Document:

Pilgrim's Pride Corporation 2005 Deferred Compensation Plan

	
Exhibit 10.1

PILGRIM’S PRIDE CORPORATION

2005 DEFERRED COMPENSATION PLAN

EFFECTIVE AS OF JANUARY 1, 2005

	

DALDMS/516222.1 

	 	 	 
	

	Exhibit 10.1

 

	
ARTICLE I

 
	
TITLE AND DEFINITIONS

 
	
1

 

	
1.1

 
	
Definitions.

 
	
1

 

	
ARTICLE II

 
	
PARTICIPATION

 
	
6

 

	
2.1

 
	
Enrollment.

 
	
6

 

	
2.2

 
	
Participation.

 
	
6

 

	
ARTICLE III

 
	
DEFERRAL ELECTIONS

 
	
7

 

	
3.1

 
	
Elections to Defer Compensation.

 
	
7

 

	
3.2

 
	
Investment Elections.

 
	
8

 

	
ARTICLE IV

 
	
DEFERRAL ACCOUNTS AND TRUST FUNDING

 
	
8

 

	
4.1

 
	
Deferral Accounts.

 
	
8

 

	
4.2

 
	
Company Contribution Account.

 
	
9

 

	
4.3

 
	
Prior Plan Account.

 
	
9

 

	
4.4

 
	
Trust Funding.

 
	
10

 

	
ARTICLE V

 
	
VESTING

 
	
11

 

	
ARTICLE VI

 
	
DISTRIBUTIONS

 
	
11

 

	
6.1

 
	
Distribution of Deferred Compensation and Company Contributions.

 
	
11

 

	
6.2

 
	
Hardship Distribution.

 
	
13

 

	
6.3

 
	
Taxes.

 
	
13

 

	
6.4

 
	
Inability to Locate Participant.

 
	
13

 

	
6.5

 
	
Distributions from Prior Plan Account.

 
	
13

 

	
ARTICLE VII

 
	
ADMINISTRATION

 
	
14

 

	
7.1

 
	
The Committees.

 
	
14

 

	
7.2

 
	
Committee Action.

 
	
14

 

	
7.3

 
	
Powers and Duties of the Administrative Committee.

 
	
14

 

	 	 	 
	
7.4

 
	
Powers and Duties of the Oversight Committee.

 
	
15

 

	
7.5

 
	
Construction and Interpretation.

 
	
15

 

	
7.6

 
	
Information.

 
	
15

 

	
7.7

 
	
Compensation, Expenses and Indemnity.

 
	
15

 

	
7.8

 
	
Annual Statements.

 
	
16

 

	
7.9

 
	
Disputes.

 
	
16

 

	
ARTICLE VIII

 
	
MISCELLANEOUS

 
	
17

 

	
8.1

 
	
Unsecured General Creditor.

 
	
17

 

	
8.2

 
	
Restriction Against Assignment.

 
	
17

 

	
8.3

 
	
Withholding.

 
	
18

 

	
8.4

 
	
Amendment, Modification, Suspension or Termination.

 
	
18

 

	
8.5

 
	
Governing Law.

 
	
18

 

	
8.6

 
	
Receipt or Release.

 
	
18

 

	
8.7

 
	
Payments on Behalf of Persons Under Incapacity.

 
	
18

 

	
8.8

 
	
Limitation of Rights and Employment Relationship.

 
	
19

 

	
8.9

 
	
Severability.

 
	
19

 

	
8.10

 
	
Gender.

 
	
19

 

	
8.11

 
	
No Enlargement of Employee Rights.

 
	
19

 

	
8.12

 
	
Addresses.

 
	
19

 

	
8.13

 
	
Interpretation.

 
	
20

 

	
8.14

 
	
No Implied Rights or Obligations.

 
	
20

 

 

	
i

	 	 	 
	

	

PILGRIM’S PRIDE CORPORATION

2005 DEFERRED COMPENSATION PLAN

EFFECTIVE AS OF JANUARY 1, 2005

 

WHEREAS, Pilgrim’s Pride Corporation, a Delaware corporation (the "Company") has set forth its desire to establish this Deferred Compensation Plan as an unfunded plan for the purpose of providing deferred compensation for a select group of management or highly compensated employees for purposes of Title I of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"); 

 

NOW, THEREFORE, as of January 1, 2005, this Plan is hereby adopted to read as follows:

 

ARTICLE I  

 

 

TITLE AND DEFINITIONS

 

	1.1  	Definitions.

 

Whenever the following words and phrases are used in this Plan, with the first letter capitalized, they shall have the meanings specified below.

 

(a)  "Account" or "Accounts" shall mean the Deferral Account and the Company Contribution Account and any Prior Plan Account.

 

(b)  "Administrative Committee" shall mean the Administrative Committee appointed by the Board to administer the Plan in accordance with Article VII.

 

(c)  "Base Salary" shall mean a Participant's annual base salary, excluding bonus, commissions, incentive and all other remuneration for services rendered to Company and a Participating Company and prior to reduction for any salary contributions to a plan established pursuant to Section 125 of the Code, Section 132(f) of the Code or qualified pursuant to Section 401(k) of the Code.

 

(d)  "Beneficiary" or "Beneficiaries" shall mean the person or persons, including a trustee, personal representative or other fiduciary, last designated in writing by a Participant in accordance with procedures established by the Administrative Committee to receive the benefits specified hereunder in the event of the Participant's death. No beneficiary designation shall become effective until it is filed with the Administrative Committee. Any designation shall be revocable at any time through a written instrument filed by the Participant with the Administrative Committee with or without the consent of the previous Beneficiary. No designation of a Beneficiary other than the Participant's spouse shall be valid unless consented to in writing by such spouse. If there is no such designation or if there is no surviving designated Beneficiary, then the Participant's surviving spouse shall be the Beneficiary. If there is no surviving spouse to receive any benefits payable in accordance with the preceding sentence, the duly appointed and currently acting personal representative of the Participant's estate (which shall include either the Participant's probate estate or living trust) shall be the Beneficiary. In any case where there is no such personal representative of the Participant's estate duly appointed and acting in that capacity within 90 days after the Participant's death (or such extended period as the Administrative Committee determines is reasonably necessary to allow such personal representative to be appointed, but not to exceed 180 days after the Participant's death), then Beneficiary shall mean the person or persons who can verify by affidavit or court order to the satisfaction of the Administrative Committee that they are legally entitled to receive the benefits specified hereunder. In the event any amount is payable under the Plan to a minor, payment shall not be made to the minor, but instead be paid (i) to that person's living parent(s) to act as custodian, (ii) if that person's parents are then divorced, and one parent is the sole custodial parent, to such custodial parent, or (iii) if no parent of that person is then living, to a custodian selected by the Administrative Committee to hold the funds for the minor under the Uniform Transfers or Gifts to Minors Act in effect in the jurisdiction in which the minor resides. If no parent is living and the Administrative Committee decides not to select another custodian to hold the funds for the minor, then payment shall be made to the duly appointed and currently acting guardian of the estate for the minor or, if no guardian of the estate for the minor is duly appointed and currently acting within 60 days after the date the amount becomes payable, payment shall be deposited with the court having jurisdiction over the estate of the minor. Payment by the Company or a Participating Company pursuant to any unrevoked Beneficiary designation, or to the Participant's estate if no such designation exists, of all benefits owed hereunder shall terminate any and all liability of the Company and the Participating Company, as applicable.

 

(e)  "Board of Directors" or "Board" shall mean the Board of Directors of the Company.

 

(f)  "Bonuses" shall mean the bonuses determined as of the last day of the fiscal year of the Company, and payable only to an Eligible Employee employed by of the Company or a Participating Company on the first day of the next following Plan Year.

 

(g)  "Code" shall mean the Internal Revenue Code of 1986, as amended.

 

(h)  "Committee" shall mean the Administrative Committee and the Oversight Committee appointed by the Board to oversee and administer the Plan in accordance with Article VII.

 

(i)  "Company" shall mean Pilgrim’s Pride Corporation, a Delaware corporation, or any successor thereof, if its successor shall adopt this Plan.

 

(j)  "Company Contribution Account" shall mean the bookkeeping account maintained by the Company or any Participating Company for each Participant that is credited with an amount equal to the Company Contribution Amount, if any, and earnings and losses on such amounts pursuant to Section 4.2.

 

(k)  "Company Contribution Amount" shall mean the amount of the Company’s or a Participating Company’s matching contribution, if any, for a Participant under the Pilgrim’s Pride Retirement Savings Plan that is required to be reduced for a Plan Year pursuant to the operation of Code Section 401(m) and any other nonelective contributions allocable to a Participant that are made by the Company or a Participating Company.

 

(l)  "Compensation" shall include a Participant’s Base Salary plus Bonuses paid in a Plan Year.

 

(m)  "Deferral Account" shall mean the bookkeeping account maintained by the Administrative Committee for each Participant that is credited with amounts equal to (i) the portion of the Participant's Compensation that he or she elects to defer pursuant to Section 3.1, (ii) the amount of any Participant deferrals under the Pilgrim’s Pride Retirement Savings Plan that is required to be reduced for a Plan Year pursuant to the operation of Code Section 401(k) and that may be deferred under this Plan in accordance with Code Section 409A, and (iii) earnings and losses pursuant to Section 4.1.

 

(n)  "Disability" shall mean a Participant has, by reason of any medically determinable physical or mental impairment which can be expected to last for a continuous period of not less than twelve (12) months, received at least three months of salary continuation benefits under the Company’s or the Participating Company’s long-term disability plan. This definition shall be interpreted consistent with Code Section 409A(a)(2)(C).

 

(o)  "Distributable Amount" shall mean the vested balance in the Participant's Deferral Account and Company Contribution Account.

 

(p)  "Early Distribution" shall mean an election by Participant in accordance with Section 6.2 to receive a withdrawal of amounts from his or her Deferral Account and Company Contribution Account prior to the time at which such Participant would otherwise be entitled to such amounts.

 

(q)  "Effective Date" shall mean January 1, 2005 and covers amounts subject to deferral elections in 2004 and thereafter which would otherwise have been payable on or after January 1, 2005.

 

(r)  "Eligible Employee" shall mean any Employee whose Compensation for a Plan Year is expected during the Initial Election Period (and each subsequent election period) to be equal to or greater than the dollar amount used to determine if an employee is highly compensated within the meaning of Code Section 414q(1)(B)(i), as adjusted. In addition, an "Eligible Employee" shall mean a former employee of a Participating Company for whom a Prior Plan Account is established. An employee whose Initial Election Period occurs after the first day of a Plan Year shall be an Eligible Employee if his or her Compensation for the remainder of the Plan Year is reasonably expected to equal or exceed such dollar amount if Compensation is annualized. If, however, the actual Compensation of a Participant is less than such amount for a Plan Year, then such Participant shall not be an Eligible Employee for the next following Plan Year. In addition, the following Employees shall not be Eligible Employees:

 

(i)  Any Employee who is a nonresident alien and who receives no earned income (within the meaning of Code Section 911(d)(2)) from the Company or any Participating Company which constitutes income from sources within the United States (within the meaning of Code Section 861(a)(3)), unless the Employee is within a group or classification of nonresident alien Employees designated as eligible to participate in the Plan by the Board of Directors;

 

(ii)  Any Employee who is employed on a temporary basis, is a leased employee, or an independent contractor; and

 

(iii)  Any person who is not classified by the Company or any Participating Company on its payroll records as an Employee under Code Section 3121(d) (including, but not limited to, a person classified by the Company or any Participating Company as an independent contractor, a non-employee consultant or as an employee of any other entity), even if such classification is determined to be erroneous, or is retroactively revised by a governmental agency, by court order or as a result of litigation, or otherwise. In the event the classification of a person who was excluded from the definition of Eligible Employee under the preceding sentence is determined to be erroneous or is retroactively revised, the person shall nonetheless continue to be excluded from treatment as an Eligible Employee for all periods prior to the date the Company or any Participating Company specifically determines for purposes of eligibility to participate in the Plan that the classification of the person was erroneous or should be revised.

 

(s)  "Employee" shall mean each person currently employed as a regular employee of the Company or any Participating Company and solely for the purpose of maintaining a Prior Plan Account, any person formerly employed by a Participating Company.

 

(t)  "Fund" or "Funds" shall mean one or more of the investment funds selected by the Oversight Committee pursuant to Section 3.2(b).

 

(u)  "Hardship Distribution" shall mean a severe financial hardship to the Participant resulting from an illness or accident of the Participant or of his or her spouse or dependent (as defined in Code Section 152(a)), loss of a Participant's property due to casualty, or other similar or extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. The circumstances that would constitute an unforeseeable emergency will depend upon the facts of each case, but, in any case, a Hardship Distribution may not be made to the extent that such hardship is or may be relieved (i) through reimbursement or compensation by insurance or otherwise, or (ii) by liquidation of the Participant's assets, to the extent the liquidation of assets would not itself cause severe financial hardship.

 

(v)  "Initial Election Period" shall mean the 30-day period prior to the Effective Date of the Plan, or the 30-day period following the time an Employee shall be designated by the Company or a Participating Company as an Eligible Employee.

 

(w)  "Interest Rate" shall mean, for each Fund, an amount equal to the net gain or loss on the assets of such Fund during each business day.

 

(x)  "Key Employee" means a "key employee" as defined in Code Section 416(i) without regard to paragraph 5 thereof.

 

(y)  "Oversight Committee" shall mean the Oversight Committee appointed by the Board to oversee the Plan in accordance with Article VII.

 

(z)  "Participant" shall mean any Eligible Employee who becomes a Participant in this Plan in accordance with Article II.

 

(aa)  "Participating Company" shall include any corporation that is included in a controlled group of corporations within the meaning of Code Section 414(b) that includes the Company, and any trade or business that is under common control with the Company within the meaning of Code Section 414(c) but only if the Board of Directors of the Company permits such entity to participate in the Plan and the board of the Participating Company adopts this Plan. Participating Companies and the dates as of which they adopt the Plan shall be identified on Schedule A, attached hereto.

 

(bb)  "Payment Date" shall mean the date as soon as practicable after the date requested by a Participant following such Participant's Termination the case of distributions without a Scheduled Withdrawal Date, but not later than 12 months after the Participant’s Termination date. In the case of a Scheduled Withdrawal Date, the Payment Date shall be the date as elected by the Participant in accordance with Section 6.2 of the Plan.

 

(cc)  "Plan" shall mean the Pilgrim’s Pride Corporation 2005 Deferred Compensation Plan.

 

(dd)  "Plan Year" shall mean the Plan Year beginning January 1, 2005 and ending December 31, 2005. Each subsequent Plan Year shall begin on January 1 and end on December 31.

 

(ee)  "Prior Plan Account" shall mean the bookkeeping account maintained by the Administrative Committee for each Participant that is credited with amounts equal to ( i) the accrued liability for benefits under any nonqualified plan of a Participating Company that is merged with or transferred to this Plan with the permission of the Board of Directors of the Company, and (ii) earnings and losses pursuant to Section 4.3.

 

(ff)  "Retirement" shall mean the termination of employment with the Company or a Participating Company, as applicable, for any reason, other than death or Disability, on or after the Participant’s 55th birthday, provided, however, that, to the extent Retirement is treated as a separation from service under Code Section 409A(a)(2)(A), in the case of a Key Employee, Retirement for purposes of the Plan shall not be earlier than six (6) months following the Participant’s separation from service as determined pursuant to Treasury Regulations issued under Code Section 409A(a)(2)(A).

 

(gg)  "Scheduled Withdrawal Date" shall mean the distribution date elected by the Participant for an in-service withdrawal of amounts from such Accounts deferred in a given Plan Year, and earnings and losses attributable thereto, as set forth on the election form for such Plan Year.

 

(hh)  "Termination" means the date of a Participant’s separation from service with the Company, other than Retirement, provided that, in the case of a Key Employee, Termination other than as a result of death or Disability shall be deemed to be the date six (6) months following separation from service as determined pursuant to Treasury Regulations issued under Code Section 409A(a)(2)(A).

 

(ii)  "Trust" shall mean the Pilgrim’s Pride Corporation Deferred Compensation Plan Trust.

 

(jj)  "Trustee" shall mean Wells Fargo Bank (Texas) N.A.

 

(kk)  "Years of Service" shall mean a "year of service" as such term is defined in the Pilgrim’s Pride Retirement Savings Plan as in effect January 1, 2005, as amended from time to time.

 

ARTICLE II  

 

 

PARTICIPATION

 

	2.1  	Enrollment.

 

An Eligible Employee shall become a Participant in the Plan by completing the requirements as set forth below:

 

(a)  electing to defer a portion of his or her Compensation in accordance with Section 3.1;

 

(b)  completing an investment preference form as set forth in Section 3.2;

 

(c)  filing a life insurance application form along with his or her deferral election form or investment preference form; and

 

(d)  complying with such medical underwriting requirements as determined by the life insurance carrier selected by the Company. 

 

	2.2  	Participation.

 

An Eligible Employee who completes the requirements of the preceding Section 2.1 shall commence participation in this Plan as of the first day of the month in which Compensation is deferred, a Company Contribution Amount is credited or a Prior Plan Account is established, whichever occurs first. In the event it is determined by the Committee that a proposed life insurance policy for a Participant cannot be obtained in a cost efficient manner after medical underwriting requirements have been met, no policy will be obtained. Notwithstanding any provision to the contrary, if it is determined or reasonably believed, based on a judicial or administrative determination or an opinion of Company's legal counsel that a Plan Participant is not an Eligible Employee following his or her initial enrollment, such individual shall cease to be a Participant and, to the extent permitted by Code Section 409A, his or her Distributable Amount shall be paid to him or her in a lump sum as soon as practicable after the determination is made that he or she is not an Eligible Employee.

 

ARTICLE III  

 

 

DEFERRAL ELECTIONS

 

	3.1  	Elections to Defer Compensation.

 

(a)  Initial Election Period. Subject to the provisions of Article II, each Eligible Employee may elect to defer a portion of his or her Compensation by filing with the Administrative Committee an election that conforms to the requirements of this Section 3.1, on a form provided by the Administrative Committee, no later than the last day of his or her Initial Election Period.

 

(b)  General Rule. The amount of Compensation which an Eligible Employee may elect to defer is limited to such Compensation earned on or after the time at which the Eligible Employee elects to defer in accordance with Section 3.1(a) and shall be a flat dollar amount or percentage which shall not exceed 100% of the Eligible Employee's Compensation, provided that the total amount deferred by a Participant shall be limited in any calendar year, if necessary, to satisfy the Participant’s Social Security Tax obligation (including Medicare) on the amount of Compensation prior to any deferral election under this Plan, income tax and employee benefit plan withholding requirements as determined in the sole and absolute discretion of the Administrative Committee.

 

(c)  Duration of Compensation Deferral Election. An Eligible Employee's initial election to defer Compensation must be made prior to the Effective Date and is to be effective with respect to Compensation received after such deferral election is processed but only through the last day of the Plan Year. Thereafter, a Participant may commence, renew, increase, decrease or terminate a deferral election with respect to Compensation for any subsequent Plan Year by filing a new election not less than 15 days prior to the beginning of the next Plan Year or such earlier date as determined by the Administrative Committee, which election shall be effective on the first day of the next following Plan Year. In the case of an Employee who becomes an Eligible Employee after the Effective Date, such Eligible Employee shall have 30 days from the date he or she first becomes an Eligible Employee to make an Initial Election with respect to Compensation. Such election shall be effective for the remainder of the Plan Year, in the event the Plan Year has commenced.

 

(d)  Elections other than Elections during the Initial Election Period. Subject to the limitations of Section 3.1(b) above, any Eligible Employee who failed to file an initial election or whose prior Compensation deferral election has expired may elect to again defer Compensation, by filing an election on a form provided by the Administrative Committee to defer Compensation as described in Sections 3.1(b) and 3.1(c) above. An election to defer Compensation must be filed in a timely manner in accordance with Section 3.1(c).

 

(e)  Rescission of Deferral Election. A Participant may rescind his or her deferral election by filing a rescission election as permitted under Code Section 409A and the relevant transition rules in Section 885(f) of the American Jobs Creation Act of 2004 and Treasury Regulations issued thereunder on a form provided by the Administrative Committee which will become effective on the first pay period following the date the election is implemented in the Company’s or the Participating Company’s payroll system. Once a rescission election is filed with the Administrative Committee, the Participant will be unable to elect to participate in the Plan until the next following Plan Year.

 

(f)  Ineligibility. A Participant whose actual Compensation is below the threshold for a Plan Year shall cease to be an Eligible Employee for the next following Plan Year, and any election to defer Compensation for such Plan Year shall be null and void unless, in the Administrative Committee’s sole and exclusive determination, the Participant is likely to be an Eligible Employee in such succeeding Plan Year.

 

(g)  Irrevocable Election. Except as permitted under paragraph (e) above, once made Compensation deferral elections shall remain in force for the applicable Plan Year unless the Participant ceases to be an Eligible Employee, in which case contributions made while an Eligible Employee shall remain in the Plan until distribution as elected in accordance with Article VI.

 

	3.2  	Investment Elections.

 

(a)  At the time of making the deferral elections described in Section 3.1, and effective with the establishment of a Prior Plan Account for a Participant, the Participant shall select, on a form provided by the Oversight Committee, from among the types of Funds selected by the Oversight Committee in which the Participant's Account will be deemed to be invested in for purposes of determining the amount of earnings or losses to be credited to that Account. In making the selection pursuant to this Section 3.2, the Participant may specify that all or any multiple of his or her Account be deemed to be invested, in whole percentage increments, in one or more of the Funds provided under the Plan as communicated from time to time by the Oversight Committee. A Participant may change the selection made under this Section 3.2 by following such procedures and formats as the Administrative Committee shall authorize. If a Participant fails to elect a type of Fund under this Section 3.2, he or she shall be deemed to have elected the money market type of Fund.

 

(b)  Although the Participant may designate the type of investments, the Committee shall not be bound by such designation. The Oversight Committee shall select from time to time, in its sole and absolute discretion, commercially available investments of each of the types communicated by the Oversight Committee to the Participant pursuant to Section 3.2(a) above, which shall to be the Funds. The Interest Rate of each such commercially available investment Fund shall be used to determine the amount of earnings or losses to be credited to Participant's Account under Article IV.

 

ARTICLE IV  

 

 

DEFERRAL ACCOUNTS AND TRUST FUNDING

 

	4.1  	Deferral Accounts.

 

The Administrative Committee shall establish and maintain a Deferral Account for each Participant under the Plan. Each Participant's Deferral Account shall be further divided into separate subaccounts ("Fund subaccounts"), each of which corresponds to a Fund elected by the Participant pursuant to Section 3.2(a). A Participant's Deferral Account shall be credited as follows:

 

(a)  On the fifth business day after amounts are withheld and deferred from a Participant's Compensation, the Administrative Committee shall credit the Fund subaccounts of the Participant's Deferral Account with an amount equal to Compensation deferred by the Participant in accordance with the Participant's election under Section 3.2(a); that is, the portion of the Participant's deferred Compensation that the Participant has elected to be deemed to be invested in a certain type of Fund shall be credited to the Fund subaccount corresponding to that Fund;

 

(b)  Each business day, each Fund subaccount of a Participant's Deferral Account shall be credited with earnings or losses in an amount equal to that determined by multiplying the balance credited to such Fund subaccount as of the prior day plus contributions credited that day to the Fund subaccount by the Interest Rate for the corresponding fund selected by the Oversight Committee pursuant to Section 3.2(b).

 

(c)  In the event that a Participant elects for a given Plan Year's deferral of Compensation to have a Scheduled Withdrawal Date, all amounts attributed to the deferral of Compensation for such Plan Year shall be accounted for in a manner which allows separate accounting for the deferral of Compensation and investment gains and losses associated with such Plan Year's deferral of Compensation.

 

	4.2  	Company Contribution Account.

 

The Administrative Committee shall establish and maintain a Company Contribution Account for each Participant under the Plan. Each Participant's Company Contribution Account shall be further divided into separate Fund subaccounts corresponding to the Fund selected by the Participant pursuant to Section 3.2(a). A Participant's Company Contribution Account shall be credited as follows:

 

(a)  On the fifth business day after a Company Contribution Amount is made, the Administrative Committee shall credit the Fund subaccounts of the Participant's Company Contribution Account with an amount equal to the Company Contribution Amount, if any, which the Participant selected to be deemed to be invested in a certain type of Fund shall be credited to the corresponding investment Fund subaccount; and

 

(b)  Each business day, each Fund subaccount of a Participant's Company Contribution Account shall be credited with earnings or losses in an amount equal to that determined by multiplying the balance credited to such Fund subaccount as of the prior day plus contributions credited that day to the Fund subaccount by the Interest Rate for the corresponding Fund selected by the Oversight Committee pursuant to Section 3.2(b).

 

	4.3  	Prior Plan Account.

 

The Administrative Committee shall establish and maintain a Prior Plan Account for each Participant under the Plan whose benefit under this Plan includes amounts accrued under the prior nonqualified deferred compensation plan of a Participating Company, to the extent permitted by the Board. Each Participant's Prior Plan Account shall be further divided into Fund subaccounts, each of which corresponds to a Fund elected by the Participant pursuant to Section 3.2(a). A Participant's Prior Plan Account shall be credited as follows:

 

(a)  On the fifth business day after accrued benefits are assumed by this Plan, the Administrative Committee shall credit the Fund subaccounts of the affected Participant's Prior Plan Account with an amount equal to such accrued benefits in accordance with the Participant's election under Section 3.2(a); that is, the portion of the Participant's prior plan accrued benefit that the Participant has elected to be deemed to be invested in a certain type of Fund shall be credited to the Fund subaccount corresponding to that Fund;

 

(b)  Each business day, each Fund subaccount of a Participant's Prior Plan Account shall be credited with earnings or losses in an amount equal to that determined by multiplying the balance credited to such Fund subaccount as of the prior day to the Fund subaccount by the Interest Rate for the corresponding fund selected by the Oversight Committee pursuant to Section 3.2(b).

 

	4.4  	Trust Funding.

 

(a)  The Company has created a Trust with the Trustee. The Company shall cause the Trust to be funded each year. The Company and any Participating Company shall contribute to the Trust the sum of: (i) an amount equal to the amount deferred by each Participant; and (ii) the aggregate amount of Company Contribution Amounts for the Plan Year. The Participating Company shall contribute to the Trust an amount equal to the amount accrued by each Participant under any nonqualified deferred compensation plan of the Participating Company that is merged with or transferred to this Plan.

 

(b)  Although the principal of the Trust and any earnings thereon shall be held separate and apart from other funds of Company and any Participating Company and shall be used exclusively for the uses and purposes of Plan Participants and Beneficiaries as set forth therein, neither the Participants nor their Beneficiaries shall have any preferred claim on, or any beneficial ownership in, any assets of the Trust prior to the time such assets are paid to the Participants or their Beneficiaries. Benefits and all rights created under this Plan shall be unsecured contractual rights of Plan Participants and Beneficiaries against the Company and any Participating Company. Any assets held in the Trust will be subject to the claims of Company's and any Participating Company’s general creditors under federal and state law in the event its or their becoming "insolvent" as defined in Section 4(a) of the Trust or any successor section.

 

(c)  The assets of the Plan and Trust shall never inure to the benefit of the Company or any Participating Company and the same shall be held for the exclusive purpose of providing benefits to Participants and their Beneficiaries and for deferring reasonable expenses of administering the Plan and Trust.

 

ARTICLE V  

 

 

VESTING

 

A Participant shall be 100% vested in his or her Deferral Account and Prior Plan Account. A Participant shall be vested in his or her Company Contribution Amount as follows.

 

	
 

Years of Service
	
 

Percentage

	
 

Less than 2
	
 

0%

	
 

2
	
 

20%

	
 

3
	
 

40%

	
 

4
	
 

60%

	
 

5
	
 

80%

	
 

6 or more
	
 

100%

 

ARTICLE VI  

 

 

DISTRIBUTIONS

 

	6.1  	Distribution of Deferred Compensation and Company Contributions.

 

(a)  Distribution Without Scheduled Withdrawal Date. In the case of a Participant who (i) terminates employment with Company and any Participating Company on account of Retirement and (ii) has a vested Account balance of more than $50,000, the Distributable Amount shall be paid to the Participant (and after his or her death to his or her Beneficiary) in substantially equal quarterly installments over ten (10) years commencing on the Participant's Payment Date. An optional form of benefit may be elected by the Participant, on the form provided by the Administrative Committee, during his or her Initial Election Period from among the following:

 

(1)  A lump sum distribution beginning on the Participant's Payment Date.

 

(2)  Substantially equal quarterly installments over five (5) years beginning on the Participant's Payment Date.

 

(3)  Substantially equal quarterly installments over fifteen (15) years beginning on the Participant's Payment Date.

 

A Participant may modify the form of benefit that he or she has previously elected, provided such modification is on a form provided by the Company that is filed with the Committee at least twelve (12) months prior to his or her original Payment Date. Any change of distribution election relating to a distribution other than as a result of death or Disability shall be effective only to the extent the first payment pursuant to such changed election is deferred for a period of at least five (5) years from the date such payment would otherwise have been made.

 

In the case of a Participant who terminates employment with Company and any Participating Company and either (i) the Termination does not qualify as Retirement or (ii) the Participant has a vested Account balance of $50,000 or less, then the Distributable Amount shall be paid to the Participant (and after his or her death to his or her Beneficiary) in a lump sum distribution on the Participant's Payment Date.

 

The Participant's Account shall continue to be credited with earnings pursuant to Section 4.1 of the Plan until all amounts credited to his or her Account under the Plan have been distributed.

 

(b)  Distribution With Scheduled Withdrawal Date. In the case of a Participant who has elected a Scheduled Withdrawal Date for a distribution while still in the employ of the Company and any Participating Company, such Participant shall receive his or her Distributable Amount, but only with respect to those deferrals of Compensation and vested Company Contribution Amounts and earnings on such deferrals of Compensation and Company Contribution Amounts as shall have been elected by the Participant to be subject to the Scheduled Withdrawal Date in accordance with Section 1.1(ff) of the Plan. A Participant's Scheduled Withdrawal Date with respect to deferrals of Compensation and Company Contribution Amounts deferred in a given Plan Year can be no earlier than two years from the first day of the Plan Year for which the deferrals of Compensation and Company Contribution Amounts are made; provided, however, that with respect to the Plan year that includes the Effective Date, the Scheduled Withdrawal Date can be no earlier than 18 months from the Effective Date of the Plan. A Scheduled Withdrawal Date shall be a date certain, rather than an event, in accordance with Code Section 409A. A Participant may extend the Scheduled Withdrawal Date for any Plan Year, provided such extension is (i) made on a form provided by the Administrative Committee, (ii) filed with the Administrative Committee at least twelve months before the Scheduled Withdrawal Date, and (iii) extended for a period of not less than five (5) years from the Scheduled Withdrawal Date. The Participant shall have the right to twice modify any Scheduled Withdrawal Date. In the event a Participant terminates employment with the Company and any Participating Company prior to a Scheduled Withdrawal Date other than by reason of death, the portion of the Participant's Account associated with a Scheduled Withdrawal Date which has not been paid in full prior to such Termination, shall be distributed in accordance with the payment methods described in Section 6.1(a) above.

 

(c)  Distribution for Termination of Employment due to Death. In the case of a Participant who dies while employed by the Company or any Participating Company, the Participant’s vested Account balance shall be paid to the Participant’s Beneficiary in a lump sum unless the Participant has elected installments. In addition, a death benefit shall be paid to the Beneficiary in an amount that is equal to the lesser of (i) $50,000 and (ii) 25% of the Participant’s vested Account balance as of the date of death.

 

(d)  Post-Termination Death Benefit. In the event a Participant dies after his or her Termination of employment, has begun receiving quarterly installments, and still has a vested balance in his or her Account, the vested balance of such Account shall continue to be paid in quarterly installments for the remainder of the period in accordance with the election previously made by the Participant.

 

	6.2  	Hardship Distribution.

 

A Participant shall be permitted to elect a Hardship Distribution from his or her vested Accounts in accordance with Section 1.1(u) of the Plan prior to the Payment Date, subject to the following restrictions:

 

(a)  The election to take a Hardship Distribution shall be made by filing a form provided by and filed with the Administrative Committee prior to the end of any calendar month.

 

(b)  The Administrative Committee shall have made a determination that the requested distribution constitutes a Hardship Distribution in accordance with Section 1.1(u) of the Plan.

 

(c)  The amount determined by the Administrative Committee as a Hardship Distribution (which may not exceed the amount necessary to satisfy such emergency plus the amount necessary to pay taxes reasonably anticipated as a result of the distribution) shall be paid in a single cash lump sum as soon as practicable after the end of the calendar month in which the Hardship Distribution election is made and approved by the Administrative Committee.

 

(d)  If a Participant receives a Hardship Distribution, then to the extent permitted under Code Section 409A the Participant will be ineligible to participate in the Plan for the balance of the Plan Year in which the Hardship Distribution was paid and the following Plan Year.

 

6.3  Taxes.

 

All distributions shall be reduced by an amount that the Administrative Committee reasonably determines is necessary to be withheld and paid over to satisfy federal, state, local and foreign tax authorities pursuant to Section 8.3.

 

6.4  Inability to Locate Participant.

 

In the event that the Administrative Committee is unable to locate a Participant or Beneficiary within two years following the required Payment Date, the entire amount allocated to the Participant's Deferral Account, Company Contribution Account and Prior Plan Account shall be forfeited. If, after such forfeiture, the Participant or Beneficiary later claims such benefit, such benefit, to the extent vested, shall be reinstated without interest or earnings.

 

	6.5  	Distributions from Prior Plan Account.

 

In the event that a Participant has a Prior Plan Account, then all distribution options with respect to amounts credited to such Prior Plan Account shall be distributed in accordance with this Article 6, except with respect to a Participant who is not a current employee and is in pay status with respect to such Prior Plan Account at the time such Account is initially credited with an accrued benefit under the prior plan. In such case, the distribution mode in effect at the time the Prior Plan Account is credited under this Plan shall continue in accordance with the provisions of said prior plan, as provided on Schedule B.

 

ARTICLE VII  

 

 

ADMINISTRATION

 

	7.1  	The Committees.

 

Two committees, the Administrative Committee and the Oversight Committee, shall be appointed by, and serve at the pleasure of, the Board of Directors. The number of members comprising each Committee shall be determined by the Board, which may from time to time vary the number of members. Any member of a Committee may resign by delivering a written notice of resignation to the Board. The Board may remove any member of a Committee by delivering a certified copy of its resolution of removal to such member. Vacancies in the membership of either Committee shall be filled promptly by the Board.

 

	7.2  	Committee Action.

 

A Committee shall act at meetings by the affirmative vote of a majority of its members. Any action permitted to be taken at a meeting may be taken without a meeting if, prior to such action, a written consent to the action is signed by all members of a Committee and such written consent is filed with the minutes of the proceedings of such Committee. A member of a Committee shall not vote or act upon any matter which relates solely to himself or herself as a Participant. The Chairman or any other member or members of a Committee designated by the Chairman may execute any certificate or other written direction on behalf of such Committee. Any member of a Committee may execute documents or provide written directions on behalf of the entire Committee.

 

	7.3  	Powers and Duties of the Administrative Committee.

 

The Administrative Committee, on behalf of the Participants and their Beneficiaries, shall enforce the Plan in accordance with its terms, shall be charged with the general administration of the Plan except with respect to the powers and duties of the Oversight Committee as described in Section 7.4, and shall have all powers necessary to accomplish its purposes, including, but not by way of limitation, the following:

 

(a)  To construe and interpret the terms and provisions of this Plan;

 

(b)  To compute and certify to the amount and kind of benefits payable to Participants and their Beneficiaries;

 

(c)  To maintain all records that may be necessary for the administration of the Plan;

 

(d)  To provide for the disclosure of all information and the filing or provision of all reports and statements to Participants, Beneficiaries or governmental agencies as shall be required by law;

 

(e)  To make and publish such rules for the regulation of the Plan and procedures for the administration of the Plan as are not inconsistent with the terms hereof; and

 

(f)  To review decisions made by the Company with respect to claims.

 

7.4    Powers and Duties of the Oversight Committee.

 

The Oversight Committee, on behalf of the Participants and their Beneficiaries, shall be charged with the general administration of the Plan, except with respect to the powers and duties of the Administrative Committee as described in Section 7.3, and shall have all powers necessary to accomplish its purposes, including, but not by way of limitation, the following:

 

(a)  To select the Funds in accordance with Section 3.2(b) hereof;

 

(b)    To appoint a Plan administrator or any other agent, and to delegate to them such powers and duties in connection with the administration of the Plan as the Oversight Committee may from time to time prescribe; and

 

(c)    To take all actions necessary for the administration of the Plan, including determining whether to hold or discontinue the Policies.

 

	7.5  	Construction and Interpretation.

 

The Administrative Committee shall have full and exclusive discretion to construe and interpret the terms and provisions of this Plan, which interpretations or construction shall be final and binding on all parties, including but not limited to the Company, the Oversight Committee and any Participant or Beneficiary. The Administrative Committee shall administer such terms and provisions in a uniform and nondiscriminatory manner and in full accordance with any and all laws applicable to the Plan.

 

	7.6  	Information.

 

To enable the Committees to perform their functions, the Company and each Participating Company shall supply full and timely information to the Committees on all matters relating to the Compensation of all Participants, their death or other events which cause termination of their participation in this Plan, and such other pertinent facts as a Committee may require.

 

	7.7  	Compensation, Expenses and Indemnity.

 

(a)  The members of a Committee shall serve without compensation for their services hereunder.

 

(b)  Each Committee is authorized at the expense of the Company and each Participating Company to employ such legal counsel as it may deem advisable to assist in the performance of its duties hereunder. Expenses and fees in connection with the administration of the Plan shall be paid equally by the Company and each Participating Company, subject to an agreement between the Company and each Participating Company to the contrary.

 

(c)  To the extent permitted by applicable state law, the Company and each Participating Company shall indemnify and hold harmless the Administrative and Oversight Committees and each member thereof, the Board of Directors and any delegate of a Committee who is an employee of the Company and any Participating Company against any and all expenses, liabilities and claims, including legal fees to defend against such liabilities and claims arising out of their discharge in good faith of responsibilities under or incident to the Plan, other than expenses and liabilities arising out of willful misconduct. This indemnity shall not preclude such further indemnities as may be available under insurance purchased by the Company and any Participating Company, or provided by the Company and any Participating Company under any bylaw, agreement or otherwise, as such indemnities are permitted under state law. The liability under this Section 7.7(c) shall be joint and several among the Company and any Participating Companies.

 

	7.8  	Annual Statements.

 

Under procedures established by the Administrative Committee, a Participant shall receive a statement with respect to such Participant's Accounts on an annual basis. In addition, a Participant may obtain access to Account information through telephonic and electronic means, including the Internet, as permitted by the Company.

 

	7.9  	Disputes.

 

(a)  Claim.

 

A person who believes that he or she is being denied a benefit to which he or she is entitled under this Plan (hereinafter referred to as "Claimant") must file a written request for such benefit with the Company, setting forth his or her claim. The request must be addressed to the President of the Company at its then principal place of business.

 

(b)  Claim Decision.

 

Upon receipt of a claim, the Company shall advise the Claimant that a reply will be forthcoming within thirty (30) days and shall, in fact, deliver such reply within such period. The Company may, however, extend the reply period for an additional thirty (30) days for special circumstances.

 

If the claim is denied in whole or in part, the Company shall inform the Claimant in writing, using language calculated to be understood by the Claimant, setting forth: (i) the specified reason or reasons for such denial; (ii) the specific reference to pertinent provisions of this Plan on which such denial is based; (iii) a description of any additional material or information necessary for the Claimant to perfect his or her claim and an explanation of why such material or such information is necessary; (iv) appropriate information as to the steps to be taken if the Claimant wishes to submit the claim for review; and (v) the time limits for requesting a review under subsection (c).

 

(c)  Request For Review.

 

Within sixty (60) days after the receipt by the Claimant of the written opinion described above, the Claimant may request in writing that the Administrative Committee review the determination of the Company. Such request must be addressed to the Administrative Committee, c/o the Secretary of the Company, at its then principal place of business. The Claimant or his or her duly authorized representative may, but need not, review the pertinent documents and submit issues and comments in writing for consideration by the Administrative Committee. If the Claimant does not request a review within such sixty (60) day period, he or she shall be barred and estopped from challenging the Company's determination.

 

(d)  Review of Decision.

 

Within thirty (30) days after the Administrative Committee's receipt of a request for review, after considering all materials presented by the Claimant, the Administrative Committee will inform the Participant in writing, in a manner calculated to be understood by the Claimant, of the decision setting forth the specific reasons for the decision containing specific references to the pertinent provisions of this Plan on which the decision is based. If special circumstances require that the thirty (30) day time period be extended, the Administrative Committee will so notify the Claimant and will render the decision as soon as possible, but no later than sixty (60) days after receipt of the request for review.

 

ARTICLE VIII  

 

 

MISCELLANEOUS

 

	8.1  	Unsecured General Creditor.

 

Participants and their Beneficiaries, heirs, successors, and assigns shall have no legal or equitable rights, claims, or interest in any specific property or assets of the Company or any Participating Company. No assets of the Company or any Participating Company shall be held in any way as collateral security for the fulfilling of the obligations of the Company or any Participating Company under this Plan. Any and all of the Company's and any Participating Company’s assets shall be, and remain, the general unpledged, unrestricted assets of the Company and any Participating Company. The Company's and any Participating Company’s obligation under the Plan shall be merely that of an unfunded and unsecured promise of the Company or any Participating Company to pay money in the future, and the rights of the Participants and Beneficiaries shall be no greater than those of unsecured general creditors. It is the intention of the Company and any Participating Company that this Plan be unfunded for purposes of the Code and for purposes of ERISA.

 

	8.2  	Restriction Against Assignment.

 

The Company and any Participating Company shall pay all amounts payable hereunder only to the person or persons designated by the Plan and not to any other person or corporation. No part of a Participant's Accounts shall be liable for the debts, contracts, or engagements of any Participant, his or her Beneficiary, or successors in interest, nor shall a Participant's Accounts be subject to execution by levy, attachment, or garnishment or by any other legal or equitable proceeding, nor shall any such person have any right to alienate, anticipate, sell, transfer, commute, pledge, encumber, or assign any benefits or payments hereunder in any manner whatsoever. If any Participant, Beneficiary or successor in interest is adjudicated bankrupt or purports to anticipate, alienate, sell, transfer, commute, assign, pledge, encumber or charge any distribution or payment from the Plan, voluntarily or involuntarily, the Administrative Committee, in its discretion, may cancel such distribution or payment (or any part thereof) to or for the benefit of such Participant, Beneficiary or successor in interest in such manner as the Administrative Committee shall direct.

 

	8.3  	Withholding.

 

There shall be deducted from each payment made under the Plan or any other Compensation payable to the Participant (or Beneficiary) all applicable federal, state, local or foreign taxes which are required to be withheld by the Company or any Participating Company in respect to such payment or this Plan. The Company and any Participating Company shall have the right to reduce any payment (or compensation) by the amount of cash sufficient to provide the amount of said taxes.

 

	8.4  	Amendment, Modification, Suspension or Termination.

 

The Board may amend, modify, suspend or terminate the Plan in whole or in part, except that no amendment, modification, suspension or termination shall have any retroactive effect to reduce any amounts allocated to a Participant's Accounts. In the event that this Plan is terminated, the amounts allocated to a Participant's Accounts shall be distributed to the Participant or, in the event of his or her death, his or her Beneficiary in a lump sum within thirty (30) days following the date of termination.

 

	8.5  	Governing Law.

 

This Plan shall be construed, governed and administered in accordance with the laws of the State of Texas to the extent not preempted by ERISA.

 

	8.6  	Receipt or Release.

 

Any payment to a Participant or the Participant's Beneficiary in accordance with the provisions of the Plan shall, to the extent thereof, be in full satisfaction of all claims against the Committees, the Company and each Participating Company. The Administrative Committee may require such Participant or Beneficiary, as a condition precedent to such payment, to execute a receipt and release to such effect.

 

	8.7  	Payments on Behalf of Persons Under Incapacity.

 

In the event that any amount becomes payable under the Plan to a person who, in the sole judgment of the Administrative Committee, is considered by reason of physical or mental condition to be unable to give a valid receipt therefore, the Administrative Committee may direct that such payment be made to any person found by the Administrative Committee, in its sole judgment, to have assumed the care of such person. Any payment made pursuant to such determination shall constitute a full release and discharge of the Committees, the Company and each Participating Company.

 

	8.8  	Limitation of Rights and Employment Relationship.

 

Neither the establishment of the Plan and Trust nor any modification thereof, nor the creating of any fund or account, nor the payment of any benefits shall be construed as giving to any Participant, or Beneficiary or other person any legal or equitable right against the Company, a Participating Company or the Trustee of the Trust except as provided in the Plan and Trust; and in no event shall the terms of employment of any Employee or Participant be modified or in any way be affected by the provisions of the Plan and Trust.

 

	8.9  	Severability.

 

If any provision of this Plan is held to be invalid or unenforceable, the remaining provisions shall be effective.

 

	8.10  	Gender.

 

Unless the context clearly indicates otherwise, the masculine gender shall include the feminine, the singular shall include the plural, and the plural the singular.

 

	8.11  	No Enlargement of Employee Rights.

 

(a)  This Plan is strictly a voluntary undertaking on the part of the Company and a Participating Company and shall not be deemed to constitute a contract between the Company or any Participating Company and any Employee, or to be consideration for, or an inducement to, or a condition of, the employment of any Employee.

 

(b)  Nothing contained in this Plan or the Trust shall be deemed to give any Employee the right to be retained in the employ of the Company or any Participating Company or to interfere with the right of the Company or any Participating Company to discharge or retire any Employee at any time.

 

(c)  No Employee, or any other person, shall have any right to or interest in any portion of the Trust, and no Employee or any other person shall be entitled to rely upon any representations, whether oral or in writing, any prospectus or other document, which are inconsistent with this Plan document.

 

	8.12  	Addresses.

 

Each Participant or Eligible Employee shall be responsible for furnishing the Administrative Committee with his or her correct current address and the correct current name and address of his or her Beneficiary or Beneficiaries.

 

	8.13  	Interpretation.

 

Article and Section headings are for convenient reference only and shall not be deemed to be part of the substance of this instrument or in any way to enlarge or limit the content of any Article or Section.

 

	8.14  	No Implied Rights or Obligations.

 

The Company, in establishing and maintaining this Plan as a voluntary and unilateral undertaking, expressly disavows the creation of any rights in Employees, Eligible Employees, Participants, or Beneficiaries or any obligations on the part of the Company or a Participating Company, except as expressly provided herein.

 

	 
ii

DALDMS/516222.1 

	 	 	 
	

	 

SCHEDULE A

 

PARTICIPATING COMPANIES

 

Name of Company    Date of Participation

To-Ricos, Inc.            January 1, 2005

 

Pilgrim’s Pride Corporation    January 1, 2005

of West Virginia, Inc.

 

PFS Distribution Company     January 1, 2005

 

PPC Transportation Company                                                               January 1, 2005

   

Pilgrim’s Pride Affordable       January 1, 2005

Housing Corporation

 

PPC Marketing Ltd.               January 1, 2005

 

	 
ii

DALDMS/516222.1 

	 	 	 
	

	 

SCHEDULE B

 

The balance of this page is intentionally left blank.

	
ii

DALDMS/516222.1Exhibit 10_1

SECOND AMENDMENT TO CREDIT AND GUARANTY AGREEMENT

THIS SECOND AMENDMENT TO CREDIT AND GUARANTY AGREEMENT (this “Amendment”) is made as of the 21st day of December, 2004, by and among RY-8, INC., a Hawaii corporation (referred to herein as the
“Borrower”), WACHOVIA BANK, NATIONAL ASSOCIATION (referred to herein as the “Bank”), ROY’S HOLDINGS, INC., a Hawaii corporation, OUTBACK STEAKHOUSE, INC., a Delaware corporation, and OS PACIFIC, INC., a Florida corporation (collectively
referred to herein as the “Guarantors”).

R E C I T A L S:

The Borrower, the Guarantors and the Bank have entered into a certain Credit and Guaranty Agreement dated October 31, 2000, as amended by that certain First Amendment to Credit and Guaranty Agreement dated October 19, 2001
(the “Credit Agreement”). Capitalized terms used in this Amendment which are not otherwise defined in this Amendment shall have the respective meanings assigned to them in the Credit Agreement.

The Borrower and Guarantors have requested the Bank to amend the Credit Agreement to amend the definition of “Termination Date” and make certain other modifications, all upon the terms and conditions hereinafter
set forth.

NOW, THEREFORE, in consideration of the Recitals and the mutual promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Borrower, the
Guarantors and the Bank, intending to be legally bound hereby, agree as follows:

SECTION 1.  Recitals.  The Recitals are incorporated herein by reference and shall be deemed to be a part of this Amendment.

SECTION 2.  Amendments.  The Credit Agreement is hereby amended as set forth in this Section 2.

SECTION 2.1.  Amendment to Section 1.01.  (a) The definitions of “Consolidated Outback Total Debt”, “Existing Outback Credit Agreement,” “Outback/Wachovia Credit Agreement,”
and “Termination Date” contained in Section 1.01 are hereby amended and restated to read as follows:

            “Consolidated Outback Total Debt” means as of the last day of each Outback Fiscal Quarter the sum of:  (a) the Debt of Outback and the
Consolidated Subsidiaries of Outback, determined on a consolidated basis as of such date; and (b) the product of:  (i) eight, and (ii) the sum of all payment obligations (excluding Outback Contingent Rents and Outback Minority Rents) under all operating leases
and rental agreements of Outback and the Consolidated Subsidiaries of Outback, determined on a consolidated basis for the Outback Fiscal Quarter then ended and the immediately preceding three Outback Fiscal Quarters in accordance with GAAP.

            “Existing Outback Credit Agreement” means that certain Credit Agreement dated April 27, 2004, by and among Outback Steakhouse, Inc., the banks
party thereto, Wachovia Bank, National Association, as Agent, Wachovia Capital Markets, LLC, as Sole Arranger, SunTrust Bank, as Syndication Agent and SouthTrust Bank, as Documentation Agent, as in effect on the date hereof without regard and without giving effect to
any waivers given by the Banks (as defined in the Existing Credit Agreement) or amendments agreed to by Outback Steakhouse, Inc. and the Banks (as defined in the Existing Credit Agreement).

            “Outback/Wachovia Credit Agreement” shall mean that certain Credit Agreement dated as of April 27, 2004 between Outback and the Bank.

            “Termination Date” means June 30, 2007.

(b)        Section 1.01 is hereby amended to delete the definition of the term “Outback EBITDA.”

(c)        Section 1.01 is hereby amended to add the following definitions:

            “Amendment Closing Date” means December 21, 2004.

            “Outback EBITDAR” means for any period the sum of:  (a) Consolidated Outback Net Income, plus (b) the amount deducted in determining
Consolidated Outback Net Income for such period for (i) taxes on income, (ii) Consolidated Outback Interest Expense, (iii) Outback Depreciation and Amortization, and (iv) the sum of all payment obligations (excluding Outback Contingent Rents) under all operating
leases and rental agreements, all determined with respect to Outback and the Consolidated Subsidiaries of Outback on a consolidated basis for such period and in accordance with GAAP.  In determining Outback EBITDAR for any period, (i) any Consolidated Subsidiary
acquired during such period by Outback or any other Consolidated Subsidiary of Outback shall be included on a pro forma, historical basis as if it had been a Consolidated Subsidiary of Outback during such entire period, (ii) any amounts which would be included in a
determination of Outback EBITDAR for such period with respect to  assets acquired during such period by Outback or any Consolidated Subsidiary of Outback shall be included in the determination of Outback EBITDAR for such period and the amount thereof shall be
calculated on a pro forma, historical basis as if such assets had been acquired by Outback or such Consolidated Subsidiary of Outback prior to the first day of such period, (iii) any Consolidated Subsidiary of Outback sold during such period by Outback or any other
Consolidated Subsidiary of Outback shall be excluded as if it had not been a Consolidated Subsidiary of Outback at any time during such period, and (iv) any amounts which would be otherwise included in a determination of Outback EBITDAR for such period with respect
to assets sold or otherwise disposed of during such period by Outback or any Consolidated Subsidiary of Outback shall be excluded in the determination of Outback EBITDAR for such period and the amount excluded shall be calculated as if such assets had been sold or
otherwise disposed of by Outback or such Consolidated Subsidiary of Outback prior to the first day of such period.

            “Outback Contingent Rents” means for any period, the aggregate payments of contingent rentals under operating leases and rental agreements, based
on a percentage of gross revenues as defined by the terms of the applicable lease or rental agreement, made by Outback and the Consolidated Subsidiaries of Outback, determined on a consolidated basis in accordance with GAAP.

            “Outback Minority Rents” means for any period, the aggregate payment obligations under operating leases and rental agreements of Outback and the
Consolidated Subsidiaries of Outback allocable to minority partners, determined in accordance with GAAP.

SECTION 2.2.  Amendment to Section 2.04(b).  Section 2.04(b) of the Credit Agreement is hereby deleted in its entirety.

SECTION 2.3.  Amendment to Section 2.05.  Section 2.05 of the Credit Agreement is hereby amended and restated to read as follows:

SECTION 2.05.  Interest Rates. (a)  ”Applicable Margin” shall be determined quarterly based upon the ratio of Consolidated Outback Total Debt (calculated as of the last day of each Outback
Fiscal Quarter) to Outback EBITDAR (calculated as of the last day of each Outback Fiscal Quarter for the Outback Fiscal Quarter then ended and the immediately preceding three Outback Fiscal Quarters), as follows:

Ratio of Outback

Consolidated Total

Debt to Outback EBITDAR     Base Rate Loan            Euro-Dollar Loan

Greater than 2.5                                  
0%                               .95%

Greater than 2.0 but

equal to or less than 2.5                       
0%                               .70%

Less than or equal to 2.0                      
0%                               .575%

The Applicable Margin shall be determined effective as of the date (herein, the “Rate Determination Date”) which is 60 days after the last day of the Outback Fiscal Quarter as of the end of which the foregoing
ratio is being determined, based on the quarterly financial statements for such Outback Fiscal Quarter, and the Applicable Margin so determined shall remain effective from such Rate Determination Date until the date which is 60 days after the last day of the Outback
Fiscal Quarter in which such Rate Determination Date falls (which latter date shall be a new Rate Determination Date); provided that (i) for the period from and including the Amendment Closing Date to but excluding the Rate Determination Date next following
the Amendment Closing Date, the Applicable Margin shall be (A) 0% for a Base Rate Loan, and (B) .575%% for a Euro-Dollar Loan, (ii) in the case of any Applicable Margin determined for the fourth and final Outback Fiscal Quarter of a Outback Fiscal Year, the
Rate Determination Date shall be the date which is 120 days after the last day of such final Outback Fiscal Quarter and such Applicable Margin shall be determined based upon the annual audited financial statements for the Outback Fiscal Year ended on the last day of
such final Outback Fiscal Quarter,  and (iii) if on any Rate Determination Date the Borrower shall have failed to deliver to the Bank the financial statements required to be delivered pursuant to Section 5.2.01(a) or Section 5.2.01(b) with respect to the Outback
Fiscal Year or Outback Fiscal Quarter, as the case may be, most recently ended prior to such Rate Determination Date, then for the period beginning on such Rate Determination Date and ending on the earlier of (A) the date on which the Borrower shall deliver to the
Bank the financial statements to be delivered pursuant to Section 5.2.01(b) with respect to such Outback Fiscal Quarter or any subsequent Outback Fiscal Quarter, or (B) the date on which the Borrower shall deliver to the Bank annual financial statements required
to be delivered pursuant to Section 5.2.01(a) with respect to the Outback Fiscal Year which includes such Outback Fiscal Quarter or any subsequent Outback Fiscal Year, the Applicable Margin shall be determined as if the ratio of Consolidated Outback Total Debt to
Outback EBITDAR was more than 2.5 at all times during such period.  Any change in the Applicable Margin on any Rate Determination Date shall result in a corresponding change, effective on and as of such Rate Determination Date, in the interest rate applicable to
each Advance; provided, that no Applicable Margin shall be decreased pursuant to this Section 2.05 if a Default is in existence on the Rate Determination Date.

(b)        During each Interest Period in which the Loan is a Base Rate Loan, such Base Rate Loan shall bear interest on the outstanding principal amount thereof, for each day during the
applicable Interest Period, at a rate per annum equal to the Base Rate for such day plus the Applicable Margin.  Any overdue principal of and, to the extent permitted by applicable law, overdue interest on any Base Rate Loan shall bear interest, payable on
demand, for each day until paid in full at a rate per annum equal to the Default Rate.

(c)        During each Interest Period on which the Loan is a Euro-Dollar Loan, such Euro-Dollar Loan shall bear interest on the outstanding principal amount thereof, for the Interest Period
applicable thereto, at a rate per annum equal to the sum of: (1) the Applicable Margin, plus (2) the Usage Margin, plus (3) the applicable Adjusted Daily Libor Index as that rate may change from day to day in accordance with changes in the Adjusted Daily Libor
Index.  Any overdue principal of and, to the extent permitted by applicable law, overdue interest on any Euro-Dollar Loan shall bear interest, payable on demand, for each day until paid in full at a rate per annum equal to the Default Rate.

The “Adjusted Daily Libor Index” means a rate per annum equal to the applicable London Interbank Offered Rate (determined in accordance with the paragraph below), adjusted for all applicable Costs (as hereinafter
defined).  The Adjusted Daily Libor Index shall be adjusted each Euro-Dollar Business Day and shall be further adjusted for any changes in the Bank’s Costs.  As used herein, “Costs” shall mean any charges, fees or costs incurred by the
Bank as a result of any changes in any laws, rules, regulations, or governmental requirements pertaining to London Interbank Offered Rate loans.

The “London Interbank Offered Rate” for any day, means the rate for one month U.S. dollar deposits as reported on Telerate page 3750 as of 11:00 a.m., London time, on such day, or if such day is not a London
business day, then the immediately preceding London business day (or if not so reported, then as determined by Bank from another recognized source or interbank quotation).  Notwithstanding any provision herein to the contrary, if the Bank should at any time be
unable to determine the London Interbank Offered Rate, then the Adjusted Daily Libor Index shall be based on an interest rate selected by the Bank in good faith that approximates the one month London Interbank Offered Rate taking into account rates in relevant
markets.  Such rate shall be in effect until the next Euro-Dollar Business Day on which the London Interbank Offered Rate is determinable.

                        (d)        The Loan shall at all times be a
Euro-Dollar Loan unless the Loan is to be a Base Rate Loan pursuant to Article VII herein.  Interest shall be payable for each Interest Period on the Interest Payment Date immediately succeeding the last day of the Interest Period; provided that:  (1) all
accrued unpaid interest on the Loan shall be paid in full on the Termination Date; and (2) should the Commitment be terminated at any time prior to the Termination Date for any reason, any and all accrued unpaid interest shall be paid on the date of such
termination.

(e)        The Bank shall determine each interest rate applicable to the Loan hereunder.

(f)         After the occurrence and during the continuance of a Default, the principal amount of the Loan (and, to the extent permitted by applicable law, all accrued interest thereon)
may, at the election of the Bank, bear interest at the Default Rate; provided, however, that automatically whether or not the Bank elects to do so, any overdue principal of and, to the extent permitted by law, overdue interest on the Loan shall bear interest payable
on demand, for each day until paid at a rate per annum equal to the Default Rate. 

SECTION 2.4.  Amendment to Section 2.06.  Section 2.06 of the Credit Agreement is hereby amended and restated to read as follows:

SECTION 2.06.  Fees.  (a) The Borrower shall pay to the Bank a facility fee equal to the product of:  (i) the aggregate of the daily average amounts of the Bank’s Commitment, times (ii) a
per annum percentage equal to the Applicable Facility Fee Rate.  Such facility fee shall accrue from and including the Closing Date to and including the Termination Date.  The facility fee shall be payable quarterly in arrears on the first Facility Fee
Payment Date following each Facility Fee Determination Date and on the Termination Date; provided that should the Commitment be terminated at any time prior to the Termination Date for any reason, the entire accrued and unpaid facility fee shall be paid on the date
of such termination.  The “Applicable Facility Fee Rate” shall be determined quarterly based upon the ratio of Consolidated Outback Total Debt (calculated as of the last day of each Outback Fiscal Quarter) to Outback EBITDAR (calculated as of the
last day of each Outback Fiscal Quarter for the Outback Fiscal Quarter then ended and the immediately preceding three Outback Fiscal Quarters) as follows:

Ratio of Consolidated

Outback Total
Debt                                                     
       Applicable

to Outback
EBITDAR                                                 
   Facility Fee Rate

Greater than
2.5                                                                      
..25%

Greater than 2.0

but equal to or less than
2.5                                                     
..20%

Less than or equal to
2.0                                                          
..175%

The Applicable Facility Fee Rate shall be determined effective as of the date (herein, the “Facility Fee Determination Date”) which is 60 days after the last day of the Outback Fiscal Quarter as of the end of which
the foregoing ratio is being determined, based on the quarterly financial statements for such Outback Fiscal Quarter, and the Applicable Facility Fee Rate so determined shall remain effective from such Facility Fee Determination Date until the date which is 60 days
after the last day of the Outback Fiscal Quarter in which such Facility Fee Determination Date falls (which latter date shall be a new Facility Fee Determination Date); provided that (i) for the period from and including the Amendment Closing Date to but
excluding the Facility Fee Determination Date next following the Amendment Closing Date, the Applicable Facility Fee Rate shall be .175%; (ii) in the case of any Applicable Facility Fee Rate determined for the fourth and final Outback Fiscal Quarter of a Outback
Fiscal Year, the Facility Fee Determination Date shall be the date which is 120 days after the last day of such final Outback Fiscal Quarter and such Applicable Facility Fee Rate shall be determined based upon the annual audited financial statements for the Outback
Fiscal Year ended on the last day of such final Outback Fiscal Quarter, and (iii) if on any Facility Fee Determination Date the Borrower shall have failed to deliver to the Bank the financial statements required to be delivered pursuant to Section 5.2.01(a) or
Section 5.2.01(b) with respect to the Outback Fiscal Year or Outback Fiscal Quarter, as the case may be, most recently ended prior to such Facility Fee Determination Date, then for the period beginning on such Facility Fee Determination Date and ending on the earlier
of (A) the date on which the Borrower shall deliver to the Bank the financial statements to be delivered pursuant to Section 5.2.01(b) with respect to such Outback Fiscal Quarter or any subsequent Outback Fiscal Quarter, and (B) the date on which the Borrower shall
deliver to the Bank annual financial statements required to be delivered pursuant to Section 5.2.01(a) with respect to the Outback Fiscal Year which includes such Outback Fiscal Quarter or any subsequent Outback Fiscal Year, the Applicable Facility Fee Rate shall be
determined as if the ratio of Consolidated Outback Total Debt to Outback EBITDAR was more than 2.5 at all times during such period.

SECTION 3.  Conditions to Effectiveness.  The effectiveness of this Amendment and the obligations of the Bank hereunder are subject to the following conditions, unless the Bank waives such
conditions:

(a)        receipt by the Bank from each of the parties hereto of a duly executed counterpart of this Amendment signed by such party;

(b)        the Bank shall have received:  (i) corporate resolutions and other evidence as the Bank may reasonably request, respecting the authorization, execution and delivery of this
Amendment; and (ii) an opinion from counsel to the Borrower and Guarantors substantially in the form of Exhibit A hereto and covering such additional matters relating to the transactions contemplated hereby as the Bank may reasonably request; and

(c)        the fact that the representations and warranties of the Borrower and Guarantors contained in Section 6 of this Amendment shall be true on and as of the date hereof.

            

SECTION 4.  No Other Amendment.  Except for the amendments set forth above, the text of the Credit Agreement shall remain unchanged and in full force and effect.  This Amendment is not intended to effect,
nor shall it be construed as, a novation.  The Credit Agreement and this Amendment shall be construed together as a single agreement.  Nothing herein contained shall waive, annul, vary or affect any provision, condition, covenant or agreement contained in
the Credit Agreement, except as herein amended, nor affect nor impair any rights, powers or remedies under the Credit Agreement as hereby amended.  The Bank does hereby reserve all of its rights and remedies against all parties who may be or may hereafter become
secondarily liable for the repayment of the Note.  The Borrower and Guarantors promise and agree to perform all of the requirements, conditions, agreements and obligations under the terms of the Credit Agreement, as heretofore and hereby amended, the Credit
Agreement, as amended, being hereby ratified and affirmed.  The Borrower and Guarantors hereby expressly agree that the Credit Agreement, as amended, is in full force and effect.

SECTION 5.  Representations and Warranties.  The Borrower and Guarantors hereby represent and warrant to the Bank as follows:

(a)        No Default or Event of Default, nor any act, event, condition or circumstance which with the passage of time or the giving of notice, or both, would constitute an Event of Default,
under the Credit Agreement or any other Loan Document has occurred and is continuing unwaived by the Bank on the date hereof.

(b)        The Borrower and Guarantors have the power and authority to enter into this Amendment and to do all acts and things as are required or contemplated hereunder, or thereunder, to be
done, observed and performed by it.

(c)        This Amendment has been duly authorized, validly executed and delivered by one or more authorized officers of the Borrower and Guarantors and constitute legal, valid and binding
obligations of the Borrower and each Guarantor enforceable against it in accordance with their terms, provided that such enforceability is subject to general principles of equity.

(d)        The execution and delivery of this Amendment and the performance of the Borrower and Guarantors hereunder and thereunder do not and will not require the consent or approval of any
regulatory authority or governmental authority or agency having jurisdiction over the Borrower or any Guarantor, nor be in contravention of or in conflict with the articles of incorporation or bylaws of the Borrower or any Guarantor, or the provisions of any statute,
or any judgment, order or indenture, instrument, agreement or undertaking, to which the Borrower or any Guarantor is party or by which the assets or properties of the Borrower and Guarantors are or may become bound.

SECTION 6.  Counterparts.  This Amendment may be executed in multiple counterparts, each of which shall be deemed to be an original and all of which, taken together, shall constitute one and the same
agreement.

SECTION 7.  Governing Law.  This Amendment shall be considered in accordance with and governed by the laws of the State of Georgia.

SECTION 8.  Consent by Guarantors.  The Guarantors consent to the foregoing amendments.  The Guarantors promise and agree to perform all of the requirements, conditions, agreements and obligations under
the terms of the Credit Agreement as hereby amended, said Credit Agreement, as hereby amended, being hereby ratified and affirmed.  The Guarantors hereby expressly agree that the Credit Agreement, as hereby amended, is in full force and effect.

SECTION 9.  Effective Date.  This Amendment shall be effective as of December 21, 2004.

SECTION 10.  Renewal Fee.  On the date hereof, Borrower shall pay to Bank a renewal fee of $36,750.00.

SECTION 11.  Notices.  All notices, requests and other communications to the Bank under the Agreement shall be given to the Bank at the following addresses and telecopy number:

Wachovia Bank, National Association

10 South Jefferson Street, Mail Code VA7628 (24011)

P. O. Box 13327

Roanoke, VA  24040

with a copy to:

Wachovia Bank, National Association

100 South Ashley Drive, FL4050

Suite 1000

Tampa, FL  33602

Attention:  Lynn E. Culbreath

Senior Vice President

Telecopy number:  (813) 276-6454

Telephone number:  (813) 276-6517

[The remainder of this page intentionally left blank.]

IN WITNESS WHEREOF, the parties hereto have executed and delivered, or have caused their respective duly authorized officers or representatives to execute and deliver, this Amendment as of the day and year first above
written.

BORROWER:

RY-8, INC.

By:________________________________(SEAL)

Title:____________________________________

Documentary stamp tax in the maximum

amount required by Florida Statutes, Section

201.08(2)(a) has been paid.

STATE OF _________________

COUNTY OF _______________

                        THE FOREGOING INSTRUMENT was acknowledged before me this ____ day of December, 2004, by
____________, as _______________ of RY-8, INC. on behalf of the corporation.  He/she is personally known to me.

                                                                       
________________________________________

(Affix
Seal)                                                     
Print Name:______________________________

                                                                       
Notary Public – State of ____________________

                                                                       
My Commission Expires:___________________

                                                                       
My Commission No.:______________________

[Remainder of this page intentionally left blank]

GUARANTORS:

OUTBACK STEAKHOUSE, INC.

By:________________________________(SEAL)

Robert S. Merritt, Senior Vice President, Chief Financial Officer and Treasurer

STATE OF _________________

COUNTY OF _______________

                        THE FOREGOING INSTRUMENT was acknowledged before me this ____ day of December, 2004, by
Robert S. Merritt, as Senior Vice President, Chief Financial Officer and Treasurer of OUTBACK STEAKHOUSE, INC. on behalf of the corporation.   He/she is personally known to me.

                                                                       
________________________________________

(Affix
Seal)                                                     
Print Name:______________________________

                                                                       
Notary Public – State of ____________________

                                                                       
My Commission Expires:___________________

                                                                       
My Commission No.:______________________

[Remainder of this page intentionally left blank]

ROY’S HOLDINGS, INC.

By:________________________________(SEAL)

Title:____________________________________

STATE OF _________________

COUNTY OF _______________

                        THE FOREGOING INSTRUMENT was acknowledged before me this ____ day of December, 2004, by
____________, as _______________ of ROY’S HOLDINGS, INC. on behalf of the corporation.  He/she is personally known to me.

                                                                       
________________________________________

(Affix
Seal)                                                     
Print Name:______________________________

                                                                       
Notary Public – State of ____________________

                                                                       
My Commission Expires:___________________

                                                                       
My Commission No.:______________________

[Remainder of this page intentionally left blank]

OS PACIFIC, INC.

By:________________________________(SEAL)

Robert S. Merritt, Senior Vice President, Chief Financial Officer and Treasurer

STATE OF _________________

COUNTY OF _______________

                        THE FOREGOING INSTRUMENT was acknowledged before me this ____ day of December, 2004, by
Robert S. Merritt, as Senior Vice President, Chief Financial Officer and Treasurer of OS PACIFIC, INC. on behalf of the corporation.  He/she is personally known to me.

                                                                       
________________________________________

(Affix
Seal)                                                     
Print Name:______________________________

                                                                       
Notary Public – State of ____________________

                                                                       
My Commission Expires:___________________

                                                                       
My Commission No.:______________________

[Remainder of this page intentionally left blank]

WACHOVIA BANK, NATIONAL

ASSOCIATION

By:_______________________________________

Lynn E. Culbreath, Senior Vice President

STATE OF _________________

COUNTY OF _______________

                        THE FOREGOING INSTRUMENT was acknowledged before me this ____ day of December, 2004, by
Lynn E. Culbreath, as Senior Vice President of WACHOVIA BANK, NATIONAL ASSOCIATION on behalf of the corporation.  He/she is personally known to me.

                                                                       
________________________________________

(Affix Seal)                 
                                    Print Name:______________________________

                                                                       
Notary Public – State of ____________________

                                                                       
My Commission Expires:___________________

                                                                       
My Commission No.:______________________

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