Exhibit 10.12

PSS WORLD MEDICAL, INC.

DIRECTORS’ DEFERRED COMPENSATION PLAN

Amended and Restated January 1, 2009

 

ARTICLE I

  

Establishment and Purpose

   Page 1

ARTICLE II

  

Definitions

   Page 1

ARTICLE III

  

Eligibility and Participation

   Page 4

ARTICLE IV

  

Deferral Elections, Account Valuation

   Page 5

ARTICLE V

  

Distributions and Withdrawals

   Page 7

ARTICLE VI

  

Administration

   Page 8

ARTICLE VII

  

Amendment and Termination

   Page 9

ARTICLE VIII

  

Informal Funding

   Page 9

ARTICLE IX

  

General Conditions

   Page 10

 

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PSS WORLD MEDICAL, INC.

DIRECTORS’ DEFERRED COMPENSATION PLAN

Amended and Restated Effective January 1, 2009

ARTICLE I

ESTABLISHMENT AND PURPOSE

 

1.1 Background of Plan. PSS World Medical, Inc. (the “Company”) maintains the
PSS World Medical, Inc. Directors’ Deferred Compensation Plan (the “Plan”),
which became effective January 1, 2004 (the “Original Effective Date”). The Plan
is hereby amended and restated to comply with Section 409A of the Internal
Revenue Code of 1986, as amended (“Code Section 409A”), effective as of
January 1, 2009.

 

1.2 Purpose. The purpose of the Plan is to provide non-employee Directors with
an opportunity to defer receipt of their annual retainer, meeting fees, and
other cash compensation. The Plan is not intended to meet the qualification
requirements of Section 401(a) of the Internal Revenue Code, and will not be
subject to ERISA because it will not be offered to employees of the Company. The
Plan is intended to comply with, and shall be construed so as to provide for
deferrals and benefits that are consistent with the requirements of, Code
Section 409A.

ARTICLE II

DEFINITIONS

 

2.1 Account Balance. Account Balance means the total value of all the Investment
Options in which Participant deferrals have been Deemed Invested as of a
specific date, taking into account the value of all distributions from that
Account to the specific date.

 

2.2 Allocation Election. Allocation Election means a choice by a Participant of
one or more Investment Options, and the allocation among them, in which future
Participant deferrals are Deemed Invested for purposes of determining earnings
in the Deferred Compensation Account.

 

2.3 Allocation Election Form. Allocation Election Form means the form (or
Website screen) approved by the Plan Administrator on which the Participant
makes or modifies an Allocation Election.

 

2.4 Annual Valuation Date. Annual Valuation Date shall mean the anniversary of
the Termination Valuation Date utilized to determine the amount of an annual
installment payment.

 

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2.5 Beneficiary. Beneficiary means a natural person, estate, or trust designated
by a Participant on the form designated by the Plan Administrator to receive
benefits to which a Beneficiary is entitled under and in accordance with
provisions of the Plan. The Participant’s estate shall be the Beneficiary if:

 

  (a) the Participant has not designated a natural person or trust as
Beneficiary, or

 

  (b) the designated Beneficiary has predeceased the Participant.

 

2.6 Change in Control. Change in Control means the occurrence of: (a) any merger
or consolidation in which the Company is not the surviving corporation and which
results in the holders of the outstanding voting securities of the Company
(determined immediately prior to such merger or consolidation) owning less than
a majority of the outstanding voting securities of the surviving corporation
(determined immediately following such merger or consolidation), (b) any sale or
transfer by the Company of all or substantially all of its assets, or (c) any
tender offer or exchange offer for or the acquisition, directly or indirectly,
by any person or group of all or a majority of the then-outstanding voting
securities of the Company.

 

2.7 Chief Executive Officer. Chief Executive Officer means the individual who
performs the functions of a Chief Executive Officer for the Company.

 

2.8 Code. Code means the Internal Revenue Code of 1986, as amended from time to
time.

 

2.9 Code Section 409A. Section 409A of the Internal Revenue Code of 1986, as
amended from time to time, and includes a reference to the underlying Treasury
regulations and guidance under such Code Section.

 

2.10 Company. Company means PSS World Medical, Inc.

 

2.11 Compensation. Compensation shall mean, for purposes of this Plan, cash
remuneration paid to a Director in connection with his or her services as an
outside Director with the Company including, without limitation, annual
retainers, meeting fees, and other Directors’ fees, and any equity based
compensation (if any) approved by the Plan Administrator as Compensation for
purposes of this Plan.

 

2.12 Compensation Deferral Agreement. Compensation Deferral Agreement shall mean
the deferral election form, or such other forms furnished by the Plan
Administrator (or screens on the Participant Website approved by the Plan
Administrator), on which a Participant elects: (a) the amount of deferral and
type of Compensation to be deferred beginning the first day of the following
Plan Year; and (b) the Form of Payment elections for Termination Benefits. The
Allocation Election Form may be part of the Compensation Deferral Agreement, in
the discretion of the Plan Administrator.

 

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2.13 Death Benefit. Death Benefit shall mean a distribution of the total amount
of the Participant’s Deferred Compensation Account Balance to the Participant’s
Beneficiary(ies) in accordance with Article V of the Plan.

 

2.14 Deemed Investment. A Deemed Investment (or “Deemed Invested”) shall mean
the notional conversion of a dollar amount of deferred Compensation credited to
a Participant’s Deferred Compensation Account into shares or units (or a
fraction of such measures of ownership, if applicable) of the underlying
investment (e.g. mutual fund or other investment) which is referred to by the
Investment Option(s) selected by the Participant. The conversion shall occur as
if shares (or units) of the designated investment were being purchased (or sold,
for a distribution) at the purchase price as of the close of business of the day
on which the Deemed Investment occurs. At no time shall a Participant have any
real or beneficial ownership in the actual investment to which the Investment
Option refers, irrespective of whether such a Deemed Investment is mirrored by
an actual identical investment by the Company or a trustee acting on behalf of
the Company.

 

2.15 Deferred Compensation Account. A Participant’s Deferred Compensation
Account (or “Account”) shall mean a record maintained by the Plan Administrator
of all Participant deferrals and Deemed Investments thereof minus any
withdrawals and distributions from said Account. The Account shall be a
bookkeeping account utilized solely as a device for the measurement of amounts
to be paid to the Participant under the Plan. The Account, and all Sub-Accounts,
shall not constitute or be treated as an escrow, trust fund, or any other type
of funded account for Code purposes and, moreover, amounts credited thereto
shall not be considered “plan assets”.

 

2.16 Deferred Compensation Committee. Deferred Compensation Committee (or
“Committee”) means a committee of at least three (3) officers of the Company
appointed by the Compensation Committee of the Board or the Chief Executive
Officer, who shall serve until the earlier of termination of service or
appointment of a replacement by the Compensation Committee of the Board or the
Chief Executive Officer.

 

2.17 Director. Director shall mean for purposes of this Plan a non-employee
independent contractor serving as a member of the Board of Directors of the
Company.

 

2.18 Effective Date. The Plan was originally effective January 1, 2004. This
amended and restated Plan is effective January 1, 2009.

 

2.19 Investment Option. Investment Option shall mean a security or other
investment such as a mutual fund, life insurance sub-account, or other
investment approved by the Plan Administrator for use as part of an Investment
Option menu, which a Participant may elect as a measuring device to determine
Deemed Investment earnings (positive or negative) to be valued in the
Participant’s Account or Sub-Account. The Participant has no real or beneficial
ownership in the security or other investment represented by the Investment
Option.

 

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2.20 Participant. Participant means a Director who has elected to defer
Compensation in accordance with the Plan in any Plan Year.

 

2.21 Plan. Plan means the PSS World Medical, Inc. Directors’ Deferred
Compensation Plan as documented herein and as may be amended from time to time
hereafter.

 

2.22 Plan Administrator. Plan Administrator shall mean a person or persons
appointed by the Deferred Compensation Committee who is responsible for the
day-to-day decision making, record keeping, and administration of the Plan;
provided, that the Plan Administrator may delegate duties of the Plan
Administrator to employees or others to assist in the administration of the
Plan.

 

2.23 Plan Year. Plan Year means January 1 through December 31 each year.

 

2.24 Separation from Service. A Separation from Service occurs when a
Participant incurs a “separation of service” within the meaning of Code
Section 409A.

 

2.25 Sub-Account. Sub-Account shall mean a portion of the Deferred Compensation
Account maintained separately by the Plan Administrator in order to properly
administer the Plan.

 

2.26 Termination Benefit. Termination Benefit shall mean the Participant’s
Deferred Compensation Account Balance distributed in accordance with Article V
of the Plan.

 

2.27 Termination Valuation Date. Termination Valuation Date shall mean the last
day of the calendar month in which Separation from Service occurs.

ARTICLE III

ELIGIBILITY AND PARTICIPATION

 

3.1 Eligibility and Participation. Each Director shall be eligible to
participate in this Plan upon his or her election or appointment as a Director.

 

3.2 Duration. Once a Director becomes a Participant, such Director shall
continue to be a Participant so long as he or she is entitled to receive
benefits hereunder, notwithstanding any subsequent Separation from Service.

 

3.3

Revocation of Future Participation. Notwithstanding the provisions of
Section 3.2, the Committee may revoke such Participant’s eligibility to make
future deferrals under this Plan to be effective as of the January 1st following
such revocation. Such revocation will not affect in any manner a Participant’s
Deferred Compensation Account or other terms of this Plan.

 

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3.4 Notification. Each newly eligible Director shall be notified by the Plan
Administrator, in writing, of his or her eligibility to participate in this
Plan.

ARTICLE IV

DEFERRAL ELECTIONS, AND PARTICIPANT ACCOUNT VALUATION

 

4.1 Deferral Elections

 

  (a) A Participant shall make deferral elections under the Plan by completing
and submitting to the Plan Administrator a written Compensation Deferral
Agreement provided by the Plan Administrator (or completing and electronically
submitting the deferral election screen on the Participant website, when made
available by the Plan Administrator). Deferral elections shall be made during an
annual enrollment period which shall end no later than December 31 preceding the
Plan Year to which the deferral election relates. Notwithstanding the foregoing,
a Director who becomes eligible to be a Participant during any Plan Year may, in
the initial year of eligibility only, make deferral elections with respect to
Compensation which will be paid during the balance of such Plan Year but after
such elections in such Plan Year, within 30 days of the date of his or her
eligibility for participation in the Plan pursuant to Section 3.1 herein.

 

  (b) Deferral elections shall be for a Plan Year, and shall remain in effect
from Plan Year to Plan Year unless modified or revoked by the Participant in
writing on such forms as may be prescribed by the Plan Administrator (or by
following such procedures as are set by the Plan Administrator regarding using
the Participant website, when available) during an enrollment period. Such
modification or revocation shall become effective on the first day of the Plan
Year following the date of the modification or revocation.

 

  (c) A deferral election shall designate the amount of Compensation to be
deferred in whole percentages. A Participant may defer up to 100% of his or her
Compensation to be paid during the Plan Year to which the election refers.

 

  (d) Deferrals shall be deducted from a Participant’s Compensation and the
amount deferred shall be credited to the Participant’s Deferred Compensation
Account and a Deemed Investment shall be made in the investment(s) represented
by the Investment Option(s) elected by the Participant as of the close of
business on the date it would otherwise have been paid as Compensation to the
Participant.

 

  (e)

The Compensation Deferral Agreement shall indicate the Participant’s election of
a payment schedule for his or her Termination Benefit. A Participant shall elect
to have such Termination Benefit distributed subject

 

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to Section 5.3: (a) a portion, or all, in a single lump sum payable within 30
days following the Termination Valuation Date; and/or (b) the balance in up to
ten (10) annual installment payments payable at the time described in
Section 5.2. An election of a payment schedule for a Participant’s Termination
Benefit shall pertain to the entire Deferred Compensation Account Balance. A
Participant shall be permitted to change his or her payment schedule election at
any time by filing a new Compensation Deferral Agreement (or by following such
procedures as are set by the Plan Administrator regarding using the Participant
website, when available), provided the payment commencement date under the new
payment schedule election is at least five (5) years later than the payment
commencement date under the prior payment schedule election; such election is
made at least twelve (12) months prior to the Participant’s date of Separation
from Service and may not be effective for twelve (12) months after the election
is made. Any payment schedule election made within twelve (12) months of
Separation from Service shall be null and void, and the most recent payment
schedule election which is dated at least twelve (12) months prior to Separation
from Service will be in effect.

 

4.2 Allocation Elections and Valuation of Accounts

 

  (a) A Participant shall elect Investment Options from a menu provided by the
Plan Administrator. The initial election shall be made on the Allocation
Election form approved by the Plan Administrator (or Allocation Election Screen
on the Participant website approved by the Plan Administrator) and shall specify
the allocations among the Investment Options elected. A Participant’s Deferred
Compensation Account shall be valued as the sum of the value of all Deemed
Investments minus any withdrawals or distributions from said Account. Investment
Options shall be utilized to determine the earnings attributable to the Account.
Elections of Investment Options do not represent actual ownership of, or any
ownership rights in or to, the securities or other investments to which the
Investment Options refer, nor is the Company in any way bound or directed to
make actual investments corresponding to Deemed Investments.

 

  (b) The Committee, in its sole discretion, shall be permitted to add or remove
Investment Options provided that any such additions or removals of Investment
Options shall not be effective with respect to any period prior to the effective
date of such change. Any unallocated portion of the Participant’s Account or any
unallocated portion of new deferrals shall be Deemed Invested in an Investment
Option referring to a money market based fund.

 

  (c)

A Participant may make a new Allocation Election with respect to future
deferrals, and change the allocation of his or her Account, provided that such
new allocations shall be in increments of one percent (1%). New

 

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Allocation Elections may be made on any business day, and will become effective
on the same business day or, in the case of Allocation Elections received after
a cut-off time established by the Plan Administrator, the following business
day.

 

  (d) Notwithstanding anything in this Section to the contrary, the Company
shall have the sole and exclusive authority to invest any or all amounts
deferred in any manner, regardless of any Allocation Elections by any
Participant. A Participant’s Allocation Election shall be used solely for
purposes of determining the value of such Participant’s Sub-Accounts and the
amount of the corresponding liability of the Company in accordance with this
Plan.

 

4.3 Prohibition Against Modifications to deferral elections. A Participant may
not modify or revoke a deferral election during a Plan Year.

ARTICLE V

DISTRIBUTIONS AND WITHDRAWALS

 

5.1 Termination Benefit Distribution. The Termination Benefit will be paid (or
the first payment will be made) in accordance with the Participant payment
schedule election within 30 days of the Termination Valuation Date.

 

5.2 Installment Payments. If the Participant has elected installment payments
for his or her Termination Benefit distribution, annual cash payments will be
made beginning within 30 days of the Termination Valuation Date or, in the event
of a partial lump sum election, following the first anniversary of the partial
lump sum payment made following Separation from Service. Such payments shall
continue annually on or about the anniversary of the previous installment
payment until the number of installment payments elected has been paid. The
installment payment amount shall be determined annually as the result of a
calculation, performed on the Annual Valuation Date, where (i) is divided by
(ii):

 

  (i) equals the value of the applicable Sub-Account on the Annual Valuation
Date; and

 

  (ii) equals the remaining number of installment payments.

 

5.3 Small Account Balance Lump Sum Payment. In the event that a Participant’s
Deferred Compensation Account Balance is less than $25,000 on the initial
Termination Valuation Date, the Termination Benefit shall be paid in a lump sum
and any form of payment election to the contrary shall be null and void.

 

5.4

Death Benefit. In the event of a Participant’s death either before Separation
from Service or before complete distribution of the Termination Benefit, such
Participant’s Beneficiary, named on the most recently filed Beneficiary
Designation Form, shall be paid a Death Benefit in the amount of the remaining

 

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Deferred Compensation Account Balance in a single lump sum as soon as
practicable following the end of the month in which the Participant’s death
occurred. The Valuation Date for purposes of determining the Death Benefit shall
be the last day of the month in which the Participant’s death occurs.

 

5.5 Domestic Relations Order. If necessary to comply with a domestic relations
order, as defined in Code Section 414(p)(1)(B), pursuant to which a court has
determined that a spouse or former spouse of a Participant has an interest in
the Participant’s Account under the Plan, the Plan Administrator shall have the
right to immediately distribute the spouse’s or former spouse’s interest in the
Participant’s benefits under the Plan to such spouse or former spouse.

 

5.6 Change in Control. In the event a Participant shall have a Separation from
Service within two (2) years following a Change in Control, such Participant
shall receive his or her Deferred Compensation Account Balance in a single lump
sum paid within 30 days following the Termination Valuation Date All payment
schedule elections to the contrary shall be ignored.

 

5.7 Pro-rata subtraction from Investment Options. In the event a distribution
under this Article V (e.g. an installment payment) is less than the entire
Account Balance and the Account is allocated over more than one Investment
Option, the distribution shall be subtracted from each Investment Option in a
pro-rata manner determined in the sole discretion of the Plan Administrator.

ARTICLE VI

ADMINISTRATION

 

6.1 Plan Administration. This Plan shall be administered by the Plan
Administrator, which shall have discretionary authority to make, amend,
interpret and enforce all appropriate rules and regulations for the
administration of this Plan and to utilize its discretion to decide or resolve
any and all questions, including but not limited to eligibility for benefits and
interpretations of this Plan and its terms, as may arise in connection with the
Plan. Claims for benefits shall be filed with the Plan Administrator and
resolved in accordance with the claims procedures in Article IX.

 

6.2 Withholding. The Employer shall have the right to withhold from any payment
made under the Plan (or any amount deferred into the Plan) any taxes required by
law to be withheld in respect of such payment (or deferral).

 

6.3

Indemnification. The Company shall indemnify and hold harmless each employee,
officer, director, agent or organization, to whom or to which is delegated
duties, responsibilities, and authority with respect to administration of the
Plan, against all claims, liabilities, fines and penalties, and all expenses
reasonably incurred by or imposed upon him or it (including but not limited to
reasonable attorney fees) which arise as a result of his or its actions or
failure to

 

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act in connection with the operation and administration of the Plan to the
extent lawfully allowable and to the extent that such claim, liability, fine,
penalty, or expense is not paid for by liability insurance purchased or paid for
by the Company. Notwithstanding the foregoing, the Company shall not indemnify
any person or organization if his or its actions or failure to act are due to
gross negligence or willful misconduct or for any such amount incurred through
any settlement or compromise of any action unless the Company consents in
writing to such settlement or compromise.

 

6.4 Expenses. The expenses of administering the Plan shall be paid by the
Company.

 

6.5 Delegation of Authority. In the administration of this Plan, the Plan
Administrator may, from time to time, employ agents and delegate to them such
administrative duties as it sees fit, and may from time to time consult with
legal counsel who may be legal counsel to the Company.

 

6.6 Binding Decisions or Actions. The decision or action of the Plan
Administrator in respect of any question arising out of or in connection with
the administration, interpretation and application of the Plan and the rules and
regulations thereunder shall be final and conclusive and binding upon all
persons having any interest in the Plan.

ARTICLE VII

AMENDMENT AND TERMINATION

 

7.1 Amendment and Termination. The Plan is intended to be permanent, but the
Committee may at any time modify, amend, or terminate the Plan, provided that
such modification, amendment or termination shall not cancel, reduce, or
otherwise adversely affect the amount of benefits of any Participant accrued
(and any form of payment elected) as of the date of any such modification,
amendment, or termination, without the consent of the Participant. Following a
Plan termination, the Participants’ Account balances shall remain in the Plan
and shall not be distributed until such amounts become eligible for distribution
in accordance with the other applicable provisions of the Plan. Notwithstanding
the preceding sentence, to the extent permitted by Treas. Reg.
§1.409A-3(j)(4)(ix), the Committee may provide that upon termination of the
Plan, all Participant Accounts shall be distributed, subject to and in
accordance with any rules established by the Committee deemed necessary to
comply with the applicable requirements and limitations of Treas. Reg.
§1.409A-3(j)(4)(ix).

ARTICLE VIII

INFORMAL FUNDING

 

8.1

General Assets. All benefits in respect of a Participant under this Plan shall
be paid directly from the general funds of the Company, or a Rabbi Trust created
by

 

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the Company and funded by the Company for the purpose of informally funding the
Plan, and other than such Rabbi Trust, if created, no special or separate fund
shall be established and no other segregation of assets shall be made to assure
payment. No Participant, spouse or Beneficiary shall have any right, title or
interest whatever in or to any investments which the Company may make to aid the
Company in meeting its obligation hereunder. Nothing contained in this Plan, and
no action taken pursuant to its provisions, shall create or be construed to
create a trust of any kind, or a fiduciary relationship, between the Company or
any if its subsidiaries or affiliated companies and any Director, spouse, or
Beneficiary. To the extent that any person acquires a right to receive payments
from the Company hereunder, such rights are no greater than the right of an
unsecured general creditor of the Company.

 

8.2 Rabbi Trust. The Company may, at its sole discretion, establish a grantor
trust, commonly known as a Rabbi Trust, as a vehicle for accumulating the assets
needed to pay the promised benefit, but the Company shall be under no obligation
to establish any such trust or any other informal funding vehicle.

ARTICLE IX

GENERAL CONDITIONS

 

9.1 Anti-assignment Rule. No interest of any Participant, spouse or Beneficiary
under this Plan and no benefit payable hereunder shall be assigned as security
for a loan, and any such purported assignment shall be null, void and of no
effect, nor shall any such interest or any such benefit be subject in any
manner, either voluntarily or involuntarily, to anticipation, sale, transfer,
assignment or encumbrance by or through any Participant, spouse or Beneficiary.

 

9.2 No Legal or Equitable Rights or Interest. No Participant or other person
shall have any legal or equitable rights or interest in this Plan that are not
expressly granted in this Plan. Participation in this Plan does not give any
person any right to be retained in the service of the Company or any of its
subsidiaries or affiliated companies. The right and power of the Company to
dismiss or discharge a Director is expressly reserved.

 

9.3 Claims Procedures. Claims for payments under this Plan shall be governed by
the procedures established under Department of Labor Regulations, §2560.503-1.

 

9.4 No Employment Contract. Nothing contained herein shall be construed to
constitute a contract of employment between a Director and the Company.

 

9.5 Headings. The headings of Sections are included solely for convenience of
reference, and if there is any conflict between such headings and the text of
this Plan, the text shall control.

 

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9.6 Invalid or Unenforceable Provisions. If any provision of this Plan shall be
held invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provisions hereof and the Plan Administrator may elect in its
sole discretion to construe such invalid or unenforceable provisions in a manner
that conforms to applicable law or as if such provisions, to the extent invalid
or unenforceable, had not been included.

 

9.7 Governing Law. The laws of the State of Florida shall govern the
construction and administration of the Plan.

The foregoing is hereby acknowledged as being the PSS World Medical, Inc.
Directors’ Deferred Compensation Plan as adopted by the Board of Directors of
the Company on December 12, 2008.

 

PSS WORLD MEDICAL, INC. By:  

/s/ David A. Smith

  David A. Smith   Chairman and Chief Executive Officer Its:  

 

ATTEST:  

 

 

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