Harris Teeter 2010 Annual Report Download - page 120

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PROPOSAL 2
APPROVAL OF THE RUDDICK CORPORATION
2011 INCENTIVE COMPENSATION PLAN
The Board of Directors has adopted the Ruddick Corporation 2011 Incentive Compensation Plan (the “2011
Plan”) and directed that it be submitted to the Company’s shareholders for approval.
The material terms and provisions of the 2011 Plan are summarized below. The complete text of the 2011 Plan
is attached as Appendix A. This summary is not intended to be a complete description of the 2011 Plan and is
qualified in its entirety by the actual text of the 2011 Plan.
Background
The 2011 Plan is designed to help attract and retain personnel of superior ability for positions of exceptional
responsibility, to reward employees and non-employee directors for past services and to motivate such individuals
through added incentives to further contribute to the success of the Company. The Company believes the 2011 Plan
will secure for the Company and its shareholders the benefits arising from ownership of the Common Stock by
employees and non-employee directors of the Company, all of whom are and will be responsible for the Company’s
future growth. A primary reason for adopting the 2011 Plan is to reserve shares of Common Stock for incentive
awards that will support our compensation philosophy of linking the compensation of key employees to the
performance of the Company and its subsidiaries, as applicable. The 2011 Plan will become effective immediately
upon shareholder approval.
The Ruddick Corporation 2002 Comprehensive Stock Option and Award Plan (and the Addendum thereto)
and the Ruddick Corporation 2000 Comprehensive Stock Option and Award Plan (together, the “Prior Plans”) will
be replaced by the 2011 Plan upon shareholder approval of the 2011 Plan. No awards will be granted under the
Prior Plans after the 2011 Plan is approved by the Company’s shareholders, although outstanding awards previously
granted under the Prior Plans will continue in effect in accordance with the terms and conditions of the Prior Plans.
Eligibility and Administration
All present and future employees and other service providers of the Company and its related companies are
eligible to receive incentive awards under the 2011 Plan. An employee or other service provider who receives an
award becomes a participant in the 2011 Plan. Also, all present and future non-employee directors of the Company
are eligible to receive awards under the 2011 Plan. As of October 31, 2010, the Company estimates that there are
approximately 262 employees (four of whom are executive officers), no service providers other than employees,
and nine non-employee directors who may be eligible for awards under the 2011 Plan.
Unless otherwise determined by the Board of Directors or except as may otherwise be required by its charter,
the Compensation Committee (the “Committee”) will administer the 2011 Plan with respect to awards for employees
and other service providers. The Committee generally has the power and complete discretion to select employees
and service providers to receive incentive awards and to determine for each employee or service provider the nature
of the incentive award and the terms and conditions of each incentive award. Upon recommendation by the
Committee, the independent members of the Board of Directors (as determined under NYSE requirements and other
applicable tax and securities laws), have the authority to approve equity compensation awards to our Chief Executive
Officer and our executive officers, and have all of the powers and responsibilities as the Committee in approving
such awards. In addition, the independent members of the Board of Directors have the sole authority to grant
incentive awards to our non-employee directors, and generally have all of the powers and responsibilities of the
Committee in granting such incentive awards.
The 2011 Plan is intended to comply with the provisions of Rule 16b-3 promulgated under the Exchange Act,
and allows for awards that are intended to meet the requirements for performance-based compensation under
Internal Revenue Code Section 162(m). Awards under the 2011 Plan that constitute nonqualified deferred
compensation are intended to meet the requirements of Internal Revenue Code Section 409A, as discussed below
in the section entitled “Federal Income Tax Consequences.”
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