Document:

EXHIBIT 10.3

Hormel
Foods Corporation

Executive Deferred Income
Plan II

Master Plan Document (2005 Restatement)

As
Amended and Restated

Effective
January 1, 2005

 

TABLE
OF CONTENTS

	
  

  	
   

  	
  Page

  
	
  ARTICLE 1

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2

  	
  Selection, Enrollment, Eligibility

  	
  9

  
	
   

  	
   

  	
   

  
	
   

  	
  2.1

  	
  Selection by Committee

  	
   

  
	
   

  	
  2.3

  	
  Enrollment and Eligibility Requirements;
  Commencement of Participation

  	
   

  
	
   

  	
  2.3

  	
  Termination of Participation and/or Deferrals

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3

  	
  Deferral
  Commitments/Discretionary Contribution Amounts/Profit Sharing
  Amounts/Vesting/Crediting/Taxes

  	
  10

  
	
   

  	
   

  	
   

  
	
   

  	
  3.1

  	
  Minimum Deferrals

  	
   

  
	
   

  	
  3.2

  	
  Maximum Deferral

  	
   

  
	
   

  	
  3.3

  	
  Election to Defer; Effect of Election Form

  	
   

  
	
   

  	
  3.4

  	
  Withholding and Crediting of Annual Deferral Amounts

  	
   

  
	
   

  	
  3.5

  	
  Annual Discretionary Contribution Amount

  	
   

  
	
   

  	
  3.6

  	
  Annual Profit Sharing Amount

  	
   

  
	
   

  	
  3.8

  	
  Vesting

  	
   

  
	
   

  	
  3.8

  	
  Crediting/Debiting of Account Balances

  	
   

  
	
   

  	
  3.9

  	
  FICA and Other Taxes

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4

  	
  Deduction Limitation

  	
  16

  
	
   

  	
   

  	
   

  
	
   

  	
  4.1

  	
  Deduction Limitation on Benefit Payments

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5

  	
  In-Service Distribution; Unforeseeable
  Financial Emergencies; Withdrawal Election

  	
  17

  
	
   

  	
   

  	
   

  
	
   

  	
  5.1

  	
  In-Service Distribution

  	
   

  
	
   

  	
  5.2

  	
  Other Benefits Take Precedence Over In-Service
  Distributions

  	
   

  
	
   

  	
  5.3

  	
  Withdrawal Payout/Suspensions for Unforeseeable
  Financial Emergencies

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6

  	
  Change In Control Benefit

  	
  18

  
	
   

  	
   

  	
   

  
	
   

  	
  6.1

  	
  Change in Control Benefit

  	
   

  
	
   

  	
  6.2

  	
  Payment of Change in Control Benefit

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7

  	
  Retirement Benefit

  	
  19

  
	
   

  	
   

  	
   

  
	
   

  	
  7.1

  	
  Retirement Benefit

  	
   

  
	
   

  	
  7.2

  	
  Payment of Retirement Benefit

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8

  	
  Termination Benefit

  	
  20

  

 

 i
 

 

	
   

  	
  8.1

  	
  Termination Benefit

  	
   

  
	
   

  	
  8.2

  	
  Payment of Termination Benefit

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9

  	
  Disability Waiver and Benefit

  	
  21

  
	
   

  	
   

  	
   

  
	
   

  	
  9.1

  	
  Disability Waiver

  	
   

  
	
   

  	
  9.2

  	
  Continued Eligibility; Disability Benefit

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10

  	
  Survivor Benefit

  	
  22

  
	
   

  	
   

  	
   

  
	
   

  	
  10.1

  	
  Survivor Benefit

  	
   

  
	
   

  	
  10.2

  	
  Payment of Survivor Benefit

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11

  	
  Forfeiture of Benefits

  	
  22

  
	
   

  	
   

  	
   

  
	
   

  	
  11.1

  	
  Forfeiture of Benefits

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 12

  	
  Beneficiary Designation

  	
  23

  
	
   

  	
   

  	
   

  
	
   

  	
  12.1

  	
  Right to Designate

  	
   

  
	
   

  	
  12.2

  	
  Failure of Designation

  	
   

  
	
   

  	
  12.3

  	
  Disclaimers by Beneficiaries

  	
   

  
	
   

  	
  12.4

  	
  Definitions

  	
   

  
	
   

  	
  12.5

  	
  Special Rules

  	
   

  
	
   

  	
  12.6

  	
  No Spousal Rights

  	
   

  
	
   

  	
  12.7

  	
  Death Prior to Full Distribution

  	
   

  
	
   

  	
  12.8

  	
  Discharge of Obligations

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 13

  	
  Leave of Absence

  	
  25

  
	
   

  	
   

  	
   

  
	
   

  	
  13.1

  	
  Paid Leave of Absence

  	
   

  
	
   

  	
  13.2

  	
  Unpaid Leave of Absence

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 14

  	
  Termination, Amendment or Modification

  	
  26

  
	
   

  	
   

  	
   

  
	
   

  	
  14.1

  	
  Termination

  	
   

  
	
   

  	
  14.2

  	
  Amendment

  	
   

  
	
   

  	
  14.3

  	
  Plan Agreement

  	
   

  
	
   

  	
  14.4

  	
  Effect of Payment

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 15

  	
  Administration

  	
  27

  
	
   

  	
   

  	
   

  
	
   

  	
  15.1

  	
  Committee Duties

  	
   

  
	
   

  	
  15.2

  	
  Administration Upon Change In Control

  	
   

  
	
   

  	
  15.3

  	
  Agents

  	
   

  
	
   

  	
  15.4

  	
  Binding Effect of Decisions

  	
   

  
	
   

  	
  15.5

  	
  Indemnity of Committee

  	
   

  
	
   

  	
  15.6

  	
  Employer Information

  	
   

  

 

 ii
 

 

	
  ARTICLE 16

  	
  Other Benefits and Agreements

  	
  28

  
	
   

  	
   

  	
   

  
	
   

  	
  16.1

  	
  Coordination with Other Benefits

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 17

  	
  Claims Procedures

  	
  28

  
	
   

  	
   

  	
   

  
	
   

  	
  17.1

  	
  Presentation of Claim

  	
   

  
	
   

  	
  17.2

  	
  Notification of Decision

  	
   

  
	
   

  	
  17.3

  	
  Review of a Denied Claim

  	
   

  
	
   

  	
  17.4

  	
  Decision on Review

  	
   

  
	
   

  	
  17.5

  	
  Legal Action

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 18

  	
  Trust

  	
  30

  
	
   

  	
   

  	
   

  
	
   

  	
  18.1

  	
  Establishment of the Trust

  	
   

  
	
   

  	
  18.2

  	
  Interrelationship of the Plan and the Trust

  	
   

  
	
   

  	
  18.3

  	
  Distributions From the Trust

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 19

  	
  Miscellaneous

  	
  30

  
	
   

  	
   

  	
   

  
	
   

  	
  19.1

  	
  Status of Plan

  	
   

  
	
   

  	
  19.2

  	
  Unsecured General Creditor

  	
   

  
	
   

  	
  19.3

  	
  Employer’s Liability

  	
   

  
	
   

  	
  19.4

  	
  Nonassignability

  	
   

  
	
   

  	
  19.5

  	
  Not a Contract of Employment

  	
   

  
	
   

  	
  19.6

  	
  Furnishing Information

  	
   

  
	
   

  	
  19.7

  	
  Terms

  	
   

  
	
   

  	
  19.8

  	
  Captions

  	
   

  
	
   

  	
  19.9

  	
  Governing Law

  	
   

  
	
   

  	
  19.10

  	
  Notice

  	
   

  
	
   

  	
  19.11

  	
  Successors

  	
   

  
	
   

  	
  19.12

  	
  Spouse’s Interest

  	
   

  
	
   

  	
  19.13

  	
  Validity

  	
   

  
	
   

  	
  19.14

  	
  Incompetent

  	
   

  
	
   

  	
  19.15

  	
  Court Order

  	
   

  
	
   

  	
  19.16

  	
  Insurance

  	
   

  

 

 iii

 

HORMEL
FOODS CORPORATION

EXECUTIVE DEFERRED INCOME PLAN II

(2005 Restatement)

Amended and Restated Effective January 1, 2005

History
and Purpose

HORMEL FOODS CORPORATION, a Delaware corporation
(hereinafter, the “Company”), has previously established a nonqualified,
unfunded deferred compensation plan (the “Plan”) which is currently embodied in
a document titled “HORMEL FOODS CORPORATION EXECUTIVE DEFERRED INCOME PLAN II
(2002 Restatement),” effective November 1, 2002, as amended (the “Prior
Plan Statement”).  Deferred compensation
credited under the Plan which relates entirely to services performed on or
before December 31, 2004 shall continue to be governed by the terms of the
Prior Plan Statement, attached hereto as Appendix A.  Deferred compensation credited under the Plan
which relates all or in part to services performed on or after January 1,
2005 shall be governed by the terms of this Plan restatement, the terms of
which are intended to comply with the deferred compensation provisions in the
American Jobs Creation Act of 2004.

The purpose of this Plan is to provide specified
benefits to a select group of management or highly compensated Employees who
contribute materially to the continued growth, development and future business
success of Hormel Foods Corporation and its Affiliates and/or subsidiaries, if
any, that sponsor this Plan.  This Plan
shall be administered and construed so that it is unfunded for tax purposes and
for purposes of Title I of ERISA.

ARTICLE 1

Definitions

For the purposes of this Plan, unless otherwise
clearly apparent from the context, the following phrases or terms shall have
the following indicated meanings:

1.1                                 “Account Balance”
shall mean, with respect to a Participant, a credit on the records of the
Employer equal to the sum of (i) the Deferral Account balance,
(ii) the Discretionary Contribution Account balance, and (iii) the
Profit Sharing Account balance.  The
Account Balance, and each other specified account balance, shall be a
bookkeeping entry only and shall be utilized solely as a device for the
measurement and determination of the amounts to be paid to a Participant, or
his or her designated Beneficiary, pursuant to this Plan.

1.2                                 “Affiliate” shall mean
a business entity which is affiliated in ownership with the Principal Sponsor
or an Employer and is recognized as an Affiliate by the Principal Sponsor for
the purposes of this Plan.

 

1.3                                 “Annual Deferral
Amount” shall mean that portion of a Participant’s Base Annual Salary, Bonus,
LTIP Amounts, Operator Share Dividends and Operator Share Bonus that a
Participant defers in accordance with Article 3 for any one Plan
Year.  In the event of a Participant’s
Retirement, Disability (if deferrals cease in accordance with
Section 9.1), death or a Termination of Employment prior to the end of a
Plan Year, such year’s Annual Deferral Amount shall be the actual amount
withheld prior to such event.

1.4                                 “Annual Discretionary
Contribution Amount” shall mean, for any one Plan Year, the amount determined
in accordance with Section 3.5.

1.5                                 “Annual Profit Sharing
Amount” for any one Plan Year shall be the amount determined in accordance with
Section 3.6.

1.6                                 “Base Annual Salary”
shall mean the annual cash compensation relating to services performed during
any calendar year, excluding
operator share dividends, bonuses, commissions, overtime, fringe benefits,
stock options, relocation expenses, incentive payments, non-monetary
awards, director fees and other fees, and automobile and other allowances paid
to a Participant for employment services rendered (whether or not such
allowances are included in the Employee’s gross income).  Base Annual Salary shall be calculated before
reduction for compensation voluntarily deferred or contributed by the
Participant pursuant to all qualified or non-qualified plans of any
Employer and shall be calculated to include amounts not otherwise included in
the Participant’s gross income under Code Sections 125, 402(e)(3), 402(h),
or 403(b) pursuant to plans established by any Employer; provided, however,
that all such amounts will be included in compensation only to the extent that
had there been no such plan, the amount would have been payable in cash to the
Employee.

1.7                                 “Beneficiary” shall
mean one or more persons, trusts, estates or other entities, designated in
accordance with Article 12, that are entitled to receive benefits under
this Plan upon the death of a Participant.

1.8                                 “Beneficiary
Designation Form” shall mean the form established from time to time by the
Committee that a Participant completes, signs and returns to the Committee to
designate one or more Beneficiaries.

1.9                                 “Benefit Distribution
Date” shall mean the date that triggers distribution of a Participant’s Account
Balance.  A Participant’s Benefit
Distribution Date shall be determined upon the occurrence of any one of the
following events, whichever is earliest:

(a)                                  The date selected by
the Participant (in connection with his or her commencement of participation in
the Plan) from among the following (provided, however, that in
the event the Participant changes his or her Retirement Benefit or Termination
Benefit election in accordance with Section 7.2 or Section 8.2,
respectively, his or her Benefit Distribution Date under this
paragraph (a) shall be postponed in accordance with such Section):

 2
 

 

(i)                                     The date on which
the Participant Retires or experiences a Termination of Employment (except
that, in the case of a Participant who is a Specified Employee, the date that
is six months and one day immediately following the date on which the
Participant Retires or experiences a Termination of Employment);

(ii)                                  The January 1
immediately following the date on which the Participant Retires or experiences
a Termination of Employment (except that, in the case of a Participant who is a
Specified Employee, the date that is six months and one day immediately
following the date on which the Participant Retires or experiences a
Termination of Employment, if later than such January 1);

(iii)                               The later of:  (1) the date designated in (i) above; or
(2) the Participant’s attainment of an age specified by the Participant
(which cannot be later than age 65); or

(iv)                              The later of:  (1) the date designated in (ii) above;
or (2) the January 1 immediately following the Participant’s
attainment of an age specified by the Participant (which cannot be later than
age 65);

(b)                                 The date on which the
Committee is provided with proof that is satisfactory to the Committee of the
Participant’s death, if the Participant dies prior to the complete distribution
of his or her vested Account Balance; or

(c)                                  The date on which the
Committee determines the Participant is Disabled.

1.10                           “Board” shall mean the board
of directors of the Principal Sponsor.

1.11                           “Bonus” shall mean any
compensation, in addition to Base Annual Salary, LTIP Amounts, Operator Share
Dividends and Operator Share Bonus, payable to a Participant during a Plan
Year, under any bonus and cash incentive plans, excluding stock options.

1.12                           “Change in Control” shall
mean any of the following events or transactions:

(a)                                  A change in control
of a nature that would be required to be reported in response to Item 6(e)
of Schedule 14A of Regulation 14A promulgated under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), whether or not the
Principal Sponsor is then subject to such reporting requirement.

(b)                                 The public
announcement (which, for purposes of this definition, shall include, without
limitation, a report filed pursuant to Section 13(d) of the Exchange Act)
by the Principal Sponsor or any “person” (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act) that such person has become
the “beneficial owner” (as defined in Rule 13d-3 promulgated under
the Exchange Act), directly or indirectly, of securities of the Principal
Sponsor:

 3
 

 

(i)                                     Representing
twenty percent (20%) or more of the combined voting power of the Principal
Sponsor’s then outstanding securities unless the transaction resulting in such
ownership has been approved in advance by the “Continuing Directors” (as
hereinafter defined), or

(ii)                                  Representing more
than fifty percent (50%) of the combined voting power of the Principal Sponsor’s
then outstanding securities (regardless of any approval by the Continuing
Directors).

Provided, however, that notwithstanding the foregoing,
no Change in Control shall be deemed to have occurred by reason of the
ownership of twenty percent (20%) or more of the total voting capital stock of
the Principal Sponsor then issued and outstanding by:

(i)                                     The Principal
Sponsor, any subsidiary of the Principal Sponsor or any employee benefit plan
of the Principal Sponsor or of any subsidiary of the Principal Sponsor or any
entity holding shares of the Stock organized, appointed or established for, or
pursuant to the terms of, any such plan (any such person or entity described in
this clause is referred to herein as a “Principal Sponsor Entity”), or

(ii)                                  The Hormel
Foundation.

(c)                                  The announcement of a
tender offer by any person or entity (other than a Principal Sponsor Entity)
for twenty percent (20%) or more of the Principal Sponsor’s voting capital
stock then issued and outstanding, which tender offer has not been approved by
the Board, a majority of the members of which are the Continuing Directors, and
recommended to the stockholders of the Principal Sponsor.

(d)                                 The Continuing
Directors cease to constitute a majority of the Principal Sponsor’s Board of
Directors.

(e)                                  The stockholders of
the Principal Sponsor approve:

(i)                                     Any consolidation
or merger of the Principal Sponsor in which the Principal Sponsor is not the
continuing or surviving Principal Sponsor or pursuant to which shares of
Principal Sponsor stock would be converted to cash, securities or other
property, other than a merger of the Principal Sponsor in which the
stockholders immediately prior to the merger have the same proportionate
ownership of stock of the surviving Principal Sponsor immediately after the
merger; or

(ii)                                  Any sale, lease,
exchange or other transfer (in one transaction or a series of related
transactions) of all or substantially all of the assets of the Principal
Sponsor; or

 4
 

 

(iii)                               Any plan of liquidation
or dissolution of the Principal Sponsor.

For purposes of this
definition:

(i)                                     “Continuing
Director” shall mean any person who is a member of the Board of Directors of
the Principal Sponsor, while such person is a member of the Board of Directors,
who is not an “Acquiring Person” (as defined below) or an “Affiliate” or “Associate”
(each term as defined below) of an Acquiring Person, or a representative of an
Acquiring Person or of any such Affiliate or Associate, and who

(A)                              was a member of the Board
of Directors on the date of this Plan as first written above or

(B)                                subsequently becomes a
member of the Board of Directors,

if such person’s initial nomination for election or
initial election to the Board of Directors is recommended or approved by a
majority of the Continuing Directors.

(ii)                                  “Acquiring Person”
shall mean any “person” (as such term is used in Sections 13(d) and 14(d)
of the Exchange Act) who or which, together with all Affiliates and Associates
of such person, is the “beneficial owner” (as defined in Rule 13(d)-3
promulgated under the Exchange Act), directly or indirectly, of securities of
the Principal Sponsor representing twenty percent (20%) or more of the combined
voting power of the Principal Sponsor’s then outstanding securities, but shall
not include the Hormel Foundation or any Principal Sponsor Entity.

(iii)                               “Affiliate” and “Associate”
shall have their respective meanings ascribed to such terms in Rule 12b-2
promulgated under the Exchange Act.

1.13                           “Change in Control Benefit”
shall have the meaning set forth in Article 6.

1.14                           “Claimant” shall have the
meaning set forth in Section 17.1.

1.15                           “Code” shall mean the
Internal Revenue Code of 1986, as it may be amended from time to time.

1.16                           “Committee” shall mean the
committee described in Article 15.

1.17                           “Crediting Rate” shall mean,
for each Plan Year, an interest rate that is 120% of the applicable federal
long-term rate, as determined by the Compensation Committee of the Board,
in its sole discretion, and communicated to Participants, prior to the
beginning of each Plan Year.

 5
 

 

1.18                           “Deduction Limitation” shall
mean the limitation on a benefit that may otherwise be distributable pursuant
to the provisions of this Plan, as set forth in Article 4.

1.19                           “Deferral Account” shall
mean (i) the sum of all of a Participant’s Annual Deferral Amounts, plus
(ii) amounts credited in accordance with all the applicable crediting and
debiting provisions of this Plan that relate to the Participant’s Deferral
Account, less (iii) all distributions made to the Participant or his or
her Beneficiary pursuant to this Plan that relate to his or her Deferral
Account.

1.20                           “Disability” or “Disabled”
shall mean that a Participant is (i) unable to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months, or (ii) by reason of
any medically determinable physical or mental impairment which can be expected
to result in death or can be expected to last for a continuous period of not
less than 12 months, receiving income replacement benefits for a period of not
less than three months under an accident or health plan covering employees
of the Participant’s Employer.

1.21                           “Disability Benefit” shall
mean the benefit set forth in Article 9.

1.22                           “Discretionary Contribution
Account” shall mean (i) the sum of the Participant’s Annual Discretionary
Contribution Amounts, plus (ii) amounts credited or debited in accordance
with all the applicable crediting and debiting provisions of this Plan that
relate to the Participant’s Discretionary Contribution Account, less
(iii) all distributions made to the Participant or his or her Beneficiary
pursuant to this Plan that relate to the Participant’s Discretionary
Contribution Account.

1.23                           “Election Form” shall mean
the form established from time to time by the Committee that a Participant
completes, signs and returns to the Committee to make an election under the
Plan.

1.24                           “Employee” shall mean a
person who is an employee of any Employer.

1.25                           “Employer(s)” shall mean the
Principal Sponsor and/or any of its Affiliates and/or subsidiaries (now in
existence or hereafter formed or acquired) that have been selected by the Board
to participate in the Plan and have adopted the Plan as a sponsor.

1.26                           “ERISA” shall mean the
Employee Retirement Income Security Act of 1974, as it may be amended from time
to time.

1.27                           “In-Service
Distribution” shall mean the distribution set forth in Section 5.1.

1.28                           “Installment Method” shall
mean a series of payments, payable either monthly or annually, over the number
of years selected by the Participant. 
The Participant’s vested Account Balance shall be payable pursuant to a
Monthly Installment Method over the number of years selected by the Participant
in accordance with this Plan.

 6
 

 

1.29                           “LTIP Amounts” shall mean
any compensation payable to a Participant as an Employee under any Employer’s
long-term incentive plan or any other long-term incentive
arrangement designated by the Committee which is eligible for deferral in
accordance with Article 3, and includes payments made under the Hormel
Foods Corporation Long Term Incentive Plan.

1.30                           “Monthly Installment Method”
shall be a monthly installment payment over the number of years selected by the
Participant in accordance with this Plan, calculated as follows:  (i) for the first monthly installment,
the Participant’s vested Account Balance shall be calculated as of the close of
business on or around the Participant’s Benefit Distribution Date, as
determined by the Committee in its sole discretion, and (ii) for remaining
monthly installments, the Participant’s vested Account Balance shall be calculated
as of the close of business on or around on the last business day of the
preceding month, as determined by the Committee in its sole discretion.  Each monthly installment shall be calculated
by multiplying this balance by a fraction, the numerator of which is one and
the denominator of which is the remaining number of monthly payments due the
Participant.  By way of example, if the
Participant elects a ten (10) year Monthly Installment Method, the first
payment shall be 1/120 of the Participant’s vested Account Balance calculated
as described in this definition.  The
following month, the payment shall be 1/119 of the Participant’s vested Account
Balance calculated as described in this definition.

1.31                           “Operator Share Bonus” shall
mean any compensation payable to a Participant during the Principal Sponsor’s
fiscal year under the Hormel Foods Corporation Operator Share Incentive
Compensation Plan.

1.32                           “Operator Share Dividends”
shall mean any quarterly dividends payable to a Participant in cash during the
Principal Sponsor’s fiscal year under the Hormel Foods Corporation Operator
Share Incentive Compensation Plan.

1.33                           “Participant” shall mean any
Employee (i) who is selected to participate in the Plan, (ii) who
elects to participate in the Plan, (iii) who signs a Plan Agreement and an
Election Form, (iv) whose signed Plan Agreement and Election Form are
accepted by the Committee, (v) who commences participation in the Plan,
and (vi) whose Plan Agreement has not terminated.  A spouse or former spouse of a Participant
shall not be treated as a Participant in the Plan or have an account balance
under the Plan, even if he or she has an interest in the Participant’s benefits
under the Plan as a result of applicable law or property settlements resulting
from legal separation or divorce.

1.34                           “Plan” shall mean the Hormel
Foods Corporation Executive Deferred Income Plan II (2005 Restatement), which
shall be evidenced by this instrument and by each Plan Agreement, as they may
be amended from time to time.

1.35                           “Plan Agreement” shall mean
a written agreement, as may be amended from time to time, which is entered into
by and between an Employer and a Participant. 
Each Plan Agreement executed by a Participant and the Participant’s
Employer shall provide for the entire benefit to

 7
 

 

which such Participant is entitled under the
Plan; should there be more than one Plan Agreement, the Plan Agreement bearing
the latest date of acceptance by the Employer shall supersede all previous Plan
Agreements in their entirety and shall govern such entitlement.  The terms of any Plan Agreement may be
different for any Participant, and any Plan Agreement may provide additional
benefits not set forth in the Plan or limit the benefits otherwise provided
under the Plan; provided, however, that any such additional benefits or benefit
limitations must be agreed to by both the Employer and the Participant.

1.36                           “Plan Year” shall mean a
period beginning on January 1 of each year and continuing through
December 31 of such year.

1.37                           “Principal Sponsor” shall
mean Hormel Foods Corporation, a Delaware corporation, and any successor to all
or substantially all of the Hormel Foods Corporation’s assets or business.

1.38                           “Profit Sharing Account”
shall mean (i) the sum of all of a Participant’s Annual Profit Sharing
Amounts, plus (ii) amounts credited in accordance with all the applicable
crediting and debiting provisions of this Plan that relate to the Participant’s
Profit Sharing Account, less (iii) all distributions made to the
Participant or his or her Beneficiary pursuant to this Plan that relate to the
Participant’s Profit Sharing Account.

1.39                           “Profit Sharing Plan” shall
mean the Hormel Foods Corporation Joint Earnings Profit Sharing Trust Plan.

1.40                           “Retirement”, “Retire(s)” or
“Retired” shall mean, with respect to an Employee, separation from service (as
that term is defined under Section 409A of the Code) from all Employers on or
after the earlier of the attainment of age sixty-five (65) or (b) age
fifty-five (55) with fifteen (15) Years of Service for any reason other
than a leave of absence, death or Disability.

1.41                           “Retirement Benefit” shall
mean the benefit set forth in Article 7.

1.42                           “Specified Employee” shall
mean a key employee of the Employer or an Affiliate, within the meaning of
Section 409A of the Code and regulations issued thereunder.  In determining whether a Participant is a key
employee, the identification date to be used shall be December 31.

1.43                           “Stock” shall mean Hormel
Foods Corporation common stock, $0.01 par value, or any other equity securities
of the Principal Sponsor designated by the Committee.

1.44                           “Survivor Benefit” shall
mean the benefit set forth in Article 10.

1.45                           “Termination Benefit” shall
mean the benefit set forth in Article 8.

1.46                           “Termination of Employment”
shall mean the separation from service (as that term is defined under Section
409A of the Code) with all Employers, voluntarily or involuntarily, for any
reason other than Retirement, Disability, death or an authorized leave of
absence.  A transfer of

 8
 

 

employment with an Employer to employment
with an Affiliate of an Employer shall not constitute a Termination of
Employment.  If an Employer who is an
Affiliate (i.e., not the Principal Sponsor) ceases to be an Affiliate because
of a sale of substantially all the stock or assets of that Employer, then
Participants who are employed by that Employer and who cease to be employed by
that Employer in connection with the sale of substantially all the stock or
assets of that Employer shall be deemed to have thereby had a Termination of
Employment for the purposes of commencing distributions from this Plan.

1.47                           “Trust” shall mean one or
more trusts established pursuant to that certain Master Trust Agreement between
the Principal Sponsor and the trustee named therein, as amended from time to
time.

1.48                           “Unforeseeable Financial
Emergency” shall mean an unanticipated emergency that is caused by an event
beyond the control of the Participant that would result in severe financial
hardship to the Participant resulting from (i) a sudden and unexpected
illness or accident of the Participant, the Participant’s spouse, or a
dependent of the Participant, (ii) a loss of the Participant’s property
due to casualty, or (iii) such other similar extraordinary and
unforeseeable circumstances arising as a result of events beyond the control of
the Participant, all as determined in the sole discretion of the Committee.

1.49                           “Years of Service” shall
mean the total number of full years in which a Participant has been employed by
one or more Employers.  For purposes of
this definition, a year of employment shall be a 365 day period (or 366 day
period in the case of a leap year) that, for the first year of employment,
commences on the Employee’s date of hiring and that, for any subsequent year,
commences on an anniversary of that hiring date.  The Committee shall make a determination as
to whether any partial year of employment shall be counted as a Year of
Service.

ARTICLE 2

Selection, Enrollment, Eligibility

2.1                                 Selection by Committee.  Participation in the Plan shall be limited to
a select group of management and highly compensated Employees of the Employer,
as determined by the Committee in its sole discretion.  From that group, the Committee shall select, in
its sole discretion, Employees to participate in the Plan.

2.2                                 Enrollment and Eligibility Requirements; Commencement
of Participation.

(a)                                  As a condition to
participation, each selected Employee who is eligible to participate in the
Plan effective as of the first day of a Plan Year shall complete, execute and
return to the Principal Sponsor an Election Form and a Beneficiary Designation
Form prior to the first day of such Plan Year, or such other earlier deadline
as may be established by the Committee in its sole discretion.  In addition, the Committee shall establish
from time to

 9
 

 

time such other enrollment requirements as it
determines in its sole discretion are necessary.

(b)                                 A selected Employee
who first becomes eligible to participate in this Plan after the first day of a
Plan Year must complete these requirements within 30 days after he or she first
becomes eligible to participate in the Plan, or within such other earlier
deadline as may be established by the Committee, in his or her sole discretion,
in order to participate for that Plan Year. 
In such event, such person’s participation in this Plan shall not
commence earlier than 30 days after he or she first becomes eligible to
participate in the Plan, and such person shall not be permitted to defer under
this Plan any portion of his or her Base Salary, Bonus, LTIP Amounts, Operator
Share Dividends or Operator Share Bonus that are paid with respect to services
performed prior to his or her participation commencement date, except to the
extent permissible under Code Section 409A and related Treasury guidance
or Regulations.

(c)                                  Each selected
Employee who is eligible to participate in the Plan shall commence
participation in the Plan only after the Employee has met all enrollment
requirements set forth in this Plan and required by the Principal Sponsor,
including returning all required documents to the Principal Sponsor within the
specified time period.  Notwithstanding
the foregoing, the Principal Sponsor shall process such Participant’s deferral
election as soon as administratively practicable after such deferral election
is submitted to the Principal Sponsor.

(d)                                 If an Employee fails
to meet all requirements contained in this Section 2.2 within the period
required, that Employee shall not be eligible to participate in the Plan during
such Plan Year.

2.3                                 Termination of Participation and/or Deferrals.  The Committee shall have the right, in its
sole discretion, to (i) prevent the Participant from making future deferral
elections, and/or (ii) take further action that the Committee deems
appropriate.  In the event that a
Participant is no longer eligible to defer compensation under this Plan, the
Participant’s Account Balance shall continue to be governed by the terms of
this Plan until such time as the Participant’s Account Balance is paid in accordance
with the terms of this Plan.

ARTICLE 3

Deferral Commitments/Discretionary Contribution Amounts/Profit Sharing
Amounts/Vesting/Crediting/Taxes

3.1                                 Minimum Deferrals.

(a)                                  Base Annual Salary, Bonus, LTIP Amounts, Operator
Share Dividends and Operator Share Bonus.  For each Plan Year, a Participant may elect to
defer, as his or

 10
 

 

her Annual Deferral Amount, Base Annual
Salary, Bonus, LTIP Amounts and/or Operator Share Dividends in the following
minimum amounts for each deferral elected:

	
  Deferral

  	
   

  	
  Minimum Amount

  	
   

  
	
  Base Annual
  Salary

  	
   

  	
  $

  	
  0

  	
   

  
	
  Bonus

  	
   

  	
  $

  	
  2,000

  	
   

  
	
  LTIP Amounts

  	
   

  	
  $

  	
  2,000

  	
   

  
	
  Operator Share
  Dividends

  	
   

  	
  $

  	
  0

  	
   

  
	
  Operator Share Bonus

  	
   

  	
  $

  	
  2,000

  	
   

  

 

If an election is made for less than the stated
minimum amounts, or if no election is made, the amount deferred shall be zero.
If, at any time after the beginning of a Plan Year, a Participant has deferred
less than the stated minimum amounts for that Plan Year, any amount credited to
the Participant’s Account Balance as the Annual Deferral Amount for that Plan
Year shall be distributed to the Participant within 60 days after the last day
of the Plan Year.

(b)                                 Short Plan Year.  Notwithstanding the foregoing, if a
Participant first becomes a Participant after the first day of a Plan Year, the minimum Annual Deferral Amount shall
be an amount equal to the minimum set forth above, multiplied by a fraction,
the numerator of which is the number of complete months remaining in the Plan
Year and the denominator of which is 12.

3.2                                 Maximum Deferral.

(a)                                  Base Annual Salary, Bonus, LTIP Amounts and Operator
Share Dividends and Operator Share Bonus.  For each Plan Year, a Participant may elect
to defer, as his or her Annual Deferral Amount, Base Annual Salary, Bonus, LTIP
Amounts and/or Operator Share Dividends up to the following maximum percentages
for each deferral elected:

	
  Deferral

  	
   

  	
  Maximum Amount

  	
   

  
	
  Base Annual
  Salary

  	
   

  	
  40

  	
  %

  
	
  Bonus

  	
   

  	
  100

  	
  %

  
	
  LTIP Amounts

  	
   

  	
  100

  	
  %

  
	
  Operator Share
  Dividends

  	
   

  	
  40

  	
  %

  
	
  Operator Share Bonus

  	
   

  	
  100

  	
  %

  

 

(b)                                 Short Plan Year. 
Notwithstanding the foregoing, if a Participant first becomes a
Participant after the first day of a Plan Year, the maximum Annual Deferral
Amount (i) with respect to Base Annual Salary shall be limited to the
amount of compensation not yet earned by the Participant as of the date the
Participant submits a Plan Agreement

 11
 

 

and Election Form to the Committee for
acceptance, and (ii) with respect to Bonus, LTIP Amounts, Operator Share
Dividends and Operator Share Bonus shall be limited to those amounts deemed
eligible for deferral, in the sole discretion of the Committee.

3.3                                 Election to Defer; Effect of Election Form.

(a)                                  First Plan Year.  In connection with a Participant’s commence­ment
of participa­tion in the Plan, the Participant shall make an irrevocable
deferral election for the Plan Year in which the Participant commences
participation in the Plan, along with such other elections as the Committee
deems necessary or desirable under the Plan. 
For these elections to be valid, the Election Form must be completed and
signed by the Participant, timely delivered to the Committee (in accordance
with Section 2.2 above) and accepted by the Committee.

(b)                                 Subsequent Plan Years.  For each succeeding Plan Year, an irrevocable
deferral election for that Plan Year, and such other elections as the Committee
deems necessary or desirable under the Plan, shall be made by timely delivering
a new Election Form to the Committee, in accordance with its rules and
procedures, before the first day of the Plan Year for which the election is
made.  If no such Election Form is timely
delivered for a Plan Year, the Annual Deferral Amount shall be zero for that
Plan Year.

(c)                                  Fiscal Year Compensation. 
Notwithstanding the foregoing, an irrevocable election pertaining to an
Operator Share Bonus which qualifies as “fiscal year compensation” may be made
by timely delivering an Election Form to the Principal Sponsor, in accordance
with the terms of the Plan, before the first day of the Principal Sponsor’s
fiscal year for which the election is made. 
“Fiscal year compensation” shall mean compensation relating to a period
of service coextensive with one or more consecutive fiscal years of the
Employer, of which no amount is paid or payable during the service period.

(d)                                 Performance-Based Compensation. 
Notwithstanding the foregoing, an irrevocable deferral election
pertaining to Bonus and LTIP Amounts which qualify as “performance-based
compensation” may be made by timely delivering an Election Form to the
Principal Sponsor, in accordance with the terms of the Plan, no later than six
months before the end of the performance period.  “Performance-based compensation” shall
be compensation based on services performed over a period of at least 12
months, in accordance with Code Section 409A and related guidance.

3.4                                 Withholding and Crediting of Annual Deferral Amounts.  For each Plan Year, the Base Annual Salary
portion of the Annual Deferral Amount shall be withheld from each regularly
scheduled Base Annual Salary payroll in equal amounts, as adjusted from time to
time for increases and decreases in Base Annual Salary.  The Bonus, LTIP Amounts, Operator Share
Dividends and Operator Share Bonus shall be withheld at the time the Bonus,
LTIP Amounts, Operator Share Dividends or Operator Share Bonus are or otherwise
would be paid to the

 12
 

 

Participant, whether or not this occurs
during the Plan Year itself.  Annual
Deferral Amounts shall be credited to a Participant’s Deferral Account at the
time such amounts would otherwise have been paid to the Participant.

3.5                                 Annual Discretionary Contribution Amount.

(a)                                  For each Plan Year,
an Employer may be required to credit amounts to a Participant’s Discretionary
Contribution Account in accordance with employment or other agreements entered
into between the Participant and the Employer. 
Such amounts shall be credited on the date or dates prescribed by such
agreements.

(b)                                 For each Plan Year, an
Employer, in its sole discretion, may, but is not required to, credit any
amount it desires to any Participant’s Discretionary Contribution Account under
this Plan, which amount shall be for that Participant the Annual Discretionary
Contribution Amount for that Plan Year. 
The amount so credited to a Participant may be smaller or larger than
the amount credited to any other Participant, and the amount credited to any
Participant for a Plan Year may be zero, even though one or more other
Participants receive an Annual Discretionary Contribution Amount for that Plan
Year.  The Annual Discretionary
Contribution Amount described in this Section 3.5(b), if any, shall be
credited as of the last day of the Plan Year. 
If a Participant is not employed by an Employer as of the last day of a
Plan Year other than by reason of his or her Retirement or death while
employed, the Annual Discretionary Contribution Amount for that Plan Year shall
be zero.

3.6                                 Annual Profit Sharing Amount.  A Participant’s Annual Profit Sharing Amount
shall be equal to the difference between (i) the contributions that would
have been allocated to the Participant’s “account” under the Profit Sharing
Plan for the Plan Year, pursuant to the terms of the Profit Sharing Plan in
effect for such year, without giving effect to the limitations imposed on the
Profit Sharing Plan by Sections 415 and 401(a)(17) of the Code; and
(ii) the amount of the contributions actually allocated to the Participant’s
“account” under the Profit Sharing Plan for the Plan Year.  The amount so credited to a Participant under
this Plan shall be for that Participant the Annual Profit Sharing Amount for
that Plan Year and shall be credited to the Participant’s Profit Sharing
Account on a date or dates to be determined by the Committee, in its sole
discretion.  If a Participant is not
employed by an Employer as of the last day of a Plan Year, the Annual Profit
Sharing Amount for such Plan Year shall be zero.

3.7                                 Vesting.

(a)                                  A Participant shall
at all times be 100% vested in his or her Deferral Account and Profit Sharing
Account.

(b)                                 A Participant shall be
vested in his or her Discretionary Contribution Account in accordance with the
vesting schedule(s) set forth in his or her Plan Agreement, employment
agreement or any other agreement entered into between the Participant and

 13
 

 

his or her Employer.  If not addressed in such agreements, a Participant
shall vest in his or her Discretionary Contribution Account in accordance with
the schedule declared by the Committee in its sole discretion.

3.8                                 Crediting/Debiting of Account Balances.  In accordance with, and subject to, the rules
and procedures that are established from time to time by the Committee, in its
sole discretion, amounts shall be credited or debited to a Participant’s
Account Balance in accordance with the following rules:

(a)                                  Measurement Funds.  Subject to the restrictions found in this
Section 3.8, the Participant may elect one or more of the measurement
funds selected by the Committee, in its sole discretion, which are based on
certain mutual funds (the “Measurement Funds”), for the purpose of crediting or
debiting additional amounts to his or her Account Balance.  As necessary, the Committee may, in its sole
discretion, discontinue, substitute or add a Measurement Fund.  Each such action will take effect as of the
first day of the first calendar quarter that begins at least thirty (30) days
after the day on which the Committee gives Participants advance written notice
of such change.

(b)                                 Election of Measurement Funds.  Subject to the restrictions found in this
Section 3.8, a Participant, in connection with his or her initial deferral
election in accordance with Section 3.3(a) above, shall elect, on the
Election Form, one or more Measurement Fund(s) (as described above) to be used
to determine the amounts to be credited or debited to his or her Account
Balance.  If a Participant does not elect
any of the Measurement Funds as described in the previous sentence, the
Participant’s Account Balance shall automatically be allocated into the lowest-risk
Measurement Fund, as determined by the Committee, in its sole discretion.  Subject to the restrictions found in
Section 3.8, the Participant may (but is not required to) elect, by
submitting an Election Form to the Committee that is accepted by the Committee,
to add or delete one or more Measurement Fund(s) to be used to determine the
amounts to be credited or debited to his or her Account Balance, or to change
the portion of his or her Account Balance allocated to each previously or newly
elected Measurement Fund.  If an election
is made in accordance with the previous sentence, it shall apply as of the
first business day deemed reasonably practicable by the Committee, in its sole
discretion, and shall continue thereafter for each subsequent day in which the
Participant participates in the Plan, unless changed in accordance with the
previous sentence.

(c)                                  Declared Rate Measurement Fund.  Subject to the restrictions found in this
Section 3.8, a Participant may allocate or re-allocate any portion
of his or her Account Balance to the Declared Rate Measurement Fund, at any
time.  The rate of interest credited on
amounts allocated to the Declared Rate Measurement Fund shall be the Crediting
Rate and such interest shall be credited and compounded on a daily basis to a
Participant’s Account Balance.

 14

 

(d)                                 Proportionate Allocation.  In
making any election, the Participant shall specify on the Election Form, in
increments of one percent (1%), the percentage of his or her Account Balance to
be allocated to a Measurement Fund (as if the Participant was making an
investment in that Measurement Fund with that portion of his or her Account
Balance).

(e)                                  Crediting or Debiting Method. 
The performance of each elected Measurement Fund (either positive or
negative) will be determined by the Committee, in its reasonable discretion,
based on the performance of the Measurement Funds themselves.  A Participant’s Account Balance shall be
credited or debited on a daily basis based on the performance of each
Measurement Fund selected by the Participant, such performance being
determined by the Committee in its sole discretion.

(f)                                    No Actual Investment.  Notwithstanding any other provision of this
Plan that may be interpreted to the contrary, the Measurement Funds are to be
used for measurement purposes only, and a Participant’s election of any such
Measurement Fund, the allocation to his or her Account Balance thereto, the
calculation of additional amounts and the crediting or debiting of such amounts
to a Participant’s Account Balance shall  not be considered or
construed in any manner as an actual investment of his or her Account Balance
in any such Measurement Fund.  In the
event that the Principal Sponsor or the Trustee (as that term is defined in the
Trust), in its own discretion, decides to invest funds in any or all of the
investments on which the Measurement Funds are based, no Participant shall have
any rights in or to such investments themselves.  Without limiting the foregoing, a Participant’s
Account Balance shall at all times be a bookkeeping entry only and shall not
represent any investment made on his or her behalf by the Principal Sponsor or
the Trust; the Participant shall at all times remain an unsecured creditor of
the Principal Sponsor.

3.9                                 FICA and Other Taxes.

(a)                                  Annual Deferral Amounts.  For each Plan Year in which an Annual
Deferral Amount is being withheld from a Participant, the Participant’s
Employer(s) shall withhold from that portion of the Participant’s Base Annual
Salary, Bonus, LTIP Amounts, Operator Share Dividends and/or Operator Share
Bonus that are not being deferred, in a manner determined by the Employer(s),
the Participant’s share of FICA and other employment taxes on such Annual
Deferral Amount.  If necessary, the
Committee may reduce the Annual Deferral Amount in order to comply with this Section 3.9.

(b)                                 Annual Profit Sharing Amount.  When the Participant’s Employer(s) credits an
Annual Profit Sharing Amount to a Participant’s Profit Sharing Account, the
Participant’s Employer(s) shall withhold from the Participant’s Base Annual
Salary, Bonus, LTIP Amounts, Operator Share Dividends and/or Operator Share
Bonus that are not deferred, in a manner determined by the Employer(s), the
Participant’s share of FICA and other employment taxes.  If necessary, the Committee may reduce the
vested

 15
 

 

portion of the Participant’s Profit Sharing
Account in order to comply with this Section 3.9.

(c)                                  Discretionary Contribution Account.  When a Participant becomes vested in a
portion of his or her Discretionary Contribution Account, the Participant’s
Employer(s) shall withhold from the Participant’s Base Annual Salary, Bonus,
LTIP Amounts, Operator Share Dividends and/or Operator Share Bonus that are not
deferred, in a manner determined by the Employer(s), the Participant’s share of
FICA and other employment taxes.  If
necessary, the Committee may reduce the vested portion of the Participant’s
Discretionary Contribution Account in order to comply with this
Section 3.9.

(d)                                 Distributions.  The Participant’s Employer(s), or the trustee
of the Trust, shall withhold from any payments made to a Participant under this
Plan all federal, state and local income, employment and other taxes required
to be withheld by the Employer(s), or the trustee of the Trust, in connection
with such payments, in amounts and in a manner to be determined in the sole
discretion of the Employer(s) and the trustee of the Trust.

ARTICLE 4

Deduction Limitation

4.1                                 Deduction Limitation on Benefit Payments.  The Principal Sponsor may determine that as a
result of the application of the limitation under Code Section 162(m), a
distribution payable to a Participant pursuant to this Plan would not be
deductible if such distribution were made at the time required by the
Plan.  If the Principal Sponsor makes
such a determination, then the distribution shall not be paid to the
Participant until such time as the distribution first becomes deductible.  The amount of the distribution shall continue
to be adjusted in accordance with Section 3.8 above until it is distributed
to the Participant.  The amount of the distribution,
plus amounts credited or debited thereon, shall be paid to the Participant or
his or her Beneficiary (in the event of the Participant’s death) at the
earliest possible date, as determined by the Principal Sponsor, on which the
deductibility of compensation paid or payable to the Participant for the
taxable year of the Principal Sponsor during which the distribution is made
will not be limited by Section 162(m). 
Notwithstanding the foregoing, the Committee shall interpret this
provision in a manner that is consistent with Code Section 409A and other
applicable tax law, including but not limited to guidance issued after the
effective date of this Plan.

 16
 

 

ARTICLE 5

In-Service Distribution; Unforeseeable Financial Emergencies;

Withdrawal Election

5.1                                 In-Service Distribution.  In
connection with each election to defer an Annual Deferral Amount, a Participant
may irrevocably elect to receive an In-Service Distribution from the Plan
with respect to all or a portion of (i) the Annual Deferral Amount, (ii) the
Annual Discretionary Contribution Amount, and (iii) the Annual Profit
Sharing Amount.  The In-Service
Distribution shall be a lump sum payment in an amount that is equal to the
portion of the Annual Deferral Amount, the vested portion of the Annual Discretionary
Contribution Amount and the vested portion of the Annual Profit Sharing Amount
that the Participant elected to have distributed as an In-Service
Distribution, plus amounts credited or debited in the manner provided in
Section 3.8 above on that amount, calculated as of the close of business
on or around the date on which the In-Service Distribution becomes
payable, as determined by the Committee in its sole discretion.  Subject to the other terms and conditions of
this Plan, each In-Service Distribution elected shall be paid out during
a sixty (60) day period commencing immediately after the first day of any Plan
Year designated by the Participant.  The
Plan Year designated by the Participant must be at least three Plan Years after
the end of the Plan Year in which the Annual Deferral Amount is actually
deferred, or the vested portion of the Annual Discretionary Contribution Amount
or Annual Profit Sharing Amount is actually contributed.  By way of example, if an In-Service
Distribution is elected for Annual Deferral Amounts that are deferred in the
Plan Year commencing January 1, 2005, the In-Service Distribution
would become payable during a sixty (60) day period commencing January 1,
2009.  Notwithstanding the language set forth above, the Committee
shall, in its sole discretion, adjust the amount distributable as an In-Service
Distribution if any portion of the Annual Discretionary Contribution Amount or
Annual Profit Sharing Amount is unvested on the In-Service Distribution
Date.  A Participant may elect to change
to an allowable alternative payout date in accordance with this
Section 5.1 by submitting a new Election Form to the Committee, subject to
the following:

(a)                                  A
Participant may only elect to change an In-Service Distribution Date one
time;

(b)                                 Such
In-Service Distribution Election Form must be submitted to and accepted
by the Committee at least 12 months prior to the Participant’s previously designated In-Service
Distribution Date;

(c)                                  The
new In-Service Distribution Date selected by the Participant must be the
first day of a Plan Year, and must be at least five years after the previously designated In-Service
Distribution Date; and

(d)                                 The election of the new In-Service
Distribution Date shall have no effect until at least 12 months after the
date on which the election is made.

 17
 

 

5.2                                 Other Benefits Take Precedence Over In-Service
Distributions.  Should an
event occur that triggers a benefit under Article 6, 7, 8, 9 or 10, any
Annual Deferral Amount, plus amounts credited or debited thereon, that is
subject to an In-Service Distribution election under Section 5.1
shall not be paid in accordance with Section 5.1 but shall be paid in
accordance with the other applicable Article.

5.3                                 Withdrawal Payout/Suspensions for Unforeseeable
Financial Emergencies.  If the Participant experiences an
Unforeseeable Financial Emergency, the Participant may petition the Committee
(i) to suspend deferrals of Base Annual Salary, Bonus, LTIP Amounts,
Operator Share Dividends and Operator Share Bonus required to be made by such
Participant, to the extent deemed necessary by the Committee to satisfy the
Unforeseeable Financial Emergency, or (ii) to suspend deferrals of Base
Annual Salary, Bonus, LTIP Amounts, Operator Share Dividend and Operator Share
Bonus required to be made by such Participant, to the extent deemed necessary
by the Committee to satisfy the Unforeseeable Financial Emergency, and receive
a partial or full payout from the Plan. 
The payout shall not exceed the lesser of the Participant’s vested Account
Balance, excluding the portion of the Account Balance calculated as if such
Participant were receiving a Termination Benefit, or the amount reasonably
needed to satisfy the Unforeseeable Financial Emergency.  A Participant may not receive a payout from the
Plan to the extent that the Unforeseeable Financial Emergency is or may be
relieved (i) through reimbursement or compensation by insurance or
otherwise, (ii) by liquidation of the Participant’s assets, to the extent
the liquidation of such assets would not itself cause severe financial hardship
or (iii) by suspension of deferrals under this Plan.

If the Committee, in its sole discretion, approves a
Participant’s petition for suspension, the Participant’s deferrals under this
Plan shall be suspended as of the date of such approval.  If the Committee, in its sole discretion,
approves a Participant’s petition for suspension and payout, the Participant’s
deferrals under this Plan shall be suspended as of the date of such approval
and the Participant shall receive a payout from the Plan within sixty
(60) days of the date of such approval.

ARTICLE 6

Change in Control Benefit

6.1                                 Change in Control Benefit.  A Participant, in connection with his or her
commencement of participation in the Plan, shall irrevocably elect on an
Election Form whether to (i) receive a lump sum payment (the “Change in Control
Benefit”) in the event of the Participant’s Retirement or Termination of
Employment within six (6) months following the occurrence of a Change in
Control, which shall be equal to the Participant’s vested Account Balance,
calculated as of the close of business on or around the Participant’s Benefit
Distribution Date, as determined by the Committee in its sole discretion, or
(ii) to have his or her Account Balance remain subject to the terms and
conditions of the Participant’s Election Form pertaining to the Participant’s
Termination Benefit or Retirement Benefit, as applicable.  If a Participant does not make any election
with respect to the payment of the Change in Control Benefit, then such

 18
 

 

Participant’s Account Balance shall be
subject to the terms and conditions of the Participant’s Election Form
pertaining to the Participant’s Termination Benefit or Retirement Benefit, as
applicable.

6.2                                 Payment of Change in Control Benefit.  The Change in Control Benefit, if any, shall
be paid to the Participant in a lump sum no later than sixty (60) days after
the Participant’s Benefit Distribution Date, which for this purpose shall mean
the date on which the Participant Retires or experiences a Termination of
Employment (except that, in the case of a Participant who is a Specified
Employee, the date that is six months and one day following the date on which
the Participant Retires or experiences a Termination of Employment).  Notwithstanding the foregoing, the Committee
shall interpret all provisions in this Plan relating to a Change in Control
Benefit in a manner that is consistent with Code Section 409A and other
applicable tax law, including but not limited to guidance issued after the
effective date of this Plan.

ARTICLE 7

Retirement Benefit

7.1                                 Retirement Benefit.  A Participant who Retires shall receive, as a
Retirement Benefit, his or her vested Account Balance, calculated as of the
close of business on or around the occurrence of the Participant’s Benefit
Distribution Date, as determined by the Committee in its sole discretion.

7.2                                 Payment of Retirement Benefit.

(a)                                  A
Participant, in connection with his or her commencement of participation in the
Plan, shall elect on an Election Form to receive the Retirement Benefit in a
lump sum or pursuant to an Installment Method of two to twenty years (24 to 240
months) and shall select a Benefit Distribution Date.  The Participant may change this election by
submitting an Election Form to the Committee in accordance with the following
criteria:

(i)                                     The
election to modify the time and/or form of payment for such Account Balance
shall have no effect until at least 12 months after the date on which the
election is made;

(ii)                                  The
first payment related to such Account Balance shall be delayed at least five
years from the originally scheduled Benefit Distribution Date for such Account
Balance, as described in Section 1.11;

(iii)                               The
election to modify the Retirement Benefit shall have no effect until at least
12 months after the date on which the election is made; and

(iv)                              Notwithstanding
the foregoing, the Committee shall interpret all provisions relating to
changing the Retirement Benefit election under this Article 7 in a

 19
 

 

manner that is consistent with Code Section 409A and other
applicable tax law, including but not limited to guidance issued after the
effective date of this Plan.

(b)                                 The
Election Form most recently accepted by the Principal Sponsor shall govern the
payout of the Account Balance.  If a
Participant does not make any election with respect to the payment of the
Retirement Benefit, then such benefit shall be payable in a lump sum on the
January 1 immediately following the Participant’s Retirement (or, in the
case of a Specified Employee, the date that is six months and one day
immediately following the date on which the Participant Retires, if later than
such January 1).

(c)                                  The
lump sum payment shall be made, or installment payments shall commence, no
later than sixty (60) days after the Participant’s Benefit Distribution
Date.  Remaining monthly installments, if
any, shall be paid no later than fifteen (15) days after the last business day
of the preceding month.  Remaining annual
installments, if any, shall be paid no later than sixty (60) days after each
anniversary of Participant’s Benefit Distribution Date.

ARTICLE 8

Termination Benefit

8.1                                 Termination Benefit.  A Participant who experiences a Termination
of Employment shall receive a Termination Benefit, which shall be equal to the
Participant’s vested Account Balance, calculated as of the close of business on
or around the occurrence of the Participant’s Benefit Distribution Date, as
determined by the Committee in its sole discretion.

8.2                                 Payment of Termination Benefit.

(a)                                  A
Participant, in connection with his or her commencement of participation in the
Plan, shall select a Benefit Distribution Date. 
The Termination Benefit shall be paid to the Participant in a lump sum
payment no later than sixty (60) days after the Participant’s Benefit
Distribution Date.  The Participant may
change this election by submitting an Election Form to the Committee in
accordance with the following criteria:

(i)                                     The
election to modify the time of payment for such Account Balance shall have no
effect until at least 12 months after the date on which the election is made;

(ii)                                  The
first payment related to such Account Balance shall be delayed at least five
years from the originally scheduled Benefit Distribution Date for such Account
Balance, as described in Section 1.11;

(iii)                               The
election to modify the Termination Benefit shall have no effect until at least
12 months after the date on which the election is made; and

 20
 

 

(iv)                              Notwithstanding
the foregoing, the Committee shall interpret all provisions relating to
changing the Termination Benefit election under this Article 8 in a manner
that is consistent with Code Section 409A and other applicable tax law,
including but not limited to guidance issued after the effective date of this
Plan.

(b)                                 The
Election Form most recently accepted by the Principal Sponsor shall govern the
payout of the Account Balance.  If a
Participant does not make any election with respect to the payment of the
Termination Benefit, then such benefit shall be payable in a lump sum on the
January 1 immediately following the Participant’s Termination of
Employment (or, in the case of a Specified Employee, the date that is six
months and one day following the date on which the Participant incurs a
Termination of Employment, if later than such January 1).

ARTICLE 9

Disability Waiver and Benefit

9.1                                 Disability Waiver.  A Participant who is determined to be
suffering from a Disability shall be excused from fulfilling that portion of
the Annual Deferral Amount commitment that would otherwise have been withheld
from a Participant’s Base Annual Salary, Bonus, LTIP Amounts, Operator Share
Dividends and/or Operator Share Bonus during the remainder of the Plan Year in
which the Participant first suffers the Disability.  During the period of Disability, the
Participant shall not be allowed to make any additional deferral elections.

9.2                                 Disability Benefit.

(a)                                  Disability Benefit. 
Upon a Participant’s Disability, the Participant shall receive a
Disability Benefit, which shall be equal to the Participant’s vested Account
Balance, calculated as of the close of business on or around the Participant’s
Benefit Distribution Date.

(b)                                 Payment of Disability Benefit.  If
the Disabled Participant is not otherwise eligible to Retire, the Participant
shall receive his or her Disability Benefit in a lump sum payment no later than
sixty (60) days after his or her Benefit Distribution Date.  If the Disabled Participant is eligible to
Retire, the Participant shall receive his or her Disability Benefit in the same
form in which such Participant elected to receive his or her Retirement
Benefit, commencing no later than sixty (60) days after the Disabled
Participant’s Benefit Distribution Date.  Remaining monthly installments, if any, shall
be paid no later than fifteen (15) days after the last business day of the
preceding month.  Remaining annual
installments, if any, shall be paid no later than sixty (60) days after each
anniversary of Participant’s Benefit Distribution Date.

 21
 

 

ARTICLE
10

Survivor Benefit

10.1                           Survivor Benefit.  The Participant’s Beneficiary(ies) shall
receive a Survivor Benefit upon the Participant’s death which will be equal to
(i) the Participant’s vested Account Balance, calculated as of the close
of business on or around the date of the Participant’s death, if the
Participant dies prior to his or her Retirement, Termination of Employment or
Disability, or (ii) the Participant’s unpaid Retirement Benefit or
Disability Benefit, calculated as of the close of business on or around the
date of the Participant’s death, if the Participant dies before his or her
Retirement Benefit or Disability Benefit is paid in full.

10.2                           Payment of Survivor Benefit.  A Participant, in connection with his or her
commencement of participation in the Plan, shall elect on an Election Form to
have the Survivor Benefit paid to his or her Beneficiary(ies) in a lump sum or
pursuant to an Installment Method of two to twenty years (24 to 240
months).  If a Participant does not make
any election with respect to the payment of the Survivor Benefit, then such
benefit shall be payable in a lump sum. 
The lump sum payment shall be made, or installment payments shall
commence, no later than sixty (60) days after the date on which the Committee
is provided with proof that is satisfactory to the Committee of the Participant’s
death.  Remaining monthly installments,
if any, shall be paid no later than fifteen (15) days after the last business
day of the preceding month.  Remaining
annual installments, if any, shall be paid no later than sixty (60) days after
each anniversary of Participant’s Benefit Distribution Date.

ARTICLE 11

Forfeiture of Benefits

11.1                           Forfeiture of Benefits.  Notwithstanding any provision in this Plan or
a Participant’s Plan Agreement to the contrary, a Participant’s Account Balance
shall not be credited or debited in the manner provided in Section 3.8 and
no distribution shall be made to a Participant while a Participant engages in
the following:

(a)                                  Intentional
conduct resulting in material harm to Hormel or an Affiliate; or

(b)                                 In
any employment or self-employment with a competitor of Hormel or an
Affiliate within the geographical area which is then served by Hormel or an
Affiliate during the Participant’s employment or during a period of two (2)
years after the termination of the Participant’s employment.

Any dispute arising under or with respect to this
Section 11.1 shall be subject to the claims procedure set forth in
Article 17.

 22
 

 

ARTICLE
12

Beneficiary Designation

12.1                           Right to Designate.  Each Participant may designate, upon forms to
be furnished by and filed with the Committee, one or more primary Beneficiaries
or contingent Beneficiaries to receive all or a specified part of such
Participant’s Account Balance in the event of such Participant’s death.  The Participant may change or revoke any such
designation from time to time without notice to or consent from any
Beneficiary.  No such designation, change
or revocation shall be effective unless executed by the Participant and received
by the Committee during the Participant’s lifetime.

12.2                           Failure of Designation.  If a Participant:

(a)                                  Fails
to designate a Beneficiary,

(b)                                 Designates
a Beneficiary and thereafter revokes such designation without naming another
Beneficiary, or

(c)                                  Designates
one or more Beneficiaries and all such Beneficiaries so designated fail to
survive the Participant,

such Participant’s Account Balance, or the part
thereof as to which such Participant’s designation fails, as the case may be,
shall be payable to the first class of the following classes of automatic
Beneficiaries with a member surviving the Participant and (except in the case
of surviving issue) in equal shares if there is more than one member in such
class surviving the Participant:

Participant’s surviving spouse

Participant’s surviving issue per stirpes and not per capita

Participant’s surviving parents

Participant’s surviving brothers and sisters

Representative of Participant’s estate.

12.3                           Disclaimers by Beneficiaries.  A Beneficiary entitled to a distribution of
all or a portion of a deceased Participant’s Account Balance may disclaim an
interest therein subject to the following requirements.  To be eligible to disclaim, a Beneficiary
must be a natural person, must not have received a distribution of all or any
portion of the Account Balance at the time such disclaimer is executed and
delivered, and must have attained at least age twenty-one (21) years as
of the date of the Participant’s death. 
Any disclaimer must be in writing and must be executed personally by the
Beneficiary before a notary public.  A
disclaimer shall state that the Beneficiary’s entire interest in the
undistributed Account Balance is disclaimed or shall specify what portion
thereof is disclaimed.  To be effective,
duplicate original executed copies of the disclaimer must be both executed and
actually delivered to the Committee after the date of the Participant’s death
but not later than forty-five (45) days after the date of the Participant’s

 23
 

 

death. 
A disclaimer shall be irrevocable when delivered to the Committee.  A disclaimer shall be considered to be
delivered to the Committee only when actually received by the Committee.  The Committee shall be the sole judge of the
content, interpretation and validity of a purported disclaimer.  Upon the filing of a valid disclaimer, the
Beneficiary shall be considered not to have survived the Participant as to the
interest disclaimed.  A disclaimer by a Beneficiary shall not be
considered to be a transfer of an interest in violation of the provisions in
Section 19.4 and shall not be considered to be an assignment or alienation
of benefits in violation of federal law prohibiting the assignment or
alienation of benefits under this Plan. 
No other form of attempted disclaimer shall be recognized by the
Committee.

12.4                           Definitions.  When used herein and, unless the Participant
has otherwise specified in the Participant’s Beneficiary Designation Form, when
used in a Beneficiary designation, “issue” means all persons who are lineal
descendants of the person whose issue are referred to, including legally
adopted descendants and their descendants but not including illegitimate
descendants and their descendants; “child” means an issue of the first
generation; “per stirpes” means in equal shares among living children of the
person whose issue are referred to and the issue (taken collectively) of each
deceased child of such person, with such issue taking by right of
representation of such deceased child; and “survive” and “surviving” mean
living after the death of the Participant.

12.5                           Special Rules.  Unless the Participant has otherwise
specified in the Participant’s Beneficiary Designation Form, the following
rules shall apply:

(a)                                  If
there is not sufficient evidence that a Beneficiary was living at the time of
the death of the Participant, it shall be deemed that the Beneficiary was not
living at the time of the death of the Participant.

(b)                                 The
automatic Beneficiaries specified in Section 12.2 and the Beneficiaries
designated by the Participant shall become fixed at the time of the Participant’s
death so that, if a Beneficiary survives a Participant but dies before receipt
of the payment due such Beneficiary hereunder, such payment shall be payable to
the representative of such Beneficiary’s estate.

(c)                                  If
the Participant designates as a Beneficiary the person who is the Participant’s
spouse on the date of the designation, either by name or by relationship, or
both, the dissolution, annulment or other legal termination of the marriage
between the Participant and such person shall automatically revoke such
designation.  (The foregoing shall not
prevent the Participant from designating a former spouse as a Beneficiary on
the Beneficiary Designation Form executed by the Participant and received by
the Committee after the date of the legal termination of the marriage between
the Participant and such former spouse, and during the Participant’s lifetime.)

 24
 

 

(d)                                 Any
designation of a nonspouse Beneficiary by name that is accompanied by a
description of relationship to the Participant shall be given effect without
regard to whether the relationship to the Participant exists either then or at
the Participant’s death.

(e)                                  Any
designation of a Beneficiary only by statement of relationship to the
Participant shall be effective only to designate the person or persons standing
in such relationship to the Participant at the Participant’s death.

A Beneficiary designation is permanently void if it
either is executed or is filed by a Participant who, at the time of such
execution or filing, is then a minor under the law of the state of the
Participant’s legal residence.  The
Committee shall be the sole judge of the content, interpretation and validity
of a purported Beneficiary designation.

12.6                           No Spousal Rights.  No spouse or surviving spouse of a
Participant and no person designated to be a Beneficiary shall have any rights
to or interest in the benefits accumulated under this Plan including, but not
limited to, the right to be the sole Beneficiary or to consent to the
designation of Beneficiaries (or the changing of designated Beneficiaries) by
the Participant.

12.7                           Death Prior to Full Distribution.  If, at the death of the Participant, any
payment to the Participant was due or otherwise pending but not actually paid,
the amount of such payment shall be included in the Account Balance which is
payable to the Beneficiary (and shall not be paid to the Participant’s estate).

12.8                           Discharge of Obligations.  The payment of benefits under the Plan to a
Beneficiary shall fully and completely discharge all Employers and the Committee
from all further obligations under this Plan with respect to the Participant,
and that Participant’s Plan Agreement shall terminate upon such full payment of
benefits.

ARTICLE 13

Leave of Absence

13.1                           Paid Leave of Absence.  If a Participant is authorized by the
Participant’s Employer to take a paid leave of absence from the employment of
the Employer, the Participant shall continue to be considered eligible for the
benefits provided in Articles 5, 6, 7, 8, 9 or 10 in accordance with the
provisions of those Articles.

13.2                           Unpaid Leave of Absence.  If a Participant is authorized by the
Participant’s Employer to take an unpaid leave of absence from the employ­ment
of the Employer, such Participant shall continue to be eligible for the
benefits provided in Articles 5, 6, 7, 8, 9 or 10 in accordance with the
provisions of those Articles.  However,
the Participant shall be excused from fulfilling that portion of the Annual
Deferral Amount commitment that would otherwise have been withheld from such
Participant’s Base Annual Salary, Bonus, LTIP Amounts, Operator Share Dividends
and/or Operator Share Bonus during the remainder of the Plan Year in which the
unpaid leave

 25
 

 

of absence is taken.  During the unpaid leave of absence, the
Participant shall not be allowed to make any additional deferral
elections.  However, if the Participant
returns to employment, the Participant may elect to defer an Annual Deferral
Amount for the Plan Year following his or her return to employment and for
every Plan Year thereafter while a Participant in the Plan.

ARTICLE 14

Termination, Amendment or Modification

14.1                           Termination.  Although each Employer anticipates that it
will continue the Plan for an indefinite period of time, there is no guarantee
that any Employer will continue to sponsor the Plan in the future.  Accordingly, each Employer reserves the right
to discontinue its sponsorship of the Plan at any time with respect to any or
all of its participating Employees, by action of its board of directors;
provided, however, the Board shall have the sole authority to terminate the
Plan at any time.  If there is a
termination of the Plan with respect to all Participants, the Employer shall
have the right, in its sole discretion, and notwithstanding any elections made
by the Participant, to amend the Plan to immediately pay all benefits in a lump
sum following such Plan termination, to the extent permissible under Section
409A of the Code and related Treasury regulations and guidance.  Notwithstanding the foregoing, , that the
Participant’s vested accrued benefit as of the date of such amendment or
termination, if any, shall not be, without the written consent of the
Participant, diminished or delayed by such amendment or termination.

14.2                           Amendment.  The Compensation Committee of the Board may,
at any time, amend or modify the Plan in whole or in part; provided, however,
that:  (i) no amendment or
modification shall be effective to decrease or restrict the value of a
Participant’s vested Account Balance in existence at the time the amendment or
modification is made, calculated as if the Participant had experienced a
Termination of Employment as of the effective date of the amendment or
modification or, if the amendment or modification occurs after the date upon
which the Participant was eligible to Retire, the Participant had Retired as of
the effective date of the amendment or modification, and (ii) no amendment
or modification of this Section 14.2 shall be effective.  The amendment or modification of the Plan
shall not affect any Participant or Beneficiary who has become entitled to the
payment of benefits under the Plan as of the date of the amendment or
modification; provided, however, if there is a termination of the Plan with
respect to all Participants, the Employer shall have the right, in its sole
discretion, and notwithstanding any elections made by the Participant, to amend
the Plan to immediately pay all benefits in a lump sum following such Plan
termination, to the extent permissible under Section 409A of the Internal Revenue
Code.

14.3                           Plan Agreement.  Despite the provisions of Sections 14.1
and 14.2 above, if a Participant’s Plan Agreement contains benefits or
limitations that are not in this Plan document, the Employer may only amend or
terminate such provisions with the written consent of the Participant.

 26

 

14.4                           Effect of Payment.  The full payment of the Participant’s vested
Account Balance under Articles 5, 6, 7, 8, 9 or 10 of the Plan shall
completely discharge all obligations to a Participant and his or her designated
Beneficiaries under this Plan and the Participant’s Plan Agreement shall
terminate.

ARTICLE 15

Administration

15.1                           Committee Duties.  Except as otherwise provided in this
Article 15, this Plan shall be administered by the Compensation Committee
of the Board of Directors of the Principal Sponsor (the “Committee”).  The Committee shall have final authority to
interpret and construe the Plan and determine all factual and legal questions
under the Plan.  The Committee shall also
have the discretion and authority to (i) make, amend, interpret, and enforce
all appropriate rules and regulations for the administra­tion of this Plan and
(ii) decide or resolve any and all ques­tions including interpretations of
this Plan, as may arise in connection with the Plan.  When making a determination or calculation,
the Committee shall be entitled to rely on information furnished by a
Participant or the Principal Sponsor. 
Notwithstanding the foregoing, the Committee may delegate to the
Executive Committee of the Principal Sponsor the authority to:  (i) determine who is eligible to participate,
other than with respect to Section 16 Officers; (ii) decide claims for benefits
which are brought by Participants or Beneficiaries, other than with respect to
Section 16 Officers; and (iii) add or remove the Measuring Investments
available for Participants’ investment elections under Section 3.8.   Any individual serving on the Compensation
Committee or the Executive Committee who is a Participant shall not vote or act
on any matter relating solely to himself or herself or to any individual
superior to himself or herself in the organization.

15.2                           Agents. In the administration of this
Plan, the Committee may, from time to time, employ agents and delegate to them
such administrative duties as it sees fit (including acting through a duly
appointed representative) and may from time to time consult with counsel who
may be counsel to any Employer.

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

15.4                           Indemnity of Committee.  All Employers shall indemnify and hold
harmless the members of the Committee, any Employee to whom the duties of the
Committee may be delegated, and the Administrator against any and all claims,
losses, damages, expenses or liabilities arising from any action or failure to
act with respect to this Plan, except in the case of willful misconduct by the
Committee, any of its members, any such Employee or the Administrator.

 27
 

 

15.5                           Employer Information.  To enable the Committee and/or Administrator
to perform its functions, the Principal Sponsor and each Employer shall supply
full and timely information to the Committee and/or Administrator, as the case
may be, on all matters relating to the compensation of its Participants, the
date and circum­stances of the Retirement, Disability, death or Termination of
Employment of its Participants, and such other pertinent information as the
Committee or Administrator may reasonably require.

ARTICLE 16

Other Benefits and Agreements

16.1                           Coordination with Other Benefits.  The benefits provided for a Participant and
Participant’s Beneficiary under the Plan are in addition to any other benefits
available to such Participant under any other plan or program for employees of
the Participant’s Employer.  The Plan
shall supplement and shall not supersede, modify or amend any other such plan
or program except as may otherwise be expressly provided.

ARTICLE 17

Claims Procedures

17.1                           Presentation of Claim.  Any Participant or Beneficiary of a deceased
Participant (such Participant or Beneficiary being referred to below as a “Claimant”)
may deliver to the Committee a written claim for a determination with respect
to the amounts distributable to such Claimant from the Plan.  If such a claim relates to the contents of a
notice received by the Claimant, the claim must be made within sixty
(60) days after such notice was received by the Claimant.  All other claims must be made within
180 days of the date on which the event that caused the claim to arise
occurred.  The claim must state with
particularity the determination desired by the Claimant.

17.2                           Notification of Decision.  The Committee shall consider a Claimant’s
claim within a reasonable time, but no later than ninety (90) days after
receiving the claim.  If the Committee
determines that special circumstances require an extension of time for
processing the claim, written notice of the extension shall be furnished to the
Claimant prior to the termination of the initial ninety (90) day period.  In no event shall such extension exceed a
period of ninety (90) days from the end of the initial period.  The extension notice shall indicate the
special circumstances requiring an extension of time and the date by which the
Committee expects to render the benefit determination.  The Committee shall notify the Claimant in
writing:

(a)                                  that
the Claimant’s requested determination has been made, and that the claim has
been allowed in full; or

 28
 

 

(b)                                 that
the Committee has reached a conclusion contrary, in whole or in part, to the
Claimant’s requested determination, and such notice must set forth in a manner
calculated to be understood by the Claimant:

(i)                                     the
specific reason(s) for the denial of the claim, or any part of it;

(ii)                                  specific
reference(s) to pertinent provisions of the Plan upon which such denial was
based;

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

(iv)                              an
explanation of the claim review procedure set forth in Section 17.3 below;
and

(v)                                 a
statement of the Claimant’s right to bring a civil action under ERISA
Section 502(a) following an adverse benefit determination on review.

17.3                           Review of a Denied Claim.  On or before sixty (60) days after
receiving a notice from the Committee that a claim has been denied, in whole or
in part, a Claimant (or the Claimant’s duly authorized representative) may file
with the Committee a written request for a review of the denial of the
claim.  The Claimant (or the Claimant’s
duly authorized representative):

(a)                                  may,
upon request and free of charge, have reasonable access to, and copies of, all
documents, records and other information relevant to the claim for benefits;

(b)                                 may
submit written comments or other documents; and/or

(c)                                  may
request a hearing, which the Committee, in its sole discretion, may grant.

17.4                           Decision on Review.  The Committee shall render its decision on
review promptly, and no later than sixty (60) days after the Committee
receives the Claimant’s written request for a review of the denial of the
claim.  If the Committee determines that
special circumstances require an extension of time for processing the claim,
written notice of the extension shall be furnished to the Claimant prior to the
termination of the initial sixty (60) day period.  In no event shall such extension exceed a
period of sixty (60) days from the end of the initial period.  The extension notice shall indicate the
special circumstances requiring an extension of time and the date by which the
Committee expects to render the benefit determination.  In rendering its decision, the Committee
shall take into account all comments, documents, records and other information
submitted by the Claimant relating to the claim, without regard to whether such
information was submitted or considered in the initial benefit
determination.  The decision must be
written in a manner calculated to be understood by the Claimant, and it must
contain:

(a)                                  specific
reasons for the decision;

 29
 

 

(b)                                 specific
reference(s) to the pertinent Plan provisions upon which the decision was
based;

(c)                                  a
statement that the Claimant is entitled to receive, upon request and free of
charge, reasonable access to and copies of, all documents, records and other
information relevant (as defined in applicable ERISA regulations) to the
Claimant’s claim for benefits; and

(d)                                 a
statement of the Claimant’s right to bring a civil action under ERISA
Section 502(a).

17.5                           Legal Action.  A Claimant’s compliance with the foregoing
provisions of this Article 17 is a mandatory prerequisite to a Claimant’s
right to commence any legal action with respect to any claim for benefits under
this Plan.

ARTICLE 18

Trust

18.1                           Establishment of the Trust.  In order to provide assets from which to
fulfill the obligations of the Participants and their beneficiaries under the
Plan, the Principal Sponsor may establish a Trust by a trust agreement with a
third party, the trustee, to which each Employer may, in its discretion,
contribute cash or other property, including securities issued by the Principal
Sponsor, to provide for the benefit payments under the Plan.

18.2                           Interrelationship of the Plan and the Trust.
 The provisions of the Plan and the
Plan Agreement shall govern the rights of a Participant to receive
distributions pursuant to the Plan.  The
provisions of the Trust shall govern the rights of the Employers, Participants
and the creditors of the Employers to the assets transferred to the Trust.  Each Employer shall at all times remain
liable to carry out its obligations under the Plan.

18.3                           Distributions From the Trust.  Each Employer’s obligations under the Plan
may be satisfied with Trust assets distributed pursuant to the terms of the
Trust, and any such distribution shall reduce the Employer’s obligations under
this Plan.

ARTICLE 19

Miscellaneous

19.1                           Status of Plan.  The Plan is intended to be a plan that is not
qualified within the meaning of Code Section 401(a) and that “is unfunded
and is maintained by an employer primarily for the purpose of providing
deferred compensation for a select group of management or highly compensated
employees” within the meaning of ERISA Sections 201(2), 301(a)(3) and
401(a)(1).  The Plan shall be
administered and interpreted to the extent possible in a manner consistent with
that intent.

 30
 

 

19.2                           Unsecured General Creditor.  Participants and their Bene­ficiaries, heirs,
successors and assigns shall have no legal or equitable rights, interests or
claims in any property or assets of an Employer.  For purposes of the payment of benefits under
this Plan, any and all of an Employer’s assets shall be, and remain, the
general, unpledged unrestricted assets of the Employer.  An Employer’s obligation under the Plan shall
be merely that of an unfunded and unsecured promise to pay money in the future.

19.3                           Employer’s Liability.  An Employer’s liability for the payment of
benefits shall be defined only by the Plan and the Plan Agreement, as entered
into between the Employer and a Participant. 
An Employer shall have no obliga­tion to a Participant under the Plan
except as expressly provided in the Plan and his or her Plan Agreement.

19.4                           Nonassignability.  Neither a Participant nor any other person
shall have any right to commute, sell, assign, transfer, pledge, anticipate,
mortgage or otherwise encumber, transfer, hypothecate, alienate or convey in
advance of actual receipt, the amounts, if any, payable hereunder, or any part
thereof, which are, and all rights to which are expressly declared to be,
unassignable and non-transfer­able. 
No part of the amounts payable shall, prior to actual payment, be
subject to seizure, attachment, garnishment or sequestration for the payment of
any debts, judgments, alimony or separate maintenance owed by a Participant or
any other person, be transferable by operation of law in the event of a
Participant’s or any other person’s bankruptcy or insolvency or be transferable
to a spouse as a result of a property settlement or otherwise.

19.5                           Not a Contract of Employment.  The terms and conditions of this Plan shall
not be deemed to constitute a contract of employment between any Employer and
the Participant.  Such employment is
hereby acknowledged to be an “at will” employment relationship that can be
terminated at any time for any reason, or no reason, with or without cause, and
with or without notice, unless expressly provided in a written employment
agreement.  Nothing in this Plan shall be
deemed to give a Participant the right to be retained in the service of any
Employer as an Employee or to inter­fere with the right of any Employer to discipline
or discharge the Participant at any time.

19.6                           Furnishing Information.  A Participant or his or her Beneficiary will
cooperate with the Committee by furnishing any and all information requested by
the Committee and take such other actions as may be requested in order to
facilitate the administra­tion of the Plan and the payments of benefits
hereunder, including but not limited to taking such physical examinations as
the Committee may deem necessary.

19.7                           Terms.  Whenever any words are used herein in the
masculine, they shall be construed as though they were in the feminine in all
cases where they would so apply; and whenever any words are used herein in the
singular or in the plural, they shall be construed as though they were used in
the plural or the singular, as the case may be, in all cases where they would
so apply.

 31
 

 

19.8                           Captions. 
The captions of the articles, sections and paragraphs of this Plan
are for convenience only and shall not control or affect the meaning or
construction of any of its provisions.

19.9                           Governing Law.  Subject to ERISA, the provisions of this Plan
shall be construed and interpreted according to the internal laws of the State
of Minnesota without regard to
its conflicts of laws principles.

19.10                     Notice.  Any notice or filing required or permitted to
be given to the Committee under this Plan shall be sufficient if in writing and
hand-delivered, or sent by registered or certified mail, to the address
below:

Hormel Foods Corporation

Attn: Corporate Secretary

1 Hormel Place

Austin, MN 55912

Such notice shall be deemed given as of the date of
delivery or, if delivery is made by mail, as of the date shown on the postmark
on the receipt for registration or certification.

Any notice or filing required or permitted to be given
to a Participant under this Plan shall be sufficient if in writing and hand-delivered,
or sent by mail, to the last known address of the Participant.

19.11                     Successors.  The provisions of this Plan shall bind and
inure to the benefit of the Participant’s Employer and its successors and
assigns and the Participant and the Participant’s designated Beneficiaries.

19.12                     Spouse’s Interest.  The interest in the benefits hereunder of a
spouse of a Participant who has predeceased the Participant shall automatically
pass to the Participant and shall not be transferable by such spouse in any
manner, including but not limited to such spouse’s will, nor shall such
interest pass under the laws of intestate succession.

19.13                     Validity.  In case any provision of this Plan shall be
illegal or invalid for any reason, said illegality or invalidity shall not
affect the remaining parts hereof, but this Plan shall be construed and
enforced as if such illegal or invalid provision had never been inserted
herein.

19.14                     Incompetent.  If the Committee determines in its discretion
that a benefit under this Plan is to be paid to a minor, a person declared
incompetent or to a person incapable of handling the disposition of that person’s
property, the Committee may direct payment of such benefit to the guardian,
legal representative or person having the care and custody of such minor,
incompetent or incapable person.  The
Committee may require proof of minority, incompetence, incapacity or
guardianship, as it may deem appropriate prior to distribution of the
benefit.  Any payment of a benefit shall
be a payment for the account of the Participant and 

 32
 

 

the Participant’s Beneficiary, as the case
may be, and shall be a complete discharge of any liability under the Plan for
such payment amount.

19.15                     Court Order.  The Committee is authorized to make any
payments directed by court order in any action in which the Plan or the
Committee has been named as a party.  In
addition, if a court determines that a spouse or former spouse of a Participant
has an interest in the Participant’s benefits under the Plan in connection with
a property settlement or otherwise, the Committee, in its sole discretion,
shall have the right, notwithstanding any election made by a Participant, to
immediately distribute the spouse’s or former spouse’s interest in the
Participant’s benefits under the Plan to that spouse or former spouse.

19.16                     Insurance.  The Employers, on their own behalf or on
behalf of the trustee of the Trust, and, in their sole discretion, may apply
for and procure insurance on the life of the Participant, in such amounts and
in such forms as the Trust may choose. 
The Employers or the trustee of the Trust, as the case may be, shall be
the sole owner and beneficiary of any such insurance.  The Participant shall have no interest
whatsoever in any such policy or policies, and at the request of the Employers
shall submit to medical examinations and supply such information and execute
such documents as may be required by the insurance company or companies to whom
the Employers have applied for insurance.

IN WITNESS WHEREOF, the Principal Sponsor has signed
this Plan document as of                         ,
2006.

	
   

  	
  “Principal Sponsor”

  
	
   

  	
  Hormel Foods
  Corporation, a Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
					

 

 33EXHIBIT 10.4

FOURTH AMENDMENT

OF

HORMEL SURVIVOR INCOME PLAN FOR EXECUTIVES

(1993 Restatement)

The “Hormel Survivor
Income Plan for Executives (1993 Restatement)” adopted by Hormel Foods
Corporation (“Hormel”), a Delaware corporation, on November 1, 1993, but
effective November 1, 1992, as heretofore amended by a First Amendment
adopted effective February 1, 1995 and October 29, 2000, and by a Second
Amendment adopted effective November 1, 2000 
and by a Third Amendment adopted effective February 23, 2001 (hereinafter
collectively referred to as the “Plan Statement”), is hereby amended as
follows:

1.                                      BASE SALARY DETERMINATIONS. 
Effective for determining Base Salary of individuals who are actively
employed at any time on or after October 29, 2006, Section 2(a) of the Plan
Statement shall be amended to read as follows:

(a)                                  Base Salary shall mean one-twelfth (1/12th) of the average annual rate of base salary
of a Participant from Hormel for the five (5) calendar years out of the ten
(10) consecutive calendar years immediately preceding the Participant’s death
or retirement, as applicable, which produce the highest average.  “Base Salary” shall include incentive
payments and bonuses; provided, however, that long-term incentive plan awards
earned on or after October 29, 2006 shall not be included.  Base Salary shall also include amounts that
would have been included in Base Salary but were voluntarily deferred under a
nonqualified deferred compensation plan maintained by Hormel.  Base Salary shall not include supplemental
unemployment benefits, contributions to any profit sharing or other qualified
plan, reimbursements of moving expenses or other expenses or disability
payments.  The Compensation Committee
shall determine whether a particular item of income constitutes “Base Salary”
if a question arises.

2.                                    RETIREE SURVIVOR BENEFIT DETERMINATIONS.  Effective for determining Survivor Benefits
of individuals who are actively employed at any time on or after October 29,
Section 2 of the Plan Statement shall be amended by the addition of the
following new Section 2(b) to read as follows (and all subsequent sections and
cross references thereto shall be renumbered accordingly):

(b)                                 Benefit Service shall mean a measure of a Participant’s service (stated as a number of
years and fractions of years) as defined under the Hormel Foods Corporation
Salaried Employees’ Pension Plan.

 

3.                                      RETIREE SURVIVOR BENEFIT DETERMINATIONS (PRE-2000 PARTICIPANTS).  Effective for determining Survivor Benefits
of individuals who are actively employed at any time on or after October 29,
2006 Sections 4.2.1 and 4.2.2 of the Plan Statement shall be amended to read as
follows:

4.2.1.                     Death During Employment.  If a Participant’s employment with Hormel ends because of his or her
death while an Executive (i.e., the Participant dies while still an employee
and an Executive), the Participant’s Beneficiary shall receive a Survivor
Benefit equal to sixty percent (60%) of the Participant’s Base Salary at the
time of the Participant dies.  A
Participant shall be considered an Executive after October 28, 2000, only (i)
during continued employment with Hormel while the employee is participating in
the Operators’ Share Plan, or (ii) after employment ends if such person retired
from Hormel while participating in the Operators’ Share Plan.  This Survivor Benefit shall be paid in two
hundred forty (240) equal monthly installments commencing on the first day of
the second month following the Participant’s death.  Notwithstanding the foregoing, if prior to
the time one hundred twenty (120) equal monthly installments have been paid,
there is no Surviving Spouse or Eligible Dependent Child entitled to payment,
the Survivor Benefit shall be paid to the Participant’s Beneficiary in no more
than one hundred twenty (120) equal monthly installments (minus the number of
monthly installments, if any, previously paid to a Surviving Spouse and
Eligible Dependent Children).

4.2.2.                     Death After Retirement.  If a
Participant (i) remains an Executive of Hormel until his or her Retirement, and
(ii) dies following such Retirement, then his or her Beneficiary shall receive
upon his death a Survivor Benefit equal to one percent (1%) of the Participant’s
Base Salary (determined as of such specified date), multiplied by the
Participant’s Benefit Service (determined as of such specified date), not to
exceed forty (40).  This Survivor Benefit
shall be paid in one hundred eighty (180) equal monthly installments commencing
on the first day of the second month following the Participant’s death.  Notwithstanding the foregoing, if prior to
the time one hundred twenty (120) equal monthly installments have been paid,
there is no Surviving Spouse or Eligible Dependent Child entitled to payment,
the Survivor Benefit shall be paid to the Participant’s Beneficiary in no more
than one hundred twenty (120) equal monthly installments (minus the number of
monthly installments, if any, previously paid to a Surviving Spouse and
Eligible Dependent Children).

4.                                      RETIREE SURVIVOR BENEFIT DETERMINATIONS (POST-2000 PARTICIPANTS).  Effective for determining Survivor Benefits
of individuals who are actively employed at any time on or after October 29,
2006, the introductory paragraph in Section 5.2.2 of the Plan Statement shall
be amended to read as follows:

5.2.2.                     Death After Retirement.  If a
Participant (i) remains an Executive of Hormel until his or her Retirement, and
(ii) dies following such Retirement, the Participant’s Surviving Spouse,
Eligible Dependent Children or Beneficiary shall receive upon his death a
Survivor Benefit equal to one percent (1%) of the Participant’s Base Salary
(determined as of such specified date), multiplied by the

 2
 

 

Participant’s Benefit Service (determined as of such
specified date), not to exceed forty (40). 
(A Participant shall be considered an Executive after October 28, 2000,
only (i) during continued employment with Hormel while the employee is
participating in the Operators’ Share Plan, or (ii) after employment ends if
such person retired from Hormel while participating in the Operators’ Share
Plan.)  This Survivor Benefit shall be
paid monthly, commencing on the first day of the second month following the
Participant’s death, in accordance with Option A below unless Hormel shall have
received prior to the Participant’s death an election made and signed by the
Participant, in such form as Hormel may prescribe, an affirmative election that
the benefit be paid in accordance with Option B below:

5.                                      SAVINGS CLAUSE.  Save and except
as herein expressly amended, the Plan Statement shall continue in full force
and effect.

 3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}]]