HANESBRANDS
INC.
EXECUTIVE LIFE INSURANCE PLAN
(Conformed
through October 31, 2008)
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PAGE
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1
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Introduction
and Definitions
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1
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1
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1
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5
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5
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2.1
Eligibility for Participation
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5
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2.2
Acquisition of Insurance
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5
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2.3
Additional Life Insurance Coverage
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5
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2.4
Company’s Payment of Premiums Prior to Retirement,
Termination of Employment, Disability or Death
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6
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2.5
Company’s Payment of Premiums after Retirement
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6
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2.6
Company’s Payment of Premiums after Disability
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6
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2.7
Company’s Payment of Premiums During Authorized Absences from
Employment
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7
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2.8
Cessation of Premium Payments
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7
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2.9
Optional Premium Payments by Participants
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7
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8
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8
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9
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9
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9
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3.2
Decisions and Actions of the Committee
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9
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3.3
Rules and Records of the Committee
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9
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9
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9
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10
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11
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11
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4.1
Presentation of Claim
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11
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4.2
Notification of Decision
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11
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4.3
Review of a Denied Claim
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12
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12
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12
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4.6
Disability Determinations
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13
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14
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14
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14
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5.2
No Guarantee of Employment
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14
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i
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PAGE
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14
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14
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14
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14
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5.7
Non-Assignability and Facility of Payment
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14
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15
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5.9
Information to be Furnished by Covered Employees
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15
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5.10
Company and Committee Decision Final
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15
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5.11
Action by Company or Employer
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15
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15
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5.13
Recovery of Benefits
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15
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5.14
Additional Employers
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16
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16
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16
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17
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Amendment
and Termination
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17
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17
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17
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6.3
Mergers and Acquisitions
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17
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ii
HANESBRANDS
INC.
EXECUTIVE LIFE INSURANCE PLAN
(Effective as of January 1, 2006)
Introduction
and Definitions
The
Hanesbrands Inc. Executive Life Insurance Plan, effective as of
January 1, 2006 (the “Plan”) is established by
Hanesbrands Inc. (the “Company”) to provide life
insurance benefits to a select group of management or highly
compensated Employees who contribute materially to the continued
growth, development and future business success of the Company. The
Plan, as set forth herein, is considered to be a “Top-Hat
Plan” as defined in DOL
Regulation Section 2520.104-24 for purposes of the
Employee Retirement Income Security Act of 1974, as amended
(“ERISA”).
For
purposes of this Plan, unless otherwise clearly apparent from the
context, the following phrases or terms shall have the following
indicated meanings:
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(a)
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“Base Salary” means the annual cash compensation
relating to services performed during any calendar year, excluding
distributions from nonqualified deferred compensation plans,
bonuses, commissions, overtime, fringe benefits, stock options,
relocation expenses, incentive payments, non-monetary awards,
director fees and other fees, and automobile and other allowances
paid to a Participant for employment services rendered (whether or
not such allowances are included in the Participant’s gross
income). Base Salary shall be calculated before reduction for
compensation voluntarily deferred or contributed by the Participant
pursuant to all qualified or non-qualified plans of the Company and
shall be calculated to include amounts not otherwise included in
the Participant’s gross income under Code Sections 125,
402(e)(3), 402(h), or 403(b) pursuant to plans established by the
Company; provided, however, that all such amounts will be included
in compensation only to the extent that had there been no such
plan, the amount would have been payable in cash to the
Participant.
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For purposes of determining a Participant’s Base Salary for
premium purposes pursuant to Section 2 for any Policy Year, up
to and including the Policy Year in which the Participant Retires,
becomes Disabled, or experiences a Termination of Employment, the
Participant’s Base Salary shall be measured and annualized as
of the March 31 preceding the date on which such Participant
Retires, becomes Disabled or experiences a Termination of
Employment. If a Participant’s Base Salary increases after
the Committee has determined the amount of such
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1
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Participant’s Base Salary for premium purposes for a
particular Policy Year, the amount of the Participant’s
increased Base Salary shall not be considered for purposes of this
Plan until the next Policy Year. For purposes of determining a
Participant’s Base Salary for premium purposes pursuant to
Section 2 after the Policy Year in which the Participant
Retires, becomes Disabled, or experiences a Termination of
Employment, the Participant’s Base Salary shall be measured
and annualized as of the March 31 preceding the date on which
such Participant Retired, became Disabled, or experienced a
Termination of Employment.
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(b)
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“Board” means the Board of Directors of the
Company.
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(c)
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“Code” means the Internal Revenue Code of 1986, as
amended.
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(d)
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“Committee” means the Hanesbrands Inc. Employee
Benefits Administrative Committee appointed by the Board of
Directors of the Company to administer the Plan, which committee
shall be a named fiduciary of the Plan, as defined in
Section 402 of ERISA.
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(e)
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“Company” means Hanesbrands Inc., a Maryland
corporation, and any successor thereto, including any corporation
that is a successor to all or substantially all of the
Company’s assets or business.
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(f)
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“Disability” or “Disabled” means a
determination by the Committee, or its delegate, in its sole
discretion, that a Participant is disabled in accordance with the
terms of the Hanesbrands Inc. Long Term Disability Plan. Upon
request by the Committee, or its delegate, the Participant must
timely submit proof of continued disability.
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(g)
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“Employee” means a person who is an active full-time
employee of the Company who is in Salary Bands one through five and
the Chief Executive Officer and Chairman of the Board. Individuals
classified by the Company as independent contractors, consultants,
leased employees or similar types of non-employee positions are
specifically excluded from the Plan, even if retroactively
classified as an employee by a court, the Internal Revenue Service
or another governmental agency.
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(h)
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“Effective Date” means January 1, 2006, the
effective date of this Plan document.
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(i)
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“Insurance Company” means the applicable insurance
company that has issued the Policy(ies) providing benefits under
the Plan for a Participant.
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(j)
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“Participant” means an Employee of the Company who is
selected to participate in the Plan and who has satisfied the
conditions for Plan participation as set forth in
Section 2.
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(k)
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“Plan” means this Hanesbrands Inc. Executive Life
Insurance Plan, effective as of January 1, 2006, as it may be
amended from time to time.
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2
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(l)
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“Plan Agreement” means a written agreement, as may be
amended from time to time, which is entered into by and between the
Company and a Participant. Each Plan Agreement executed by a
Participant and the Company shall provide for the entire benefit to
which such Participant is entitled under the Plan; should there be
more than one Plan Agreement, the Plan Agreement bearing the latest
date of acceptance by the Company shall supersede all previous Plan
Agreements in their entirety and shall govern such entitlement. The
terms of any Plan Agreement may be different for any Participant,
and any Plan Agreement may provide additional benefits not set
forth in the Plan or limit the benefits otherwise provided under
the Plan; provided, however, that any such additional benefits or
benefit limitations must be agreed to by both the Company and the
Participant.
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(m)
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“Plan Year” means the consecutive twelve
(12) month period commencing on January 1 of each year and
ending on the next following December 31.
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(n)
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“Policy” means the life insurance policy (or life
insurance policies if more than one is required because of death
benefit amounts or otherwise) purchased on a Participant’s
life that is subject to the terms and conditions of this
Plan.
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(o)
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“Policy Year” means the twelve (12) month period
commencing on the date the Policy is issued by the insurer, and
every twelve (12) month period commencing
thereafter.
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(p)
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“Projected Premium Payment Period” means the number of
Policy Years projected to occur between the Policy issue date and
the later of the Participant’s (i) Projected Retirement
Date, (ii) attainment of age sixty (60), or
(iii) attainment of ten (10) Years of Plan Participation.
For executives age sixty (60) and over as of November 1, 2008, the
Projected Premium Payment Period is projected to be 10
years.
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(q)
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“Projected Retirement Date” means the date on which the
Committee assumes the Participant will retire, solely for purposes
of this Plan; provided, however, the Committee may use its
discretion to revise this assumption as necessary at any time
during the Participant’s participation in the
Plan.
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(r)
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“Retirement”, “Retire(s)” or
“Retired” means severance from employment from the
Company for any reason other than a leave of absence, death or
Disability on or after the date on which the Participant is
eligible for a retirement benefit under the Hanesbrands Inc.
Pension Plan, as determined by the Committee in its sole
discretion.
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(s)
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“Termination of Employment” means the severing of
employment with the Company, voluntarily or involuntarily, for any
reason other than Retirement, Disability, death or an authorized
leave of absence. A Participant’s Termination of Employment
will be deemed to occur when the Participant ceases to be a
full-time employee of the Company, even though the Participant may
continue to serve as a director of the Company, or as a consultant
or independent contractor.
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(t)
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“Years of Plan Participation” means the total number of
full Plan Years a Participant has been a Participant in the Plan
prior to his or her Termination of Employment. Any partial year
shall not be counted for purposes of the Plan.
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4
2.1
Eligibility for Participation
An
Employee of the Company shall be eligible to participate in this
Plan and become a Participant in the Plan on the date he or she
meets all five of the following requirements:
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(a)
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Has been designated in writing by the Company, in its sole and
absolute discretion, as a Participant;
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(b)
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Completes and returns to the Committee, no later than thirty
(30) days after he or she receives written notice of such
designation, a Plan Agreement, and such administrative and other
forms as the Committee may require for participation;
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(c)
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Completes such insurance forms, exams and questions as the
Committee may designate from time to time;
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(d)
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Timely completes any other participation conditions as may be
prescribed by the Committee from time to time; and
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(e)
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Is insurable.
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If
an Employee fails to meet all of the above-listed requirements
within a reasonable time, as determined by the Committee in its
sole discretion, the Committee shall provide that Employee with
written notice within thirty (30) days of such failure, and
that person shall not be eligible to become a Participant under
this Plan.
2.2
Acquisition of Insurance
The
Participant agrees to cooperate in applying for and obtaining an
insurance policy on his or her life. The selection of the life
insurance policy used for this Plan shall be at the sole discretion
of the Company. The Policy shall be issued in the name of the
Participant as the sole and exclusive owner of the Policy. The
Participant shall have the right to name the beneficiary of the
Policy proceeds. At the sole discretion of the Committee, the
Participant may designate a person or entity other than the
Participant as the owner of the Policy, provided that such owner
agrees to be bound to the terms and conditions of this Plan. In no
event will a death benefit be payable to a Participant prior to the
issuance of a Policy on the Participant’s life. A reduced
amount of death benefit coverage may be provided to a Participant
under any Policy issued on a rated basis.
2.3
Additional Life Insurance Coverage
During
the term of this Plan, the death benefit coverage under the Policy
may be increased from time to time. The Participant agrees to
cooperate in applying for and obtaining such additional coverage.
If the Participant does not so cooperate, and such coverage cannot
be obtained because of that, the Company shall have no obligation
under this Plan to provide such
5
additional
coverage. Further, if the Participant is not insurable on a
guaranteed issue basis at the time such additional coverage is
sought, or if coverage is offered on a rated basis that is higher
than standard, nonsmoker, then the Company shall have no obligation
under this Plan to provide such additional coverage. A reduced
amount of death benefit coverage may be provided to a Participant
under any Policy issued on a rated basis.
2.4
Company’s Payment of Premiums Prior to Retirement,
Termination of Employment, Disability or Death
Subject
to subsections 2.1 and 2.2 above, prior to the Participant’s
Retireme
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