Document:

Exhibit 10(L)

 

TARGET CORPORATION

 

OFFICER INCOME CONTINUANCE
POLICY STATEMENT

 

As Amended and Restated November 12,
2008

 

I.              CONCEPTS

 

A.            GENERAL

 

The present policy of the Corporation is to
provide, under certain defined circumstances, Income Continuance Payments to
certain “Officers” or “Executives” whose employment is terminated at the
instance of the Corporation or who involuntarily or for good reason terminate
within two years after a Change in Control. This policy is intended to assist
in the occupational transition and financial security of those identified
Executives whose services are no longer deemed required within the Corporation,
who have during their tenure been faithful and honest employees, who do not
during the period of those payments engage in disqualifying misconduct, and to
the extent not compensated for services to a directly competitive employer and
to assist Executives who involuntarily or for good reason terminate employment
with the Corporation within two years after a Change in Control.

 

This will be known as the Officer Income
Continuance Policy (“Officer-ICP”) of the Corporation. It will be interpreted
and applied in accordance with this Statement of policy and with any subsequent
amendment or restatement applicable to the Executive. The Corporation’s Income
Continuance Policy Statement has been consolidated and transferred into the
Officer-ICP.

 

The Officer-ICP has been operated in
compliance with Internal Revenue Code (“Code”) Section 409A since January 1,
2005.  Effective January 1, 2009,
the Officer-ICP has been amended to comply with Code Section 409A with
respect to all amounts payable from the Officer-ICP that are considered
nonqualified deferred compensation.

 

B.            ELIGIBILITY

 

To be eligible under Officer-ICP, an
individual must be an Officer as specified in this Statement.

 

C.            REASSIGNMENT

 

An Executive will continue to have income
protection under Officer-ICP for at least 12 calendar months (Eligibility
Period) after internal reassignment to a position which does not otherwise
include eligibility for Officer-ICP benefits.

 

 

D.            SPIN-OFF

 

An Executive who is employed by a business
unit on the closing date of any Spin-Off which includes such business unit is
no longer eligible for Officer-ICP.

 

E.             DISQUALIFICATION
AND REDUCTION

 

Serious and deliberate misconduct in
employment by an Executive resulting in discharge for cause can disqualify an
Executive from Officer-ICP eligibility. Except as otherwise expressly provided
in this Statement, after termination under Officer-ICP and normal windup of
former duties an Executive will not be required to perform any regular services
for the Corporation, and will be free to accept any other employment. Except as
otherwise provided in this Statement, Officer-ICP Payments otherwise payable to
an Executive will be reduced or excused in the amount of compensation from
Directly Competitive Employment as specifically defined to the Executive in
advance according to this Statement. An Executive otherwise entitled to
Officer-ICP Payments after Termination or Reassignment will be disqualified
from receiving future Payments by reason of serious and deliberate misconduct
which is unlawful or clearly and seriously harmful to the Corporation, or to
its interests.

 

F.             INTERPRETATION

 

Subject to the express terms of this
Statement, the Chief Executive Officer of the Corporation will have sole and
final authority to interpret the Officer-ICP and determine its application, and
will interpret it consistently. Section I of this Statement is intended as
a summary of the more detailed provisions of Section II. For that reason, Section II
will control in the event of any difference.

 

II.            APPLICATION

 

A.            ELIGIBILITY
PERIOD - DEFINITION

 

The “Eligibility Period” of an Executive is
determined by the Executive’s most recent Salary Grade on the Notice of
Termination or Reassignment by the Corporation; provided, however, in the event
of a downgrade or downgrades, the Eligibility Period of the Executive’s highest
Salary Grade shall continue to be applicable until the expiration of the
Eligibility Period for that Salary Grade and then the Eligibility Period for
the next highest Salary Grade shall be used until it expires and this process
shall continue until the Eligibility Period for the last Salary Grade for which
this Statement covers expires. It will be calculated according to the following
schedule:

 

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  Salary Grade

  	
   

  	
  Eligibility Period

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  37 or higher

  	
   

  	
  24
  months

  	
   

  
	
  35-36

  	
   

  	
  22
  months

  	
   

  
	
  32-34

  	
   

  	
  20
  months

  	
   

  
	
  30-31

  	
   

  	
  18
  months

  	
   

  
	
  28-29

  	
   

  	
  16
  months

  	
   

  
	
  26-27

  	
   

  	
  14
  months

  	
   

  
	
  lower than 26

  	
   

  	
  12
  months

  	
   

  

 

An Executive entitled to Officer-ICP Payments
will not be entitled to prepayment or other change in the payment schedule.

 

B.            ELIGIBILITY
PERIOD - USE

 

The Eligibility Period of an Executive will
determine the number of consecutive calendar months for which an Executive
remains eligible for Officer-ICP Payments under this Statement after:

 

1.             Reassignment to a new
position within the Corporation which is not designated an Officer Position, or

 

2.             A downgrade as set forth in
A. above.

 

C.            PAYMENT PERIOD
- DEFINITION

 

The Payment Period for an Executive will
consist of the same number of months as the Executive’s Eligibility Period,
measured from the time when Officer-ICP Payments first become payable to the
Executive under the terms of this Statement.

 

D.            PAYMENTS

 

1.             Amount

 

Each monthly Officer-ICP amount during the
Payment Period will equal one twelfth (1/12) of the Executive’s Final Annual
Cash Compensation from the Corporation which will consist of the sum of:

 

a.             Base Compensation

 

The annual Base (regular monthly or other
fixed salary) rate payable as Cash Compensation to the Executive at the time of
Notice of Termination or effective date of Reassignment or downgrade, but in no
event less than the highest annual rate paid to the Executive at any time
during a number of months equal to the Executive’s Eligibility Period
immediately before the Notice of Termination or effective date of Reassignment
or downgrade, and

 

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b.             Performance Bonus

 

The average amount of the three annual
Performance Bonuses most recently paid or credited to the Executive as Cash
Compensation or deferred bonus, prior to Executive’s Notice of Termination or
effective date of Reassignment or downgrade. For purposes of Officer-ICP, the
Performance Bonus of an Executive shall be determined according to the
applicable Short Term Incentive Plan of the Corporation, shall also include, if
applicable, any discretionary bonus paid during said applicable period on
account of the Executive’s performance but outside of the purview of the then
applicable Short Term Incentive Plan.

 

c.             Adjustment

 

The annual rate in dollars of each merit
increase awarded to an Executive before Notice of Termination will be included
in Base Compensation to determine the Executive’s Officer-ICP Payments. If the
Executive’s annual rate of Base Compensation at the time of Notice of
Termination has been increased or decreased to reflect a change from the Short
Term Incentive Plan used to determine the Performance Bonus defined above, and
the change is for the purpose of altering the future relationship of Bonus to
total Annual Cash Compensation of the Executive, then the dollar amount of that
increase or decrease in annual rate of Base Compensation will be excluded in
determining ICP Payments.

 

d.             Installment Payments

 

Although the amount of an Executive’s benefit
is determined on a monthly basis, such monthly amount shall be converted to and
made at the same frequency as the Corporation’s standard payroll practices.
With respect to any benefit under Officer-ICP that is considered deferred
compensation pursuant to Code Section 409A, each installment payment shall
be considered a separate payment.

 

2.             Commencement

 

Officer-ICP Payments, or entitlement to begin
receiving them, will commence after the Corporation has received a valid
unrevoked Release and Agreement from Executive, subject to any Set-offs,
Adjustments and Withholding as specified herein. Unless the Executive is a
Specified Employee, Officer-ICP Payments shall commence not later than ninety
(90) days following the date of the Executive’s separation from service, as
defined under Code Section 409A. If at the time of the Executive’s
separation from service, as defined under Code Section 409A, the Executive
is a Specified Employee then no distribution of an Officer-ICP Payment that is
considered deferred compensation pursuant to Code Section 409A will be
made within 6 months of the separation from service, as defined under Code Section 409A,
unless such Officer-ICP Payment would 

 

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otherwise be exempt from the requirements of
Code Section 409A. Any Officer-ICP Payments suspended during such 6 month
period will be paid at the time of the first Officer-ICP Payment after such 6
month period. The Executive shall not be entitled to any compensation, benefits
or perquisites, other than Officer-ICP Payments, after the date of the
Executive’s separation from service, as defined under Code Section 409A.

 

3.             Set-Off and
Withholding

 

Officer-ICP Payments are not intended to
duplicate or be in addition to any other payment due between the Corporation
and the Executive.

 

a.             Reduction

 

Each Payment otherwise due from the
Corporation to the Executive will be reduced, dollar for dollar and in timing
by all amounts which the Executive receives or is entitled to receive from the
Corporation or under a plan, program or agreement maintained by and at the
expense of the Corporation after the Employment Severance Date. This will
include but not be limited to legally required payments during any required
notice period or in connection with a plant closing, mass layoff, termination,
severance or redundancy under any law, regulation or order. This will also
include such sources as life and disability insurance. It will not apply to
accrued vacation or expense reimbursement (both will be paid in cash at
termination), pension proceeds, 401(k) proceeds, deferred compensation
plans, Social Security, equity awards (for example, stock options, performance
shares or restricted stock awards) or benefits payable under any Worker’s
Compensation or similar law or regulation. Termination of employment by reason
of mandatory retirement under a lawful and uniform policy of the employer
applicable to the Executive will not be treated as a termination for
Officer-ICP purposes. In no circumstance whatsoever shall there be any
combination or duplication of any Officer-ICP Payments with any such other
legally required payment or payments which shall result in the Executive
receiving because of or due to termination of employment a combined total
amount from the Corporation which is greater than the amount of Officer-ICP
Payments to which Executive is entitled under this Officer-ICP before
accounting for such legally required other payments.

 

b.             Adjustments

 

Taxes and other amounts which the Corporation
reasonably determines are required by law or by the Executive’s written
instruction will be withheld from Officer-ICP amounts otherwise payable.

 

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E.             DEATH OF
EXECUTIVE

 

If an Executive should die after Notice of
Termination and before completion of the Executive’s Payment Period, the
remaining Payments will be made by the Corporation as follows, without
unnecessary interruption:

 

1.             Unless the Executive has
otherwise designated in unrevoked writing, acknowledged in writing by the CEO,
the surviving spouse of the Executive, if any, will be entitled to all
remaining Payments.

 

2.             If the Executive has
otherwise effectively designated in unrevoked writing, acknowledged in writing
by the CEO, then Payment will be made to or for the account of the person or
persons so designated as identified by the Corporation.

 

3.             In the absence of effective
prior written designation by the Executive and of a known surviving spouse, the
Corporation shall pay any remaining Payments to the Executive’s estate.

 

4.             In the interest of providing
uninterrupted income to authorized beneficiaries of the Executive, any
Officer-ICP Payment made with reasonable care and in good faith by the
Corporation shall conclusively constitute Payment by the Corporation in
accordance with and satisfaction of the entitlement of the Executive and Executive’s
beneficiaries under Officer-ICP. No interest or other charge shall be payable
by the Corporation or its representatives on any Payment delayed by the
Corporation to permit reasonable verification of authorized recipient(s).

 

F.             DISQUALIFICATION

 

No Executive will be disqualified from
receipt of future Officer-ICP Payments by reason of any act or omission of
anyone other than the Executive or one or more persons acting pursuant to the
conscious and effective control of the Executive. Disqualification will be
interpreted as follows:

 

1.             While Employed
in the Corporation

 

Deliberate and serious disloyal or dishonest
conduct in the course of employment will disqualify if it justifies and results
in prompt discharge for specific cause under the established policies and
practices of the Corporation as interpreted by the CEO for this purpose.
Examples would include material unlawful conduct, material and conscious
falsification or unauthorized disclosure of important records or reports,
embezzlement or unauthorized conversion of property, serious violation of
conflict of interest or vendor relations policies, and misuse or disclosure of
significant trade secrets or other information likely to be of use to the
detriment of the Corporation or its interests.

 

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2.             After Notice of
Termination

 

The Officer-ICP will not restrict an
Executive’s conduct or employment opportunities after Notice of Termination, or
any independent remedy of the Corporation or its representatives by reason of
the Executive’s conduct while employed. The obligation of the Corporation to or
for an Executive during the Eligibility and Payment Periods can be terminated
only by the deliberate conduct of the Executive or one acting under the
Executive’s conscious and effective control, and only as to any Officer-ICP
Payments not yet due, by reason of one or more of the following events:

 

a.             Unauthorized removal, use or
disclosure of strategic or operating plans, trade secrets, customer lists,
internal systems or other significant proprietary information of or concerning
the Corporation or its personnel, the use or disclosure of which is intended or
likely to cause loss or reduction of business advantage or substantial injury
to the Corporation or its management, business opportunities or interests.

 

b.             Expressing or endorsing
publication of untrue statements which are intended or likely to receive broad
public attention and to bring the Corporation or its interests, methods or
representatives into disrepute.

 

c.             Providing materially false
or misleading information concerning post-termination employment, or failure or
refusal promptly and accurately to provide required information, verification
or authorization required by the CEO as provided in this Statement and
affecting any Officer-ICP payment due from the Corporation.

 

d.             Solicitation of or an offer
to an employee within the Corporation to accept employment elsewhere, where the
selection of or offer to the recruited employee was based in the whole or in
part upon Executive’s knowledge or experience concerning the employee which was
acquired by the Executive while employed within the Corporation or through one
or more personal acquaintances employed within the Corporation.

 

e.             Exercising the discretion,
authority or powers of an office or position held by an Executive after Notice
of Termination, and whether or not before an Employment Severance Date, unless
specifically authorized or directed in writing in advance by an authorized
executive of the Corporation.

 

3.             Preservation of
Rights

 

Neither Officer-ICP nor its application shall
waive, excuse, preclude or otherwise affect any right or remedy which the
Corporation or any agent or representative of the Corporation may have,
individually or collectively, under law by reason of conduct of the Executive
during or after employment within 

 

7

 

the Corporation. Disqualification or
reduction of Payments under Officer-ICP will be an additional and not an
exclusive remedy.

 

G.            COMPETITIVE
EMPLOYMENT

 

An Executive will receive not less than the
full amount of the specified Officer-ICP Payments from the Employment Severance
Date through the full Payment Period whether or not compensated by another
employer for services in that period, unless disqualified under Section F.,
immediately above or as provided in this Section G. Compensation from
employment which is not identified as Directly Competitive Employment (“DCE”)
will be in addition to and will not reduce any Officer-ICP Payment. If an
Executive engages in DCE as specifically defined in advance and by this
Statement, then each Officer-ICP Payment otherwise payable to the Executive
will be currently reduced, dollar for dollar and in timing, by the amount of
all Cash Compensation earned (whether on a current or deferred payment basis)
from that source during the Payment Period.

 

These provisions will be interpreted and
administered as follows:

 

1.             Purpose of
Set-Off

 

Reduction of Officer-ICP Payments by the
amount of Cash Compensation determined to be from DCE is not intended to
restrict or penalize an Executive’s choice of alternative career opportunities,
but only to preserve and reconcile the personal income security intended to be
provided to Executives by Officer-ICP with the legitimate interests of the
Shareholders of the Corporation in its highly competitive business context.

 

2.             Competitors
Identified

 

At or about the time of Notice of
Termination, the Corporation will inform the Executive in writing of those employers
who have been individually and specifically determined to offer DCE for
Officer-ICP purposes with respect to the Executive’s former employment within
the Corporation. This designation will take into account existing operations
and known plans of the Corporation and of the employers listed, and will not
change during the Eligibility Period by reason of subsequent and mutually
unanticipated changes in the operations or plans of either.

 

3.             Criteria

 

The following criteria will be employed in
determining and administering Officer-ICP application to DCE.

 

a.             Selective
Potential Detriment

 

A position will not be determined to
constitute DCE for this purpose unless the CEO determines that the competitive
effectiveness of the 

 

8

 

Executive and the new employer would be
materially enhanced by the Executive’s current knowledge of such matters as the
particular methods, policies, customers, suppliers, personnel or plans of the
Corporation or its relevant business unit, as distinguished from the skills,
experience and services of the Executive generally. The Corporation will
identify for DCE purposes not more than five persons, firms or corporations who
are determined for this purpose to be the leading direct and immediate
competitors of the affected business of the Corporation.

 

b.             Preservation of
Employment Opportunities

 

Whether or not an Executive’s most recent
employment within the Corporation involved direct participation in the
management of one or more business units, this section will not be used to
discourage or penalize otherwise suitable employment opportunities in retailing
or otherwise. The Corporation may require, as a condition of avoiding DCE
designation for the Executive, a suitable written undertaking by the Executive
and the new employer that the Executive remains obliged not to use or divulge
trade secrets or proprietary information of the Corporation and that the
Executive will not volunteer or be expected or required to violate that
obligation in the course of the new employment.

 

c.             Relevant
Considerations

 

In determining DCE, the CEO will give
suitable consideration to geographic, product and price-line marketing
overlaps, the nature and content of the Executive’s particular knowledge of
strategies and plans within the Corporation, and the extent to which the
Executive’s knowledge, as distinguished from skills, is likely to be a
significant factor in generating an employment opportunity. Employment
exclusively with a component of a larger business entity, which component is
not presently or known to be planned to be a direct and immediate competitor of
the Executive’s former business unit, will not be treated as DCE merely because
one or more other components of that entity is or may become a competitor of
the Corporation or one or more of its business units.

 

4.             Officer-ICP
Payment Reduction

 

Uniform and responsible administration of
Officer-ICP will require reliable information and verification to the
Corporation.

 

a.             Reporting

 

To be eligible for any Officer-ICP Payment
during a period of DCE, an Executive must, in addition to all other required
reporting, provide to the Corporation in writing an accurate statement of the
amount and payment schedule of all Cash Compensation or its equivalent to be
received from 

 

9

 

the new DCE employer and of any subsequent
change or correction of that amount, in such form and with such verification as
the CEO may request in writing. An Executive will not be or become entitled to
receive or retain any portion of any Officer-ICP Payment on account of any
Payment Period for which that information, and any required verification, is
not currently and accurately provided.

 

b.             Verification and
Reconciliation

 

Required verification may include
authorization for written confirmation from the employer and confidential
disclosure of completed W-2, payroll and income tax forms of the Executive on
which taxes have been or will be paid. If the Corporation withholds for more
than 30 days any Officer-ICP Payment pending receipt of required information or
verification which is later received and found satisfactory, the Corporation
will pay interest at a realistic rate determined by the CEO for the period of
delay. The Corporation and the Executive will each fairly and promptly adjust
by payment any discrepancy later discovered between reported and actual Cash
Compensation of the Executive, but the Corporation will have no liability for
any amount not claimed by an Executive in writing before final expiration of
the Executive’s Payment Period.

 

H.            REASSIGNMENT
AND SPIN-OFF

 

1.             Reassignment
and Other Adjustments

 

The Corporation may transfer an Executive to
another position within the Corporation or reduce the Executive’s Base
Compensation in Executive’s current position (collectively referred to as “Reassignment”).
An Executive in the case of either event may elect Officer-ICP Payments if the
Executive’s total monetary compensation after Reassignment will be measurably
and substantially below the total monetary compensation of the Executive
immediately before notice of Reassignment. For this purpose, total monetary
compensation will include salary and bonus and continuation, or payment of the
substantial equivalent in Cash Compensation, of all non-cash personal benefits
and perquisites which the Executive was receiving immediately before and does
not receive after the Reassignment and which are susceptible of accurate and
objective measurement in dollars as determined by the CEO. An Executive who
elects Officer-ICP Payments must terminate employment with the Corporation
within thirty (30) days after notice of Reassignment to be eligible for such
payments.

 

2.             Spin-Off

 

An Executive who is employed by a business
unit on the closing date of any Spin-Off that includes such business unit is no
longer eligible for Officer-ICP. A Spin-Off will be deemed to have occurred for
purposes of this paragraph whether or not afterward: (a) the Executive has
a personal ownership or incentive interest in the severed business unit or
operation; or (b) the severed 

 

10

 

business unit or operation becomes, as a
result of or after the severance, a part of one or more other legal entity or
entities.

 

I.              REPORTING

 

For convenience and uniformity of
administration, each Executive while eligible for or entitled to Officer-ICP
Payments after Notice of Termination will be expected as a pre-condition
currently and accurately to inform the Corporation in writing of the name and
business address of each employer of Executive during the Eligibility and
Payment Periods, including a summary description of the nature and principal
business locations of the new employer and the title, principal duties, address
and telephone number of the Executive. Significant changes in employment,
duties or location will also be promptly reported. The Corporation will not be
required to make any Officer-ICP Payment for any period for which it has not
received a current and accurate report as required by, or by the CEO in
accordance with, this Statement.

 

J.             INTERPRETATION

 

1.             Any decision of the CEO will
be: (1) Final and conclusive of the rights and obligations of all affected
parties and (2) Applied uniformly as to all Executives then similarly situated
(subject to subsequent Officer-ICP amendment); and (3) Not subject to
separate determination or review by any public or private agency or authority
except as expressly provided in this Statement.

 

2.             References to compensation
and other monetary rates or measurements in this Statement and its applications
are in current dollars, unadjusted by reason of inflation, deflation or
otherwise.

 

3.             Any portion of a full
calendar month or year will be prorated on a full calendar basis, without
differential related to such considerations as working days or holidays. Any
portion of a day will be treated as a full day, and measurement days will begin
and end at midnight, current time. The fiscal year of the Corporation will be
treated for all purposes as it is for financial reporting purposes.

 

4.             In the event of application
or interpretation of Officer-ICP to an individual Executive who is a Director
of the Corporation, or otherwise in its sole discretion, the Board of Directors
of the Corporation or its authorized committee shall have and may exercise the
sole, exclusive and final authority and discretion of the CEO for any purpose
under Officer-ICP.

 

K.            RELEASE

 

Payment and receipt of Officer-ICP Payments
will be in full and final satisfaction of all claims by or through an Executive
against the Corporation and its representatives by reason of the employment of
the Executive and its termination, except as otherwise expressly provided in
this Statement or as required by applicable law or regulation. A signed and unrevoked
written Release to that effect, in form approved by the CEO, will 

 

11

 

be delivered by the Executive
or the Executive’s representative to the Corporation before any Officer-ICP
Payment will become payable by the Corporation to or on account of the
Executive. Such Release must be delivered to the Corporation within 60 days of
the date of Executive’s separation from service, as defined under Code Section 409A.
The Release may, without limitation, require a representation that no
confidential documents concerning the Corporation or its intentions have been
or will be removed or retained by the Executive without specific authority, and
that the Executive will not engage in disqualifying misconduct as defined in
this Statement, in reference to the Corporation. The Release will not affect
any conversion, vested or continuing rights available to an Executive under a
plan of the Corporation other than Officer-ICP.

 

L.                                      GENERAL

 

The Officer-ICP and this
Statement will not constitute or infer an obligation or undertaking to employ
any person for any future period of time or in any specific position.
Officer-ICP Eligibility or Payments after Notice of Termination will not
create, continue or evidence any employment relationship with the Corporation.
All employment privileges, benefits and perquisites not expressly and in
writing reserved to an Executive under Officer-ICP will terminate on Executive’s
separation from service, as defined under Code Section 409A, unless
otherwise expressly agreed in advance in writing by the Corporation. This will
not affect any conversion, vested or other continuing benefits or rights
available to an Executive under a plan of the Corporation other than
Officer-ICP.

 

M.                                 AMENDMENT

 

Officer-ICP and this Statement
may not be terminated and may not be amended to reduce benefits with respect an
Executive subject to the Officer-ICP until twelve months after the Executive
receives written notice of the proposed termination or amendment. Except as set
forth in the first sentence hereof, Officer-ICP and this Statement can be
amended (including modification, restatement, suspension and termination) at
any time, without prior written notice to or consultation with any Executive,
by the Board of Directors or any committee appointed by the Board of Directors
having the authority of the Board for that purpose. Any such change will have
effect as follows:

 

1.                                       Effective
Date of Change

 

Except as set forth below, any
amendment will be effective on the date of its adoption by the Board or
committee or such other such subsequent date or dates as may be specified in
the amendment or the resolution by which it is adopted. Unless otherwise
mutually agreed in writing by the parties, (a) an amendment or termination
will have no effect upon any Executive who at the time has received Notice of
Termination under Officer-ICP and (b) a termination or an amendment that
reduces benefits will not be effective as to an Executive subject to the
Officer-ICP until twelve months after the Executive receives written notice of
the termination or amendment.

 

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2.                                       Notice
of Amendment

 

The Corporation will promptly
after any amendment provide to each Executive then eligible for Officer-ICP
benefits a written statement of Officer-ICP as amended, and no amendment will
be effective as to an Executive until the later of the date the Executive
receives such written statement, or twelve months after notice as provided in 1
above. An Executive will be deemed to have received the written statement if it
is delivered to the Executive in person, or after 48 hours following its hand
delivery or dispatch by mail or other suitable means of delivery to the last
known address of the Executive.

 

3.                                       Acquiescence

 

An amendment will apply in full
to an Executive if mutually agreed in writing by the Executive and the
Corporation, or if the Executive or the Executive’s representative knowingly
receives a benefit or improvement under Officer-ICP as amended which would not
have been available without the amendment. If any such benefit from an
amendment is knowingly received by an Executive with the consent of the
Corporation, then all elements of that amendment and all prior Officer-ICP
Statements and amendments then currently in effect will also be applicable to
the Executive.

 

4.                                       Adjustment

 

A change in or addition or
deletion of any benefit or perquisite plan or program of the Corporation
applicable to an Executive may be expressly made subject to prior written
agreement by the Executive upon a corresponding change in the interpretation or
application of Officer-ICP to the Executive, to prevent redundant or other
unintended benefits or detriments to the Executive or the Corporation which
might otherwise result.

 

5.                                       Change
in Control

 

No amendment or termination
that would adversely affect the benefits or protections under the Officer-ICP
of any eligible Executive as of the date of such amendment or termination shall
be effective as to such individual unless no Change in Control occurs within
twelve (12) months of the adoption of such amendment or termination, and any
such attempted amendment or termination adopted within twelve (12) months prior
to a Change in Control shall retroactively be null and void from the date of
adoption as it relates to all such Executives who were eligible for benefits
under the Officer-ICP prior to such adoption.

 

For two (2) years after a
Change in Control, the Officer-ICP and this Statement may not be amended in any
manner that would adversely affect the benefits or protections under the
Officer-ICP of the Executives who are eligible for benefits under the
Officer-ICP at the time of the Change in Control.

 

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N.                                    APPLICABLE
LAW

 

It is intended that the
decision of the CEO, as specified in the Officer-ICP statement, will be
exclusive and final with respect to any application or interpretation of
Officer-ICP. If any body of law should be used or applied in determining the
meaning or effect of Officer-ICP, in the interest of consistency this will be
deemed an agreement made and executed in the State of Minnesota and the law of
the State of Minnesota will control to the extent not preempted by federal law.

 

O.                                    DEFINITIONS

 

As used in this Statement:

 

1.                                       “Cash
Compensation”

 

Means all amounts earned,
whether or not currently payable, as wages, salary, bonus or a combination by
an Executive, payable in cash or its equivalent or agreed to be in lieu of cash
compensation. This will not include any stock-based compensation (whether such
stock-based compensation is settled in cash or otherwise), or the value of
employee or executive perquisites or benefits accrued or received pursuant to a
plan of the employer which is uniformly applied to all of the employees of the
employer who are similarly situated or is consistent with established prior
practice for the position occupied by the Executive.

 

2.                                       “CEO”

 

Means the Chief Executive
Officer of Target Corporation, as then currently designated by its Board of
Directors, or as otherwise expressly provided in the Officer-ICP Statement.

 

3.                                       “Corporation”

 

Means Target Corporation and
each and all of its business units, including divisions and subsidiaries,
unless otherwise clearly intended by the written context, and any person with
whom Target Corporation would be considered a single employer under Code
Sections 414(b) and 414(c).

 

4.                                       “Directly
Competitive Employment” (or “DCE”)

 

Means personal services to, or
for the direct and intended benefit of, a person, firm or corporation
determined by the CEO and specified in writing to the Executive at or about the
time of Notice of Termination as constituting DCE for Officer-ICP purposes.

 

5.                                       “Employment
Severance Date”

 

All employment relationships
between the Executive and the Corporation shall cease on the Employment
Severance Date.

 

14

 

6.                                       “Executive”
or “Officer” (both of which shall have the same definition)

 

Means an Executive Officer (as
defined by the Securities and Exchange Commission) of the Corporation or an
individual employed as an executive within the Corporation who currently is, or
within the designated Eligibility Period has been designated and categorized as
an officer of the Corporation by the CEO. Unless clearly otherwise intended by
the written context, Executive or Officer will include all beneficiaries of and
persons claiming by or through the designated employee or former employee.

 

An Executive or Officer is not
eligible for Officer-ICP unless (1) his or her services are performed
within the continental United States (including Alaska) or Hawaii or (2) his
or her principal base of operations to which he or she frequently returns is
within the continental United States (including Alaska ) or Hawaii.

 

7.                                       “Notice
of Termination” (or “Notice”)

 

Means an unconditional written
or oral statement of an Executive’s organizational superior that the Executive’s
employment in the Corporation is terminated at the instance of the Corporation.
Notice that an Executive’s employment will end because of achievement of the
age of mandatory retirement under lawful policies of the Corporation will not
be a Notice of Termination for Officer-ICP purposes.

 

8.                                       “Payments”
(or “ICP Payments”)

 

By the Corporation will include
all of those payments made by or on account of the Corporation under
Officer-ICP and will include all of those made to or for the account of an
Executive or a designated creditor or authorized representative or beneficiary
of an Executive or deceased Executive.

 

9.                                       “Reassignment”

 

Means the transfer of an
Executive to another position within the Corporation or a reduction on the
Executive’s Base Compensation in Executive’s current position.

 

10.                                 “Spin-Off”

 

Means a sale of assets or stock
or other disposition as a going business of the Corporation’s ownership or
control of a business unit or other operation previously a part of the
Corporation.

 

15

 

11.                                 “Change
in Control”

 

A “Change in
Control” shall be deemed to have occurred if:

 

(a)                                  50%
or more of the directors of Target shall be persons other than persons

 

(i)                                     for
whose election proxies shall have been solicited by the Board of Directors of
Target or

 

(ii)                                  who
are then serving as directors appointed by the Board of Directors of Target to
fill vacancies on the Board of Directors of Target caused by death or
resignation (but not by removal) or to fill newly-created directorships, or

 

(b)                                 30%
or more of the outstanding voting power of the Voting Stock of Target is
acquired or beneficially owned (as defined in Article IV of the Restated
Articles of Incorporation, as amended, of Target) by any person (as defined in Article IV
of the Restated Articles of Incorporation, as amended, of Target), other than
an entity resulting from a Business Combination in which clauses (x) and (y) of
subparagraph (c) apply, or

 

(c)                                  the
consummation of a merger or consolidation of Target with or into another
entity, a statutory share exchange, a sale or other disposition (in one
transaction or a series of transactions) of all or substantially all of Target’s
assets or a similar business combination (each, a “Business Combination”), in
each case unless, immediately following such Business Combination, (x) all
or substantially all of the beneficial owners of Target’s Voting Stock
immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 60% of the voting power of the then outstanding shares of
voting stock (or comparable voting equity interests) of the surviving or
acquiring entity resulting from such Business Combination (including such
beneficial ownership of an entity that, as a result of such transaction, owns
Target or all or substantially all of Target’s assets either directly or
through one or more subsidiaries), in substantially the same proportions (as
compared to the other beneficial owners of Target’s Voting Stock immediately
prior to such Business Combination) as their beneficial ownership of Target’s
Voting Stock immediately prior to such Business Combination, and (y) no
person (as defined in Article IV of the Restated Articles of
Incorporation, as amended, of Target) beneficially owns, directly or
indirectly, 30% or more of the voting power of the outstanding voting stock (or
comparable equity interests) of the surviving or acquiring entity (other than a
direct or indirect parent entity of the surviving or acquiring entity, that,
after giving effect to the Business Combination, beneficially owns, directly or
indirectly, 100% of the outstanding voting stock (or comparable equity
interests) of the surviving or acquiring entity), or

 

16

 

(d)                                 approval
by the shareholders of a definitive agreement or plan to liquidate or dissolve
Target.

 

For purposes of this Section II.O.11,
“Voting Stock” has the same meaning as defined in Article IV of the
Restated Articles of Incorporation, as amended, of Target.

 

For purposes of this Section II.O.11,
“Target” shall mean Target Corporation, a Minnesota corporation, and any
successor thereof.

 

12.                                 “Salary
Grade”

 

The numerical “Salary Grade”
that the Executive is assigned under the Corporation’s salary grading system.

 

13.                                 “Auditor”

The “Auditor” is the
independent auditor selected by a committee of two or more members of the
Compensation Committee of the Board of Directors who are appointed from time to
time by the Board and who are outside, independent Board members.

 

14.                                 “Specified
Employee”

“Specified Employee” means an
Executive who as of the date of his or her separation from service, as defined
under Code Section 409A, is a “key employee” (as defined below), and the
Corporation has stock that is traded on an established securities market
(within the meaning of Code Section 409A(a)(2)(B)). The Executive is a “key
employee” during the 12-month period beginning on the April 1 immediately
following a calendar year, any time during which such Executive was a key
employee as defined in Code Section 416(i) (without regard to Code Section 416(i)(5)),
of the Corporation. An Executive will not be treated as a Specified Employee if
he or she would not be a “specified employee” as defined under Treasury
regulations issued under Code Section 409A.

 

NOTE:                        Additional
Definitions for particular purposes are contained in the text.

 

P.                                      CHANGE
IN CONTROL

 

Other provisions of this
Statement to the contrary notwithstanding, in the event of a Change in Control:

 

1.                                       If
an Executive’s employment with the Corporation is terminated, whether
involuntarily or by the Executive for “good reason” (as defined in Section II.P.5),
within two years following a Change in Control, an Executive shall be eligible
for Officer-ICP Payments.

 

17

 

2.                                       To
the extent the Officer ICP-Payments are not subject to Code Section 409A
(including pursuant to a short-term deferral exception under Treasury
Regulation Section 1.409A-1(b)(4) and separation pay plan exception
under Treasury Regulation Section 1.409A-1(b)(9)), or such Change in
Control qualifies as a “change in control event” under Code Section 409A,
the Officer-ICP Payments shall be made in a lump sum payment within 20 days of
the Executive’s separation of service, as defined under Code Section 409A;
provided that if the Executive is a Specified Employee, the distribution of any
such Officer-ICP Payments subject to Code Section 409A will be made 6
months after the separation of service, as defined under Code Section 409A.  The lump sum amount shall be determined by
discounting the periodic Officer-ICP Payments by a rate equivalent to the
annual prime rate as published in the Wall Street Journal on the first business
day following the Officer-ICP Payments.

 

3.                                       To
the extent the Officer-ICP Payments are subject to Code Section 409A,
(after considering any exceptions to Code Section 409A, including the
short-term deferral exception under Treasury Regulation Section 1.409A-1(b)(4) and
separation pay plan exception under Treasury Regulation Section 1.409A-1(b)(9))  and such Change in Control does not qualify
as a change in control event under Code Section 409A, the Officer-ICP
Payments shall be made according to the payment schedule set forth in Section II.D
of this Statement; provided that if the Executive is a Specified Employee, the
distribution of any such Officer-ICP Payments subject to Code Section 409A
will be made 6 months after Executive’s separation from service, as defined
under Code Section 409A.

 

4.                                       Except
for the Release required by Section II.K of this Statement, all other
obligations or restrictions of Executive under this Statement shall terminate.

 

5.                                       For
purposes of this Section II.P, “good reason” shall mean any material diminution
of the Executive’s position, authority, duties or responsibilities (including
the assignment of duties materially inconsistent with the Executive’s position
or a material increase in the time Executive is required by the Corporation or
its successor to travel), any reduction in salary or in the Executive’s
aggregate bonus and incentive opportunities, any material reduction in the
aggregate value of the Executive’s employee benefits (including retirement,
welfare and fringe benefits), or relocation to a principal work site that is
more than 40 miles from the Executive’s principal work site immediately prior
to the Change in Control.

 

6.                                       If
an Executive’s employment was terminated prior to a Change in Control, such
Executive is receiving or is entitled to receive Officer-ICP Payments that will
continue after the Change in Control, and the Change in Control qualified as a “change
in control event” for purposes of Code Section 409A, then, subject to the
six month delay for Specified Employees in effect under Section II.D.2,
the Officer-ICP Payments due after such change in control event will be
accelerated and paid to Executive in a lump sum as soon as practicable, but not
more than 

 

18

 

90 days following such change
in control event. The lump sum under this Section II.P.6 will be
calculated in the same manner as the lump sum calculated under Section II.P.2
above.

 

Q.                                    CERTAIN
REDUCTION OF PAYMENTS BY THE CORPORATION

 

1.                                       Anything
in this Officer-ICP to the contrary notwithstanding, the provisions of this Section Q
shall apply to an Executive if the Auditor determines that each of a and b
below are applicable.

 

a.                                       Payments
hereunder, determined without application of this Section Q, either alone
or together with other payments in the nature of compensation to the Executive
which are contingent on or accelerated by a change in the ownership or
effective control of the Corporation, or in the ownership of a substantial
portion of the assets of the Corporation, or otherwise, would result in any
portion of the payments hereunder being subject to an excise tax on excess
parachute payments imposed under Code Section 4999.

 

b.                                      The
excise tax imposed on the Executive under Section 4999 of the Code on
excess parachute payments, from whatever source, would result in a lesser net
aggregate present value of payments and distributions to the Executive (after
subtraction of the excise tax) than if payments and distributions to the
Executive were reduced to the maximum amount that could be made without
incurring the excise tax.

 

2.                                       Under
this Section Q the payments under this Officer-ICP shall be reduced (but
not below zero) so that the present value of such payments and distributions
shall equal the Reduced Amount. The “Reduced Amount” (which may be zero) shall
be an amount expressed as the present value of the payments and distributions
under this Officer-ICP that can be made without causing such payments and
distributions to be subject to the excise tax under Section 4999 of the
Code. To the extent necessary, the reductions in the payments and distributions
will be applied to those Officer-ICP payments nearest the Employment Severance
Date until the full amount of the necessary reductions have been applied. The
determinations and reductions under this Section Q shall be made before
any eliminations or reductions, if any, have been made under the Corporation’s
Long Term Incentive Plan.

 

3.                                       If
the Auditor determines that this Section Q is applicable to an Executive,
it shall so advise the Corporation. The Corporation shall then promptly give
the Executive notice to that effect together with a copy of the detailed
calculation supporting such determination which shall include a statement of
the Reduced Amount. Such notice shall also include a description of which and
how much of the payments shall be eliminated or reduced (as long as after such
election the aggregate present value of the payments equals the Reduced
Amount.) For purposes of this Section Q, present value shall be determined
in accordance with 

 

19

 

Section 280G of the Code.
All the foregoing determinations made by the Auditor under this Section Q
shall be made as promptly as practicable after it is determined that parachute
payments will be made to the Executive if an elimination or reduction is not
made. As promptly as practicable following the election hereunder, the
Corporation shall pay to or for the benefit of the Executive such amounts as
are then due to the Executive under this Officer-ICP and shall promptly pay to
or for the benefit of the Executive in the future such amounts as become due to
the Executive under this Officer-ICP.

 

4.                                       As
a result of the uncertainty in the application of Section 280G of the Code
at the time of the initial determination by the Auditor hereunder, it is
possible that payments under this Officer-ICP will have been made which should
not have been made (“Overpayment”) or that additional payments which will have
not been made could have been made (“Underpayment”), in each case, consistent
with the calculation of the Reduced Amount hereunder. In the event that the
Auditor, based upon the assertion of a deficiency by the Internal Revenue
Service against the Corporation or the Executive which the Auditor believes has
a high probability of success, determines that an Overpayment has been made,
any such Overpayment shall be treated for all purposes as a loan to the
Executive which the Executive shall repay together with interest at the
applicable Federal rate provided for in Section 7872(f)(2) of the
Code; provided, however, that no amount shall be payable by the Executive if
and to the extent such payment would not reduce the amount which is subject to
the excise tax under Section 4999 of the Code. In the event that the
Auditor, based upon controlling precedent, determines that an Underpayment has
occurred, any such Underpayment shall be promptly paid to or for the benefit of
the Executive together with interest at the applicable Federal rate provided for
in Section 7872(f)(2)(A) of the Code.

 

5.                                       In
making its determination under this Section Q, the value of any non-cash
benefit shall be determined by the Auditor in accordance with the principles of
Section 280G(d)(3) of the Code.

 

6.                                       All
determinations made by the Auditor under this Section Q shall be binding
upon the Corporation and the Executive.

 

20

 

CLAIMS PROCEDURE

for
the

Target
Corporation

Officer
Income Continuance Policy Statement

 

When your employment with Target Corporation
(the “Company”) terminates, the Company will tell you whether you are eligible
for benefits from the above-referenced plan and, if so, the amount and timing
of the payments that will be made to you.

 

If you believe that the Company’s
determination is incorrect in any way, you must file a written claim with the
Chief Executive Officer of the Company. The Chief Executive Officer or his or
her delegate ordinarily will respond to the claim within 90 days of the date on
which it is received. However, if special circumstances require an extension of
the period of time for processing a claim, the 90-day period can be extended
for an additional 90 days by giving you written notice of the extension and the
reason that the extension is necessary.

 

If the claim for a benefit is approved, you
will receive written notice of the amount of your benefit and the date on which
payments will begin. If your claim is denied in whole or in part, you will be
told in writing the specific reasons for the decision and will receive an
explanation of the procedures for reviewing the decision.

 

If you do not agree with the decision, you
can request that the Chief Executive Officer reconsider his or her decision by
filing a written request for review within 60 days after receiving notice that
the claim has been denied. You or your representative can also present written
statements which explain why you believe that the benefit claimed should be
paid and may review all pertinent plan documents.

 

Generally, the decision will be reviewed
within 60 days after the Chief Executive Officer receives a request for
reconsideration. However, if special circumstances require a delay, the review
may take up to 120 days. (If a decision cannot be made within the 60-day period,
you will be notified of this fact in writing.) You will receive a written
notice of the decision which will explain the reasons for the decision by
making specific reference to the Plan provisions on which the decision is
based.

 

These Claims Procedures must be followed
before you can file a lawsuit seeking recovery of any Officer-ICP Payments to
which you claim to be entitled.Exhibit 10(O)

 

TARGET CORPORATION

DEFERRED COMPENSATION TRUST AGREEMENT

 

(As Amended and Restated Effective January 1,
2009)

 

This Agreement is made, effective as of the 1st day of January, 2009,
by and between TARGET CORPORATION, a Minnesota corporation (“Company”) and
STATE STREET BANK AND TRUST COMPANY (“Trustee”);

 

WHEREAS, Company and certain of its wholly-owned subsidiaries have
adopted the non-qualified deferred compensation plans and certain other
programs listed in Appendix A (collectively, the “Plans” and separately, a
“Plan”);

 

WHEREAS, Company, each wholly-owned subsidiary of Company which
participates in a Plan and which has indicated to the Trustee in writing its
acceptance of this Trust (or may so indicate in the future), and any
corporation which succeeds to the position of an employer hereunder by reason
of merger or consolidation, are referred to collectively herein as “Employers”
and individually as an “Employer”;

 

WHEREAS, the Employers have incurred or expect to incur liability under
the terms of the Plans with respect to the individuals participating in such
Plans;

 

WHEREAS, Company has previously established a trust (hereinafter called
“Trust”) to enable the Employers to contribute to the Trust assets that shall
be held therein, subject to the claims of each Employer’s creditors in the
event of an Employer’s Insolvency, as herein defined, until paid to Plan
participants and their beneficiaries in such manner and at such times as
specified in the Plans;

 

WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of any Plan
as an unfunded plan maintained for the purpose of providing deferred
compensation for a select group of management or highly compensated employees
for purposes of Title I of the Employee Retirement Income Security Act of 1974
(“ERISA”);

 

WHEREAS, it is the intention of Company to make contributions to the
Trust and to cause contributions to be made to the Trust by other Employers to
provide a source of funds to assist in the meeting of the Employers’
liabilities under the Plans;

 

WHEREAS, Company and Trustee previously entered into a Trust Agreement
effective January 1, 2005;

 

1

 

WHEREAS, it is the intention of Company to amend the Trust Agreement to
comply with Internal Revenue Code section 409A;

 

WHEREAS the parties have agreed to amend and restate the Trust
Agreement in its entirety to read as set forth herein;

 

NOW, THEREFORE, the parties do hereby amend and restate the Trust and
agree that the Trust shall hereafter be comprised, held and disposed of as
follows:

 

Section 1.  Maintenance of Trust.

 

(a)                    Company has previously deposited
with Trustee in trust certain amounts which currently constitute the principal
of the Trust and shall continue to be held, administered and disposed of by
Trustee as provided in this Trust Agreement along with such additional
contributions as may be deposited with Trustee in the future.

 

(b)                   The Trust hereby established shall
be irrevocable, except to the extent provided in Section 4.

 

(c)                    The Trust is intended to be a
grantor trust, of which each Employer is the grantor with respect to the
portion attributable to its contributions, within the meaning of
subpart E, part I, subchapter J, chapter 1, subtitle A
of the Internal Revenue Code of 1986, as amended, and shall be construed
accordingly.  Company or another Employer
shall pay any and all federal, state or local taxes on the Trust, or any part
thereof, and on the income of the Trust to the extent not paid by the assets of
the Trust.

 

(d)                   The principal of the Trust, and any
earnings thereon shall be held separate and apart from other funds of the
Employers and shall be used exclusively for the uses and purposes of Plan participants
and their beneficiaries and general creditors as herein set forth.  Plan participants and their beneficiaries
shall have no preferred claim on, or any beneficial ownership interest in, any
assets of the Trust.  Any rights created
under the Plans and this Trust Agreement shall be unsecured contractual rights
of Plan participants and their beneficiaries against the Employers.  Any assets held by the Trust which are
attributable to the contributions made by a particular Employer will be subject
to the claims of that Employer’s general creditors under federal and state law
in the event of Insolvency, as defined in Section 3(a) herein.

 

(e)                    Company, in its sole discretion,
may at any time, or from time to time, make (or cause other Employers to make)
additional deposits of cash or other eligible property in trust with Trustee to
augment the principal to be held, administered and disposed of by Trustee as
provided in this Trust Agreement. 
Neither Trustee nor any Plan participant or beneficiary shall have any
right to compel such additional deposits. 
Such deposits to the Trust will be subject to the following rules:

 

2

 

(1)                       Company,
and other Employers, shall not make deposits of cash or eligible property solely
on the basis of a change in the Company’s (or respective Employer’s) financial
health.

 

(2)                       Company,
and other Employers, will not make deposits of cash or eligible property to the
extent restricted by Internal Revenue Code section 409A(b)(3).

 

(f)                     The following
provisions shall apply in the event of an actual or potential Change of Control
as defined in Section 13(d):

 

(1)                       In the
event there is scheduled a duly called shareholders meeting of Company with
respect to which (i) any person or entity has filed a definitive proxy
statement with the Securities and Exchange Commission soliciting proxies to
effect at such meeting a Change of Control of the nature described in Section 13(d)(1) (a
“Change of Board Control”) or (ii) Company has included in a definitive
proxy statement of Company filed with the Securities and Exchange Commission
nominees of one or more persons or entities for election to the Board of
Directors whose election is opposed by the Board of Directors but the election
of whom would constitute a Change of Board Control, each Employer shall make
contributions to the Trust, no sooner than three business days or later than
one business day prior to the scheduled date of the meeting, of cash or other
eligible property which, together with amounts attributable to its previous
contributions to the Trust, have a value equal to the amount required under
paragraph (5), unless the Board of Directors of Company determines in its sole
discretion, not later than three business days prior to the scheduled date of
the meeting, that the Trust shall not be funded and provides a written notice
to the Employer of that determination prior to the time the Employer makes the
contribution.  However, no such
contribution shall be made pursuant to this paragraph (1) if, prior to the
time the Employer makes any such contribution, a written settlement agreement
is entered into with Company or the nominations of nominees are otherwise
withdrawn in such a manner that a Change of Board Control will not be further
pursued or effected at such meeting.

 

(2)                       In the
event a Change of Control that does not constitute a Change of Board Control,
or any offer or written agreement of the nature hereinafter described in clause
(i) that, if completed or consummated, would constitute a Change of
Control, occurs prior to any Change of Board Control, each Employer, as
promptly as practicable, but not sooner than 20 days (subject to extension as
hereinafter provided) and not later than 30 days (subject to extension as
hereinafter provided) after a public announcement of (i) any offer to
acquire beneficial ownership of Voting Stock (as defined in Article IV of
the Restated Articles of Incorporation, as amended, of Company) or of any
written agreement that would result in a Change of Control pursuant to Section 13(d)(2) or
(3) if the offer is completed or the agreement is consummated or (ii) the
occurrence of any Change of Control other than a Change of Board Control (the “Contribution

 

3

 

Period”), shall make contributions to the Trust of cash or other
eligible property which, together with amounts attributable to its previous
contributions to the Trust, have a value equal to the amount required under
paragraph (5), unless the Board of Directors determines, in its sole
discretion, that funding of the Trust shall not occur and provides a written
notice to the Employer of that determination prior to the earlier of (X) the
time the Employer makes the contribution or (Y) a Change of Board
Control.  At any time prior to the
commencement of the Contribution Period (or any extension of such commencement
date made in accordance with this sentence), the Board of Directors (if no
Change of Board Control shall have occurred), in its sole discretion, may extend
the commencement date and/or the duration of the Contribution Period (or any
previous extension of either thereof) by written notice to the Employers.  However, no such contribution shall be made
pursuant to this paragraph (2) if, prior to the time the Employer makes
any such contribution, no Change of Control has occurred and the offer or
agreement that, if completed or consummated, would result in a Change of
Control is terminated.

 

(3)                       Any written
notice from the Board of Directors relating to a contribution pursuant to
paragraph (1) or (2) may be modified or withdrawn by a later dated
written notice of the Board of Directors delivered at any time or from time to
time prior to the earlier of (i) the time such contribution is made or (ii) the
end of the last day on which the original notice could have been given in
accordance with the provisions of paragraph (1) or (2).

 

(4)                       Neither
Trustee nor any Plan participant or beneficiary shall have any right to compel
any contributions under this subsection (f) or to compel any Employer or
the Board of Directors to take any action under this subsection.  In deciding whether or not to take any action
authorized under this subsection (f), the Board of Directors shall have no fiduciary
or other duty to participants and beneficiaries.

 

(5)                       If the
Trust is to be funded pursuant to paragraph (1) or (2), the amount of each
Employer’s contribution shall be 120% of the amount determined by the General
Counsel and the Chief Financial Officer of Company, in their sole discretion,
to be sufficient to pay the present value of the Employer’s total projected
liability under the Plans with respect to participants employed or formerly
employed by that Employer or their beneficiaries, plus two percent of such
amount as a reserve for payment of Trustee fees and expenses of the Trust.  The determination of an Employer’s “total
projected liability” under a Plan for purposes of this paragraph shall be made
utilizing the definition specified in Appendix B applicable to the Plan, if
any, and otherwise by utilizing the assumptions prescribed in Section 13(e).

 

4

 

(6)                       On or
before the date of a contribution made pursuant to this subsection (f), each
Employer shall deliver to the Trustee a schedule showing its best estimate of
the aggregate amount of benefits payable by it under each Plan.

 

(g)                  In the event of
a final and unappealable determination by a court of competent jurisdiction or
the U. S. Department of Labor that one or more Plans do not satisfy the
requirements for being maintained primarily for the purpose of providing
deferred compensation for a select group of management or highly compensated
employees for purposes of Title I of ERISA, Trustee shall immediately
segregate the assets attributable to such Plan or Plans into a separate
Trust.  Said separate Trust shall
continue to be held and administered by Trustee in accordance with this
Agreement until the provisions applicable to the separate Trust are amended
pursuant to Section 12.

 

(h)                  For purposes of
this Trust, “eligible property” means property in one or more of the following
categories:

 

(1)                       Cash.

 

(2)                       Treasury or
other government agency securities not exceeding one year in maturity.

 

(3)                       Money
market securities.

 

(4)                       An
ownership interest in the Target Corporation Credit Card Master Trust, which
may be evidenced by, among other things, a participation or certificates.

 

(5)                       Corporate
owned life insurance policies

 

(6)                       In the
event that the total of the property available under paragraphs (1) through
(4) is not sufficient to provide the entire contribution to be made by an
Employer under subsection (f), “eligible property” shall also include
unencumbered real property owned by the Employer with a fair market value that
is at least equal to the additional amount necessary to provide the entire
contribution that is to be made.

 

The fair market value of the property to be contributed under
paragraphs (2) through (6) of this subsection shall be determined by
the General Counsel and the Chief Financial Officer of Company in their sole
discretion, taking into account any reduction in that value that could result
from the lack of an orderly liquidation of a particular item or items of
property.

 

5

 

Section 2.  Payments to Plan Participants and Their
Beneficiaries.

 

(a)

 

(1)                       As soon as
reasonably possible after a Change of Control occurs that results in funding of
the Trust under Section 1(f) (provided that the funding has not been
returned to the Employers pursuant to Section 4), Company’s Director of
Executive Compensation (or his or her successor) shall deliver to Trustee a
Payment Schedule showing the amount payable to each Plan participant or
beneficiary under each Plan.

 

(i)                        The Payment Schedule will
provide the amount payable, determined as of the date of the Change of Control,
as well as the method and rate to credit earnings on such amounts, if any,
until amounts are paid to the Plan participant, and the date on which the
amounts are payable.

 

(ii)                     The Payment Schedule shall, with
respect to any amounts subject to Internal Revenue Code section 409A, only
provide for payments under an allowable distribution event under Code section
409A.  The Payment Schedule shall reflect
the time and form of distribution as provided under the respective Plan.

 

(2)                       Except as
otherwise provided in subsection (c), Trustee shall make payments to the Plan
participants and their beneficiaries in accordance with such Payment Schedule,
and may rely conclusively on such Payment Schedule in making payments.

 

(3)                       Trustee
shall make provision for the reporting and withholding of any federal, state or
local taxes that may be required to be withheld with respect to the payment of
benefits pursuant to the terms of the Plans and shall pay amounts withheld to
the appropriate taxing authorities or determine that such amounts have been
reported, withheld and paid by the Employers. 
Trustee may rely on instructions from Company as to any required
withholding and shall be fully protected hereunder in relying on such
instructions.  For purposes of the
preceding sentence, a failure by Company to provide any instructions as to
required withholding may be deemed by Trustee to be an instruction by Company
that no withholding is required.

 

(b)                  Prior to a
Change of Control described in subsection (a), the entitlement of a Plan
participant or his or her beneficiaries to benefits under the Plans shall be
determined by Company or such party as it shall designate under the Plans, and
any claim for such benefits shall be considered and reviewed under the
procedures set out in the Plans.  Company
shall make (or cause other Employers to make) payment of benefits directly to
Plan participants or their beneficiaries as they become due under the terms of
the Plans, 

 

6

 

and Trustee shall have no obligation to make such payments prior to
such Change of Control.

 

(c)                   In the event of
a dispute over a payment under subsection (a) following a Change of
Control, a participant or beneficiary who claims to be entitled to a larger
payment from the Plans than shown in the Payment Schedule may submit a written
claim for payment to Trustee within 90 days from the date the payment was
otherwise scheduled to be made.  The
claim shall be processed as follows:

 

(1)                       Trustee
shall give notice of the claim to Company. 
If Trustee receives no notice of response from Company within 30 days
after the date Company is given the notice of claim, Trustee shall pay the
participant or beneficiary the amount claimed from the assets in the Trust held
on behalf of such participant.  If a
notice of response is received within such 30 days, Trustee shall consider the
claim, including Company’s response.  If
the merits of the claim depend on compensation, service or other data in the
possession of Company and such information is not provided to Trustee by
Company, Trustee may rely upon information provided by the participant or
beneficiary.

 

(2)                       Trustee
shall give notice to the participant or beneficiary and Company of its decision
on the claim, which shall be made within any period applicable to the
particular Plan.  The participant or
beneficiary shall then pursue the appeals procedure for the Plan, if any, if he
or she wishes to contest Trustee’s decision. 
Either the participant or beneficiary (after any applicable claims
procedure has been exhausted) or Company may challenge Trustee’s decision by
filing suit in a court of competent jurisdiction.  If no such suit is filed within 60 days after
notice of Trustee’s decision (and exhaustion of any applicable appeals
procedure provided for a Plan), the decision shall become final and binding on
all parties.  If the decision is to grant
the claim, Trustee shall make payment to the participant or beneficiary of the
appropriate amount; provided, however, that the amount of any distribution from
the Trust shall not exceed the total amount of assets held in the Trust on
behalf of such participant.

 

(3)                       Trustee may
decline to decide a claim and may file suit to have the matter resolved by a
court of competent jurisdiction.  All of
Trustee’s expenses in the court proceeding, including attorneys’ fees, shall be
allowed as administrative expenses of the Trust.

 

(4)                       In the
event of a dispute to be resolved under this subsection (c), Trustee may retain
a third party to review the calculations and the payment amounts and advise
Trustee as to the correct amount to be paid. 
All expenses of such a third party shall be allowed as administrative
expenses of the Trust.

 

(d)                  If payment is
made to a participant or beneficiary under this Section 2, the obligation
of the Employers under the terms of the applicable Plan or Plans shall be
extinguished to 

 

7

 

the extent of the amount paid. 
Trustee has no obligation to make payments to a participant or
beneficiary from the Trust under this Section 2 except to the extent
amounts have been contributed to the Trust with respect to such person.

 

Section 3.  Trustee Responsibility Regarding Payments
When Employer is Insolvent.

 

(a)                   Trustee shall
cease payment of benefits to Plan participants and their beneficiaries
attributable to a particular Employer if the Employer is Insolvent.  An Employer shall be considered “Insolvent”
for purposes of this Trust Agreement if (i) it is unable to pay its debts
as they become due, or (ii) it is subject to a pending proceeding as a
debtor under the United States Bankruptcy Code.

 

(b)                  At all times
during the continuance of this Trust, as provided in Section 1(d) hereof,
the principal and income of the Trust attributable to a particular Employer
shall be subject to claims of general creditors of that Employer under federal
and state law as set forth below.

 

(1)                       The Board
of Directors and the Chief Executive Officer of Company shall have the duty to
certify to Trustee in writing of an Employer’s Insolvency.  If a person claiming to be a creditor of an
Employer alleges in writing to Trustee that an Employer has become Insolvent,
Trustee shall determine whether an Employer is Insolvent and, pending such
determination, Trustee shall discontinue payment of benefits to its Plan
participants or their beneficiaries.

 

(2)                       Unless
Trustee has actual knowledge of an Employer’s Insolvency, or has received
notice from Company or a person claiming to be a creditor alleging that an
Employer is Insolvent, Trustee shall have no duty to inquire whether an
Employer is Insolvent.  Trustee may in
all events rely on such evidence concerning each Employer’s solvency as may be
furnished to Trustee and that provides Trustee with a reasonable basis for
making a determination concerning solvency.

 

(3)                       If at any
time Trustee has determined that an Employer is Insolvent, Trustee shall
discontinue payments to Plan participants or their beneficiaries and shall hold
the assets of the Trust attributable to that Employer for the benefit of the
Employer’s general creditors.  Nothing in
this Trust Agreement shall in any way diminish any rights of Plan participants
or their beneficiaries to pursue their rights as general creditors of Company
with respect to benefits due under the Plans or otherwise.

 

(4)                       Trustee
shall resume the payment of benefits to Plan participants or their
beneficiaries in accordance with Section 2 of this Trust Agreement only
after Trustee has determined that an Employer is not Insolvent (or is no longer
Insolvent).

 

8

 

(c)       Provided that there are
sufficient assets, if Trustee discontinues the payment of benefits from the
Trust pursuant to Section 3(b) hereof and subsequently resumes such
payments, the first payment following such discontinuance shall include the
aggregate amount of all payments due to the affected Plan participants or their
beneficiaries under the terms of the Plans for the period of such
discontinuance, less the aggregate amount of any payments made to Plan
participants or their beneficiaries by Company or another Employer in lieu of
the payments provided for hereunder during any such period of discontinuance.

 

Section 4. Payments to Employers.

 

Except as provided in Section 3 or this
Section, Company shall have no right or power to direct Trustee to return to
Company or another Employer or to divert to others any of the Trust assets
before all payments of benefits have been made to Plan participants and their
beneficiaries pursuant to the terms of the Plans and all other obligations of
the Trust, including fees and expenses of Trustee, have been paid. Notwithstanding
the foregoing sentence or anything else in this Trust Agreement to the
contrary, if any Employer is required to contribute assets to the Trust in
accordance with Section 1(f), Trustee shall return such assets plus the
earnings attributable to the assets to the Employer upon receipt of
notification from the Board of Directors that it has determined that the
anticipated Change of Control will not occur and determination by Trustee that
a Change of Control has not in fact occurred.

 

Section 5. Investment Authority.

 

(a)       In no event may Trustee
invest in assets other than eligible property as defined in Section 1(h). All
rights associated with assets of the Trust shall be exercised by Trustee or the
person designated by Trustee, and shall in no event be exercisable by or rest
with Plan participants.

 

(b)      Company shall have the
right, at any time, and from time to time in its sole discretion, to substitute
assets of equal fair market value for any asset held by the Trust, provided
that the substitute assets also qualify as eligible property under Section 1(h) —
(1) through (5).

 

(c)       Trustee shall hold, manage,
invest and otherwise administer the Trust pursuant to the terms of this
Agreement. The Trustee shall be responsible only for contributions actually
received by it hereunder. The amount of each contribution made by the Employers
to the Trust shall be determined in the sole discretion of the Executive
Committee or other persons allocated that responsibility herein, and Trustee
shall have no duty or responsibility with respect thereto. Except as otherwise
specifically agreed to by Trustee, Trustee shall not be responsible for the
administration of any Plan (including without limitation the determination of
Plan participation rights of employees of the Employers and the determination
of benefits of the participants in any Plan). Except to the extent that Trustee
has otherwise specifically agreed in writing, Trustee shall not be responsible,
directly or indirectly, for the investment or reinvestment of the assets of the

 

9

 

Trust, which investment and reinvestment
shall be the sole responsibility of Company; provided, however, that upon a
Change of Control, Trustee shall become responsible for the investment and
reinvestment of the assets of the Trust as elsewhere provided herein. Prior to
a Change of Control, and unless Company and Trustee have mutually agreed in a
separate writing that Trustee shall have and exercise investment discretion, in
either case with respect to all or a portion of the assets of the Trust,
Company shall have complete discretion with respect to the investment of such
assets at all times, and shall direct Trustee accordingly.

 

Section 6. Disposition of Income.

 

During the term of this Trust, all income
received by the Trust, net of expenses and taxes, shall be accumulated and
reinvested in eligible property as defined in Section 1(h).

 

Section 7. Accounting by Trustee.

 

Trustee shall keep accurate and detailed
records of all investments, receipts, disbursements, and other transactions
required to be made, including such specific records as shall be agreed upon in
writing between Company and Trustee. Within 60 days following the close of each
calendar year and within 60 days after the removal or resignation of Trustee,
Trustee shall deliver to Company a written account of its administration of the
Trust during such year or during the period from the close of the last
preceding year to the date of such removal or resignation, setting forth all
investments, receipts, disbursements and other transactions effected by it,
including a description of all securities and investments purchased and sold
with the cost or net proceeds of such purchases or sales (accrued interest paid
or receivable being shown separately), and showing all cash, securities and
other property held in the Trust at the end of such year or as of the date of
such removal or resignation, as the case may be.

 

Section 8. Responsibility of Trustee.

 

(a)       Trustee shall act with the
care, skill, prudence and diligence under the circumstances then prevailing
that a prudent person acting in like capacity and familiar with such matters
would use in the conduct of an enterprise of a like character and with like
aims, provided, however, that Trustee shall incur no liability to any person
for any action taken pursuant to a direction, request or approval given by
Company which is contemplated by, and in conformity with, the terms of the Plans
or this Trust and is given in writing by Company, or for any failure to take
any action in the absence of such a direction, request or approval. The duties
of Trustee shall only be those specifically undertaken pursuant to this
Agreement or by means of a separate written agreement. In the event of a
dispute between Company and a party, Trustee may apply to a court of competent
jurisdiction to resolve the dispute.

 

(b)      The Employers and the Trust
hereby indemnify Trustee against, and agree to hold Trustee harmless from, all
liabilities and claims (including reasonable attorneys’ fees and expenses in
defending against such liabilities and claims) against Trustee as a result 

 

10

 

of any breach of fiduciary responsibility by
a fiduciary other than Trustee or an agent of Trustee (excluding any agent
which is Company or an agent of Company), unless Trustee or such agent of
Trustee participates knowingly in such breach.

 

(c)       Trustee may consult with
legal counsel (who may also be counsel for Company generally) with respect to
any of its duties or obligations hereunder.

 

(d)      Trustee may hire agents,
accountants, actuaries, investment advisors, financial consultants or other
professionals to assist it in performing any of its duties or obligations
hereunder.

 

(e)       Trustee shall have, without
exclusion, all powers conferred on Trustees by applicable law, unless expressly
provided otherwise herein.

 

(f)       Notwithstanding any powers
granted to Trustee pursuant to this Trust Agreement or pursuant to applicable
law, Trustee shall not have any power that could give this Trust the objective
of carrying on a business and dividing the gains therefrom, within the meaning
of section 301.7701-2 of the Procedure and Administrative Regulations
promulgated pursuant to the Internal Revenue Code.

 

Section 9. Compensation and Expenses
of Trustee.

 

The Employers shall pay all administrative
and Trustee’s fees and expenses in such proportions as Company determines. Unless
and until so paid, such expenses and compensation shall be a charge on the
Trust and shall constitute a lien on the Trust in favor of Trustee. All
payments to, or reimbursements of, Trustee pursuant to this Trust Agreement may
be made without approval or direction of Company.

 

Section 10. Resignation and Removal
of Trustee.

 

(a)       Trustee may resign at any
time by written notice to Company, which shall be effective 60 days after
receipt of such notice unless Company and Trustee agree otherwise.

 

(b)      Trustee may be removed by Company
on 60 days notice or upon shorter notice accepted by Trustee.

 

(c)       Notwithstanding subsection
(b), upon a Change of Control, Trustee may not be removed by Company for three
years.

 

(d)      Upon resignation or removal
of Trustee and appointment of a successor Trustee, all assets shall
subsequently be transferred to the successor Trustee. The transfer shall be
completed within 60 days after receipt of notice of resignation, removal or
transfer, unless Company extends the time limit.

 

11

 

(e)       If Trustee resigns or is
removed, a successor shall be appointed, in accordance with Section 11
hereof, by the effective date of resignation or removal under paragraph(s) (a) or
(b) of this section. If no such appointment has been made, Trustee may
apply to a court of competent jurisdiction for appointment of a successor or
for instructions. All expenses of Trustee in connection with the proceeding
shall be allowed as administrative expenses of the Trust.

 

Section 11. Appointment of Successor.

 

(a)       If Trustee resigns or is
removed in accordance with Section 10(a) or (b) hereof, Company
may appoint any national bank or trust company with capital in excess of
$50,000,000 as a successor to replace Trustee upon resignation or removal. The
appointment shall be effective when accepted in writing by the new Trustee, who
shall have all of the rights and powers of the former Trustee, including
ownership rights in the Trust assets. The former Trustee shall execute any
instrument necessary or reasonably required by Company or the successor Trustee
to evidence the transfer.

 

(b)      The successor Trustee need
not examine the records and acts of any prior Trustee and may retain or dispose
of existing Trust assets, subject to Sections 7 and 8 hereof. The successor
Trustee shall not be responsible for and Company shall indemnify and defend the
successor Trustee from any claim or liability resulting from any action or
inaction of any prior Trustee or from any other past event, or any condition
existing at the time it becomes successor Trustee.

 

Section 12. Amendment or Termination.

 

(a)       This Trust Agreement may be
amended by a written instrument executed by Trustee and Company. Notwithstanding
the foregoing, no such amendment shall conflict with the terms of the Plans or
shall make the Trust revocable after it has become irrevocable in accordance
with Section 1(b) (subject to Sections 3 and 4).

 

(b)      The Trust shall not
terminate until the date on which Plan participants and their beneficiaries are
no longer entitled to benefits pursuant to the terms of the Plans. Upon
termination of the Trust, any assets remaining in the Trust shall be returned
to the Employers in such proportions as Company determines.

 

(c)       Upon written approval of
participants or beneficiaries entitled to payment of benefits pursuant to the
terms of the Plans, Company may terminate this Trust prior to the time all
benefit payments under the Plans have been made. All assets in the Trust at
termination shall be returned to the Employers in such proportions as Company
determines.

 

12

 

Section 13. Miscellaneous.

 

(a)       Any provision of this Trust
Agreement prohibited by law shall be ineffective to the extent of any such
prohibition, without invalidating the remaining provisions hereof.

 

(b)      Benefits payable to Plan
participants and their beneficiaries under this Trust Agreement may not be
anticipated, assigned (either at law or in equity), alienated, pledged,
encumbered or subjected to attachment, garnishment, levy, execution or other
legal or equitable process.

 

(c)       This Trust Agreement shall
be governed by and construed in accordance with the laws of the State of
Minnesota, to the extent such laws are not preempted by laws of the United
States of America.

 

(d)      For purposes of this Trust,
a “Change of Control” shall be deemed to have occurred if:

 

(1)       50% or more of the directors of Company shall be
persons other than persons

 

(i)         for whose election
proxies shall have been solicited by the Board of Directors of Company or

 

(ii)        who are then serving as
directors appointed by the Board of Directors to fill vacancies on the Board of
Directors caused by death or resignation (but not by removal) or to fill
newly-created directorships, or

 

(2)       30% or more of the
outstanding voting power of the Voting Stock of Company is acquired or
beneficially owned (as defined in Article IV of the Restated Articles of
Incorporation, as amended, of Company) by any person (as defined in Article IV
of the Restated Articles of Incorporation, as amended, of Company) other than
an entity resulting from a Business Combination in which clauses (X) and (Y) of
subparagraph (3) apply, or

 

(3)       The consummation of a
merger or consolidation of Company with or into another entity, a statutory
share exchange, a sale or other disposition (in one transaction or a series of
transactions) of all or substantially all of Company’s assets or a similar
business combination (each, a “Business Combination”), in each case unless,
immediately following such Business Combination, (X) all or substantially
all of the beneficial owners of Company’s Voting Stock immediately prior to
such Business Combination beneficially own, directly or indirectly, more than
60% of the voting power of the then outstanding shares of voting stock (or
comparable voting equity interests) of the surviving or acquiring entity
resulting from such Business Combination (including such beneficial ownership
of an entity that, as a result of such transaction, owns Company or all or
substantially all of Company’s assets either directly or through one or more
subsidiaries), in substantially the same proportions (as compared to the other
beneficial owners of Company’s 

 

13

 

Voting Stock immediately prior to such
Business Combination) as their beneficial ownership of Company’s Voting Stock
immediately prior to such Business Combination, and (Y) no person (as
defined in Article IV of the Restated Articles of Incorporation, as
amended, of Company) beneficially owns, directly or indirectly, 30% or more of
the voting power of the outstanding voting stock (or comparable equity
interests) of the surviving or acquiring entity (other than a direct or
indirect parent entity of the surviving or acquiring entity, that, after giving
effect to the Business Combination, beneficially owns, directly or indirectly,
100% of the outstanding voting stock (or comparable equity interests) of the
surviving or acquiring entity), or

 

(4)       Approval by the
shareholders of a definitive agreement or plan to liquidate or dissolve
Company.

 

For purposes
of this paragraph (d), “Voting Stock” has the same meaning as defined in Article IV
of the Restated Articles of Incorporation, as amended, of Company

 

(e)       A “Change of Control”
qualifies as a “change in control event” as long as it satisfies the
requirements of Code section 409A

 

(f)        For purposes of this
Trust, the phrase “the present value of the Employer’s total projected
liability” shall be interpreted to require the calculation of such present
value to be done as follows:

 

(1)        By using the methods
specified in Appendix B in the case of the Plans listed in that Appendix.

 

(2)        In the case of a Plan not
listed in Appendix B, by discounting the projected cash flow of each future
year by a rate equal to the then current market yield for U.S. Treasury
securities maturing in said future year. To the extent that said calculation
requires the use of an actuarial equivalent factor reflecting matters other
than interest, said factor shall be determined in accordance with the
provisions then in effect of Section 417(e)(3)(ii)(I) of the Internal
Revenue Code of 1986, as amended, or any successor or substitute provisions of
said Code or its replacement, or if there are no such applicable provisions,
the corresponding factor then being used to calculate immediate lump sum
distributions under the Target Corporation Employees’ Retirement Plan or its
successor.

 

(g)       Company hereby represents
and warrants to the Trustee that this Trust shall constitute an unfunded
arrangement and shall not affect the status of any Plan as an unfunded plan
maintained for the purpose of providing deferred compensation for a select
group of management or highly compensated employees for purposes of Title I of
ERISA.

 

(h)       The Trust and all assets
under the Trust shall be located in the United States.

 

14

 

Section 14. Effective Date.

 

The effective date of this Trust Agreement
shall be January 1, 2009. The original effective date of the Trust was January 1,
1987.

 

IN WITNESS WHEREOF,
the Company and the Trustee have caused this Agreement to be executed by their
duly authorized officers this          day
of                 ,
2009.

 

 

	
   

  	
  COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title 

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TRUSTEE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title

  	
   

  

 

15

 

APPENDIX A

 

The following plans maintained by Company or
any other Employer which has indicated in writing its acceptance of the Trust
to Trustee and Company are “Plans” covered by the Deferred Compensation Trust
Agreement:

 

·                              Target
Corporation Officer EDCP (formerly known as Target Corporation Deferred
Compensation Plan—Senior Management Group)

·                              Target
Corporation DDCP (formerly known as Target Corporation Director Deferred
Compensation Plan)

·                              Target
Corporation EDCP (formerly known as Executive Deferred Compensation Plan)

·                              Officer
Executive Deferred Compensation Plan

·                              Deferred
Compensation Plan Directors

·                              SPP
I (formerly known as Supplemental Pension Plan I)

·                              SPP
II (formerly known as Supplemental Pension Plan II)

·                              SPPIII
(formerly known as Supplemental Pension Plan III)

·                              SPP
IV (formerly known as Supplemental Pension Plan IV)

·                              SPP
V (formerly known as Supplemental Pension Plan V)

·                              Pilot
Supplemental Pension

·                              Board
of Director Consulting Fee

·                              Long
Term Incentive Plan (but only with respect to awards considered deferred
compensation under Code section 409A)

·                              Individual
deferred compensation agreements to the extent the agreement requires the
obligation to be funded under a rabbi trust.

 

In addition, the following programs are also “Plans”,
but solely with respect to individuals whose employment or directorship with
the Employers has terminated prior to the date a contribution is required under
Section 1(f):

 

·                              Executive
Survivor Benefit Plan

·                              Income
Continuance Policy (formerly known as the SMG Income Continuance Policy)

·                              Excess
Long Term Disability Plan

·                              Severance
or Supplemental Payment Accruals, but only to the extent the underlying
agreement requires the obligation to be funded under a rabbi trust.

 

16

 

APPENDIX B

Definitions
for Funding Purposes

 

Reference Yield

The yield on Moody’s AA Corporate Bond Index (rounded to the nearest
..1%) as determined by Bloomberg on the day prior to the funding of the Trust. If
this yield information is no longer available from Bloomberg, an alternative
provider of the information will be chosen by the Chief Financial Officer.

 

Deferred Compensation Plan — Senior
Management Group and Directors

The present value of all payments expected to be made to participants
and their spouses (or beneficiaries) based on the most recent calculation of
the value of participants’ plan account balances (the “plan valuation”). In
accordance with the plan document, expected payments shall be based on (1) the
participants’ marital status, (2) participants’ and their spouses’ life
expectancies at the time the participants have scheduled to begin receiving
payments, (3) the assumed retirement ages of participants and the time
following retirement that the participants have scheduled to begin receiving
payments, (4) the assumed crediting rate on participants’ account
balances, which is equal to the crediting rate as of the most recent plan
valuation, and (5) the accumulated balances in participants’ accounts as
of the latest plan valuation. The discount rate applied to these expected
payments shall be the interest rate used to calculate interest credited to
participants’ plan account balances during the current plan year less 600 basis
points. Should the Trust be activated after the date of the latest plan
valuation (1) the total liability shall be increased by an amount equal to
the total liability as of the latest plan valuation times the discount rate
times the number of days since the latest plan valuation divided by 365 and (2) the
total liability shall be reduced by the present value of any payments made to
participants since the latest plan valuation.

 

Executive Deferred Compensation Plan

The total value of participants’ balances as of the close of business
on the day preceding the funding of the Trust.

 

Executive Deferred Compensation Plan — Senior
Management Group and Directors

The total value of participants’ balances as of the close of business
on the day preceding the funding of the Trust.

 

Supplemental Pension Plans I and IV

The difference in the present values of all pension annuities that (1) participants
would earn excluding any deferred income, but not taking into account IRS
limits on qualified income, and that (2) participants would earn excluding
any deferred income and taking into account IRS qualified income limitations. The
calculation of this liability is based on the annual actuarial factors
applicable for Supplemental Pension Plans I and IV respectively. Should the
Trust be activated after the date of the latest plan valuation, the amount of
the total liability shall be increased by (1) an amount equal to the total
liability as of the most recent plan valuation times the discount rate used in
that valuation divided by the number of days since the plan valuation was
conducted divided by 365 and (2) service credited since the latest annual
actuarial valuation.

 

17

 

Supplemental Pension Plans II and V

The difference in the present values of the pension annuities that (1) participants
would earn if the participants had not deferred any income and (2) participants
would earn excluding any deferred income, after taking into account any
benefits due under Supplemental Pension Plans I or IV. The calculation of this
liability is based on the annual actuarial factors applicable for Supplemental
Pension Plans II and V respectively. Should the Trust be activated after the date
of the latest plan valuation, the amount of the total liability shall be
increased by (1) an amount equal to the total liability as of the most
recent plan valuation times the discount rate used in that valuation divided by
the number of days since the plan valuation was conducted divided by 365 and (2) service
credited since the latest annual actuarial valuation.

 

Supplemental Pension Plan III

The difference in the present values of the pension annuities that (1) participants
would earn by adding 5 years to their actual ages (but in no case will the
participant’s age be deemed to be greater than age 65) and (2) the
benefits that these participants would earn without such an age adjustment,
after taking into account any benefits due under Supplemental Pension Plans I
and II. The calculation of this liability is based on the annual actuarial
factors applicable for Supplemental Pension Plan III. Should the Trust be
activated after the date of the latest plan valuation, the amount of the total
liability shall be increased by (1) an amount equal to the total liability
as of the most recent plan valuation times the discount rate used in that
valuation divided by the number of days since the plan valuation was conducted
divided by 365 and (2) service credited since the latest annual actuarial
valuation.

 

Pilot Supplemental Pension Plan

The present value of all annuity payments either currently committed
to, or expected to be made to, participants between the ages of 55 and 65. The
discount rate applied to the expected annuity payments shall be the discount
rate used in the latest qualified pension plan annual actuarial valuation.

 

Board of Director Consulting Fee

The present value of all consulting fees committed to members of the
Board of Directors as of the date of the Trust’s funding. The discount rate
applied to the committed consulting fees shall be the Reference Yield.

 

Executive Survivor Benefit Plan

The present value of all benefits expected to be paid to the surviving
spouses of participants. Expected payments are calculated based on (1) the
existing pension benefit formula, applied to a Joint and 100% Survivor annuity,
(2) expected growth in participants’ compensation until retirement, which
is equal to the average assumed rate of compensation increase presented in the
Company’s annual report pension footnote, (3) participants’ marital status
and age of their spouses, and (4) the assumed retirement age of
participants. For purposes of calculating the duration of expected annuity
payments to surviving spouses, the differences in the expected lives of
participants and their spouses as of the date of the Trust’s funding shall be
used. The discount rate applied to the expected annuity payments shall be the
Reference Yield.

 

18

 

Income Continuance Policy

The present value of all Income Continuance Policy severance agreement
payments committed to at the time of the Trust’s funding. The discount rate
applied to these payments shall be the Reference Yield.

 

Non-Income Continuance Policy Severance
Accruals

The present value of all non-Income Continuance Policy severance
agreement payments committed to at the time o the Trust’s funding. The discount
rate applied to the expected annuity payments shall be the Reference Yield.

 

Excess Long-Term Disability Plan

The present value of all excess long-term disability payments committed
to plan participants at the time of the Trust’s funding, assuming that those
payments continue until the disabled participants reach the age of 65. The
discount rate applied to these projected payments shall be the Reference Yield.

 

19

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