Harris Teeter 2010 Annual Report Download - page 141

or make arrangements satisfactory to his Employer regarding the payment to his Employer of, Applicable
Withholding Taxes. Until the amount has been paid or arrangements satisfactory to the Employer have been
made, no stock certificate shall be issued to the Participant. Payment to the Employer in satisfaction of
Applicable Withholding Taxes may be in cash. In addition, if the Committee allows or the Grant Agreement
so provides, (A) payment to the Employer in satisfaction of Applicable Withholding Taxes may be made in
shares of Company Stock (valued at their Fair Market Value as of the date of payment) to which the Participant
has good title, free and clear of all liens and encumbrances; (B) the Participant may elect to have his Employer
retain that number of shares of Company Stock (valued at their Fair Market Value as of the date of such
retention) that would satisfy all or a specified portion of the Applicable Withholding Taxes; or (C) unless
prohibited by law, the Participant may deliver irrevocable instructions to a broker to deliver promptly to the
Employer, from the sale or loan proceeds with respect to the sale of Company Stock or a loan secured by
Company Stock, the amount necessary to pay the Applicable Withholding Taxes.
(g) The Committee shall establish the Performance Goals for Performance Shares. The Committee shall
determine the extent to which any Performance Criteria shall be used and weighted with respect to any grant
of Performance Shares. The Committee may vary the Performance Criteria, Performance Goals and weightings
from Participant to Participant, Performance Share to Performance Share and Fiscal Year to Fiscal Year. The
Committee may increase, but not decrease, any Performance Goal during a Fiscal Year. However, the
Committee shall adjust the Performance Goals, but only to the extent permitted pursuant to Code section
162(m), if it determines that nonrecurring, extraordinary or non-operational items have materially affected the
fairness of the Performance Goals and have unduly affected the Company’s ability to meet them, including
without limitation, items such as the effects of currency fluctuations, items excluded from the calculation of
earnings publicly reported by the Company in relation to an earnings announcement, asset write-downs,
litigation or claim judgments or settlements, accruals for reorganizations and restructuring programs and the
effect of changes in tax law, accounting principles or other laws or provisions affecting reported results. In
addition, Performance Goals shall be calculated without regard to any changes in accounting standards that
may be required by the Financial Accounting Standards Board after such Performance Goals are established.
(h) The Committee (or, with respect to executive officers, the independent members of the Board) shall
establish for each Performance Share the amount of cash or Company Stock payable at specified levels of
performance, based on the Performance Goal for each Performance Criteria. Any Performance Share shall be
awarded not later than 90 days after the start of the period for which the Performance Share relates and shall
be awarded prior to the completion of 25% of such period. All determinations regarding the achievement of
any Performance Goals will be made by the Committee. The Committee may not increase during a Fiscal Year
the amount of cash or Company Stock that would otherwise be payable upon achievement of the Performance
Goal or Goals but may reduce or eliminate the payments as provided in a Performance Share.
(i) The actual payments to a Participant under a Performance Share will be calculated by applying the
achievement of a Performance Criteria to the Performance Goal as established in the Grant Agreement. All
calculations of actual payments shall be made by the Committee and the Committee shall certify in writing
the extent, if any, to which the Performance Goals have been met.
(j) The Company shall distribute amounts payable to Participants pursuant to Performance Shares as
soon as is administratively practicable following the determination and written certification of the Committee
for a Performance Period, but in no event later than two and one-half months after the end of the calendar
year in which the Performance Period ends.
(k) The payment of any amounts pursuant to a Performance Share, if any (as determined by the
Committee at the end of the Performance Period), with respect to a specific Performance Period requires that
the Participant be an active employee on the Company’s or a Related Company’s payroll on the last day of
each applicable Performance Period and at the time the payment is made, unless the Participant’s employment
was earlier terminated due to early, normal or late retirement under the terms of the Company’s pension or
similar retirement plan or unless payment is required under the terms of the applicable Change In Control And
Severance Agreement between the Company and the Participant.
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