EXHIBIT 10.2
BELK INC. 2004 SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
ARTICLE I - INTRODUCTION
1.1. Predecessors and Affiliates of the Company previously established
the Belk Stores Supplemental Executive Retirement Plan (the "Old SERP"),
effective March 5, 1986, in order to provide eligible employees with certain
benefits. Whereas now, the Company wishes to establish and maintain a
restructured supplemental executive retirement plan through the adoption of the
Belk, Inc. 2004 Supplemental Executive Retirement Plan (the "2004 SERP"). The
2004 SERP, the provisions of which are contained herein below, shall have an
effective date of April 1, 2004.
1.2. The Company intends for the 2004 SERP to be an unfunded deferred
supplemental executive retirement plan for a select group of management or
highly compensated associates within the meaning of United States Department of
Labor regulations Section 2520.104-23 and to be construed in a manner consistent
with such intent.
ARTICLE II - DEFINITIONS
Whenever the following words and phrases are used in this document,
they shall have the meanings stated below unless a different meaning is plainly
required by the context:
2.1. "ACCOUNT" means the retirement account maintained for bookkeeping
purposes by the Committee reflecting the accrued benefit of a Participant under
the 2004 SERP.
2.2. "AFFILIATE" means (a) any corporation that is a member of a
controlled group of corporations, as defined in Section 414(b) of the Code, of
which the Company is a member; (b) any other trade or business (whether or not
incorporated) that is under common control, as defined in Section 414(c) of the
Code, with the Company; and (c) any business that is a member of an affiliated
service group, as defined in Section 414(m) of the Code, of which the Company is
a member.
2.3. "ANNUAL CREDIT" means the amounts, if any, credited to one or more
Participant's Account pursuant to Section 5.3.
2.4. "BENEFICIARY" means the person or persons designated by a
Participant as his or her beneficiary or beneficiaries under the 2004 SERP, as
provided for in Article VII.
2.5. "CODE" means the Internal Revenue Code of 1986, as now existing or
hereinafter amended, and regulations issued thereunder.
2.6. "COMMITTEE" means the Executive Committee of the Company or such
other committee as the Board of Directors of the Company shall designate from
time to time to administer the 2004 SERP.
2.7. "COMPANY" means Belk, Inc., a Delaware corporation, and any
successor to Belk, Inc.
2.8. "COMPENSATION" means basic cash compensation in the form of annual
salary, and/or performance bonuses earned by a Participant in the applicable
calendar year.
2.9. "DISABILITY" OR "DISABLED" shall have the same meaning as provided
for in the Company's Long Term Disability Plan in effect at the time a
Participant is seeking a Disability distribution under this 2004 SERP. In the
absence of a Company sponsored long term disability plan, "Disability" shall
mean any medically determinable physical or mental disorder that renders a
Participant incapable of continuing in the employment of an Employer in his or
her regular duties of employment, as determined by the Committee in its sole and
absolute discretion.
2.10. "DISCRETIONARY CREDIT" A discretionary amount, if any, determined
by the Committee that is credited to one or more Participant's Account in
accordance with the terms of Section 5.4 hereof.
2.11. "DISTRIBUTION FORM" The separate written agreement, submitted to
the Committee, by which a Participant elects a distribution method for his or
her Account.
2.12. "EFFECTIVE DATE" means April 1, 2004, the effective date of the
2004 SERP as set forth herein.
2.13. "EMPLOYER" means the Company and each Affiliate that the
Committee designates as a participating employer and that elects to participate
in the 2004 SERP by action of its board of directors or other governing body. An
initial list of Employers is provided as Exhibit A, attached hereto.
2.14. "INITIAL CREDIT" means the amount, if any, credited to a
Participant's Account pursuant to Section 5.2.
2.15. "PARTICIPANT" means an associate of an Employer who has been
designated by the Committee to participate in the 2004 SERP.
2.16. "PLAN" means the Belk, Inc. 2004 Supplemental Executive
Retirement Plan, as set forth herein and as amended from time to time. Such Plan
may also be referenced herein as "2004 SERP."
2.17. "PLAN YEAR" For the initial Plan Year, April 1, 2004 through
March 31, 2005. For each year thereafter, Plan Year shall means April 1 through
March 31.
2.18. "RETIREMENT" means the termination of a Participant's employment
with the Company and its Affiliates for any reason other than death or
Disability at or subsequent to the Participant's attainment of a combined age
attained and Years of Service equal to, or greater than, sixty-five (65).
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2.19. "TERMINATION OF EMPLOYMENT" means the termination of a
Participant's employment with the Company and its Affiliates for any reason,
other than death, Disability or Retirement.
2.20. "TRUST" means any grantor trust established by and between the
Company and the Trustee under which the assets of the 2004 SERP are held,
administered and managed, which shall conform to the terms of Rev. Proc. 92-64.
2.21. "TRUSTEE" means the person or persons chosen by the Company to
serve as trustee pursuant to the terms of the 2004 Trust.
2.22. "YEAR(S) OF SERVICE" has the same meaning as such term under the
Belk Pension Plan.
ARTICLE III - PARTICIPATION
3.1. PARTICIPATION. An associate of an Employer who is eligible to
participate in the Old SERP will become a Participant upon the Committee's
selection. Additionally, the Committee may, from time to time, designate certain
other management and highly compensated associates of the Employer, including
associates who are not participants in the Old SERP, as eligible to participate
in the 2004 SERP.
3.2. DURATION OF PARTICIPATION. An associate eligible to participate in
the 2004 SERP shall continue to be a Participant until the associate incurs a
Termination of Employment, Disability, death or Retirement. Upon a Participant's
Termination of Employment, Disability, death or Retirement, the Participant's
Account shall be distributed in accordance with Article VII, contained herein.
ARTICLE IV - DISTRIBUTION ELECTIONS
4.1. MODIFICATION OF DISTRIBUTION FORM. A Distribution Form which is
properly completed and timely submitted shall remain in full force and effect
until a new Distribution Form becomes effective in accordance with Section 7.6,
contained herein. The Distribution Form will provide for the election by the
Participant of the appropriate distribution method for his or her Account. In
the event a Participant fails to submit an effective Distribution Form with the
Employer, all distributions shall occur as a single lump sum distribution to the
appropriate Participant or Beneficiary.
ARTICLE V - MAINTENANCE OF ACCOUNTS
5.1. ACCOUNT. The Committee shall maintain on the Employer's books and
records an Account for each Participant that shall be adjusted to reflect
credits, service charges, and tax withholding under this Article V and
distributions and forfeitures under Articles VI and VII. Such Account shall be
established for each Participant. His or her Account shall be credited with the
applicable Initial Credit, Annual Credit(s), Discretionary Credit(s) and
interest rate earnings
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credited, as may be appropriate. Each Participant's Account shall be reduced by
any distributions and forfeitures made plus any federal, state and/or local tax
withholding and any social security withholding tax as may be required by law.
The Committee may, from time to time, assess reasonable service charges against
all or any portion of the Participant's Account(s) to defray costs incurred by
an Employer in connection with the implementation and administration of the 2004
SERP. Distributions under the 2004 SERP shall be charged against a Participant's
Account on the date on which the distributions are made and forfeitures shall be
charged on the date of Termination of Employment.
5.2. INITIAL CREDIT. As of the first day of the initial Plan Year, the
Account of each Old SERP Participant who is a Participant in the 2004 SERP on
such date shall be credited with any applicable Initial Credit. The amount of
any Initial Credit shall be communicated to the Participant prior to the
Participant's entrance into the 2004 SERP. This Initial Credit will only be
provided for the initial Plan Year.
5.3. ANNUAL CREDIT. As of April 1, 2005 and April 1 of each subsequent
Plan Year, and as of such other dates as the Committee may determine, the
Account of a Participant may be credited with an Annual Credit(s). The Annual
Credit credited to a Participant's Account for such Plan Year shall not exceed
eleven percent (11%) of such Participant's Compensation for the immediately
preceding calendar year. The Board of Directors of the Company shall retain the
right to determine each Participant's Annual Credit percentage and to vary the
Annual Credit percentage, from time to time, if it determines such variance is
warranted by a change in the Company's financial condition. The amount of Annual
Credit will be communicated to the applicable receiving Participant in the Plan
Year of Account crediting. Nothing in this Plan, however, shall obligate the
Company to make identical Annual Credit(s) for the benefit of all Participants
in any Plan Year.
5.4. DISCRETIONARY CREDIT. At its sole and absolute discretion, the
Committee may elect to make a Discretionary Credit(s) to the Account of some or
all of the Participants. The amount of such Discretionary Credit(s), if any,
shall be determined by the Committee. Nothing in this Plan, however, shall
obligate the Company to make Discretionary Credit(s) for the benefit of
Participants in any Plan Year, nor to make identical Discretionary Credit(s) for
the benefit of all Participants in any Plan Year. The Committee expressly
reserves the right to make Discretionary Credit(s) to such Participants in such
amount or such proportions as it deems warranted or appropriate.
5.5. INTEREST RATE EARNING CREDITED. The Committee shall establish as
of the first day of a Plan Year an annual rate of earnings to be applied to each
Participant's Account for such Plan Year. The aforementioned rate established by
the Committee shall be calculated utilizing the trailing ten (10) year average
of ten (10) year Treasury bills plus or minus 150 basis points. Each basis point
shall equal .01%. A Participant's Account shall be credited with an annual rate
of earnings for the initial Plan Year, pursuant to this section, equal to 6.5%.
Interest shall accrue daily, using the aforementioned rate as determined for the
applicable Plan Year, and will be credited to a Participant's Account monthly.
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5.6. PARTICIPANT STATEMENTS. A written statement indicating the total
amount credited to a Participant's Account shall be furnished by the Committee
to the Participant as frequently as Committee deems appropriate, but in no event
shall statements be provided to Participant's less frequently than quarterly in
each Plan Year. All statements shall be based on the net value of the Account as
of the last day of the preceding quarter; to the extent such values are
available to the Committee.
ARTICLE VI - VESTING AND FUNDING
6.1. VESTED PERCENTAGE. A Participant shall at all times be vested in
his or her Account in the following manner:
(a) INITIAL CREDIT - A Participant shall vest in those
portions of his or her Account associated with the Initial Credit in the
following manner:
i) Upon entrance into the 2004 Plan, a
Participant shall be 33.33% vested in his or
her Account balance associated with the
Initial Credit, and any earnings thereon.
ii) On March 31, 2005, a Participant shall be
66.66% vested in his or her Account balance
associated with the Initial Credit, and any
earnings thereon, if the Participant has
completed one (1) Year of Service in 2004
and is an associate of an Employer on March
31, 2005.
iii) On March 31, 2006, Participant shall be 100%
vested in his or her Account balance
associated with the Initial Credit, and any
earnings thereon, if Participant has
completed one (1) Year of Service in 2005
and is an associate of an Employer on March
31, 2006.
(b) ANNUAL CREDIT - A Participant shall vest 100% in the
portion of his or her Account associated with each Annual Credit on the third
(3rd) anniversary of the date such Annual Credit is credited to his or her
Account. The Annual Credit vesting schedule and any modifications thereto, shall
be communicated to the Participants as soon as administratively feasible. The
portion of a Participant's Account that is not fully vested shall be forfeited
on the date of the Participant's Termination of Employment. Notwithstanding the
foregoing, Participant shall be 100% vested in the portion of his or her Account
associated with Annual Credits upon the Participant's Retirement.
(c) DISCRETIONARY CREDIT. A Participant shall have a vested
right to the portion of his or her Account associated with Discretionary
Credit(s) to the extent determined by the Committee at the time any
Discretionary Credit(s) is credited to the Account.
6.2. ACCELERATION OF VESTING. The Committee, in its sole and absolute
discretion, shall have the power to accelerate the rate of vesting of all or any
portion of any Participant's
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Account provided, however, a Participant's Account shall become 100% vested upon
a change in control (as defined in the Belk, Inc. 2000 Incentive Stock Plan or
any successor to such plan) to the extent such vesting does not result in an
excise tax on the Participant under Internal Revenue Code ss. 4999.
6.3. PROHIBITION AGAINST FUNDING. It is the express intention of the
parties hereto that this arrangement shall be unfunded for tax purposes and for
purposes of Title I of the Employee Retirement Income Security Act of 1974, as
amended. Each Participant and Beneficiary shall be required to look to the
provisions of this 2004 SERP and to the Employer for enforcement of any and all
benefits due under this 2004 SERP, and to the extent any such person acquires a
right to receive payment under this 2004 SERP, such right shall be no greater
than the right of any unsecured general creditor of the Employer.
ARTICLE VII - PAYMENTS
7.1. DISTRIBUTION ELECTION. Each Participant shall designate on his or
her Distribution Form the method of his or her Account distribution.
7.2. PAYMENT OPTIONS UPON RETIREMENT.
(a) Account payments shall commence as soon as
administratively feasible immediately after the Participant's Retirement, as
defined in Section 2.18, but in no event shall such distribution commence later
than ninety (90) days following Participant's Retirement. The Participant may
elect any one (1) of the following forms of payment so long as the election is
made in writing and delivered to the Committee at least one (1) year prior to
the year in which the benefit payments commence.
(1) The normal form of payment of vested benefits
hereunder, and the form of payments to be used if no other election is made,
shall be a single lump-sum distribution of the value of the vested portion of
the applicable Participant's Account.
(2) A Participant entitled to a benefit hereunder may
elect to receive his or her Account in substantially equal annual installments
over a period not to exceed fifteen (15) years.
(b) The amount of the substantially equal payments described
above, and referenced in the 2004 SERP document herein, shall be determined by
multiplying the Participant's Account by a fraction, the denominator of which in
the first year of payment equals the number years over which benefits are to be
paid, and the numerator of which is one (1). The amounts of the payments for
each succeeding year shall be determined by multiplying the Participant's
Account as of the applicable anniversary of the Participant's effective date of
Retirement by a fraction, the denominator of which equals the number of
remaining years over which benefits are to be paid, and the numerator of which
is one (1).
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(c) If a Participant's employment is terminated for any reason
other than Retirement, such balance shall be distributed in accordance with
Section 7.3 of this Plan and applicable Distribution Form.
7.3. COMMENCEMENT OF PAYMENT UPON DEATH, DISABILITY OR TERMINATION OF
EMPLOYMENT.
(a) Upon the death of a Participant, all amounts credited to
his or her Account shall be 100% vested and paid, to Participant's Beneficiary
or Beneficiaries in one (1) lump-sum payment, as soon as administratively
feasible.
(b) Upon the Disability of a Participant, all amounts credited
to his or her Account shall be 100% vested and paid to the Participant, in one
(1) lump-sum payment, as soon as administratively feasible.
(c) Upon the Termination of Employment of a Participant, other
than through Retirement, death or Disability, all vested amounts credited to his
or her Account shall be paid to the Participant in one (l) lump sum payment as
soon as administratively feasible;
7.4. MINIMUM DISTRIBUTION. Notwithstanding any provision to the
contrary, if the vested balance of a Participant's Account at the time of a
termination due to Retirement is less than $10,000, then the Participant shall
be paid his or her benefits in one (1) lump sum payment as soon as
administratively feasible following said Retirement.
7.5. RIGHT OF COMPANY TO WITHHOLD. The Company shall have the right to
withhold from any payments due under the 2004 SERP the amount of any federal,
state or local taxes required by law to be withheld from such payments.
7.6 CHANGES IN ELECTIONS. A Participant may change a prior election
regarding the form of benefit to be paid by filing with the Committee, at least
one (1) year prior to the year in which the benefit payments commence, a new
properly completed Distribution Form electing a form of distribution made
available under this 2004 SERP.
7.7 BENEFICIARIES. Each Participant may from time to time designate one
or more persons (who may be any one or more members of such person's family or
other persons, trusts, foundations or other entities) as his Beneficiary under
the 2004 SERP. Such designation shall be made on a Beneficiary Form prescribed
by the Committee.
Each Participant may at any time and from time to time, change any previous
Beneficiary designation, without notice to or consent of any previously
designated Beneficiary, by amending his previous designation on a Beneficiary
Form prescribed by the Committee.
If the Beneficiary does not survive the Participant (or is otherwise unavailable
to receive payment) or if no Beneficiary is validly designated, then the amounts
payable under this Plan shall be paid to the Participant's surviving spouse, if
any, and, if none, the Participant's estate.
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If more than one person is the Beneficiary of a deceased Participant, each such
person shall receive a pro rata share of any death benefit payable unless
otherwise designated on the applicable Beneficiary Form. If a Beneficiary of a
deceased Participant dies before being paid the benefit to which he is entitled,
all benefits that were payable to such Beneficiary shall then be payable to the
estate of that Beneficiary.
7.8 LOST BENEFICIARY.
(a) All Participants and Beneficiaries shall have the
obligation to keep the Committee informed of their current address until such
time as all benefits due have been paid.
(b) If a Participant or Beneficiary cannot be located by the
Committee exercising due diligence, then, in its sole discretion, the Committee
may take one (1) of the following actions:
(1) presume that the Participant or Beneficiary is
deceased for purposes of the 2004 SERP and all unpaid amounts (net of due
diligence expenses) owed to the Participant or Beneficiary shall be paid
pursuant to Section 7.7, herein above. Any such presumption of death shall be
final, conclusive and binding on all parties; or
(2) if a Beneficiary cannot be so located, then such
amounts may be forfeited. Notwithstanding the foregoing, if any such Beneficiary
is located within five (5) years from the date of any such forfeiture, such
beneficiaries shall be entitled to receive the amount previously forfeited.
ARTICLE VIII - ADMINISTRATION AND CLAIMS
8.1. ERISA PROVISIONS. Named Fiduciary, Determination of Benefits,
Claims Procedure and Administration.
(a) Named Fiduciary. The Company is hereby designated as the
named fiduciary under this 2004 SERP. The named fiduciary shall have authority
to control and manage the claims review under this 2004 SERP.
(b) Claim. A Participant, Beneficiary or other person who
believes that he or she is being denied a benefit to which he or she is entitled
(hereinafter referred to as "Claimant"), or his or her duly authorized
representative, may file a written request for such benefit with the Executive
Vice President-Human Resources of the Company (the "First Level Reviewer")
setting forth his or her claim. Such claim must be addressed to the Executive
Vice President - Human Resources of the Company, at its then principal place of
business.
(c) Claim Decision. Upon receipt of a claim, the First Level
Reviewer shall advise the Claimant that a reply will be forthcoming within a
reasonable period of time, but ordinarily not later than ninety (90) days, and
shall, in fact, deliver such reply within such period. However, the First Level
Reviewer may extend the reply period for an additional ninety (90) days for
reasonable cause. If the reply period will be extended, the First Level Reviewer
shall
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advise the Claimant in writing during the initial ninety (90) day period
indicating the special circumstances requiring an extension and the date by
which the First Level Reviewer expects to render the benefit determination. The
First Level Reviewer has discretionary authority to determine a Claimant's
eligibility for benefits and to interpret the terms of this Agreement.
If the claim is denied in whole or in part, the First Level Reviewer
will render a written opinion, using language calculated to be understood by the
Claimant, setting forth:
(1) the specific reason or reasons for the denial;
(2) the specific references to pertinent Plan
provisions on which the denial is based;
(3) a description of any additional material or
information necessary for the Claimant to perfect the claim and an explanation
as to why such material or such information is necessary;
(4) appropriate information as to the steps to be
taken if the Claimant wishes to submit the claim for review, including a
statement of the Claimant's right to bring a civil action under Section 502(a)
of ERISA following an adverse benefit determination on review; and
(5) the time limits for requesting a review of the
denial under Subsection (d) hereof and for the actual review of the denial under
Subsection (e) hereof.
(d) Request for Review. Within sixty (60) days after the
receipt by the Claimant of the written opinion described above, the Claimant may
request in writing that the Chairman-Belk, Inc. Employee Benefits Committee (the
"Second Level Reviewer") review the First Level Reviewer's prior determination.
Such request must be addressed to the Chairman-Belk, Inc. Employee Benefits
Committee, at the Company's then principal place of business. The Claimant or
his or her duly authorized representative may submit written comments,
documents, records or other information relating to the denied claim, which such
information shall be considered in the review under this subsection without
regard to whether such information was submitted or considered in the initial
benefit determination. The Claimant or his or her duly authorized representative
shall be provided, upon request and free of charge, reasonable access to, and
copies of, all documents, records and other information which (i) was relied
upon by the First Level Reviewer in making its initial claims decision, (ii) was
submitted, considered or generated in the course of the First Level Reviewer
making its initial claims decision, without regard to whether such instrument
was actually relied upon by the First Level Reviewer in making its decision or
(iii) demonstrates compliance by the First Level Reviewer with its
administrative processes and safeguards designed to ensure and to verify that
benefit claims determinations are made in accordance with this 2004 SERP and
that, where appropriate, the provisions of this 2004 SERP have been applied
consistently with respect to similarly situated claimants. If the Claimant does
not request a review of the First Level Reviewer's determination within such
sixty (60) day period, he or she shall be barred and estopped from challenging
such determination.
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(e) Review of Decision. Within a reasonable period of time,
ordinarily not later than sixty (60) days, after the Second Level Reviewer's
receipt of a request for review, it will review the First Level Reviewer's prior
determination. If special circumstances require that the sixty (60) day time
period be extended, the Second Level Reviewer will so notify the Claimant within
the initial sixty (60) day period indicating the special circumstances requiring
an extension and the date by which the Second Level Reviewer expects to render
its decision on review, which shall be as soon as possible but not later than
120 days after receipt of the request for review. In the event that the Second
Level Reviewer extends the determination period on review due to a Claimant's
failure to submit information necessary to decide a claim, the period for making
the benefit determination on review shall not take into account the period
beginning on the date on which notification of extension is sent to the Claimant
and ending on the date on which the Claimant responds to the request for
additional information. The Second Level Reviewer has discretionary authority to
determine a Claimant's eligibility for benefits and to interpret the terms of
this Agreement. Benefits under this Agreement will be paid only if the Second
Level Reviewer decides in its discretion that the Claimant is entitled to such
benefits. The decision of the Second Level Reviewer shall be final and
non-reviewable, unless found to be arbitrary and capricious by a court of
competent review. Such decision of the Second Level Reviewer will be binding
upon the Employer and the Claimant.
(f) If the Second Level Reviewer makes an adverse benefit
determination on review, the Second Level Reviewer will render a written
opinion, using language calculated to be understood by the Claimant, setting
forth:
1. the specific reason or reasons for the denial;
2. the specific references to pertinent Plan provisions
on which the denial is based;
3. a statement that the Claimant is entitled to receive,
upon request and free of charge, reasonable access
to, and copies of, all documents, records and other
information which (i) was relied upon by the Second
Level Reviewer in making its decision, (ii) was
submitted, considered or generated in the course of
the Second Level Reviewer making its decision,
without regard to whether such instrument was
actually relied upon by the Second Level Reviewer in
making its decision or (iii) demonstrates compliance
by the Second Level Reviewer with its administrative
processes and safeguards designed to ensure and to
verify that benefit claims determinations are made in
accordance with this 2004 SERP, and that, where
appropriate, the provisions of this 2004 SERP have
been applied consistently with respect to similarly
situated claimants; and
4. a statement of the Claimant's right to bring a civil
action under Section 502(a) of ERISA following the
adverse benefit determination on such review.
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A Claimant whose appeal has been denied under this Section 8.1
shall have the right to submit said claim to final and binding arbitration in
the State of North Carolina pursuant to the rules of the American Arbitration
Association. Any such requests for arbitration must be filed by written demand
to the American Arbitration Association within sixty (60) days after receipt of
the decision regarding the appeal. The costs and expenses of arbitration,
including the fees of the arbitrators, shall be borne by the losing party. The
prevailing party shall recover as expenses all reasonable attorneys' fees
incurred by it in connection with the arbitration proceeding or any appeals
therefrom. This Article VIII is intended to comply with the ERISA claims
regulations application to the Plan and is not intended to grant (and shall not
grant) the Claimant any rights in addition to the minimum rights required to be
granted under the applicable ERISA regulations.
(g) A Claimant shall not review his or her own claim for
benefits. Such review shall be made by such person as the Chairman of the Board
of Directors of the Company designates for this purpose.
8.2 COMMITTEE. The Committee shall establish such rules and procedures
for taking actions on behalf of the Plan as it deems necessary or appropriate
from time to time. Further, to the extent the Committee is considering an action
on behalf of a Participant who is a member of the Committee, such Participant
shall not participate in such considerations and shall not vote on any matter
specifically relating to him or her.
ARTICLE IX - MISCELLANEOUS
9.1. AMENDMENT AND TERMINATION.
(a) Amendment
(1) Right to Amend. The Board of Directors of the Company, by
written instrument, shall have the right to amend the 2004 SERP at any time and
with respect to any provisions hereof, and all parties hereto or claiming any
interest hereunder shall be bound by such amendment; provided, however, that no
such amendment shall deprive the Participant or any Beneficiary(s) of a rights
accrued hereunder prior to the date of the amendment, including the right to
receive the payment of his or her benefit upon a benefit entitlement event.
(2) Amendment Required by Law. Notwithstanding anything to the
contrary, the 2004 SERP Plan may be amended at any time, retroactively if
required, if found necessary, in the opinion of the Board of Directors of the
Company, in order to ensure that the 2004 SERP is characterized as a
non-tax-qualified plan of deferred supplemental retirement compensation
maintained for members of a select group of management or highly compensated
employees as described under Internal Revenue Code of 1986, as amended from time
to time, ("Code") Section 451 and ERISA Sections 201(2), 301(a) (3) and 401 and
to conform the 2004 SERP to the provisions and requirements of any applicable
law (including ERISA and the Code).
(b) Termination
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The Board of Directors of the Company reserves the right, at
any time, to terminate the Plan; provided however, that no such termination
shall deprive the Participant or any Beneficiary of a right accrued hereunder
prior to the date of termination and provided that, upon termination, the
Participant shall become fully and immediately vested in his or her 2004 SERP
benefit and the full amount of his or her 2004 SERP benefit shall become
immediately distributable to the Participant or Beneficiary(s).
9.2. NO CONTRACT OF EMPLOYMENT. The establishment of the 2004 SERP, any
modification thereof, the creation of one or more Accounts, and/or the making of
any payments under the 2004 SERP, shall not give any associate the right to
remain in the service of any Employer, and all Participants and other associates
shall remain subject to discharge to the same extent as if the 2004 SERP had
never been adopted.
9.3. TAX EFFECTS. None of the Company, any other Employer, the
Committee or any other person, represents or guarantees that any particular
federal, state or local tax consequences shall occur as a result of any
Participant's participation in this 2004 SERP. Each Participant is encouraged to
consult with his or her own advisors regarding the tax consequences of
participation in this 2004 SERP.
9.4. NONALIENATION OF BENEFITS. None of the payments, benefits, or
rights of any Participant or Beneficiary shall be subject to any claim of any
creditor of such Participant or Beneficiary and, to the fullest extent permitted
by law, all such payments, benefits and rights shall be free from attachment,
garnishment or any other legal or equitable process available to any creditor of
such Participant or Beneficiary. No Participant or Beneficiary shall have the
right to alienate, commute, pledge, encumber or assign any of the benefits or
payments which the Participant or Beneficiary may expect to receive,
contingently or otherwise, under the 2004 SERP, except the right of a
Participant to designate a Beneficiary.
9.5. PARTICIPANTS' RIGHTS UNSECURED. The 2004 SERP shall at all times
be entirely unfunded. The claim of a Participant or Beneficiary to receive a
distribution hereunder from any Employer shall at all times be a claim of a
general and unsecured creditor of the Employer, and neither the Participant nor
any Beneficiary shall have any right in or against any specific assets of any
Employer.
9.6. LIMITATION OF LIABILITY. The liability of the Employer and the
Committee under this 2004 SERP shall be limited to the obligations expressly set
forth in the 2004 SERP, and no term or provision of this 2004 SERP may be
construed to impose any further or additional duties, obligations or costs on
the Employer or the Committee not expressly set forth in the 2004 SERP.
9.7. PAYMENTS TO MINORS, ETC. Any amount payable to or for the benefit
of a minor, an incompetent person or any other person incapable of receipting
thereof may be paid to such person's guardian, to any trustee or guardian
holding assets for the benefit of such person, or to any person providing, or
reasonably appearing to provide, for the care of such person, and such payment
shall fully discharge the Committee and the Employer with respect thereto.
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9.8. NOTICES. Notices under the 2004 SERP shall be deemed to be
sufficiently given if sent by first class, registered or certified mail
addressed (i) to a Participant or Beneficiary at such person's last known
address as set forth in the books and records of the Employer, or (ii) to the
Company, Employer and the Committee at the principal offices of the Company.
9.9. HEADINGS AND CAPTIONS. The headings and captions in the 2004 SERP
are provided for convenience only and shall not be employed in the construction
of the 2004 SERP.
9.10. ENTIRE AGREEMENT. This 2004 SERP and any subsequently adopted
amendments thereto shall constitute the entire agreement or contract between the
Employer and the Participants and Beneficiaries regarding the 2004 SERP. No oral
statement regarding the 2004 SERP may be relied upon by any Participant or
Beneficiary.
9.11. SEVERABILITY. If any term or provision of this 2004 SERP shall be
held invalid or unenforceable by a court of competent jurisdiction, such
invalidity or unenforceability shall not affect the remaining terms and
provisions hereof, and this 2004 SERP shall be construed and enforced as if such
provision had not been included.
9.12. THIRD PARTIES. Nothing expressed or implied in this 2004 SERP is
intended or may be construed to give any person other than Participants and
Beneficiaries any rights or remedies under the 2004 SERP.
9.13. GOVERNING LAW. The laws of the State of Delaware applicable to
agreements to be performed in the State of Delaware shall apply in determining
the construction and validity of the 2004 SERP and all rights and obligations
under the 2004 SERP, except to the extent such laws are preempted by federal
law.
9.14. CONSTRUCTION OF THE 2004 SERP. The Committee shall have sole
discretionary authority to interpret the 2004 SERP and determine all questions
arising in the administration, interpretation and application of the 2004 SERP.
It shall endeavor to act, whether by general rules or by particular decisions,
so as to treat all persons in similar circumstances uniformly. The Committee's
interpretations and determinations shall be final and binding on all persons.
The Committee shall provide the Trustee, if applicable, with instructions
regarding payments of benefits. The Committee shall provide directions to the
Trustee, if applicable, with respect to valuations at dates other than valuation
dates and all other matters when called for in the 2004 SERP or requested by the
Trustee. The Committee may waive any period of notice required under the 2004
SERP.
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IN WITNESS WHEREOF, the Company has caused this Belk Inc., 2004
Supplemental Executive Retirement Plan to be executed by its duly authorized
officer this 21st day of March, 2004.
BELK, INC.
By: Stephen J. Pernotto
Its: Executive Vice President - Human Resources
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EXHIBIT A
EMPLOYER
PARENT SUBSIDIARY GROUPS FEDERAL ID #
------------------------ ------------
(1) Belk, Inc. (Parent) 56-2058574
Belk Stores Services, Inc. (sub) 56-0616731
Belk Administration Company
(formerly Archdale Advertising Agency, Inc.
(sub of Belk Stores Services, Inc.) 56-0945905
The Belk Center, Inc. (sub) 56-0994215
Belk International, Inc. (sub) 56-1055129
Belk-Simpson Company, Greenville, South Carolina (sub) 57-0122410
United Electronic Services, Inc. (sub) 54-1682897
Belk National Bank (sub) 56-2130612
Note 1: The following 2 entities are divisions of Belk Stores
Services, Inc.:
* Belk Stores of Virginia LLC 56-2060596
* Belk Accounts Receivable, LLC Not applied for
Note 2: The following entities are divisions of Belk, Inc.
* Belk Gift Card Company LLC Not applied for
* BELK TEXAS LLC Not applied for
* BELK TEXAS LP Not applied for
Note 3: The following entity is a division of Belk
International, Inc.
* Belk Merchandising LLC 27-0021953