of the Mid-Term
Incentive Plan (Disability or Retirement, death, or involuntary
separation by the Corporation not for Cause prior to a Change in
Control), or (y) as of the Participant's Termination of Employment for
situations governed by Section 8(a)(iv) of the Mid-Term Incentive Plan
(at or after a Change in Control, involuntary separation by the
Corporation not for Cause or Termination by the Participant for Good
Reason). The amount includible as Compensation for purposes of the
Pension Plan formula with respect to the Participant's participation
in the Mid-Term Incentive Plan shall be considered Compensation for
the respective Plan Year in which the respective Performance Cycle for
which the Stock Units are earned ends (or in the event of the
Participant's Termination of Employment prior to the Earning Date for
a Performance Cycle, for the Plan Year in which occurs the
Participant's Termination of Employment).
(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 (not greater
than 1.0). The numerator of this fraction shall be the number of full and part
years of the Participant's employment with the Corporation (counting as years of
employment for purposes of the numerator the Years of Credit with which the
Participant is credited under the Second Amended Supplemental Annual Benefit
Determination or any other Supplemental Annual Benefit Determination under the
SERP). 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.
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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.
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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.
ARTICLE V. PARTICIPANTS.
The Committee designates as Participants for purposes of this Determination any
Employees who at any time earned Stock Units as PeRS or PRSUs under the Mid-Term
Incentive 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 October 17, 2001, effective as of the January 1, 1999
effective date of the Mid-Term Incentive Plan. 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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