EXHIBIT 10.1

HORMEL

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

(2005 Restatement)

First Effective January 1, 1976
As Amended and Restated Effective January 1, 2005

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HORMEL
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
(2005 Restatement)

TABLE OF CONTENTS

 

 

 

Page

 

 

 

 

 

SECTION 1.

 

INTRODUCTION

 

1

 

 

 

 

 

 

 

1.1.

Amendment and Restatement

 

 

 

 

 

1.1.1.

Grandfathered Accrued Benefit

 

 

 

 

 

1.1.2.

Non-Grandfathered Accrued Benefit

 

 

 

 

1.2.

Unfunded Obligation

 

 

 

 

 

 

 

 

 

SECTION 2.

 

PLAN NAME

 

2

 

 

 

 

 

SECTION 3.

 

PARTICIPANTS

 

2

 

 

 

 

 

 

 

3.1.

General Rule

 

 

 

 

3.2.

Specific Exclusion

 

 

 

 

 

 

 

 

SECTION 4.

 

BENEFIT FOR PARTICIPANTS

 

2

 

 

 

 

 

 

 

4.1.

General Amount Rule

 

 

 

 

4.2.

Special Amount Rule

 

 

 

 

4.3.

Time and Form of Payment

 

 

 

 

 

4.3.1.

Time of Payment

 

 

 

 

 

4.3.2.

Form of Payment

 

 

 

 

4.4.

Forfeiture of Benefits

 

 

 

 

 

 

 

 

SECTION 5.

 

BENEFIT FOR BENEFICIARIES

 

6

 

 

 

 

 

 

 

5.1.

Death Before Benefit Commencement

 

 

 

 

 

5.1.1

General Amount Rule

 

 

 

 

 

5.1.2.

Special Amount Rule

 

 

 

 

 

5.1.3.

Time and Form of Payment

 

 

 

 

5.2.

Death After Benefit Commencement

 

 

 

 

 

 

 

 

SECTION 6.

 

COMMUTATION TO LUMP SUM

 

8

 

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SECTION 7.

 

FUNDING

 

8

 

 

 

 

 

 

 

7.1.

Funding

 

 

 

 

7.2.

Hedging Investments

 

 

 

 

7.3.

Consensual Creditor

 

 

 

 

 

 

 

 

SECTION 8.

 

GENERAL MATTERS

 

9

 

 

 

 

 

 

 

8.1.

Amendment and Termination

 

 

 

 

8.2.

ERISA Administrator

 

 

 

 

8.3.

Limited Benefits

 

 

 

 

8.4.

Spendthrift Provision

 

 

 

 

8.5.

Service of Process

 

 

 

 

8.6.

Plan Year

 

 

 

 

8.7.

§ 162(m) Deferral

 

 

 

 

 

 

 

 

SECTION 9.

 

CLAIMS PROCEDURES

 

10

 

 

 

 

 

 

 

9.1.

Determinations

 

 

 

 

9.2.

Rules and Regulations

 

 

 

 

9.3.

Method of Executing Instruments

 

 

 

 

9.4.

Claims Procedure

 

 

 

 

 

9.4.1.

Original Claim

 

 

 

 

 

9.4.2.

Claims Review Procedure

 

 

 

 

 

9.4.3.

General Rules

 

 

 

 

 

9.4.4.

Deadline to File Claim

 

 

 

 

 

9.4.5.

Exhaustion of Administrative Remedies

 

 

 

 

 

9.4.6.

Deadline to File Legal Action

 

 

 

 

 

9.4.7.

Knowledge of Fact by Participant Imputed to Beneficiary

 

 

 

 

9.5.

Information Furnished by Participants

 

 

 

 

 

 

 

 

SECTION 10.

 

RULES OF CONSTRUCTION

 

13

 

 

 

 

 

 

 

10.1.

Defined Terms

 

 

 

 

10.2.

ERISA Status

 

 

 

 

10.3.

IRC Status

 

 

 

 

10.4.

Effect on Other Plans

 

 

 

 

10.5.

Disqualification

 

 

 

 

10.6.

Rules of Document Construction

 

 

 

 

10.7.

References to Laws

 

 

 

 

10.8.

Effect on Employment

 

 

 

 

10.9.

Choice of Law

 

 

 

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HORMEL
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
(2005 Restatement)

SECTION 1

INTRODUCTION

1.1.                                          Amendment and Restatement.  Hormel
Foods Corporation, a Delaware corporation, (hereinafter the “Principal Sponsor”)
heretofore, effective January 1, 1976, established a nonqualified plan of
deferred compensation which is now known as the “Hormel Supplemental Executive
Retirement Plan” (the “SERP”) and reserved to itself the right to amend the SERP
from time to time.  The Principal Sponsor has heretofore amended the SERP on
various occasions.  By adoption of this amended and restated document entitled
“Hormel Supplemental Executive Retirement Plan (2005 Restatement),” the
Principal Sponsor hereby further amends and restates the SERP in its entirety. 
The provisions of this restatement, which are amended to comply with section
409A of the Internal Revenue Code (added by the American Jobs Creation Act of
2004), shall apply to:  (i) the portion of each Participant’s accrued benefit
under Section 4 of this SERP which constitutes the Non-Grandfathered Accrued
Benefit, and (ii) the benefit for a surviving spouse or beneficiary of a
deceased Participant provided under Section 5 of this SERP.  The Participant’s
Grandfathered Accrued Benefit shall continue to be governed under the terms of
the 2002 Restatement, as amended by a First Amendment.  For this purpose, the
terms Grandfathered Accrued Benefit and Non-Grandfathered Accrued Benefit shall
have the following meanings:

1.1.1.                                                         Grandfathered
Accrued Benefit.  The present value, as of December 31, 2004, of the amount of
benefit to which the Participant would have been entitled under this SERP if the
Participant voluntarily terminated services on December 31, 2004, and received a
payment of the benefits with the maximum value available from this SERP on the
earliest possible date allowed under this SERP.  The Grandfathered Accrued
Benefit may increase to equal the present value of the benefit the Participant
actually becomes entitled to, determined under the terms of the SERP as in
effect on October 3, 2004, without regard to any further services rendered by
the Participant after December 31, 2004, or any other events affecting the
amount of or entitlement to benefits (other than Participant election with
respect to the time or form of an available benefit).

1.1.2.                                                         Non-Grandfathered
Accrued Benefit.  The portion of the Employee’s accrued benefit other than the
Grandfathered Accrued Benefit.

1.2.                                          Unfunded Obligation.  The
obligation of the Principal Sponsor to make payments under this SERP constitutes
only the unsecured (but legally enforceable) promise of the Principal Sponsor to
make such payments.  The Participant shall have no lien, prior claim or other
security interest in any property of the Principal Sponsor.  If a fund is
established by the Principal Sponsor in connection with this SERP, the property
therein shall remain the sole and exclusive property of the Principal Sponsor. 
The Principal Sponsor will pay the cost of this SERP out of its general assets.

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SECTION 2

PLAN NAME

This employee benefit plan shall be referred to as the “Hormel Supplemental
Executive Retirement Plan” (the “SERP”).  This document, as distinguished from
the plan maintained pursuant to this document, shall be referred to as the
“Hormel Supplemental Executive Retirement Plan (2005 Restatement)”  (the “SERP
document”).

SECTION 3

PARTICIPANTS

3.1.                                          General Rule.  The individuals
eligible to participate in and receive benefits under this SERP (i.e., to be
“Participants” under this SERP) are those individuals who are, on or after
November 1, 1988, employees of the Principal Sponsor who are, on or after
November 1, 1988, participants in the tax qualified, defined benefit, pension
plan now known as the Hormel Foods Corporation Salaried Employees’ Pension Plan
(the “Pension Plan”) and who are, on or after January 1, 1976, actively employed
by the Principal Sponsor.  Any employee who has become a Participant in the SERP
shall continue as a Participant until all benefits due under the SERP have been
paid (or forfeited) without regard to whether he continues as a participant in
the Pension Plan or an active employee.

3.2.                                          Specific Exclusion. 
Notwithstanding anything apparently to the contrary in this SERP or in any
written communication, summary, resolution or document or oral communication, no
individual shall be a Participant in this SERP, develop benefits under this SERP
or be entitled to receive benefits under this SERP (either for himself or his
survivors) unless such individual is a member of a select group of management or
highly compensated employees (as that expression is used in ERISA).  If a court
of competent jurisdiction, any representative of the U.S. Department of Labor or
any other governmental, regulatory or similar body makes any direct or indirect,
formal or informal, determination that an individual is not a member of a select
group of management or highly compensated employees (as that expression is used
in ERISA), such individual shall not be (and shall not have ever been) a
Participant in this SERP at any time. If any person not so defined has been
erroneously treated as a  Participant in this SERP, upon discovery of such error
such person’s erroneous participation shall immediately terminate ab initio and
upon demand such person shall be obligated to reimburse the Principal Sponsor
for all amounts erroneously paid to him or her.

SECTION 4

BENEFIT FOR PARTICIPANTS

4.1.                                          General Amount Rule.  This SERP
shall pay to Participants the excess, if any, of the amount, if any, determined
in “(a)” below over the amount, if any, determined in “(b)” below.

2

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(a)                                                                      There
shall be determined the amount which would have been payable to the Participant
under the formula and rules of the Pension Plan (as the Pension Plan exists on
the date as of which such amount is determined) but determined:

(i)                                     without regard to the benefit
limitations under section 415 of the Code; and

(ii)                                  without regard to the compensation
limitation of section 401(a)(17) of the Code; and

(iii)                               in the case of a Participant who is both an
officer and a member of the Executive Committee on or after December 13, 1989
and who retires on an early retirement pension under the Pension Plan and after
completing thirty (30) years of participation in the Pension Plan, as if there
were no reduction in benefits for early commencement; and

(iv)                              in the case of a Participant who is both an
officer and a member of the Executive Committee on or after May 22, 1989, as if
the thirty-five (35) years of Benefit Service maximum did not apply; and

(v)                                 including, when it would otherwise have been
paid, income deferred under any nonqualified, unfunded, elective deferred
compensation plan maintained by the Principal Sponsor; and

(vi)                              including each long term incentive plan award
earned prior to October 29, 2006; provided, however, that if the long term
incentive plan award is earned with respect to a period longer than one (1)
year, the long term incentive plan award will be included as if it had been
earned and received ratably over the period with respect to which it was earned;
and

(vii)                           including, when awarded, the fair market value
of stock awarded under all restricted stock plans as compensation for pension
accrual purposes; and

(viii)                        recognizing as Eligibility Service, Benefit
Service or as Vesting Service or both periods that are required to be recognized
for purposes of this SERP pursuant to a separate written agreement between the
Principal Sponsor and the Participant and by including in Compensation and in
Average Monthly Compensation amounts that are required to be included pursuant
to a separate written agreement between the Principal Sponsor and the
Participant (and in either such case, the separate written agreement shall be
signed on behalf of the Principal Sponsor by a member of the Board of Directors
who is not a Participant in this SERP).

(b)                                                                     There
shall be determined the amount actually payable to the Participant from the
Pension Plan.

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4.2.                                          Special Amount Rule.  In the case
of any Participant who either:

(a)                                                                      had
annual earnings in excess of Seventy-Five Thousand Dollars ($75,000) from the
Principal Sponsor as of December 31, 1989, and had attained age fifty-five (55)
years as of October 28, 1989, or

(b)                                                                     had
annual earnings in excess of One Hundred Thousand Dollars ($100,000) from the
Principal Sponsor as of December 31, 1989, and had attained age fifty (50) years
as of October 28, 1989,

the amount determined under Section 4.1(a) above shall be determined under the
formula and rules of the Pension Plan as it existed on October 28, 1989
(disregarding any subsequent amendments but taking into account the
Participant’s subsequent compensation and service) but only if the resulting
amount would be greater than the amount determined under Section 4.1(a).

4.3.                                          Time and Form of Payment.  This
benefit (minus the withholding, payroll and other taxes which must be deducted
therefrom) shall be paid to the Participant directly from the general assets of
the Principal Sponsor.

4.3.1.                                                         Time of Payment. 
Payment shall commence upon any one of the following events (the “Benefit
Commencement Date”) as selected by the Participant within thirty (30) days of
commencement of participation in the Plan (or, in accordance with transition
rules under section 409A of the Internal Revenue Code, in the case of an
individual who was a Participant before January 1, 2007, on or prior to December
31, 2006):

(a)                                                                      the
later of the first of the calendar month following attainment of age sixty (60)
or the first of the month following separation from service (as that term is
defined under Section 409A of the Internal Revenue Code);

(b)                                                                     the
later of the first of the calendar month following attainment of age sixty-two
(62) or the first of the month following separation from service; or

(c)                                                                      the
first of the calendar month following separation from service.

Notwithstanding the foregoing, with respect to any distribution made on account
of separation from service to a Participant who is a key employee (as defined
under section 409A of the Internal Revenue Code and regulations thereunder),
such Participant’s Benefit Distribution Date shall be the earlier of:  the date
that is six (6) months after the Participant’s separation from service, or the
date of the Participant’s death.  Payment shall be deemed paid as of the Benefit
Distribution Date if it is made no later than the last day of the calendar year
in which occurs the Benefit Distribution Date, or if later, the 15th day of the
third calendar month following the Benefit Distribution Date.

4.3.2.                                                         Form of Payment. 
In the absence of an affirmative written election to the contrary, payment shall
be made in the applicable presumptive form of a life annuity (either the Single
Life Annuity form or the Qualified Joint and Survivor Life Annuity form), as if
such benefit had been paid directly from the Pension Plan pursuant to Section
4.2 of such Plan regarding presumptive forms.  Notwithstanding the foregoing:

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(a)                                                                     
Optional Forms of Annuity.  Before any payment has commenced, a Participant may
elect to change the form of payment from one type of life annuity to another to
the extent permitted under the Pension Plan, and further provided that the
annuities are actuarially equivalent applying reasonable actuarial assumptions
as permitted under section 409A of the Internal Revenue Code.

(b)                                                                     Lump Sum
(Gary Ray and Michael McCoy).   Notwithstanding the foregoing, the benefits
payable to or with respect to Gary Ray and Michael McCoy under this SERP shall
be paid in an actuarially equivalent single lump sum cash payment.  The payment
of a lump sum to a Participant shall completely extinguish all other payments
that may be due under this SERP to any other person.

(c)                                                                      Small
Amounts.  If the actuarially equivalent present value of the Participant’s
benefits at separation from service is not more than Five Thousand Dollars
($5,000), that present value shall be paid in a single lump sum.  The payment of
a lump sum to a Participant shall completely extinguish all other payments that
may be due under this SERP to any other person.

4.4.                                          Forfeiture of Benefits.  All
unpaid benefits payable under this SERP to or with respect to a Participant,
shall be permanently forfeited upon the determination by the Compensation
Committee of the Board of Directors of the Principal Sponsor that the
Participant, either before or after termination of employment:

(a)                                                                      engaged
in a felonious or fraudulent conduct resulting in material harm to the Principal
Sponsor or an affiliate; or

(b)                                                                     made an
unauthorized disclosure to a competitor of any material confidential
information, trade information, or trade secrets of the Principal Sponsor or an
affiliate; or

(c)                                                                     
provided the Principal Sponsor or an affiliate with materially false reports
concerning his or her business interests or employment; or

(d)                                                                     made
materially false representations which are relied upon by the Principal Sponsor
or an affiliate in furnishing information to shareholders, auditors, or any
regulatory or governmental body; or

(e)                                                                     
maintained an undisclosed, unauthorized and material conflict of interest in the
discharge of the duties owed by the Participant to the Principal Sponsor or an
affiliate; or

(f)                                                                       
engaged in reckless or grossly negligent activity toward the Principal Sponsor
or an affiliate which is admitted or judicially proven and which results in
significant harm to the Principal Sponsor or an affiliate; or

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(g)                                                                     engaged
during his or her employment or during a period of two (2) years after the
termination of his or her employment in any employment or self-employment with a
competitor of the Principal Sponsor or an affiliate within the geographical area
which is then served by the Principal Sponsor or an affiliate.

Any dispute arising under or with respect to this Section shall be subject to
the claims procedure set forth in Section 9.

SECTION 5

BENEFIT FOR BENEFICIARIES

5.1.                                          Death Before Benefit Commencement.

5.1.1.                                                         General Amount
Rule.  This SERP shall pay to the surviving spouse or other beneficiary of a
Participant the excess, if any, of the amount, if any, determined in “(a)” below
over the amount, if any, determined in “(b)” below.

(a)                                                                      There
shall be determined the amount which would have been payable with respect to the
Participant under the formula and rules of the Pension Plan (as the Pension Plan
exists on the date as of which such amount is determined) but determined:

(i)                                     without regard to the benefit
limitations of section 415 of the Code; and

(ii)                                  without regard to the compensation
limitation of section 401(a)(17) of the Code; and

(iii)                               in the case of a Participant who is both an
officer and a member of the Executive Committee on or after December 13, 1989
and who dies after the earliest date he could have retired on an early
retirement pension under the Pension Plan (without regard to whether he has or
has not retired) and after completing at least thirty (30) years of
participation in the Pension Plan, as if there were no reduction in benefits for
early commencement; and

(iv)                              in the case of a Participant who is both an
officer and a member of the Executive Committee on or after May 22, 1989, as if
the thirty-five (35) years of Benefit Service maximum did not apply; and

(v)                                 including, when it would otherwise have been
paid, income deferred under any nonqualified, unfunded, elective deferred
compensation plan maintained by the Principal Sponsor; and

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(vi)                              including, once earned, each long term
incentive plan award; provided, however, that if the long term incentive plan
award is earned with respect to a period longer than one (1) year, the long term
incentive plan award will be included as if it had been earned and received
ratably over the period with respect to which it was earned; and

(vii)                           including, when awarded, the fair market value
of stock awarded under all restricted stock plans as compensation for pension
accrual purposes; and

(viii)                        recognizing as Eligibility Service, Benefit
Service or as Vesting Service or both periods that are required to be recognized
for purposes of this SERP pursuant to a separate written agreement between the
Principal Sponsor and the Participant and by including in Compensation and in
Average Monthly Compensation amounts that are required to be included pursuant
to a separate written agreement between the Principal Sponsor and the
Participant (and in either such case, the separate written agreement shall be
signed on behalf of the Principal Sponsor by a member of the Board of Directors
who is not a Participant in this SERP).

(b)                                                                     There
shall be determined the amount actually payable with respect to the Participant
from the Pension Plan.

5.1.2.                                                         Special Amount
Rule.  In the case of any Participant who either:

(a)                                                                      had
annual earnings in excess of Seventy-Five Thousand Dollars ($75,000) from the
Principal Sponsor as of December 31, 1989, and had attained age fifty-five (55)
years as of October 28, 1989, or

(b)                                                                     had
annual earnings in excess of One Hundred Thousand Dollars ($100,000) from the
Principal Sponsor as of December 31, 1989, and had attained age fifty (50) years
as of October 28, 1989,

the amount determined under Section 5.1.1(a) above shall be determined under the
formula and rules of the Pension Plan as it existed on October 28, 1989
(disregarding any subsequent amendments but taking into account the
Participant’s subsequent compensation and service) but only if the resulting
amount would be greater than the amount determined under Section 5.1.1(a).

5.1.3.                                                         Time and Form of
Payment.  Payment shall commence upon the first of the calendar month following
the Participant’s death.  Payment shall be made to the surviving spouse (or such
other designated beneficiary, if applicable) in the Survivor Annuity form as
provided under Section 4.2 of the Pension Plan, as if the Participant separated
from service on the date of death for reasons other than death, elected to
commence receipt of the Participant’s benefit in the Survivor Annuity form (upon
the first of the calendar month following separation) and then immediately died.

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5.2.                                          Death After Benefit Commencement. 
The only death benefits which shall be payable under this SERP upon the death of
a Participant after the Participant’s separation from service and after payment
of benefits under this SERP has commenced to the Participant shall be the unpaid
installments of annuity, if any, which are to be continued under the form of
pension which the Participant has elected under the provisions of Section 4
hereof or which are provided automatically in the absence of the Participant’s
affirmative election.

SECTION 6

COMMUTATION TO LUMP SUM

Notwithstanding the foregoing, to the extent permissible under Section 409A of
the Internal Revenue Code and related Treasury regulations and guidance, if
there is a termination of the SERP with respect to all Participants, the
Principal Sponsor shall have the right, in its sole discretion, and
notwithstanding any elections made by the Participant, to immediately pay all
benefits in a lump sum following such termination of the SERP.  The payment of a
lump sum to a Participant under the foregoing provisions of this Section 6 shall
completely extinguish all other payments that may be due under this SERP to any
other person.

SECTION 7

FUNDING

7.1.                                          Funding.  The obligation of the
Principal Sponsor to make payments under this SERP constitutes only the
unsecured (but legally enforceable) promise of the Principal Sponsor to make
such payments.  The Participant shall have no lien, prior claim or other
security interest in any property of the Principal Sponsor.  If a fund is
established by the Principal Sponsor in connection with this SERP, the property
therein shall remain the sole and exclusive property of the Principal Sponsor. 
The Principal Sponsor will pay the cost of this SERP out of its general assets.

7.2.                                          Hedging Investments.  If the
Principal Sponsor elects to finance all or a portion of its costs in connection
with this SERP through the purchase of life insurance or other investments, each
Participant agrees, as a condition of participation in this SERP, to cooperate
with the Principal Sponsor in the purchase of such investment to any extent
reasonably required by the Principal Sponsor and relinquishes any claim he may
have either for himself or any beneficiary to the proceeds of any such
investment or any other rights or interests in such investment.  If a
Participant fails or refuses to cooperate, then notwithstanding any other
provision of this SERP the Principal Sponsor may immediately and irrevocably
terminate and forfeit all benefits payable to or with respect to the Participant
under this SERP.

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7.3.                                          Consensual Creditor.  Neither the
Principal Sponsor’s officers nor any member of its Board of Directors in any way
secures or guarantees the payment of any benefit or amount which may become due
and payable hereunder to or with respect to the Participants.  The Participants
entitled at any time to payments hereunder shall look solely to the assets of
the Principal Sponsor for such payments as an unsecured, general creditor. 
After benefits shall have been paid to or with respect to a Participant and such
payment purports to cover in full the benefit hereunder, the Participant shall
have no further right or interest in the other assets of the Principal Sponsor
in connection with this SERP.  Neither the Principal Sponsor nor any of its
officers nor any member of its Board of Directors shall be under any liability
or responsibility for failure to effect any of the objectives or purposes of
this SERP by reason of the insolvency of the Principal Sponsor.

SECTION 8

GENERAL MATTERS

8.1.                                          Amendment and Termination.  The
Board of Directors of the Principal Sponsor may unilaterally amend this SERP
document prospectively, retroactively or both, at any time and for any reason
deemed sufficient by it without notice to any person affected by this SERP and
may likewise terminate the benefits of this SERP both with regard to persons
expecting to receive benefits in the future and persons already receiving
benefits at the time of such action; provided, however, that such amendment or
termination shall not be effective with respect to a Participant who was both an
officer and a member of the Executive Committee on or after May 22, 1989 without
the written consent of such Participant.  The Compensation Committee may act for
the Board of Directors to amend this SERP document.

8.2.                                          ERISA Administrator.  The
Principal Sponsor shall be the plan administrator of this SERP.

8.3.                                          Limited Benefits.  This SERP shall
not provide any benefits with respect to any defined contribution plan.  This
SERP shall not alter, enlarge or diminish any person’s employment rights or
rights or obligations under the Pension Plan.

8.4.                                          Spendthrift Provision.  No
Participant, surviving spouse, joint or contingent annuitant or beneficiary
shall have the power to transmit, assign, alienate, dispose of, pledge or
encumber any benefit payable under this SERP before its actual payment to such
person.  the Principal Sponsor shall not recognize any such effort to convey any
interest under this SERP.  No benefit payable under this SERP shall be subject
to attachment, garnishment, execution following judgment or other legal process
before actual payment to such person.

8.5.                                          Service of Process.  In the
absence of any designation to the contrary by the Principal Sponsor, the
Secretary of the Principal Sponsor is designated as the appropriate and
exclusive agent for the receipt of service of process directed to the SERP in
any legal proceeding, including arbitration, involving the SERP.

8.6.                                          Plan Year.  The plan year for this
SERP shall be the fiscal period of fifty-two (52) or fifty-three (53) weeks
ending on the last Saturday in October of each year.

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8.7.                                          § 162(m) Deferral.  Payment will
be delayed if the Principal Sponsor reasonably anticipates that the Principal
Sponsor’s deduction with respect to such payment otherwise would be limited or
eliminated by application of section 162(m) of the Internal Revenue Code;
provided that payment shall be made at the earliest date at which the Principal
Sponsor reasonably anticipates that the deduction of the payment of the amount
will not be limited or eliminated by application of section 162(m) of the
Internal Revenue Code.

SECTION 9

CLAIMS PROCEDURES

9.1.                                          Determinations.  The Compensation
Committee shall make such determinations as may be required from time to time in
the administration of the SERP.  The Compensation Committee shall have the sole
discretion, authority and responsibility to interpret and construe the SERP and
the plan document and to determine all factual and legal questions under the
SERP, including but not limited to the entitlement of employees, Participants
and beneficiaries and the amounts of their respective interests.  Benefits under
the SERP will be paid only if the Compensation Committee decides in its
discretion that an employee, Participant or Beneficiary is entitled to them. 
All interested parties may act and rely upon all information reported to them
hereunder and need not inquire into the accuracy thereof, nor be charged with
any notice to the contrary.

9.2.                                          Rules and Regulations.  Any rule
not in conflict or at variance with the provisions hereof may be adopted by the
Compensation Committee.

9.3.                                          Method of Executing Instruments. 
Information to be supplied or written notices to be made or consents to be given
by the Principal Sponsor or an affiliate or the Compensation Committee pursuant
to any provision of this SERP may be signed in the name of the Principal Sponsor
or an affiliate by any officer or by any employee who has been authorized to
make such certification or to give such notices or consents or by any
Compensation Committee member.

9.4.                                          Claims Procedure.  Until modified
by the Compensation Committee, the claims procedure set forth in this
Section shall be the claims procedure for the resolution of disputes and
disposition of claims arising under the SERP.  An application for a distribution
or benefits under Section 4 or Section 5 shall be considered as a claim for the
purposes of this Section.

9.4.1.                                                         Original Claim. 
Any employee, former employee, or beneficiary of such employee or former
employee may, if the employee, former employee or beneficiary so desires, file
with the Compensation Committee a written claim for benefits under the SERP. 
Within ninety (90) days after the filing of such a claim, the Compensation
Committee shall notify the claimant in writing whether the claim is upheld or
denied in whole or in part or shall furnish the claimant a written notice
describing specific special circumstances requiring a specified amount of
additional time (but not more than one hundred eighty days from the date the
claim was filed) to reach a decision on the claim.  If the claim is denied in
whole or in part, the Compensation Committee shall state in writing:

(a)                                                                      the
specific reasons for the denial,

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(b)                                                                     the
specific references to the pertinent provisions of this SERP on which the denial
is based,

(c)                                                                      a
description of any additional material or information necessary for the claimant
to perfect the claim and an explanation of why such material or information is
necessary, and

(d)                                                                     an
explanation of the claims review procedure set forth in this Section.

9.4.2.                                                         Claims Review
Procedure.  Within sixty (60) days after receipt of notice that the claim has
been denied in whole or in part, the claimant may file with the Compensation
Committee a written request for a review and may, in conjunction therewith,
submit written issues and comments.  Within sixty (60) days after the filing of
such a request for review, the Compensation Committee shall notify the claimant
in writing whether, upon review, the claim was upheld or denied in whole or in
part or shall furnish the claimant a written notice describing specific special
circumstances requiring a specified amount of additional time (but not more than
one hundred twenty days from the date the request for review was filed) to reach
a decision on the request for review.

9.4.3.                                                         General Rules.

(a)                                                                      No
inquiry or question shall be deemed to be a claim or a request for a review of a
denied claim unless made in accordance with the claims procedure.  The
Compensation Committee may require that any claim for benefits and any request
for a review of a denied claim be filed on forms to be furnished by the
Compensation Committee upon request.

(b)                                                                     All
decisions on claims and on requests for a review of denied claims shall be made
by the Compensation Committee unless delegated.

(c)                                                                      The
Compensation Committee may, in its discretion, hold one or more hearings on a
claim or a request for a review of a denied claim.

(d)                                                                    
Claimants may be represented by a lawyer or other representative at their own
expense, but the Compensation Committee reserves the right to require the
claimant to furnish written authorization.  A claimant’s representative shall be
entitled to copies of all notices given to the claimant.

(e)                                                                      The
decision of the Compensation Committee on a claim and on a request for a review
of a denied claim shall be served on the claimant in writing.  If a decision or
notice is not received by a claimant within the time specified, the claim or
request for a review of a denied claim shall be deemed to have been denied.

(f)                                                                        Prior
to filing a claim or a request for a review of a denied claim, the claimant or
the claimant’s representative shall have a reasonable opportunity to review a
copy of SERP plan document and all other pertinent documents in the possession
of the Principal Sponsor and the Compensation Committee.

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9.4.4.                                                         Deadline to File
Claim.  To be considered timely under the SERP’s claim and review procedure, a
claim must be filed with the Compensation Committee within one (1) year after
the claimant knew or reasonably should have known of the principal facts upon
which the claim is based.

9.4.5.                                                         Exhaustion of
Administrative Remedies.  The exhaustion of the claim and review procedure is
mandatory for resolving every claim and dispute arising under this SERP.  As to
such claims and disputes:

(a)                                                                      no
claimant shall be permitted to commence any legal action to recover Plan
benefits or to enforce or clarify rights under the SERP under section 502 or
section 510 of ERISA or under any other provision of law, whether or not
statutory, until the claim and review procedure set forth herein have been
exhausted in their entirety, and

(b)                                                                     in any
such legal action all explicit and all implicit determinations by the
Compensation Committee (including, but not limited to, determinations as to
whether the claim, or a request for a review of a denied claim, was timely
filed) shall be afforded the maximum deference permitted by law.

9.4.6.                                                         Deadline to File
Legal Action.  No legal action to recover SERP benefits or to enforce or clarify
rights under the SERP under section 502 or section 510 of ERISA or under any
other provision of law, whether or not statutory, may be brought by any claimant
on any matter pertaining to this SERP unless the legal action is commenced in
the proper forum before the earlier of:

(a)                                                                      thirty
(30) months after the claimant knew or reasonably should have known of the
principal facts on which the claim is based, or

(b)                                                                     six (6)
months after the claimant has exhausted the claim and review procedure.

9.4.7.                                                         Knowledge of Fact
by Participant Imputed to Beneficiary.  Knowledge of all facts that a
Participant knew or reasonably should have known shall be imputed to every
claimant who is or claims to be a beneficiary of the Participant or otherwise
claims to derive an entitlement by reference to the Participant for the purpose
of applying the previously specified periods.

9.5.                                          Information Furnished by
Participants.  Neither the Principal Sponsor nor the Compensation Committee
shall be liable or responsible for any error in the computation of the benefit
of a Participant resulting from any misstatement of fact made by the
Participant, directly or indirectly, to the Principal Sponsor or the
Compensation Committee and used by them in determining the Participant’s
benefit.  Neither the Principal Sponsor nor the Compensation Committee shall be
obligated or required to increase the benefit of such Participant which, on
discovery of the misstatement, is found to be understated as a result of such
misstatement of the Participant.  However, the benefit of any Participant which
is overstated by reason of any such misstatement shall be reduced to the amount
appropriate for the Participant in view of the truth.  Any reduction of an
benefit shall be retained in the SERP and used to reduce the next succeeding
contribution of the Principal Sponsor to the SERP.

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SECTION 10

RULES OF CONSTRUCTION

10.1.                                    Defined Terms.  Words and phrases used
in this SERP with initial capital letters, which are defined in the Pension Plan
documents and which are not separately defined in this SERP shall have the same
meaning ascribed to them in the Pension Plan documents unless in the context in
which they are used it would be clearly inappropriate to do so.

10.2.                                    ERISA Status.  This SERP is adopted
with the understanding that it is an unfunded plan maintained primarily for the
purpose of providing deferred compensation for a select group of management or
highly compensated employees as provided in section 201(2), section 301(3) and
section 401(a)(1) of ERISA.  Each provision shall be interpreted and
administered accordingly.

10.3.                                    IRC Status.  This SERP is intended to
be a nonqualified deferred compensation arrangement.  The rules of
section 401(a) et. seq. of the Code shall not apply to this SERP.  The rules of
section 3121(v) and section 3306(r)(2) of the Code shall apply to this SERP.

10.4.                                    Effect on Other Plans.  This SERP shall
not alter, enlarge or diminish any person’s employment rights or obligations or
rights or obligations under the Pension Plan or any other plan.  It is
specifically contemplated that the Pension Plan will, from time to time, be
amended and possibly terminated.  All such amendments and termination shall be
given effect under this SERP (it being expressly intended that except as
expressly provided in Section 4.2 and Section 5.2 this SERP shall not lock in
the benefit structures of the Pension Plan as they exist at the adoption of this
SERP or upon the commencement of participation or commencement of benefits by
any Participant).

10.5.                                    Disqualification.  Notwithstanding any
other provision of this SERP or any election or designation made under the SERP,
any individual who feloniously and intentionally kills a Participant shall be
deemed for all purposes of this SERP and all elections and designations made
under this SERP to have died before such Participant.  A final judgment of
conviction of felonious and intentional killing is conclusive for this purpose. 
In the absence of a conviction of felonious and intentional killing, the
Principal Sponsor shall determine whether the killing was felonious and
intentional for this purpose.

10.6.                                    Rules of Document Construction. 
Whenever appropriate, words used herein in the singular may be read in the
plural, or words used herein in the plural may be read in the singular; the
masculine may include the feminine; and the words “hereof,” “herein” or
“hereunder” or other similar compounds of the word “here” shall mean and refer
to the entire SERP and not to any particular paragraph or Section of this SERP
unless the context clearly indicates to the contrary.  The titles given to the
various Sections of this SERP are inserted for convenience of reference only and
are not part of this SERP, and they shall not be considered in determining the
purpose, meaning or intent of any provision hereof.  If, under the rules of this
SERP, an election, form or other document must be filed with or received by the
Principal Sponsor or other person, it must be actually received to be
effective.  The determination of whether or when an election, form or other
document has been received by the Principal Sponsor or other person shall be
made by the Principal Sponsor on the basis of what documents are acknowledged by
the Principal Sponsor or other person to be in its actual possession without
regard to any “mailbox rule” of similar rule of evidence.  The absence of a
document in the

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Principal Sponsor’s or other person’s records and files shall be conclusive and
binding proof that the document was not received.  Notwithstanding any thing
apparently to the contrary contained in this SERP document, the SERP document
shall be construed and administered to prevent the duplication of benefits
provided under this SERP and any other qualified or nonqualified plan maintained
in whole or in part by the Principal Sponsor.

10.7.                                    References to Laws.  Any reference in
this SERP to a statute or regulation shall be considered also to mean and refer
to any subsequent amendment or replacement of that statute or regulation.

10.8.                                    Effect on Employment.  Neither the
terms of this SERP nor the benefits hereunder nor the continuance thereof shall
be a term of the employment of any employee.  The Principal Sponsor shall not be
obliged to continue the SERP.  The terms of this SERP shall not give any
employee the right to be retained in the employment of the Principal Sponsor.

10.9.                                    Choice of Law.  This instrument has
been executed and delivered in the State of Minnesota and has been drawn in
conformity to the laws of that State and shall, except to the extent that
federal law is controlling, be construed and enforced in accordance with the
laws of the State of Minnesota.

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