Kroger 2011 Annual Report Download - page 40

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38
Although participants generally receive credited service beginning at age 21, those participants who
commenced employment prior to 1986, including all of the named executive officers, began to accrue credited
service after attaining age 25. In the event of a termination of employment, Messrs. Dillon and Heldman
currently are eligible for a reduced early retirement benefit, as they each have attained age 55.
Messrs. Dillon and Donnelly also participate in the Dillon Employees’ Profit Sharing Plan (the “Dillon
Plan”). The Dillon Plan is a qualified defined contribution plan under which Dillon Companies, Inc. and its
participating subsidiaries may choose to make discretionary contributions each year that are then allocated
to each participant’s account. Participation in the Dillon Plan was frozen effective January 1, 2001. Benefits
under the Dillon Plan continue to accrue for Mr. Donnelly but do not do so for Mr. Dillon. Participants in the
Dillon Plan elect from among a number of investment options and the amounts in their accounts are invested
and credited with investment earnings in accordance with their elections. Prior to July 1, 2000, participants
could elect to make voluntary contributions under the Dillon Plan, but that option was discontinued effective
as of July 1, 2000. Participants can elect to receive their Dillon Plan benefit in the form of either a lump sum
payment or installment payments.
Due to offset formulas contained in the Consolidated Plan and the Dillon Excess Plan, Messrs. Dillon
and Donnelly’s accrued benefits under the Dillon Plan offset a portion of the benefit that would otherwise
accrue for them under those plans for their service with Dillon Companies, Inc. Although benefits that accrue
under defined contribution plans are not reportable under the accompanying table, we have added narrative
disclosure of the Dillon Plan because of the offsetting effect that benefits under that plan has on benefits
accruing under the Consolidated Plan and the Dillon Excess Plan.
The assumptions used in calculating the present values are set forth in Note 13 to the consolidated
financial statements in Kroger’s Form 10-K for fiscal year 2011 ended January 28, 2012. The discount rate used
to determine the present values is 4.55%, which is the same rate used at the measurement date for financial
reporting purposes.
NONQUALIFIED DEFERRED COMPENSATION
The following table provides information on nonqualified deferred compensation for the named executive
officers for 2011.
2011 NONQUALIFIED DEFERRED COMPENSATION
Executive
Contributions
in Last FY
Registrant
Contributions
in Last FY
Aggregate
Earnings
in Last FY
Aggregate
Withdrawals/
Distributions
Aggregate
Balance at
Last FYE
Name ($) ($) ($) ($) ($)
David B. Dillon . . . . . . . . . . . . . . . . . . . . $ 0 $0 $ 62,019 $0 $ 908,447
J. Michael Schlotman . . . . . . . . . . . . . . . $ 0 $0 $ 0 $0 $ 0
W. Rodney McMullen . . . . . . . . . . . . . . . $107,736(1) $0 $371,395 $0 $5,552,502
Paul W. Heldman ................... $ 0 $0 $ 58,982 $0 $ 981,496
Michael J. Donnelly ................. $ 0 $0 $ 18,523 $0 $ 284,312
(1) This amount represents the deferral of annual bonus earned in fiscal year 2010 and paid in March 2011.
This amount is included in the Summary Compensation Table for 2010.
Eligible participants may elect to defer up to 100% of the amount of their salary that exceeds the sum
of the FICA wage base and pre-tax insurance and other Internal Revenue Code Section 125 plan deductions,
as well as 100% of their annual and long-term bonus compensation. Deferral account amounts are credited
with interest at the rate representing Kroger’s cost of ten-year debt as determined by Kroger’s CEO prior to
the beginning of each deferral year. The interest rate established for deferral amounts for each deferral year
will be applied to those deferral amounts for all subsequent years until the deferred compensation is paid
out. Participants can elect to receive lump sum distributions or quarterly installments for periods up to ten
years. Participants also can elect between lump sum distributions and quarterly installments to be received by
designated beneficiaries if the participant dies before distribution of deferred compensation is completed.