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EXHIBIT 10.28
PERFORMANCE FOOD GROUP COMPANY
EXECUTIVE DEFERRED COMPENSATION PLAN
1.1 Establishment of Plan. Performance Food Group Company (the
"Company") hereby establishes the Performance Food Group Company Executive
Deferred Compensation Plan (the "Plan") as a plan that is unfunded and
maintained by the Company and any other Adopting Employers primarily for the
purpose of providing deferred compensation for a select group of management or
highly compensated employees as described in Sections 201(2), 301(a)(3),
401(a)(1) and 4021(b)(6) of the Employee Retirement Income Security Act of 1974
("ERISA").
1.2 Purpose. The Company has established the Performance Food
Group Company Employee Savings and Stock Ownership Plan (the "ESOP"), which
permits an eligible employee of the Company or its adopting affiliates to elect
to reduce his taxable cash compensation in consideration for having the Company
make a contribution to the ESOP on the employee's behalf of an amount equal to
such reduction in compensation plus a certain matching amount. Effective
January 1, 1994, Section 401(a)(17) of the Code provides that compensation in
excess of $150,000 (as adjusted periodically for cost-of-living increases) may
not be taken into account in determining the amount of deferral or matching
contributions under the ESOP and other provisions of the Code place certain
other restrictions on the level of participation of certain employees in the
ESOP. The purpose of this Plan is to provide supplemental deferred compensation
to a select group of such employees.
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ARTICLE II
DEFINITIONS
The following words and phrases, when used herein, unless the context
already indicated otherwise, shall have the following meanings:
2.1 "Administrator" shall mean the Committee.
2.2 "Adopting Employer" shall mean any "Adopting Company" as
defined in the ESOP that has adopted the ESOP with the approval of the Company.
2.3 "Beneficiary" shall mean the person or persons designated by
a Participant on a form and in a manner prescribed by the Administrator or, if
no such designation is made, the person or persons entitled under the ESOP to
receive a benefit upon the death of a Participant whether as a result of (i) a
beneficiary designation by the Participant, (ii) the rights of a surviving
spouse under the ESOP or (iii) the provisions of the ESOP governing the payment
of death benefits in the absence of a valid beneficiary designation.
2.4 "Board" shall mean the Board of Directors of the Company.
2.5 "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
2.6 "Committee" shall mean the Plan Committee for the ESOP, which
serves as the plan administrator of the ESOP for purposes of ERISA.
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2.7 "Company" shall mean Performance Food Group Company, a
Tennessee corporation, and any successor by merger, consolidation or otherwise.
2.8 "Deferred Compensation Account" shall mean a bookkeeping
account established pursuant to Section 4.1 to serve as a measure of the
benefits payable to a Participant in the Plan.
2.9 "Effective Date" shall mean January 1, 1998.
2.10 "Eligible Executive" shall mean any employee of the Company
or an Adopting Employer who is a member of a select group of highly compensated
or management employees designated by the Compensation Committee of the Board.
An employee shall cease to be an Eligible Executive upon a determination by the
Committee or the Compensation Committee of the Board that he is no longer a
member of a select group of highly compensated or management employees.
2.11 "Employer" shall mean the Company and any Adopting Employer.
2.12 "ERISA" shall mean the Employee Retirement Income Security
Act of 1974, as amended from time to time.
2.13 "ESOP" shall mean the Performance Food Group Company Employee
Savings and Stock Ownership Plan as set forth in a document dated December 31,
1994, and as amended from time to time.
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2.14 "Participant" shall mean an individual who satisfies the
requirements to be a Participant pursuant to Article III.
2.15 "Plan" shall mean this Performance Food Group Company
Executive Deferred Compensation Plan.
2.16 "Plan Year" shall mean the twelve month period beginning each
January 1.
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ARTICLE III
PARTICIPATION
3.1 Participation. An Eligible Executive shall be eligible to
become a Participant in the Plan as of January 1 of any Plan Year as of which
he is an Eligible Executive. An Eligible Executive may become a Participant for
a particular Plan Year by making a valid election before the beginning of such
Plan Year by executing and filing with the Committee a deferred compensation
election and agreement form approved by the Committee, which election and
agreement shall contain (i) a statement that the Eligible Executive elects to
defer a portion of his compensation for the Plan Year as provided in Section
4.1 and (ii) a statement that such election is irrevocable. A Participant may
make an election to defer under the Plan only if he has made the maximum salary
reduction contributions under the ESOP permitted by Section 402(g) of the Code
or the maximum salary reduction contributions permitted under the terms of the
ESOP. For the first Plan Year in which an Eligible Executive is eligible to
participate in the Plan an Eligible Executive's election may be made after the
beginning of the Plan Year but within thirty (30) days after the date he
becomes an Eligible Executive. Any election to defer under this Section 3.1
after the beginning of the Plan Year shall apply only to compensation for
services performed after the date of such election.
3.2 Cessation of Participation. A Participant shall cease to be a
Participant upon receiving payment for the full amount of benefits to which the
Participant is entitled pursuant to Article V or upon a determination by the
Compensation Committee of the Board that he is no longer designated as an
Eligible Employee or upon determination by the Administrator that he is no
longer a member of a select group of highly compensated or management
employees.
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A Participant who is not an Eligible Executive for a Plan Year shall not be
entitled to make a deferral election under Section 3.1 for that Plan Year or to
receive further credit to his Deferred Compensation Account pursuant to Section
4.1 with respect to deferrals but shall continue to be a Participant with
respect to the benefits to which the Participant is entitled based on credits
received as a result of prior deferral elections and hypothetical earnings
thereon and shall continue to be entitled to credits for the accrual of
hypothetical earnings on credits pursuant to Section 4.2 based on such prior
credits for deferral elections and hypothetical earnings.
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ARTICLE IV
DEFERRAL OF PAYMENT OF COMPENSATION AND
ESTABLISHMENT OF DEFERRED COMPENSATION ACCOUNT
4.1 Establishment of Deferred Compensation Accounts. The
Committee and the Company or Adopting Employer shall establish an unfunded
individual Deferred Compensation Account consisting of book entries for each
Participant to which the following credits shall be made pursuant to this
Section 4.1 and Section 4.2. If an Eligible Executive makes a valid election in
the manner prescribed in Section 3.1 to defer a portion of his compensation for
a Plan Year, the Company or the Adopting Employer by which the Eligible
Executive is employed shall reduce the current cash compensation otherwise
payable to the Eligible Executive for that Plan Year by an amount equal to the
portion of his compensation that he elects to defer. The Committee and the
Company or Adopting Employer shall, for each Plan Year, credit to the Deferred
Compensation Account of each Eligible Executive who makes a valid deferral
election for that Plan Year an amount equal to the amount of such deferral for
the Plan Year. A Participant may elect to defer a flat dollar amount, the
portion of his compensation in excess of a flat dollar amount, a specified
percentage of his compensation or any other portion of his compensation that
the Administrator shall determine may be clearly specified and reasonably
administrable. A separate election may be made for a Participant's base salary
and for each quarterly bonus payment provided that each such election is made
before the beginning of the Plan Year as described in Section 3.1. Such credits
to the Participant's Deferred Compensation Account shall be made effective as
of the time the corresponding salary reduction contributions to the ESOP are
allocated to Participants' accounts pursuant to the ESOP.
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4.2 Accrual of Earnings. The Committee and the Company or
Adopting Employer shall credit each Participant's Deferred Compensation Account
with additional amounts to represent hypothetical investment earnings
(including losses) on the amounts credited to the Deferred Compensation Account
pursuant to Section 4.1. Such hypothetical investment earnings shall be accrued
commencing on the date of each credit made pursuant to Section 4.1 and shall
continue to accrue until the allocation date as of which benefits are
determined pursuant to Section 5.1. Additions credited to represent
hypothetical investment earnings shall be equal to the additional income that
would have been allocated to the Participant's accounts under the ESOP if an
amount equal to the credits made to the Deferred Compensation Account pursuant
to Section 4.1 (and any earlier credits for hypothetical investment earnings)
had been allocated to the Participant's corresponding accounts under the ESOP
and invested pursuant to the terms of the ESOP, taking into account the
Participant's selection of investment funds pursuant to the ESOP. During any
period that the Participant does not have an account balance under the ESOP,
such hypothetical investment earnings shall be determined taking into account
the investment funds offered pursuant to the ESOP that are selected by the
Participant and approved by the Administrator.
4.3. Communication of Account Balances. The Committee shall
communicate in writing to each Participant the value of the Participant's
Deferred Compensation Account as of each December 31 or at such more frequent
intervals (not to exceed quarterly) as may be determined by the Committee to be
appropriate.
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ARTICLE V
DISTRIBUTION OF DEFERRED COMPENSATION
5.1 Time of Payment of Deferred Compensation. The balance of the
Deferred Compensation Account of Participants shall not be subject to
forfeiture (other than as a result of investment losses included in the
hypothetical investment earnings credited pursuant to Section 4.2) and shall
become payable by the Company or Adopting Employer, in accordance with the
election made by the Participant at the time of his election to defer pursuant
to Section 3.1, commencing either:
(a) at the time of his termination from employment with
the Company and all Adopting Employers;
(b) at a specific date designated by the Participant; or
(c) in a combination of (a) and (b).
Such election by a Participant shall also specify whether his Deferred
Compensation Account is to be paid:
(a) in a lump sum;
(b) in pro rata annual installments for a period not to
exceed ten (10) years after his termination of employment, with each
installment equal to the unpaid balance of such Deferred Compensation
Account divided by the number of remaining installments and, if the
Participant dies before all installments are made, with the remaining
installments being made to his Beneficiary; or
(c) in a combination of (a) and (b).
Such election by a Participant may also specify that, notwithstanding his
election to have payment commence on a specified distribution date, the Company
or Adopting Employer shall
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immediately pay the Participant the balance of his Deferred Compensation
Account in a lump sum within thirty (30) days:
(a) in the event (i) there is a change in control of the
Company as defined in the Company's 1997 Stock Incentive Plan and (ii)
the Participant's employment is terminated for any reason within two
(2) years after the change in control has occurred; or
(b) in the event his employment is terminated:
(i) involuntarily (including as the result of
disability); or
(ii) voluntarily, following:
(A) any reduction in the Participant's
base salary or annual available bonus opportunity;
(B) any material reduction in the
level of responsibility, position (including status,
office, title, reporting relationships or working
conditions), authority or duties of the Participant;
or
(C) any relocation to which the
Participant has not agreed to an office of the
Company or Adopting Employer more than thirty-five
(35) miles from the office where the Participant was
located or any increase in the Participant's
required travel amounting to a constructive
relocation.
A Participant may elect one time and method of payment for himself and a
different time or method of payment for his Beneficiary.
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5.2 Withholding. There shall be deducted from all payments under
the Plan the amount of any taxes required to be withheld by any federal, state
or local government. The Participants and their Beneficiaries and personal
representatives shall bear any and all federal, foreign, state or local taxes
imposed on amounts paid under the Plan.
5.3 Restriction on Alienation or Assignment. The right of a
Participant to benefits under the Plan shall not be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment or garnishment by creditors of the Participant or the Participant's
Beneficiary, nor shall any such amount be in any manner liable for or subject
to the debts, contracts, liabilities, engagements or torts of the person
entitled to such benefit.
5.4 Unforeseen Emergency. Upon application by a Participant or
Beneficiary and approval thereof by the Committee, a Participant (or a
Beneficiary after the death of the Participant) may withdraw, upon a showing of
an unforeseen emergency, part or all of the amount then credited in his
Deferred Compensation Account. For purposes of this Section 5.4, unforeseen
emergency shall mean an unanticipated emergency that is caused by an event
beyond the control of the Participant or Beneficiary and that would result in
severe financial hardship to the Participant or Beneficiary if early withdrawal
were not permitted resulting from a sudden and unexpected illness or accident
of the Participant or Beneficiary (or of a dependent (as defined in Section
152(a) of the Code)) of the Participant or Beneficiary, loss of the
Participant's or Beneficiary's property due to casualty or other similar
extraordinary and unforeseeable circumstances arising as a result of events
beyond the control of the Participant or Beneficiary, which unforeseen
emergency may not be relieved through reimbursement or
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compensation by insurance or otherwise, by liquidation of the Participant's or
Beneficiary's assets (to the extent such liquidation would not itself cause
severe financial hardship), or by cessation of deferrals under the Plan.
Withdrawals of amounts because of an unforeseeable emergency may be permitted
only to the extent reasonably necessary to satisfy the emergency need.
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ARTICLE VI
FINANCING THE PLAN
6.1 Costs Borne by the Company and the Adopting Employers. The
costs of the Plan shall be borne by the Company and the Adopting Employers. No
reserve that may be accumulated by the Company or the Adopting Employers for
the payment of benefits under the Plan shall be allocated to Participants or
Beneficiaries or to any Eligible Executive.
6.2 Medium of Financing the Plan. The Plan shall be financed by
benefit payments to Participants from the general assets of the Company and the
Adopting Employers. The Company and the Adopting Employers may accumulate a
reserve or reserves which shall remain the property of the respective employers
as part of the general assets of the employers. Participants shall have the
status of general unsecured creditors of the Company or the Adopting Employers
and the Plan constitutes a mere promise by the Company or the Adopting
Employers to make benefit payments in the future. Any contract, policy or other
asset which the Company or the Adopting Employers may utilize to assure
themselves of the funds to provide the benefits under the Plan shall not serve
in any way as security for the payment of Plan benefits and neither the Company
nor any Adopting Employer shall be under any obligation whatsoever to purchase
or maintain any contract, policy or other asset to provide the benefits payable
under the Plan. It is the intention of the parties that the Plan is to be
unfunded for income tax purposes and for purposes of Title I of ERISA.
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ARTICLE VII
ADMINISTRATION
7.1 Administration. The Committee shall be the Administrator of
the Plan and shall have the sole responsibility for the administration of the
Plan. The Committee may designate persons other than the Committee to carry out
responsibilities under the Plan. All usual and reasonable expenses of the
Committee in administering the Plan shall be paid by the Company and the
Adopting Employers. No member of the Committee who is an employee of the
Company or any affiliate shall receive additional compensation for his services
in administering the Plan.
7.2. Claims Procedure. The Committee shall make all determinations
as to the right of any person to a benefit under the Plan. Any denial by the
Committee of a claim for benefits by a Participant or Beneficiary shall be
stated in writing by the Committee and delivered or mailed to the Participant
or Beneficiary; any such notice shall set forth the specific reasons for the
denial, written in a manner that may be understood by a layman. In addition,
the Committee shall afford a reasonable opportunity to any Participant or
Beneficiary whose claim for benefits has been denied to submit a written
request that the decision denying the claim be reviewed by the Committee.
7.3 Committee Powers and Duties. The Committee shall have such
discretion, duties and powers as may be necessary to discharge its duties
hereunder, including, but not by way of limitation, the following:
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(a) To construe and interpret the Plan, decide all
questions of eligibility and determine the amount, manner and time of
payment of any benefits hereunder;
(b) to prescribe procedures to be followed by
Participants or Beneficiaries in filing application for benefits; and
(c) to appoint or employ individuals to assist in the
administration of the Plan and any other agents it deems advisable,
including legal and actuarial counsel.
Except to the extent the Committee is expressly authorized in the Plan to
exercise discretion to be used to calculate benefits under the Plan, the
Committee shall have no power to add to, subtract from or modify any of the
terms of the Plan, or to change or add to any benefits provided by the Plan, or
to waive or fail to apply any requirements of eligibility for a benefit under
the Plan.
7.4 Rules and Decisions. The Committee may adopt such rules as it
deems necessary, desirable or appropriate. All rules and decisions by the
Committee shall be uniformly and consistently applied to all Participants and
Beneficiaries in similar circumstances. When making a determination or
calculation, the Committee shall be entitled to rely upon information furnished
by a Participant or Beneficiary, the Company, the Adopting Employers, or the
legal counsel of the Company or any Adopting Employer.
7.5 Duty to Keep Records and File Reports. The Committee shall
keep records and other data as may be necessary for proper administration of
the Plan. The Committee shall file or cause to be filed all annual reports,
financial and other statements as may be required by any federal or state
statute, agency or authority within the time prescribed by law
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or regulation for filing such documents. The Committee shall furnish such
reports, statements and other documents to Participants and Beneficiaries of
the Plan as may be required by any federal or state statute or regulation.
7.6 Authorization of Benefit Payments. The Committee shall issue
directions concerning all benefits that are to be paid pursuant to the
provisions of the Plan.
7.7 Application and Forms for Benefits. The Committee may require
a Participant or Beneficiary to complete and file with the Committee an
application for a benefit and all other forms approved by the Committee, and to
furnish all pertinent information requested by the Committee. The Committee may
rely upon all such information so furnished it, including the current mailing
address of the Participant or Beneficiary.
7.8 Facility of Payment. Whenever, in the Committee's opinion, a
person entitled to receive any payment of a benefit or installment thereof
hereunder is under a legal disability or is incapacitated in any way so as to
be unable to manage his financial affairs, the Committee may direct payments to
such person or to his legal representative or to a relative or friend of such
person for his benefit, or the Committee may direct the payment for the benefit
of such person in such manner as the Committee considers advisable. Any payment
of a benefit or installment thereof in accordance with the provisions of this
Section shall be a complete discharge to the Committee, the Company and the
Adopting Employers of any liability for the making of such payment under the
provisions of the Plan.
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7.9 Indemnification of Committee Members. The Company and the
Adopting Employers shall indemnify and hold harmless each member of the
Committee against any and all liability, claims, damages and expense, including
fees of individuals appointed pursuant to Section 7.3(c) that the member may
incur in administration of the Plan, unless arising from the gross negligence
or willful misconduct of such member.
7.10 Governing Law. The Plan, except as otherwise provided by
ERISA or other laws of the United States of America, shall be construed in
accordance with and governed by the laws of the State of Tennessee.
7.11 Severability. If any of the provisions of the Plan shall be
for any reason invalid or unenforceable, the remaining provisions shall
nevertheless remain in full force and effect.
7.12 Provisions of the Plan to Control. In the event of any
conflict between the terms of the Plan as set forth in this instrument and any
description of the Plan that may be furnished to the Participants or others,
the Plan set forth herein shall control.
7.13 No Right to Continued Employment. Nothing contained herein
shall be construed as conferring upon a Participant the right to continue in
the employ of the Company or any Adopting Employer as an Eligible Executive or
as a manager or in any other capacity.
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ARTICLE VIII
AMENDMENTS AND TERMINATION OF PLAN
8.1 Amendments and Terminations. The Board reserves the right to
amend or terminate the Plan. In the event of any such amendment or termination
such amendment or termination shall not reduce the amount of the payment of any
benefit currently payable to any individual who is a Participant or Beneficiary
on the effective date of the amendment or termination or eliminate the right of
a Participant to payment of the then current balance of the Participant's
Deferred Compensation Account. Any action by the Company amending or
terminating the Plan may be by resolution of the Board or by any person or
persons duly authorized by resolution of the Board to take such action.
8.2 Distribution of Assets Upon Termination. The Company and the
Adopting Employers shall retain absolute ownership of any assets held to
finance the payment of benefits under the Plan. Upon termination of the Plan,
any such assets held by the Company and the Adopting Employers or otherwise
held as a reserve for the payment of such benefits shall remain the property of
the Company and the Adopting Employers. No Participant or Beneficiary shall
have any right or claim to such assets except as provided herein.
IN WITNESS WHEREOF, Performance Food Group Company has caused this
instrument to be executed on the ____ day of _____________, 1997, effective
January 1, 1998, by its duly authorized officers.
ATTEST: PERFORMANCE FOOD GROUP COMPANY
By:
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