EX-10.5






Exhibit 10.5




HANESBRANDS INC.




SUPPLEMENTAL EMPLOYEE RETIREMENT PLAN




Conformed through September 24, 2008




 









 








HANESBRANDS INC.

SUPPLEMENTAL EMPLOYEE RETIREMENT PLAN




(Effective as of January 1, 2006)




SECTION 1




Introduction




1.1 Purpose




     The Hanesbrands Inc. Supplemental Employee Retirement Plan (the “Plan”) is maintained by the
Corporation to provide retirement benefits that are otherwise limited under the Retirement Savings
Plan. In addition, the accrued benefits of any Transferred Participant shall be transferred from
the Sara Lee SERP to the Plan as of the Effective Date. On and after the Effective Date, all
benefits previously accrued by Transferred Participants under the Sara Lee SERP shall be provided
under the Plan, and Transferred Participants shall accrue no additional benefits under the Sara Lee
SERP.



     The Plan shall constitute a top hat plan within the meaning of Section 201(2) of ERISA.
Notwithstanding any provision of the Plan to the contrary, the Plan is subject to the provisions of
Section 409A of the Code and at all times shall be interpreted and administered so that it is
consistent with such Code section; provided, however, that the vested benefits of each Transferred
Participant who terminated employment with Sara Lee Corporation and all of its Controlled Group
Members prior to January 1, 2005 shall be determined in accordance with Subsection 1.6 (and shall
not be subject to Code Section 409A), except as otherwise provided in Subsection 3.3.



1.2 Effective Date and Plan Year




     The Plan is effective as of January 1, 2006. The Plan is administered on the basis of a Plan
Year.



 









 





1.3 Employers




     The Corporation and each other Controlled Group Member that is a participating employer under
the Retirement Savings Plan shall be deemed to have adopted the Plan and shall be treated as an
Employer hereunder.



1.4 Plan Administration




     As described in Subsection 5.1, the Committee shall be the administrator (as defined in
Section 3(16)(A) of ERISA) of the Plan; provided, however, that the Committee may delegate all or
any part of its powers, rights, and duties under the Plan to such person or persons as it may deem
advisable.



1.5 Plan Supplements




     The provisions of the Plan may be modified by supplements to the Plan. The terms and
provisions of each supplement are a part of the Plan and supersede the other provisions of the Plan
to the extent necessary to eliminate inconsistencies between such other Plan provisions and such
supplement.



1.6 Plan Benefits for Participants who Terminated Employment




     The benefits provided under the Plan with respect to any Participant whose employment with the
Employers has terminated shall, except as otherwise specifically provided in the Plan, be governed
in all respects by the terms of the Plan in effect as of the date of the Participant’s termination
of employment (or in the case of a Transferred Participant who Separated from Service prior to the
Effective Date, pursuant to the Sara Lee SERP).



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SECTION 2




Definitions




2.1 2008 Special Election




     If the Committee, in its discretion, decides to offer a 2008 Special Election, then the “2008
Special Election” shall mean a Participant’s valid election, made prior to December 31, 2008 in
accordance with rules and procedures established by the Committee, to receive his or her RSSERP
Benefit and/or Pension SERP Benefit at a time and in a form specified in Subparagraphs 4.4(a)(iii)
and 4.4(b)(iv), respectively.



2.2 A&B Level Transition Credit




     “A&B Level Transition Credit” means the annual credit, if any, made during the 2006-2010 Plan
Years to Participants who had (a) attained age 45 and (b) completed five or more years of credited
service as an A or B level executive as of January 1, 2006;
provided, however, that S. Babu, K.
McAleer, K. Oliver, and C. Yaroch shall be treated as eligible to receive the A&B Level Transition
Credit. A&B Level Transition Credits will be calculated as follows:



	 	 	 	 	 	 
	 	Age Plus Years of 

A&B Level Service

(as of 1/1/06)
	 	 	Credit (as a percentage

of the Participant’s

Supplemental Compensation)	 
	 	50 to 54
	 	 	4%	 
	 	55 to 59
	 	 	8%	 
	 	60 to 64
	 	 	12%	 
	 	65 to 69
	 	 	14%	 
	 	70 or more
	 	 	15%	 
	 




In order to receive the A&B Level Transition Credit for any Plan Year, any Participant who meets
the requirements described herein must be an active Employee as of the last day of the Plan Year or
have retired, died, or become a Totally Disabled Participant during the Plan Year.




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2.3 Account




     “Account” means the notional accounts and subaccounts maintained for a Participant under the
Plan, as described in Subsection 4.1.



2.4 Annual Company Credit




     “Annual Company Credit” means the annual company contribution made on behalf of a Participant
as described in the Retirement Savings Plan.



2.5 Beneficiary




     “Beneficiary” means the person or persons designated by a Participant to receive payment of
his or her RSSERP Benefit (“RSSERP Beneficiary”) or Pension SERP Benefit (“Pension SERP
Beneficiary”) upon his or her death in accordance with Subsection 4.5. A beneficiary designation
shall be effective only when properly provided to the Committee in accordance with its rules and
procedures while the Participant is alive and, when effective, will cancel all prior beneficiary
designations. If the Participant does not have an effective RSSERP Beneficiary and/or Pension SERP
Beneficiary designation on the date of his or her death (because the Participant failed to
designate a beneficiary or the Participant’s named beneficiary died before the Participant), the
Committee will make the applicable payments described in Subsection 4.5 as follows:




	 	(a)	 	To the Participant’s surviving spouse;
	 
	 	(b)	 	If the Participant does not have a surviving spouse, to or for the benefit of
the legal representative or representatives of the Participant’s estate;
	 
	 	(c)	 	If the Participant does not have a surviving spouse and an estate is not opened
on behalf of the Participant, to or for the benefit of one or more of the Participant’s
relatives by blood, adoption or marriage in such proportions as the Committee (or its
delegate) determines.




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2.6 Code




     “Code” means the Internal Revenue Code of 1986, as amended.



2.7 Committee




     “Committee” means the Hanesbrands Inc. Employee Benefits Administrative Committee appointed by
the Corporation to administer the Plan.



2.8 Controlled Group Member




     “Controlled Group Member” means the Corporation and any affiliated or related corporation
which is a member of a controlled group of corporations (within the meaning of Section 1563(a) of
the Code) which includes the Corporation or any trade or business (whether or not incorporated),
which is under common control with the Corporation (within the meaning of Section 414(c) of the
Code).



2.9 Corporation




     “Corporation” means Hanesbrands Inc., a Maryland corporation.



2.10 Default Payment Date




     “Default Payment Date” means the first business day that occurs 12 months after the end of the
Participant’s Election Period.



2.11 Deferred Vested Participant




     “Deferred Vested Participant” means a Participant who has Separated from Service, is not a
Retired Participant, and is eligible for a monthly deferred vested pension under the Pension Plan.



2.12 Determination Date




     For purposes of the RSSERP Benefit, “Determination Date” means the date on which the Committee
or its delegate receives notification of a Participant’s Separation from Service. For



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purposes of the Pension SERP Benefit, “Determination Date” means the date on which the benefit
calculation package is sent to the Participant; provided, however, a Participant’s Determination
Date shall be the date that is 6 months after the Participant’s Separation from Service if his or
her benefit calculation package has not been sent by such date.




2.13 Effective Date




     “Effective Date” means January 1, 2006, except as otherwise required to comply with applicable
law or as specifically provided herein.



2.14 Election Period




     “Election Period” means the period commencing on the Participant’s Determination Date and
ending on the 60th day thereafter.



2.15 Employee




     “Employee” means a person, including an officer of an Employer, who is in the employ of an
Employer. For all purposes of the Plan, an individual shall be an “Employee” of or be “employed”
by an Employer for any Plan Year only if such individual is treated by the Employer for such Plan
Year as its employee for purposes of employment taxes and wage withholding for Federal income
taxes, regardless of any subsequent reclassification of such individual as an Employee by an
Employer, any governmental agency, court, or other third party. Any such reclassification shall
not have a retroactive effect for purposes of the Plan.



2.16 Employer




     “Employer” means the Corporation and each other Controlled Group Member that is a
participating employer under the Retirement Savings Plan.



2.17 ERISA




     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.



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2.18 Matching Credit




     “Matching Credit” means the employer matching contribution made on behalf of a Participant as
described in the Retirement Savings Plan.



2.19 Normal Retirement Date




     “Normal Retirement Date” means the first day of the month coincident with or next following
the Participant’s attainment of age 65.



2.20 Participant




     “Participant” means an Employee who satisfies the requirements of Subsection 3.1.



2.21 Pension Plan




     “Pension Plan” means the Hanesbrands Inc. Pension and Retirement Plan, as amended from time to
time. No further benefits shall accrue under the Pension Plan on or after the Effective Date.



2.22 Pension SERP Benefit




     “Pension SERP Benefit” means a Participant’s benefit described in Subsection 4.2.



2.23 Pension SERP Interest Rate




     “Pension SERP Interest Rate” means an interest rate equal to 120% of the annual rate on
30-year Treasury securities published for the month that is 3 months prior to the Determination
Date or payment commencement date, as applicable, rounded to the nearest 0.25%.



2.24 Plan




     “Plan” means the Hanesbrands Inc. Supplemental Employee Retirement Plan, as amended from time
to time.



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2.25 Plan Year




     “Plan Year” means the 12-month period beginning each January 1 and ending the next following
December 31.



2.26 Plan Year RSSERP Credit




     “Plan Year RSSERP Credit” means the credit described in Subparagraph 4.1(b).



2.27 Present Value




     “Present Value” means the present value of a Participant’s Pension SERP Benefit, calculated as
if the Pension SERP Benefit were payable as an annuity under the Pension Plan using the Pension
Plan’s (a) early payment factors, as applicable, (b) the mortality table provided under the Pension
Plan as of December 31, 2007, and (c) the Pension SERP Interest Rate. For a Retired Participant’s
Present Value calculation, the assumed commencement date shall be the date of the Participant’s
retirement and the Present Value will be accumulated with interest at the Pension SERP Interest
Rate to the actual payment commencement date. For a Deferred Vested Participant’s Present Value
calculation, the assumed commencement date shall be the Participant’s Normal Retirement Date and
the Present Value shall be determined as of the date payment is to be made under Subparagraph
4.4(b).



2.28 Residual Credit




     “Residual Credit” means a credit to the Participant’s RSSERP Benefit made after the
Participant’s Separation from Service based on the Annual Company Credit, A&B Level Transition
Credit, and Salaried Employee Transition Credit.



2.29 Retired Participant




     “Retired Participant” means a Participant who has Separated from Service after attaining age
55 and completing at least 10 years of vesting service (as defined in the Pension Plan) or after
age 65.



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2.30 Retirement Savings Plan




     “Retirement Savings Plan” means the Hanesbrands Inc. Retirement Savings Plan, as amended from
time to time; provided, however, that for the period from the Effective Date to the date the
Retirement Savings Plan first becomes effective, the term “Retirement Savings Plan” shall mean the
Sara Lee Corporation 401(k) Plan as applied to a Participant and Code limits referenced herein
shall be applied as if the Hanesbrands Inc. Retirement Savings Plan, and the Sara Lee Corporation
401(k) Plan were a single plan for the first Plan Year.



2.31 RSSERP Benefit




     “RSSERP Benefit” means the Participant’s benefit described in Subsection 4.1.



2.32 Salaried Employee Transition Credit




     In addition, a “Salaried Employee Transition Credit” will be made on behalf of any employee
who (a) had attained age 50; (b) had completed at least 10 years of vesting service (as defined in
the Pension Plan) with the Corporation as of January 1, 2006; and (c) notwithstanding any provision
of the Retirement Savings Plan, did not receive a Transition Contribution in the Retirement Savings
Plan equal to 10% of the employee’s 2006 Supplemental Compensation. The Salaried Employee
Transition Credit shall be reduced by the amount of any Transition Contribution the employee
received in the Retirement Savings Plan for 2006.



2.33 Sara Lee SERP




     “Sara Lee SERP” means the Sara Lee Corporation Supplemental Executive Retirement Plan.



2.34 Separation from Service




     “Separation from Service” occurs when a Participant’s terminates employment with the
Corporation and its Controlled Group Members by reason of a resignation, discharge, retirement,



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or death. Separation from Service for purposes of the Plan shall be interpreted consistent
with the requirements of Code Section 409A(a)(2)(A)(i) and any IRS guidance issued thereunder.




2.35 SERP Benefit




     “SERP Benefit” means the Participant’s RSSERP Benefit and/or Pension SERP Benefit, as
applicable.



2.36 Specified Employee




     “Specified Employee” means an Employee described in Code Section 409A(a)(2)(B)(i).



2.37 Supplemental Compensation




     For purposes of the RSSERP Benefit, a Participant’s “Supplemental Compensation” means his or
her compensation as defined in the Retirement Savings Plan but including the following additional
amounts:




	 	(a)	 	Any amounts that cannot be recognized as compensation in the Retirement Savings
Plan due to the dollar limitation contained in Code Sections 401(a)(17) of the Code;
	 
	 	(b)	 	Deferrals of base salary and bonus compensation for the Plan Year in which
deferred; and
	 
	 	(c)	 	Any compensation required to be included as Supplemental Compensation pursuant
to an employment, severance or other written agreement with an Employer; provided,
however, that severance payments to Specified Employees that are delayed six months in
compliance with Code Section 409A shall be attributable to the year in which such
amounts were earned rather than the year in which they are paid.




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2.38 Transferred Participant




     “Transferred Participant” means any participant in the Sara Lee SERP who was employed by the
Corporation on December 31, 2005 or who was last employed by the Corporation’s predecessor division
of Sara Lee Corporation; provided, however, that L. Chaden, D. Volz, and expatriate employees of
the Corporation on January 1, 2006 shall not be considered “Transferred Participants,” so that such
individuals’ benefits under the Sara Lee SERP shall remain payable exclusively by Sara Lee
Corporation under the Sara Lee SERP.



2.39 Total Disability




     “Total Disability” means total disability, as defined in the Pension Plan. A “Totally
Disabled Participant” means a Participant who is subject to a Total Disability.



2.40 Other Definitions




     Other defined terms used in the Plan shall have the meanings given such terms elsewhere in the
Plan, the Retirement Savings Plan and the Pension Plan.



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SECTION 3




Participation




3.1 Eligibility




     Transferred Participants shall be eligible to participate in the Plan on the Effective Date.
In addition, each other Employee of an Employer who is a participant in the Retirement Savings Plan
will become a Participant in the Plan upon the date that the contributions that he or she would
otherwise receive under the Retirement Savings Plan are limited by one or more of the following:




	 	(i)	 	By operation of Code Section 415;
	 
	 	(ii)	 	Because Supplemental Compensation is not taken into account
under the Retirement Savings Plan; or
	 
	 	(iii)	 	Because a period required to be included as service pursuant
to an employment, severance or other written agreement with an Employer is not
taken into account under the Retirement Savings Plan.





3.2 Period of Participation




     Each Employee who becomes a Participant in the Plan shall continue as a Participant until the
earlier of the date that all of his or her vested SERP Benefits (if any) have been distributed or
his or her death.



3.3 Reemployed Participants





	 	(a)	 	In the event a Participant who terminated employment with the Corporation and
all Controlled Group Members prior to January 1, 2005 is reemployed by the Controlled
Group Members on or after the Effective Date, the following rules shall apply:




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	 	(i)	 	The Participant’s SERP Benefits that were earned and vested as
of December 31, 2004 and that have been distributed or are in distribution
status as of his or her reemployment date shall continue to be distributed in
accordance with the terms of the Sara Lee SERP as in effect on his or her
earlier Separation from Service and shall not be subject to the requirements of
Code Section 409A; and
	 
	 	(ii)	 	The Participant’s SERP Benefits that either (i) were earned and
vested as of December 31, 2004 and (A) have not been distributed, or (B) are
not in distribution status, or (ii) were not earned and vested as of December
31, 2004, shall be subject to the applicable terms of this Plan document and
the requirements of Code Section 409A.






	 	(b)	 	In the event a Participant who Separated from Service with the Corporation and
all Controlled Group Members on or after January 1, 2005 is reemployed by the
Controlled Group Members on or after the Effective Date, the SERP Benefits determined
as of the Participant’s initial Separation from Service shall be subject to the
applicable terms of this Plan document and the requirements of Code Section 409A and
distribution of those amounts shall not be impacted by the Participant’s reemployment.




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SECTION 4




SERP Benefits




4.1 RSSERP Benefit




     Subject to Subsection 4.3, a Participant’s RSSERP Benefit shall be equal to the balance in the
Account maintained on behalf of the Participant under the Plan, which Account balance shall be
equal to the sum of (a) plus (b) plus (c) below, and as adjusted pursuant to (d) below:




	 	(a)	 	Pre-Effective Date Benefit. A Participant’s Account under the Plan shall be
credited with the amount of the Participant’s Sara Lee 401(k) SERP Benefit determined
under the Sara Lee SERP, if any, determined as of the date immediately preceding the
Effective Date.
	 
	 	(b)	 	Plan Year RSSERP Credits. A Participant’s Account under the Plan shall be
credited with the Plan Year RSSERP Credit equal to (i) plus (ii) plus (iii) below, if
any, as of the last day of each Plan Year:






	 	(i)	 	Annual Company Credit. The amount equal to (A) minus (B)
below:






	 	(A)	 	The annual company contribution that
would have been made on behalf of the Participant (if any)
under the Retirement Savings Plan (or, in 2006, under the Sara
Lee 401(k) Plan) for the applicable Plan Year based on the
Participant’s Supplemental Compensation and without regard to
Code Section 415; minus
	 
	 	(B)	 	The annual company contribution
actually made on behalf of the Participant under the Retirement
Savings Plan (or, in 2006, under the Sara Lee 401(k) Plan) for
such Plan Year.






	 	(ii)	 	Matching Credit. The amount equal to the Matching Credit that
would have been made on behalf of the Participant under the Retirement Savings




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	 	 	 	Plan for the Plan Year based on his or her Supplemental Compensation less
any matching contributions received (or deemed received as described below)
by the Participant under the Retirement Savings Plan for that Plan Year;
provided, however, that for purposes of determining the Matching Credit
under this Plan, the Participant will be deemed to (A) have made 401(k)
contributions (excluding catch-up contributions) of 4% of the Participant’s
Supplemental Compensation, and (B) have received the appropriate matching
contribution under the Retirement Savings Plan based upon such deemed 401(k)
contribution (regardless of the Participant’s actual contribution rate).
	 
	 	(iii)	 	The A&B Level Transition Credit, if any.
	 
	 	(iv)	 	The Salaried Employee Transition Credit, if any.






	 	(c)	 	Forfeited Retirement Savings Plan Benefit. To the extent that service under a
separation agreement is included in SERP vesting service, a Participant’s Account under
the Plan shall be credited with any amount of the Participant’s Retirement Savings Plan
benefit that would be vested under the Retirement Savings Plan recognizing SERP vesting
service but that is forfeited due to his or her Separation from Service with the
Controlled Group Members prior to becoming fully vested under the Retirement Savings
Plan.
	 
	 	(d)	 	Adjustment of Account. The Account maintained on behalf of a Participant under
the Plan shall be adjusted from time to time to reflect a hypothetical investment in
the Hanesbrands Inc. Common Stock Fund under the Retirement Savings Plan; provided,
however, that for as long as the Corporation is a Controlled Group Member of Sara Lee
Corporation, the Account maintained on behalf of a Participant under the Plan shall be
adjusted from time to time to reflect a hypothetical investment in the Sara Lee
Corporation Common Stock Fund under the Sara Lee Corporation 401(k) Plan. The
Committee may establish such rules and procedures relating to the maintenance,
adjustment, and liquidation of




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	 	 	 	Participants’ Accounts, the crediting of credits and the notional income, losses,
expenses, appreciation, and depreciation attributable thereto, as are considered
necessary or advisable. In addition to the Account described above, the Committee
may maintain such other Accounts as the Committee considers necessary or desirable.





4.2 Pension SERP Benefit




     Subject to Subsection 4.3, a Transferred Participant’s Pension SERP Benefit shall be equal to
the Transferred Participant’s Sara Lee Pension SERP Benefit determined under the Sara Lee SERP, if
any, determined as of the Effective Date.



     In the case of a Participant in compensation band 3, 4 or 5 who is entitled to receive
severance benefits under the Hanesbrands Inc. Severance Pay Plan (previously known as the Sara Lee
Corporation Severance Pay Plan for Employees of Sara Lee Branded Apparel) , and who would satisfy
the requirements for early retirement under the Pension Plan if his/her severance period (as
defined in the separation agreement pursuant to which the severance benefits are paid) were a
period of actual employment under the Pension Plan, then to the extent provided in the
Participant’s separation agreement, the Participant’s SERP Benefit shall be increased to reflect
the difference between (i) the Pension Plan benefit that would be payable if the years of severance
period was recognized as years of vesting service as defined in the Pension Plan; and (ii) the
actual Pension Plan benefit; provided, however, that such Participant’s severance period shall not
be considered as credited service for purposes of determining the amount of the Participant’s
accrued Pension SERP Benefit.



4.3 Vesting of Benefits




     A Participant shall have a nonforfeitable right to his or her SERP Benefit as provided in
Subparagraphs (a) and (b) below, as applicable.




	 	(a)	 	RSSERP Benefit. A Participant’s Annual Company Credits and Matching Credits
shall become nonforfeitable on the same basis and at the same time as his or her annual
company contributions and matching contributions, respectively, become




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	 	 	 	nonforfeitable under the Retirement Savings Plan. A Participant’s A&B Level
Transition Credits or Salaried Employee Transition Credit, if any, shall be
nonforfeitable at all times.
	 
	 	(b)	 	Pension SERP Benefit. A Participant’s Pension SERP Benefit shall become
nonforfeitable on the same basis and at the same time as his or her benefit under the
Pension Plan.




In determining whether a Participant is vested in his or her SERP Benefit, any period required to
be included as service pursuant to an employment, severance or other written agreement with an
Employer shall be considered service with an Employer under the Plan.




4.4 Payment of Benefits




     A Participant’s SERP Benefit shall, subject to the further provisions of this Plan, be payable
to or on account of the Participant as follows:




	 	(a)	 	RSSERP Benefit.






	 	(i)	 	If the value of the Participant’s vested RSSERP Benefit
(determined without regard to any Residual Credit) is less than $50,000 on the
Participant’s Determination Date, then any 2006 Special Election made by the
Participant shall be void, and the Participant’s RSSERP Benefit shall be paid
in a lump sum as soon as administratively practicable following the
Participant’s Determination Date, but in no event later than the end of the
calendar year after the calendar year of the Participant’s Determination Date.
Any Residual Credit to the Participant’s Account after his or her Determination
Date shall be paid in a lump sum as soon as practicable after such credit is
made, but in no event later than the end of the calendar year after the
calendar year of the Participant’s Determination Date. Notwithstanding the
foregoing, in no event shall distribution to a Specified Employee be made
earlier than 6 months following his or her Separation from Service.




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	 	(ii)	 	If the value of the Participant’s vested RSSERP Benefit
(determined without regard to any Residual Credit) is $50,000 or more on the
Participant’s Determination Date, the Participant’s RSSERP Benefit will be paid
as follows:






	 	(A)	 	Subject to Subparagraph (B) below, the
Participant’s RSSERP Benefit shall be paid in a lump sum on or
as soon as practicable after the Default Payment Date, but in
no event later than the end of the calendar year after the
calendar year of the Participant’s Determination Date.
	 
	 	(B)	 	In lieu of the payment method described
in Subparagraph (A), during the Election Period, the
Participant may elect to receive his or her RSSERP Benefit in
one of the following forms, in accordance with rules and
procedures established by the Committee:






	 	(1)	 	In a lump sum paid as of
the first business day of the calendar year beginning 5
years after the Default Payment Date (or any calendar
year thereafter); or
	 
	 	(2)	 	In annual installments
over a period of 5 or 10 years commencing as of the
first business day of the calendar year beginning 5
years after the Default Payment Date (or any calendar
year thereafter).






	 	(C)	 	If the Participant made a valid 2006
Special Election and does not make an election described in
Subparagraph (B), his or her RSSERP Benefit shall be paid in
accordance with such 2006 Special Election commencing as soon
as administratively practicable following the Participant’s
Default Payment Date.




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	 	 	 	If a proper election is not made during the Election Period, the Participant
shall be deemed to have elected a distribution under Subparagraph (A).






	 	(b)	 	Pension SERP Benefit.






	 	(i)	 	If the Present Value of the Participant’s vested Pension SERP
Benefit is less than $50,000 on the Participant’s Determination Date or if the
Participant does not qualify as a Retired Participant or a Totally Disabled
Participant, then any 2006 Special Election made by the Participant shall be
void, and the Present Value of the Participant’s Pension SERP Benefit shall be
paid in a lump sum as soon as administratively practicable following the
Participant’s Determination Date, but in no event later than the end of the
calendar year after the calendar year of the Participant’s Determination Date.
Notwithstanding the foregoing, in no event shall distribution to a Specified
Employee be made earlier than 6 months following his or her Separation from
Service. If the Participant’s distribution is suspended due to the waiting
period imposed by operation of Code Section 409A and the related terms of the
Plan, it shall be accumulated with interest at the Pension SERP Interest Rate.
	 
	 	(ii)	 	If the Present Value of the vested portion of the Participant’s
Pension SERP Benefit is $50,000 or more on the Participant’s Determination Date
and the Participant qualifies as either a Retired Participant or a Totally
Disabled Participant, then the Participant’s Pension SERP Benefit will be paid
as follows:






	 	(A)	 	Subject to Subparagraph (B) below, if
the Participant did not make a valid 2006 Special Election, the
Participant’s Pension SERP Benefit shall be paid the Present
Value of his or her Pension SERP Benefit shall be paid in a
lump sum as soon as administratively practicable following the
Default Payment Date but in no event later than the end of




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	 	 	 	the calendar year after the calendar year of the
Participant’s Determination Date.
	 
	 	(B)	 	In lieu of the payment method and
timing described in Subparagraph (A), and subject to the timing
restrictions in Subparagraph (C), during the Election Period,
the Participant may elect to receive his or her Pension SERP
Benefit in one of the following forms, in accordance with rules
and procedures established by the Committee:






	 	(1)	 	The Present Value paid in
a lump sum; or
	 
	 	(2)	 	The Present Value paid in
monthly installments over a period of 5 or 10 years (as
elected).






	 	(C)	 	If a Participant makes an election as
described in Subparagraph (B) during the Election Period,
payments will commence as follows:






	 	(1)	 	As elected by the
Participant, as of the first day of any month following
the date that is 5 years after the Default Payment Date.
	 
	 	(2)	 	The amount of the
Participant’s Pension SERP Benefit will be determined as
of the date the Participant retires and will be
accumulated with interest at the Pension SERP Interest
Rate to the payment date.






	 	(D)	 	If the Participant made a valid 2006
Special Election and does not make an election described in
Subparagraph (B), his or her Pension SERP Benefit shall be paid
in accordance with such 2006 Special Election.




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4.5 Payments Upon Death




     Notwithstanding any provision of Subsection 4.4 to the contrary, the following rules shall
apply upon a Participant’s death:




	 	(a)	 	RSSERP Benefit. If the Participant dies before complete payment of his or her
vested RSSERP Benefit under Subparagraph 4.4(a), payment of his or her remaining RSSERP
Benefit shall be made to his or her RSSERP Beneficiary in a lump sum as soon as
practicable following the date of the Participant’s death (but in no event later than
the end of the calendar year following the calendar year of his or her death).
	 
	 	(b)	 	Pension SERP Benefit.






	 	(i)	 	Death Before Commencement.






	 	(A)	 	If a Participant Separates from Service
before qualifying as a Retired Participant and dies before
commencement of his or her Pension SERP Benefit, the Present
Value of the Participant’s Pension SERP Benefit shall be paid
to the Participant’s Pension SERP Beneficiary in a lump sum as
soon as practicable following the date of the Participant’s
death (but in no event later than the end of the calendar year
following the calendar year of his or her death).
	 
	 	(B)	 	If a Retired Participant dies before
commencement of his or her Pension SERP Benefit payments, then
the Present Value of his or her Pension SERP Benefit shall be
paid to the Participant’s Pension SERP Beneficiary in a lump
sum as soon as practicable following the date of the
Participant’s death (but in no event later than the end of the
calendar year following the calendar year of his or her death).




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	 	(C)	 	Death while Active. If a Participant
dies while actively employed by the Corporation, the Present
Value of the Participant’s Pension SERP Benefit attributable to
the active death benefit, as determined under the Pension Plan,
shall be paid to the Participant’s Pension SERP Beneficiary in
a lump sum as soon as practicable following the date of the
Participant’s death (but in no event later than the end of the
calendar year following the calendar year of his or her death).
If such benefit is payable to the Participant’s surviving
spouse, the Present Value shall be determined based on the
surviving spouse’s age on the date of the Participant’s death.
If such benefit is payable to a Pension SERP Beneficiary other
than the Participant’s surviving spouse, the Present Value
shall be determined as if such amount were payable to a spouse
the same age as the Participant.






	 	(ii)	 	Death After Commencement. If the Participant dies after
commencement of his or her Pension SERP Benefit payments, the Present Value of
the unpaid portion of his or her Pension SERP Benefit shall be paid to his or
her Pension SERP Beneficiary in a lump sum as soon as practicable following the
date of the Participant’s death (but in no event following the later of the end
of the calendar year following the calendar year of his or her death).





4.6 Payment of FICA Tax on Pension SERP Benefit




     Notwithstanding anything contained in the Plan to the contrary, an initial Pension SERP
Benefit payment may, in the discretion of the Committee, be made on behalf of the Participant in
the amount of the Federal Insurance Contributions Act (“FICA”) tax due from the Participant on his
or her Pension SERP Benefit, determined as of the date such FICA tax is due. If such initial



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Pension SERP Benefit payment is made, then all later calculations and payments related to the
Participant’s Pension SERP Benefit shall be adjusted to reflect the initial payment.




4.7 Benefits Provided by Employers




     Benefits payable under this Plan to a Participant or his or her surviving spouse, beneficiary
or estate shall be paid directly by the Participant’s Employer. No Employer shall be required to
segregate any assets to be applied for the payment of benefits under this Plan.



4.8 Other Employment




     A Participant or his or her surviving spouse or beneficiary who is receiving SERP Benefits
hereunder will continue to be entitled thereto regardless of other employment or self-employment.



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SECTION 5




General




5.1 Committee




     This Plan will be administered by the Committee appointed by the Board of Directors of the
Corporation or a committee thereof. The Committee may delegate any of its authority hereunder to a
committee or to one or more individuals provided such delegation is in writing. Any such
delegation is incorporated herein by this reference. The Committee, and to the extent applicable
its delegates, shall have the discretionary authority to determine factual issues and eligibility
for Plan coverage and benefits, to interpret the provisions and terms of Plan and to decide claims
for benefits under the terms of the Plan. Subject to applicable law, any interpretation of the
provisions of the Plan (including any Supplement) and any decision on any matter within the
discretion of the Committee, or as applicable its delegates, made by it or them in good faith shall
be final and binding on all persons. A misstatement or other mistake of fact shall be corrected
when it becomes known, and the Committee or as applicable its delegates shall make such adjustment
on account thereof as it considers equitable and practicable. The Committee shall not be liable in
any manner for any determination of fact made in good faith. Any claim for benefits under the Plan
shall be handled by the Committee, or as applicable its delegates, pursuant to the claims
procedures under the Retirement Savings Plan or the Pension Plan, as applicable, and such
procedures are incorporated herein by this reference. No action at law or in equity may be brought
to recover benefits under the Plan until the Participant has exercised all appeal rights and the
Plan benefits requested in such appeal have been denied in whole or in part. Benefits under the
Plan shall be paid only if the Committee, or as applicable its delegates, in its or their
discretion, determines that a Participant (or other claimant) is entitled to them.



5.2 Interests Not Transferable




     Except as provided under an agreement between the Participant and the Corporation or required
for purposes of withholding of any tax under the laws of the United States or any State



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or locality, the interest of any Participant, his or her spouse or minor children under the
Plan is not subject to the claims of creditors and may not be voluntarily or involuntarily sold,
transferred, assigned, alienated or encumbered.




5.3 Facility of Payment




     When, in the Committee’s opinion, a Participant or beneficiary is under a legal disability or
is incapacitated in any way so as to be unable to manage his or her financial affairs, the amounts
payable to such person may be paid to such person’s legal representative, or to a relative or
friend of such person for his or her benefit, or such amounts may be applied for the benefit of
such person in any way the Committee considers advisable.



5.4 Gender and Number




     Where the context admits, words denoting men include women, the plural includes the singular
and vice versa.



5.5 Controlling Law




     To the extent not superseded by the laws of the United States, the laws of North Carolina
(without regard to any state’s conflict of law principles) shall be controlling in all matters
relating to the Plan.



5.6 Successors




     This Plan is binding on each Employer and will inure to the benefit of any successor of an
Employer, whether by way of purchase, merger, consolidation or otherwise.



5.7 Rights Not Conferred by the Plan




     The Plan is not a contract of employment, and participation in the Plan will not give any
Employee the right to be retained in an Employer’s employ, nor any right or claim to any benefit
under the Plan, unless the right or claim has specifically accrued under the Plan.



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5.8 Litigation by Participants




     If a legal action begun against the Committee or any of the Employers by or on behalf of any
person results adversely to that person, or if a legal action arises because of conflicting claims
to a Participant’s benefits, the cost to the Committee or any of the Employers of defending the
action will be charged to such extent as possible to the sums, if any, involved in the action or
payable to or on behalf of the Participant concerned.



5.9 Uniform Rules




     In managing the Plan, the Committee will apply uniform rules to all Participants similarly
situated.



5.10 Action by Employers




     Any action required or permitted under the Plan of an Employer shall be by resolution of its
Board of Directors or by a duly authorized Committee of its Board of Directors, or by a person or
persons authorized by resolution of its Board of Directors or such Committee.



5.11 Tax Effects




     The Corporation, the Committee, the Controlled Group Members, and their representatives and
delegates do not in any way guarantee the tax treatment of benefits for any individual, and the
Corporation, the Committee, the Controlled Group Members, and their representatives and delegates
do not in any way guarantee or assume any responsibility or liability for the legal, tax, or other
implications or effects of the Plan. In the event of any legal, tax, or other change that may
affect the Plan, the Corporation, or the Controlled Group Members, the Corporation may, in its sole
discretion, take any actions it deems necessary or desirable as a result of such change.



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SECTION 6




Amendment and Termination




     While the Employers expect to continue the Plan indefinitely, the Corporation reserves the
right to amend or terminate the Plan by action of the Board of Directors of the Corporation or by
action of a committee or an individual authorized to amend or terminate the Plan, provided that in
no event shall any Participant’s SERP Benefit accrued to the date of such amendment or termination
be reduced or modified by such action.



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SUPPLEMENT A

TO

HANESBRANDS INC.

SUPPLEMENTAL EMPLOYEE RETIREMENT PLAN

Provisions Relating to Transferred Participants Previously Participating in

the Earthgrains Company Supplemental Executive Retirement Plan




     A-1. History and Purpose. The purpose of this Supplement A is to describe the benefits that
would have been payable under the Earthgrains SERP to each Supplement A Participant (defined below)
and to describe the benefits payable to each eligible Supplement A Participant under the Plan.
This Supplement A is intended to supersede the terms of the Earthgrains SERP as applied to any
Supplement A Participant. Accordingly, any benefit payable to or on behalf of a Supplement A
Participant under this Supplement shall be considered to have been provided under the Earthgrains
SERP for all purposes. A Supplement A Participant who receives the benefits described in this
Supplement shall be deemed to have received his or her entire Earthgrains SERP benefit. Except as
otherwise specifically provided herein, a Supplement A Participant is not intended to receive any
rights under this Supplement A in addition to his or her rights under the Earthgrains SERP.
“Supplement A Participant” means each Transferred Participant who was an active participant in the
Earthgrains SERP as of December 31, 2002.



     A-2. Supplement A Pension SERP Benefit. In lieu of a Pension SERP Benefit, a Supplement A
Participant shall be entitled to the following:




	 	(a)	 	Amount of Supplement A Pension SERP Benefit. Subject to the requirements set
forth below, each Supplement A Participant who retires or terminates employment with
all Controlled Group Members shall be entitled to a benefit equal to the following:






	 	(i)	 	The benefit which would be payable to the Supplement A
Participant under the Earthgrains supplement to the Pension Plan, determined
(A) without regard to the limitation of Code Section 401(a)(17), and (B) using




A-1









 






	 	 	 	the definition of Earthgrains Formula Compensation (as defined in the Sara
Lee SERP); minus
	 
	 	(ii)	 	The Supplement A Participant’s actual accrued benefit under the
Earthgrains supplement of the Pension Plan.






	 	(b)	 	Form of Payment.






	 	(i)	 	The benefit payable to a Supplement A Participant (the
Participant’s “Supplement A SERP Benefit”) shall be paid as follows:






	 	(A)	 	Subject to Subparagraphs (B) and (C)
below, if the Participant did not make a valid 2006 Supplement
A Special Election (as defined below), the Participant’s
Supplement A SERP Benefit shall be paid in a lump sum as soon
as practicable after such Supplement A Participant’s Separation
from Service; provided, however, that in no event shall
distribution to a Specified Employee be made less than 6 months
following his or her Separation from Service.
	 
	 	(B)	 	If the Supplement A Participant made a
valid 2006 Supplement A Special Election, the Participant’s
Supplement A Benefit shall be paid in accordance with such
election. A “2006 Supplement A Special Election” means a
Supplement A Participant’s valid election, made prior to
December 31, 2005 in accordance with rules and procedures
established by the Committee, to receive his or her Supplement
A Benefit in actuarially equivalent quarterly installments,
semi-annual installments or annual installments (as elected)
for a period not to exceed 5 years, commencing as soon as
practicable after such Supplement




A-2









 






	 	 	 	A Participant’s Separation from Service (or, for a Specified
Employee, 6 months following his or her Separation from
Service).
	 
	 	(C)	 	In lieu of the payment method and
timing described in Subparagraphs (A) or (B), the Participant
may elect to receive his or her Supplement A Benefit in
actuarially equivalent quarterly installments, semi-annual
installments or annual installments (as elected) for a period
not to exceed 5 years, commencing 5 years after the later of
(x) the Participant’s Separation from Service, or (y) the date
the Participant otherwise would have commenced payment of his
or her Supplement A Benefit under Subparagraphs (A) or (B)
above, as applicable; provided, however that an election under
this Subparagraph (C) must be made in accordance with rules and
procedures established by the Committee and must be received by
the Committee at least 1 year before Participant’s Separation
from Service. A new election under this Subparagraph shall
revoke all prior elections; provided, however, that an election
received within 1 year of the date of the Participant’s
Separation from Service shall be invalid.






	 	(c)	 	Actuarial Factors. The following actuarial factors shall apply for purposes of
this Paragraph A-2:






	 	(i)	 	Present Value. Present value shall be determined using the
factors set forth in the Pension Plan on December 31, 2007.
	 
	 	(ii)	 	Early Retirement Reduction. The Supplement A SERP Benefit shall
be reduced 4/12% per month for each of the first 60 months and 5/12% per month
for each of the next 60 months that payment commences before




A-3









 






	 	 	 	Normal Retirement Date; provided, however, that no reduction shall apply if
the Supplement A Participant retires after attaining age 62 with 20 Years of
Service.
	 
	 	(iii)	 	Installment Payments. The actuarial factors for determining
installment payments shall be determined using the factors set forth in the
Pension Plan on December 31, 2007.





     A-3. Plan Provisions. All provisions of the Plan, to the extent that they are consistent with
the provisions of this Supplement, shall apply to Supplement A Participants; provided, however,
that a Supplement A Participant shall only be entitled to a benefit under the Plan to the extent
such benefit is specifically provided under this Supplement A.




A-4