Exhibit 10.26
THE PENN TRAFFIC COMPANY
SUPPLEMENTAL RETIREMENT PLAN
FOR
NON-EMPLOYEE EXECUTIVES
TABLE OF CONTENTS
Article I Establishment, Purpose and Effective Date of Plan....................1
1.1 Establishment........................................................1
1.2 Purpose..............................................................1
1.3 Effective Date.......................................................1
Article II Definitions.........................................................1
2.1 Definitions..........................................................1
2.2 Other Defined Terms..................................................4
2.3 Gender and Number....................................................4
Article III Vesting............................................................4
3.1 Vesting..............................................................4
Article IV Accounts and Credits To Accounts....................................4
4.1 Accounts.............................................................4
4.2 Basic Pay-Based Credits..............................................4
4.3 Interest Credits.....................................................5
4.4 Opening Account Balance..............................................5
Article V Retirement Benefits..................................................6
5.1 Normal Retirement Benefit............................................6
5.2 Late Retirement Benefit..............................................6
5.3 Early Retirement Benefit.............................................6
5.4 Disability Benefit...................................................7
5.5 Form of Benefit......................................................7
5.6 Payment of Normal Retirement Benefit.................................8
5.7 Termination Prior to Normal Retirement...............................8
5.8 Limitation on Annual Benefits.......................................10
Article VI Claims Procedure...................................................11
6.1 Written Request.....................................................11
6.2 Notice of Denial....................................................11
6.3 Content of Notice...................................................11
6.4 Review Procedures...................................................12
6.5 Decision on Review..................................................12
Article VII General Provisions................................................13
7.1 Administration......................................................13
7.2 Funding.............................................................13
7.3 No Employment Contract..............................................13
7.4 Spendthrift Provision...............................................14
7.5 Binding Effect......................................................14
i
7.6 Applicable Law......................................................14
7.7 Administrative Discretion...........................................14
7.8 Withholding.........................................................14
7.9 Severability........................................................15
7.10 Amendment and Termination...........................................15
7.11 Titles and Headings Not to Control..................................16
7.12 Small Benefits......................................................16
EXHIBIT A Actuarial Equivalence Factors
EXHIBIT B Beneficiary Designations
FORM I Beneficiary Designation
FORM II Beneficiary Designation for 50% or 100% Joint and Survivor Annuity
FORM III Beneficiary Designation for 10 Year Certain Life Annuity
ii
THE PENN TRAFFIC COMPANY
SUPPLEMENTAL RETIREMENT PLAN
FOR
NON-EMPLOYEE EXECUTIVES
ARTICLE I
ESTABLISHMENT, PURPOSE AND EFFECTIVE DATE OF PLAN
1.1 ESTABLISHMENT. The Penn Traffic Company ("Company"), a Delaware
corporation, hereby establishes a supplemental retirement program for
certain non-employee executives, which shall be known as The Penn
Traffic Company Supplemental Retirement Plan For Non-Employee
Executives ("Plan").
1.2 PURPOSE. The purpose of the Plan is to provide to the Executives named
in Exhibit "A", as amended from time to time, retirement income.
Payment of the retirement benefits under this Plan shall be made from
the general assets of the Company, or by such other method as is
consistent with Section 7.2 of this Plan and which is agreed to by the
Executives and the Company.
1.3 EFFECTIVE DATE. The Plan shall be effective as of June 29, 1999.
ARTICLE II
DEFINITIONS
2.1 DEFINITIONS. Whenever used herein, the following terms shall have their
respective meanings set forth below:
(A) "Account" means the bookkeeping account established and
maintained with respect to an Executive pursuant to Section
4.1.
(B) "Accrued Benefit" means, with respect to an Executive, the
monthly benefit determined in accordance with Section 5.1,
payable in the form of a single life annuity commencing at
Normal Retirement Date, or, if later, actual Termination Date.
(C) "Actuarial Equivalent", means with respect to a specified
annuity or benefit, another annuity or benefit commencing at a
different date and/or payable in a different form, but which
has the same present value when computed using the applicable
mortality and interest rate assumptions set forth in Exhibit
A, attached hereto.
(D) "Beneficiary" means the person(s) properly designated to
receive, under provisions of the Plan, benefits payable in the
event of the Executive's death.
(E) "Board" means the Board of Directors of the Company.
(F) "Code" means the Internal Revenue Code of 1986, as amended
from time to time, and any regulations relating thereto.
(G) "Committee" means the Compensation and Stock Option Committee
of the Board.
(H) "Company" means The Penn Traffic Company, a Delaware
corporation.
(I) "Compensation" means (i) with respect to Gary D. Hirsch,
$950,000 per annum and (ii) with respect to Martin A. Fox,
$500,000 per annum, prorated by days for the short year in
which their Termination Date occurs.
(J) "Corporate Plan" means The Penn Traffic Company Cash Balance
Pension Plan.
2
(K) "Disability" means being Disabled under Section 8(b) of the
Management Agreement.
(L) "Effective Date" means June 29, 1999.
(M) "Executive" means Gary D. Hirsch ("Hirsch") and Martin A. Fox
("Fox").
(N) "Interest Credits" means additions to an Executive's Account
determined pursuant to Section 4.3. Interest Credits shall be
earned each Plan Year based on the "Applicable Interest Rate"
as defined in Exhibit A, attached hereto.
(O) "Management Agreement" means the management agreement between
the Company and Hirsch & Fox, L.L.C. dated June 29, 1999 and
any extension or renewal thereof, or successor agreement
thereto.
(P) "Normal Retirement Date" means the first day of the month
coinciding with or next following the date the Executive
attains age 65.
(Q) "Opening Account Balance" means the initial bookkeeping
account established pursuant to Section 4.4 of the Plan.
(R) "Pay-Based Credit" means additions to an Executive's Account
determined pursuant to Section 4.2.
(S) "Plan" means The Penn Traffic Company Supplemental Retirement
Plan for Non-Employee Executives, as amended from time to
time.
(T) "Plan Year" means the period June 29, 1999 through December
31, 1999 and each subsequent twelve-month period from January
1st through December 31st for which this Plan is in effect.
3
(U) "Retirement Benefit" means the benefit payable to the
Executive on or after his Termination Date, but prior to his
death, pursuant to Article V of the Plan.
(V) "Surviving Spouse" means a person who is married to the
Executive at the date of his death, provided the Executive was
married to that person throughout the one-year period ending
on the date of his death.
(W) "Termination Date" means the date on which the Executive
ceases to provide services to the Company under the Management
Agreement for any reason.
2.2 OTHER DEFINED TERMS. Any capitalized terms that are used in the Plan,
which are not defined in this Article, shall have the meaning stated in
the Corporate Plan.
2.3 GENDER AND NUMBER. Except when otherwise indicated by the context,
words in the masculine gender when used in the Plan shall include the
feminine gender, the singular shall include the plural, and the plural
shall include the singular.
ARTICLE III
VESTING
3.1 VESTING. All benefits under this Plan shall be fully vested and
nonforfeitable at all times.
ARTICLE IV
ACCOUNTS AND CREDITS TO ACCOUNTS
4.1 Accounts.
(B) When an Account is initially established for an Executive, the
Account shall be credited with an Opening Account Balance in accordance
with Section 4.4
4.2 BASIC PAY-BASED CREDITS. An Executive shall accrue a Pay-Based Credit
under this Section 4.2 for each Plan Year. The amount of the Pay-Based
Credit for an Executive shall be three percent (3%) of the Executive's
Compensation for such Plan Year. The
4
determination of the amount creditable hereunder for a Plan Year shall
be made as of the last day of the Plan Year.
4.3 INTEREST CREDITS. Each Plan Year each Executive's Account shall be
automatically increased as of the last day of such Plan Year by
crediting the balance in such Account as of the last day of the
previous Plan Year (or, in the case of the first Plan Year, as of the
Effective Date), with an Interest Credit equal to said Account balance
multiplied by 5%. Such Interest Credits shall continue after the
Executive's Termination Date, provided, however, that no Interest
Credits shall be made to an Executive's Account for any Plan Year
beginning on or after the date on which payment of his benefit
commences. For the Plan Year in which the Executive's benefit
commencement date occurs, an Interest Credit shall be made on a pro
rata basis through the end of the month prior to the month in which the
date of benefit commencement occurs.
4.4 OPENING ACCOUNT BALANCE. Fox shall have an Opening Account Balance as
of the Effective Date which shall be reflected in an initial
bookkeeping account established on his behalf. Fox's Opening Account
Balance shall be $175,000.
5
ARTICLE V
RETIREMENT BENEFITS
5.1 NORMAL RETIREMENT BENEFIT. An Executive whose Termination Date is on or
after his Normal Retirement Date shall be entitled to receive a "Normal
Retirement Benefit" commencing on his Normal Retirement Date. An
Executive's Normal Retirement Benefit shall be the monthly benefit
payable as a single life annuity which is the Actuarial Equivalent of
the Executive's Account value as of the Executive's Normal Retirement
Date. An Executive's Accrued Benefit as of any date prior to the
Executive's Normal Retirement Date shall be the monthly benefit payable
as a single life annuity which is the Actuarial Equivalent of the
Executive's Account value at the date of determination projected to the
value it would have at the Executive's Normal Retirement Date assuming
additional Interest Credits continue to be made to the Account through
the Executive's Normal Retirement Date.
5.2 LATE RETIREMENT BENEFIT. If an Executive remains employed beyond his
Normal Retirement Date, he shall be entitled to receive a retirement
benefit equal to the greater of (i) the monthly benefit payable as a
single life annuity that is the Actuarial Equivalent of the value of
his Account as of his actual retirement date, considering all Pay-Based
Credits and Interest Credits thereto after his Normal Retirement Date,
or (ii) the Actuarial Equivalent of his Normal Retirement Benefit
computed at Normal Retirement Date, but based on payment commencing at
the time of actual retirement.
5.3 EARLY RETIREMENT BENEFIT. An Executive who has attained age 55 may
elect to retire prior to his Normal Retirement Date. Such an Executive
shall receive a retirement benefit commencing at Normal Retirement Date
equal to his Normal Retirement Benefit.
6
5.4 DISABILITY BENEFIT. An Executive who incurs a Disability prior to his
Termination Date has a right to a Retirement Benefit. Such a Disabled
Executive, or an Executive who, subsequent to his Termination Date
becomes Disabled, shall be entitled to receive a Retirement Benefit
payable as of the first day of any month subsequent to the
determination of Disability under the Management Agreement. The amount
of the disability benefit shall be the Actuarial Equivalent of the
Normal Retirement Benefit.
5.5 FORM OF BENEFIT. At least six months prior to the Executive's
Termination Date, or, subject to the consent of the Committee, at any
time prior to the Executive's Termination Date, the Executive may elect
to receive his Retirement Benefit in one of the following forms:
(B) a 50% joint and survivor annuity, payable monthly,
(D) a single life annuity, payable monthly, with 10 years
certain; or Each of the optional forms of benefit under Sections 5.5(B)
through (E) above, shall be the Actuarial Equivalent of the Executive's
Retirement Benefit. Unless the Executive shall have otherwise elected
as described above, the Executive's Retirement Benefit shall be paid in
a single lump sum, notwithstanding any other provision of the Plan. For
the joint and survivor options in Section 5.5(B) and (C) above, the
Executive shall designate a single Beneficiary before the commencement
date described in Section 5.6 ("commencement date"). The designation
may be changed up to the commencement date, but not thereafter. Thus,
no survivor benefits shall be payable if the Beneficiary predeceases
the Executive after the commencement date. For purposes of any benefit
payable upon the Executive's death prior to the commencement of his
benefit payments
7
and for purposes of the 10-year certain option in Section 5.5(D), (i)
the Executive may designate one or more primary Beneficiaries and one
or more secondary Beneficiaries; (ii) the designation may be changed up
to the Executive's date of death; and (iii) if no designated
Beneficiary survives the Executive, any payments due as the result of
the Executive's death prior to the commencement of payments or due for
the remainder of the10-year period shall be paid to the Executive's
estate. Sample Beneficiary designations are attached at Exhibit B.
5.6 PAYMENT OF NORMAL RETIREMENT BENEFIT. Once the Executive has reached
the Executive's Normal Retirement Date, payment of the Retirement
Benefit shall commence on the first day of the month following the
month in which the Termination Date occurs. Other than in the case of a
lump sum payment, payment of the Retirement Benefit shall cease as of
the first day of the month following the death of the Executive or the
Executive's Beneficiary, as the case may be, except when paid in the
form of a single life annuity with 10 years certain and the Executive
dies prior to the receipt of 120 monthly payments, in which case
payments shall cease upon payment of the 120th monthly payment.
5.7 TERMINATION PRIOR TO NORMAL RETIREMENT. In the event the Executive's
Termination Date is prior to the Executive's Normal Retirement Date,
the Executive shall be entitled to be paid his Retirement Benefit
pursuant to this Article V as follows:
(A) EARLY RETIREMENT. In the event the Executive's Termination
Date is after he has attained at least age fifty-five (55),
the Executive shall be entitled to receive his Retirement
Benefit. The Retirement Benefit shall be determined by: (i)
applying
8
the formula in Section 4.1 as of the date benefits commence
("early retirement date"); and (ii) reducing the resulting
amount by one-third of one percent (1/3%) for each month by
which the early retirement date precedes the Executive's
sixty-fifth (65th) birthday. In the event the Executive's
Termination Date is before January 1, 2003 and before he has
attained age 55, the Executive shall be entitled to receive,
upon reaching age 55, the reduced Retirement Benefit described
in the preceding sentence.
(B) EARLY PAYMENT. In lieu of a Retirement Benefit commencing at
Normal Retirement Date or an Early Retirement Benefit,
described in Subsection (A), above, an Executive may elect
early payment of the Actuarial Equivalent of his Normal
Retirement Benefit in a lump sum or annuity form of payment.
Such benefit may commence at the later of January 1, 2003 or
the first day of the month following his Termination Date.
(C) DEATH. If the Executive dies prior to the commencement of any
benefit payments under this Plan whether before or after his
Termination Date, the Executive's Beneficiary shall be
entitled to commence payment of a death benefit as of the
first day of any month after the Executive's death. Unless the
Beneficiary elects a form of benefit payment listed under
Section 5.5(A) through (D), the death benefit shall be payable
in a single lump sum in an amount which is the Actuarial
Equivalent of the Executive's Account value at the date of his
death increased by any Interest Credits made under the Plan
prior to the date on which distribution of the benefit is made
or commences. The foregoing rules regarding the payment of
9
death benefits under the Plan also shall apply if the
Executive's Termination Date is after his Normal Retirement
Date and the Executive dies before the payment of benefits
commences under the Plan.
(D) DEATH AFTER BENEFIT PAYMENTS Commence. If the Executive dies
after the commencement of benefit payments under this Plan,
benefits shall continue to the extent called for under the
optional form of benefit which had previously commenced.
5.8 LIMITATION ON ANNUAL BENEFITS. Notwithstanding anything to the contrary
set forth herein, the annual "pension expense" of the Company with
respect to this Plan for any Plan Year with respect to the Executives
as of the Effective Date shall not exceed $100,000 (or, for any Plan
Year consisting of less than twelve (12) months, the product of (A)
$100,000 and (B) a fraction, the numerator of which is the number of
full months in such short Plan Year, and the denominator of which is
twelve) ("Annual Limit"). For purposes of this Section 5.8, the term
"pension expense" shall mean the annual pension expense of the Company
as determined pursuant to Financial Accounting Standard #87, as
calculated by the Company's regular independent accounting firm. In the
event the Company's annual pension expense, determined in the absence
of this Section 5.8, would exceed the Annual Limit (the "Excess Pension
Expense"), the benefit of the Executives accrued for such Plan Year
shall be reduced in the following manner:
(i) by reducing the Interest Credits under Section 4.1 by
50% of the Excess Pension Expense and allocating the
reduction in proportion to the amount
10
of such Interest Credits attributable to each
Executive prior to the reduction mandated by this
Section 5.8; and
(ii) by reducing the Pay-Based Credits under Section 4.2
by 50% of the Excess Pension Expense and allocating
the reduction in proportion to the Pay-Based Credit
for each Executive prior to the application of the
reduction mandated by this Section 5.8.
ARTICLE VI
CLAIMS PROCEDURE
6.1 WRITTEN REQUEST. Any claim for benefits by the Executive or his
Beneficiaries shall be made in writing to the Committee. In this
Article VI, the Executive and his Beneficiaries are referred to
collectively as claimants.
6.2 NOTICE OF DENIAL. If the Committee denies a claim in whole or in part,
it shall send the claimant a written notice of the denial within 90
days after the date if receives a claim, unless it needs additional
time to make its decision. In that case, the Committee may authorize an
extension of up to an additional 90 days, if it notifies the claimant
of the extension within the initial 90-day period. The extension notice
shall state the reasons for the extension and the expected decision
date.
6.3 CONTENT OF NOTICE. A denial notice shall be written in a manner
calculated to be understood by the claimant and shall contain:
(A) the specific reason or reasons for the denial of the claim;
(B) specific reference to pertinent Plan provisions upon which the
denial is based ;
(C) a description of any additional material or information
necessary to perfect the claim, with an explanation of why the
material or information is necessary; and
11
(D) an explanation of the review procedures provided below.
6.4 REVIEW PROCEDURES.
(A) Within 60 days after the claimant receives a denial notice,
the claimant may file a request for review with the Committee.
Any such request must b made in writing.
(B) A Claimant who timely requests a review shall have the right
to review pertinent documents, to submit additional
information or written comments, and to be represented.
6.5 DECISION ON REVIEW.
(a) The Committee shall send the claimant a written decision on
any request for review within 60 days after the date it
receives a request for review, unless an extension of time is
needed, due to special circumstances. In that case, the
Committee may authorize an extension of up to an additional 60
days, provided it notifies the claimant of the extension
within the initial 60-day period.
(b) The review decision shall be written in a manner calculated to
be understood by the claimant and shall contain:
(i) the specific reason or reasons for the decision; and
(ii) specific reference to the pertinent Plan provisions
upon which the decision is based.
(c) If the Committee does not send the claimant a review decision
within the applicable time period, the claim shall be deemed
denied on review.
(d) The review decision (including a deemed decision) shall be the
Committee's final decision.
12
ARTICLE VII
GENERAL PROVISIONS
7.1 ADMINISTRATION. The Committee shall be responsible for the general
operation and administration of the Plan and for carrying out the
provisions hereof. The Committee shall be entitled to rely conclusively
upon all tables, valuations certificates, opinions and reports
furnished by any actuary, accountant, controller, counsel or other
person employed or engaged by the Company with respect to the Plan.
7.2 FUNDING. The Board, in its sole discretion, may elect to fund the
benefits payable under the Plan, through various investments. However,
any such investment shall remain the property of the Company and be
subject to the claims of general creditors of the Company. The
Executive shall have only the rights of a general unsecured creditor of
the Company with respect to any rights under this Plan. The Executive
may not pledge as collateral any investments purchased to fund benefits
under the Plan. Nothing contained in the Plan shall constitute a
guaranty by the Company or any other entity or person that assets of
the Company will be sufficient to pay any benefit hereunder. It is the
intention of the parties that this Plan will be an unfunded deferred
compensation plan solely for the benefit of non-employee executives and
thus would not be subject to the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"). However, if the Plan is interpreted
to be subject to ERISA, it is the intention of the parties that this
Plan be an unfunded deferred compensation plan solely for the benefit
of management and highly compensated employees for tax purposes and for
purposes of Title I of ERISA.
7.3 NO EMPLOYMENT CONTRACT. Nothing contained in this Plan shall be
construed as a contract of employment between the Company and the
Executive or as a limitation on the right of
13
the Company to terminate, discontinue , or fail to renew or extend the
Management Agreement, subject to the terms and conditions thereof, and
without regard to the effect that such discontinuity may have upon the
Executive's rights or potential rights, if any, under this Plan.
7.4 SPENDTHRIFT PROVISION. No interest of any person or entity in, or right
to receive a benefit under, the Plan shall be subject in any manner to
sale, transfer, assignment, pledge, attachment, garnishment, or other
alienation or encumbrance of any kind; nor may such interest or right
to receive a benefit be taken, either voluntarily or involuntarily, for
the satisfaction of the debts of or other obligations or claims
against, such person or entity, including claims for alimony, support,
separate maintenance and claims in bankruptcy proceedings.
7.5 BINDING EFFECT. This Plan shall be binding upon and inure to the
benefit of the Executives, their Surviving Spouses and Beneficiaries,
the Company and any successor to the Company, whether by merger,
consolidation, purchase, or otherwise.
7.6 APPLICABLE LAW. The Plan shall be governed by and construed in
accordance with the laws of the State of New York, except to the extent
preempted by ERISA, if it is determined that the Plan is subject to
ERISA.
7.7 ADMINISTRATIVE DISCRETION. The Plan shall be administered by the
Committee.
7.8 WITHHOLDING. Any payment made pursuant to this Plan shall be reduced by
federal and state income, FICA or other employee payroll, withholding
or other similar taxes that the Executive's employer may be required to
withhold. In addition, as the Retirement Benefit accrues during the
period of time that the Executive provides services to the Company
14
under the Management Agreement, the regular payments that the Company
makes to Hirsch & Fox LLC with respect to the Executive's services to
the Company shall be subject to FICA or other employee payroll,
withholding or other similar taxes which the Company may be required to
withhold on the accrual of benefits. The Company and Hirsch & Fox LLC
shall make such arrangements as are necessary and appropriate, in the
judgment of the Committee, to assure that the proper amount of federal
and state income, FICA or other employee payment, withholding or
similar tax has been withheld and reported to the appropriate
governmental authority or authorities without duplication.
7.9 SEVERABILITY. If one or more provisions of this Plan, or any part
thereof, shall be determined by a court of competent jurisdiction to be
invalid or unenforceable, then the Plan shall be administered as if
such invalid or unenforceable provision had not been contained in the
Plan. The invalidity or unenforceability of any Plan provision, or any
part thereof, shall not effect the validity and enforceability of any
other Plan provision or any part thereof.
7.10 AMENDMENT AND TERMINATION. The Company intends to maintain this Plan
until all benefit payments are made pursuant to the Plan. However,
except as otherwise required by the Management Agreement, the Company
reserves the right, in its sole discretion, to amend, suspend, or
terminate the Plan at any time or from time to time, in whole or in
part. Any such amendment, suspension or termination shall be made
pursuant to resolutions of the Board. No amendment, suspension, or
termination of the Plan shall affect directly or indirectly the rights
of an Executive who has become vested in his Plan benefits prior to the
effective date of the resolution amending, suspending, or terminating
15
the Plan. (However, if the Plan is terminated, an Executive's benefit
shall be based on Compensation and Years of Service as of the
termination date.) Further, the Company, in the sole discretion of the
Board, may pay such Executive, in a lump sum, the actuarial equivalent
of the benefit provided by the Plan in complete satisfaction of its
obligations under the Plan. Notwithstanding any other provision in the
Plan to the contrary, the Plan shall terminate automatically upon the
final payment of all amounts payable hereunder.
7.11 TITLES AND HEADINGS NOT TO CONTROL. The titles to the Articles and the
headings of Sections in the Plan are placed herein for convenience of
reference only, and in case of any conflict, the text of this
instrument, rather that such titles or headings, shall control.
7.12 SMALL BENEFITS. If any monthly benefit that shall be payable to any
person under the Plan shall be less than $400, then, if the Committee
shall so direct, the aggregate of the amounts which shall be payable to
such person in any year shall be paid in quarterly, semiannual or
annual installments. If the present value of the accrued benefit of any
Executive whose Termination Date is prior to age 55 is less than
$3,500, then the Committee may at any time direct that the actuarial
equivalent of such benefits (determined using the assumptions under
Section 7.10 hereof) shall be paid to his in a lump sum in lieu of any
benefits to which he may be entitled under this Plan.
THE PENN TRAFFIC COMPANY
By:
------------------------------------
Francis D. Price, Jr.
Vice President and Assistant Secretary
16
EXHIBIT A
ACTUARIAL EQUIVALENCE FACTORS
The interest rate, mortality table and other factors, if any, applicable for
purposes of determining an Actuarial Equivalent benefit under Plan shall be
determined in accordance with the applicable section of this Exhibit A as set
forth below.
For purposes of this Exhibit A, "APPLICABLE MORTALITY TABLE" means the mortality
table prescribed by the Internal Revenue Service, which shall be based on the
prevailing commissioner's standard table (described in ss.807(d)(5)(A) of the
Code) used to determine reserves for group annuity contracts issued on the date
as of which a present value is determined (without regard to any other
subparagraph of ss.807(d)(5) of the Code) as specified by the Internal Revenue
Service.
Also for purposes of this Exhibit A, "APPLICABLE INTEREST RATE" means, for a
Plan Year, the annual rate of interest on 30-year Treasury securities as
specified by the Internal Revenue Service for August of the preceding Plan Year,
in revenue rulings, notices or other guidance published in the Internal Revenue
Bulletin.
LUMP SUM VALUE OF ACCRUED BENEFIT - For purposes of determining the Actuarially
Equivalent lump sum value as of any determination date of a Participant's
Accrued Benefit under the Plan, Actuarial Equivalence will be based upon
the following:
MORTALITY: Applicable Mortality Table
INTEREST RATE: Applicable Interest Rate
CONVERSION OF ACCOUNT TO SINGLE-LIFE ANNUITY - For purposes of determining the
Actuarially Equivalent single life annuity value of a Participant's Account
under the Plan, Actuarial Equivalence will be based upon the following:
MORTALITY: Applicable Mortality Table
INTEREST RATE: Applicable Interest Rate
OPTIONAL FORMS - For purposes of converting a single life annuity to an
Actuarially Equivalent optional form of payment under the Plan, other than
a lump sum, Actuarial Equivalence will be based upon the following:
MORTALITY: 1983 GAM (Unisex Table)
INTEREST RATE: 7%
REDUCTION FOR EARLY RETIREMENT BENEFIT PAYMENTS PRIOR TO NORMAL RETIREMENT AGE -
A Participant's Accrued Benefit shall be reduced by 5% for each year (or
5/12% for each full month) prior to Normal Retirement Date that such
benefit is paid.
OTHER ACTUARIAL EQUIVALENCE DETERMINATIONS. The Applicable Interest Rate and
the Applicable Mortality Table shall be used for all other actuarial
equivalence determinations.
2
EXHIBIT B
Beneficiary Designations
1. Sample Beneficiary Form I is to be used for the Executive to designate
one or more Beneficiaries to receive his benefit under the Plan if he
dies prior to commencement of his benefit payments.
2. Sample Beneficiary Form II is to be used if the Executive's benefits
will be paid as a 50% or 100% joint and survivor annuity.
3. Sample Beneficiary Form III is to be used if the Executive's benefits
will be paid as a single life annuity with 10 years certain life
annuity.
3
FORM I
THE PENN TRAFFIC COMPANY
EXECUTIVES' RETIREMENT PLAN
BENEFICIARY DESIGNATION
Executive:_____________________ Social Security Number:_______________
Primary Beneficiary:__________________________________________
Social Security Number:_______________________________________
Relationship:___________________________________________________________________
Address:________________________________________________________________________
INSTRUCTION: USE THE FOLLOWING SPACE TO PROVIDE THIS SAME INFORMATION ABOUT
ADDITIONAL PRIMARY BENEFICIARIES, IF YOU WISH TO NAME MORE THAN ON PRIMARY
BENEFICIARY. FOLLOWING THIS SAME INSTRUCTION BELOW, IF YOU WISH TO NAME MORE
THAN ONE CONTINGENT BENEFICIARY.
Contingent Beneficiary:_______________________________________
Social Security Number:_______________________________________
Relationship:___________________________________________________________________
Address:________________________________________________________________________
Date:___________________ ____________________________________
FORM II
THE PENN TRAFFIC COMPANY
EXECUTIVES' RETIREMENT PLAN
BENEFICIARY DESIGNATION FOR 50% OR 100% JOINT AND SURVIVOR ANNUITY
Executive:_____________________________________
Social Security Number:________________________
Beneficiary:___________________________________
Social Security Number:________________________
Relationship:___________________________________________________________________
Address:________________________________________________________________________
________________________________________________________________________________
Date:___________________ ___________________________________
FORM III
THE PENN TRAFFIC COMPANY
EXECUTIVES' RETIREMENT PLAN
BENEFICIARY DESIGNATION FOR 10 YEAR CERTAIN LIFE ANNUITY
Executive:________________ Social Security Number:_______________
Primary Beneficiary:__________________________________________
Social Security Number:_______________________________________
Relationship:___________________________________________________________________
Address:________________________________________________________________________
INSTRUCTION: USE THE FOLLOWING SPACE TO PROVIDE THIS SAME INFORMATION ABOUT
ADDITIONAL PRIMARY BENEFICIARIES, IF YOU WISH TO NAME MORE THAN ON PRIMARY
BENEFICIARY. FOLLOWING THIS SAME INSTRUCTION BELOW, IF YOU WISH TO NAME MORE
THAN ONE CONTINGENT BENEFICIARY.
Contingent Beneficiary:__________________________________
Social Security Number:__________________________________
Relationship:___________________________________________________________________
Address:________________________________________________________________________
Date:___________________ ________________________________