<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 7, 1997
REGISTRATION NO. _______
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------
WILLIAMS-SONOMA, INC.
(Exact Name of Registrant as Specified in its Charter)
CALIFORNIA 94-2203880
(State of Incorporation) (I.R.S. Employer
Identification Number)
100 North Point Street, San Francisco, California 94133
(Address of Principal Executive Office)
First Amendment and Restatement Of
The Williams-Sonoma, Inc. Executive Deferral Plan
(Full Title of the Plan)
DENNIS A. CHANTLAND Copy to:
Executive Vice President and JOAN L. LESSER, ESQ.
Chief Administrative Officer and Secretary Irell & Manella LLP
Williams-Sonoma, Inc. 1800 Avenue of the Stars
3250 Van Ness Avenue Suite 1800
San Francisco, California 94109 Los Angeles, California 90067
(415) 421-7900 (310) 277-1010
(Name, Address and Telephone Number,
Including Area Code, of Registrant's Agent
for Service)
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=================================================================================================================
Proposed Proposed
Maximum Maximum
Title of Amount to be Offering Price Aggregate Amount of
Securities to be Registered Registered(1) Per Share(2) Offering Price Registration Fee
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Executive Deferral Obligations $13,000,000(3) 100% $13,000,000 $3,940
=================================================================================================================
</TABLE>
(1) The Executive Deferral Obligations are unsecured obligations of
Williams-Sonoma, Inc. to pay deferred compensation in the future in
accordance with the terms of the First Amendment and Restatement of the
Williams-Sonoma, Inc. Executive Deferral Plan.
(2) Pursuant to Rule 457(h), estimated solely for the purpose of calculating the
registration fee.
(3) The total maximum aggregate offering price is $18,000,000, reflecting (i) up
to $5,000,000 of Executive Deferral Obligations registered pursuant to
Registrant's Registration Statement on Form S-8 (No. 33-60787) plus
(ii) up to $13,000,000 of Executive Deferral Obligations registered hereby.
PAGE 1 OF 25 PAGES
INDEX APPEARS AT PAGE 8
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
ITEM 1. PLAN INFORMATION.*
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.*
EARLIER REGISTRATION STATEMENT INCORPORATED BY REFERENCE. On June 30, 1995,
Williams-Sonoma, Inc., filed a Registration Statement on Form S-8, registration
number 33-60787, with respect to up to $5,000,000 of Executive Deferral
Obligations in the Williams-Sonoma, Inc. Executive Deferral Plan (the "1995 Form
S-8"). The present Registration Statement on Form S-8 (the "Registration
Statement") incorporates the 1995 Form S-8 by reference.
INFORMATION REQUIRED BY PART I OF FORM S-8. The document(s) updating the
information specified in Part I of Form S-8 will be sent or given to
participating employees as specified by Rule 428(b)(1) of the Securities Act of
1933, as amended. These documents and the documents incorporated by reference
into this Registration Statement pursuant to Item 3 of Part II of this
Registration Statement, taken together, constitute a prospectus that meets the
requirements of Section 10(a) of the Securities Act of 1933, as amended.
* Information required by Part I to be contained in the Section 10(a)
prospectus is omitted from this Registration Statement in accordance with
Rule 428 under the Securities Act and the Note to Part I of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The documents listed in (a) through (d) below are incorporated by
reference in this Registration Statement. In addition, all documents
subsequently filed by Registrant pursuant to Sections 13(a), 13(c), 14 and 15(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), prior
to the filing of a post-effective amendment that indicates that all securities
offered have been sold or that deregisters all securities then remaining unsold,
shall be deemed to be incorporated by reference in this Registration Statement
and to be part hereof from the date of filing of such documents:
(a) The Company's Annual Report on Form 10-K for the year ended February
2, 1997;
(b) The Company's Annual Report on Form 11-K for the year ended December
31, 1996;
(c) The Company's Quarterly Report on Form 10-Q for the three-month
period ended May 4, 1997;
(d) The Company's Quarterly Report on Form 10-Q for the three-month
period ended August 3, 1997.
Any statement contained herein or in a document incorporated or deemed
to be incorporated herein by reference shall be deemed to be modified or
superseded for purposes of this Registration Statement to the extent that a
statement contained herein or in any subsequently filed document which also is
incorporated or deemed to be incorporated herein by reference modifies or
supersedes such prior statement. Any statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Under the First Amendment and Restatement of the Williams-Sonoma, Inc.
Executive Deferral Plan (the "Executive Deferral Plan"), the Registrant will
provide a select group of management and highly compensated employees and
officers (the "Deferred Compensation Employees") the opportunity to enter into
agreements for the deferral of a specified percentage of their cash
compensation. The obligations of the Registrant under such agreements (the
"Executive Deferral Obligations") will be unsecured general obligations of the
Registrant to pay the deferred compensation in the future in accordance with the
terms of the Executive Deferral Plan and will rank pari passu with other
unsecured and unsubordinated indebtedness of the Registrant from time to time
outstanding.
To participate in the Executive Deferral Plan in a particular year, the
Deferred Compensation Employee must enroll in the Executive Deferral Plan and
select the percentage of deferral before the beginning of that calendar year.
The amount of compensation to be deferred by each participating employee
("Deferred Compensation Participant") will be determined in accordance with the
Executive Deferral Plan based on election by the employee. Deferred Compensation
Participants may elect to defer any whole percentage of their salary, so long
as such percentage exceeds five percent (5%) annually, and the amount not
deferred is sufficient to enable the Company to
-1-
<PAGE> 3
pay payroll taxes. Deferred Compensation Participants may also elect to defer
from their bonus, if applicable, as long as the minimum amount deferred is five
percent (5%) of their annual bonus, and the amount not deferred is sufficient to
enable the Company to pay payroll taxes.
The Executive Deferral Obligations will be indexed to one or more
investment media, which will be individually chosen by each Deferred
Compensation Participant from a list of investment media (currently eighteen
selections). Each Deferred Compensation Participant's deferred compensation
account will be adjusted to reflect the investment performance of the selected
investment media, including any appreciation or depreciation. Gains or losses
are posted to the Deferred Compensation Participant's account at the end of
every month. The investment media are for bookkeeping purposes only and the
Registrant is not obligated to invest the deferred compensation in the
investment media specified by the Deferred Compensation Participants.
A committee shall be appointed by the Board of Directors of the
Registrant and shall be charged with the general administration of the Executive
Deferral Plan and the Executive Deferral Obligations. The Executive Deferral
Obligations are not convertible into another security of the Registrant. The
Executive Deferral Obligations will not have the benefit of a negative pledge or
any other affirmative or negative covenant on the part of the Registrant. No
trustee has been appointed having the authority to take action with respect to
the Executive Deferral Obligations and each Deferred Compensation Participant
will be responsible for acting independently with respect to, among other
things, the giving of notices, responding to any requests for consents, waivers
or amendments pertaining to the Executive Deferral Obligations, enforcing
covenants and taking action upon a default.
The Executive Deferral Obligations will be distributed by the Registrant
in accordance with the terms of the Executive Deferral Plan and upon the
following circumstances: upon a date selected by a Deferred Compensation
Participant before his participation begins, termination of employment, death or
long term disability, termination of the Executive Deferral Plan, or upon the
occurrence of certain hardship circumstances as determined by the Executive
Deferral Plan Committee of the Registrant. Also, a Deferred Compensation
Participant may elect to receive 90% of his Executive Deferral Obligation at any
time, in which case the remaining 10% of his Executive Deferral Obligation will
be permanently forfeited.
A Deferred Compensation Participant's right or the right of any other
person to the Executive Deferral Obligations cannot be assigned, alienated,
sold, garnished, transferred, pledged or encumbered, except to the Registrant
for obligations owed to the Registrant.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 309 (c) of the California General Corporations Code (the "CCL")
permits a provision in the articles of incorporation eliminating or limiting,
with certain exceptions, the personal liability of a director to the corporation
or its shareholders for monetary damages for breach of fiduciary duty as a
director. On June 20, 1995, Article V of the Company's Articles of Incorporation
was amended to eliminate the liability of the directors of the Company for
monetary damages to the fullest extent permissible under California law.
Section 317 of the CCL provides for the indemnification of directors,
officers and "agents" (as defined in Section 317 (a) of the CCL) under certain
circumstances. Section 7.06 of the Company's Restated and Amended Bylaws
("BYLAWS") grants the Company the power to indemnify its directors, officers and
"agents" under certain circumstances, to the extent permitted by California law,
against certain expenses, judgments, fines, settlements and other amounts
actually and reasonably incurred in connection with any proceeding arising by
reason of their positions as directors, officers or "agents." Specifically,
section 7.7 of the Executive Deferral Plan provides for the indemnification
of the Committee appointed by the Board to administer the Executive Deferral
Plan and each member thereof, the Board of Directors, and any delegate of the
Committee who is an employee of a Company, to the fullest extent permitted by
applicable law against 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. Pursuant to
California law and the Bylaws, the Company is required to indemnify directors,
officers and "agents" against expenses actually and reasonably incurred to the
extent that such party is successful on the merits in defense of certain
proceedings.
Section 317 (i) of the CCL also provides that a corporation shall have
the power to purchase and maintain insurance on behalf of any agent of the
corporation against any liabilities asserted against or incurred by the agent in
such capacity. The Company maintains a director's and officer's liability
insurance policy insuring the Company's directors and officers against certain
liabilities and expenses incurred by them in their capacities as such, and
insuring the Company under certain circumstances in the event that
indemnification payments are made by the Company to such directors and officers.
Section 204(a)(11) of the CCL provides for the indemnification, subject
to certain limitations, of directors, officers and "agents" for breach of their
duty to a corporation and its shareholders in excess of that expressly permitted
by Section 317 of the CCL. On December 6, 1988, the Company's Restated Articles
of Incorporation were amended implementing Section 204(a)(11) of the CCL.
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<PAGE> 4
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
4 First Amendment and Restatement of Williams-Sonoma, Inc.
Executive Deferral Plan
5 Opinion of Irell & Manella LLP as to the legality of the
Obligations and the Executive Deferral Obligations
23.1 Independent Auditor's Consent
23.2 Consent of Irell & Manella LLP (included in Exhibit 5)
24 Powers of Attorney (included on the signature page of this
Registration Statement)
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this
Registration Statement:
(i) to include any prospectus required by Section
10(a)(3) of the Securities Act;
(ii) to reflect in the prospectus any facts or events
arising after the effective date of this
Registration Statement (or the most recent
post-effective amendment thereof) which,
individually or in the aggregate, represent a
fundamental change in the information set forth in
this Registration Statement;
(iii) to include any material information with respect to
the plan of distribution not previously disclosed
in this Registration Statement or any material
change to such information in this Registration
Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by Registrant pursuant to Section 13 or
Section 15(d) of the Exchange Act that are incorporated by
reference in this Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment
shall be deemed to be a new registration statement
relating to the securities offered therein, and the
offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act, each
filing of Registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the Exchange Act that is incorporated by
reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and
controlling persons of Registrant pursuant to the foregoing
provisions or otherwise, Registrant has been advised that in the
opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other
than the payment by Registrant of expenses incurred or paid by a
director, officer or controlling person of Registrant in the
successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection
with the securities being registered, Registrant will, unless in
the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate
jurisdiction the question of whether such indemnification by it
is
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<PAGE> 5
against public policy as expressed in the Securities Act and will
be governed by the final adjudication of such issue.
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<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of San Francisco, State of California, on this seventh
day of November 1997.
WILLIAMS-SONOMA, INC.,
a California corporation
By: /s/ Dennis A. Chantland
---------------------------------
Dennis A. Chantland
Executive Vice President, Chief
Administrative Officer
and Secretary
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints Dennis A. Chantland, his true and lawful
attorney-in-fact and agent, with full power of substitution for him and in his
name, place and stead, in any and all capacities, to sign any and all amendments
(including without limitation post-effective amendments) to this Registration
Statement, and to file the same, with all exhibits thereto and other documents
in connection therewith, with the Securities and Exchange Commission, granting
unto said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done in and about the
premises, lawfully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ W. Howard Lester Director and Chairman of the Board and November 6, 1997
- --------------------------- Chief Executive Officer (principal
W. Howard Lester executive officer)
/s/ Charles E. Williams Director and Vice Chairman of the Board November 6, 1997
- ---------------------------
Charles E. Williams
/s/ Dennis A. Chantland Executive Vice President and Chief November 6, 1997
- --------------------------- Administrative Officer and Secretary
Dennis A. Chantland (principal financial and accounting officer)
/s/ Patrick J. Connolly
- --------------------------- Director and Executive Vice President and November 6, 1997
Patrick J. Connolly General Manager, Catalog Division
</TABLE>
<PAGE> 7
<TABLE>
<S> <C> <C>
- --------------------------- Director and Chief Merchandising Officer November ___, 1997
Gary Friedman and President, Retail Division
- --------------------------- Director November ___, 1997
Adrian Bellamy
/s/ James M. Berry Director November 5, 1997
- ---------------------------
James M. Berry
/s/ Nathan Bessin Director November 5, 1997
- ---------------------------
Nathan Bessin
/s/ Millard S. Drexler Director November 7, 1997
- ---------------------------
Millard S. Drexler
/s/ James A. McMahan Director November 6, 1997
- ---------------------------
James A. McMahan
/s/ John E. Martin Director November 5, 1997
- ---------------------------
John E. Martin
/s/ Janet L. Emerson Director November 6, 1997
- ---------------------------
Janet L. Emerson
</TABLE>
<PAGE> 8
EXHIBIT INDEX
<TABLE>
<CAPTION>
Sequentially
Exhibit Description Numbered Page
- ------- ----------- -------------
<S> <C> <C>
4 First Amendment and Restatement of the Williams-Sonoma, Inc.
Executive Deferral Plan
5 Opinion of Irell & Manella LLP as to the legality of the Executive
Deferral Obligations being registered
23.1 Independent Auditors' Consent
23.2 Consent of Irell & Manella LLP (included in Exhibit 5)
24 Powers of Attorney (included on the signature page of this
Registration Statement)
</TABLE>
<PAGE> 1
Exhibit 4
First Amendment and Restatement
of the Williams-Sonoma, Inc.
Executive Deferral Plan
<PAGE> 2
FIRST AMENDMENT AND RESTATEMENT
OF THE
WILLIAMS-SONOMA, INC.
EXECUTIVE DEFERRAL PLAN
Williams-Sonoma, Inc. (the "Company") hereby adopts this First Amendment
and Restatement of the Williams-Sonoma, Inc. Executive Deferral Plan effective
as of January 1, 1998, with reference to the following facts:
A. Effective as of July 1, 1995, the Company adopted the
Williams-Sonoma, Inc. Executive Deferral Plan (the "Plan") to provide
supplemental retirement income benefits for a select group of management and
highly compensated employees.
B. The Company wishes to amend and restate the Plan in its entirety to
enhance certain benefits provided to participants and to clarify certain
provisions of the Plan.
NOW, THEREFORE, the Plan is hereby amended and restated in its entirety,
effective as of January 1, 1998, as follows:
ARTICLE I
TITLE AND DEFINITIONS
1.1 TITLE.
This Plan shall be known as the Williams-Sonoma, Inc. Executive Deferral
Plan.
1.2 DEFINITIONS.
Whenever the following words and phrases are used in this Plan, with the
first letter capitalized, they shall have the meanings specified below.
"Beneficiary" or "Beneficiaries" shall mean the person or persons
designated under Article VII.
"Board of Directors" or "Board" shall mean the Board of Directors of the
Company.
"Bonus" shall mean any incentive compensation payable to a Participant
in addition to the Participant's Salary.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Committee" shall mean the Committee appointed by the Board to
administer the Plan in accordance with Article VII.
"Company" shall mean Williams-Sonoma, Inc., any successor corporation
and each corporation which is a member of a controlled group of corporations
(within the meaning of Section 414(b) of the Code) of which Williams- Sonoma,
Inc. is a member.
"Compensation" shall mean the Salary and Bonus that the Participant
receives for services rendered to the Company.
"Deferral Account" shall mean the bookkeeping account maintained by the
Committee for each Participant under Article IV.
"Disability" shall mean a period of disability during which a
Participant qualifies for benefits under the Company's group long term
disability plan or, if a Participant does not participate in such a plan, a
period of disability during which the Participant would have qualified for
benefits under such a plan had the Participant been a participant in such a
plan, as determined in the sole discretion of the Committee. If the Company does
not sponsor such a plan, Disability shall be determined by the Committee in its
sole discretion.
"Distributable Amount" shall mean the amount credited to a Participant's
Deferral Account as of the date of distribution or withdrawal under
Section 6.4.
<PAGE> 3
"Eligible Employee" shall mean each member of a group of select
management or highly compensated employees of the Company who is selected by the
Committee to participate in the Plan.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Fund" or "Funds" shall mean one or more of the mutual funds or
investment vehicles selected by the Committee pursuant to Section 3.2(a).
"Initial Election Period" for an Eligible Employee shall mean the 30-day
period following the date on which the Committee notifies an employee that he or
she has been selected as an Eligible Employee.
"Interest Rate" shall mean, for each Fund, an amount equal to the net
rate of gain or loss which assets invested in such Fund would have earned during
each calendar month.
"Participant" shall mean any Eligible Employee who elects to defer
Compensation in accordance with Section 3.1.
"Payment Eligibility Date" shall mean the date (which shall be the first
day of a calendar quarter) specified by the Participant on a form provided by
the Committee prior to July 30, 1995 or, if later, within 30 days of the date on
which such person becomes a Participant. If the Participant specifies no Payment
Eligibility Date, the Payment Eligibility Date shall be the first day of the
calendar quarter following the Participant's death, Disability, or Termination
of Employment.
"Plan" shall mean the Williams-Sonoma, Inc. Executive Deferral Plan set
forth herein.
"Plan Year" shall mean the 12 consecutive month period beginning January
1, and ending December 31, except that the first Plan Year shall be a short year
beginning July 1, 1995 and ending December 31, 1995.
"Retirement" shall mean a Participant's Termination of Employment on or
after his or her attainment of both age 55 and five Years of Service for any
reason other than a leave of absence approved by the Committee, death, or
Disability. For purposes of determining whether a Participant has "Retired,"
"Years of Service" shall mean the total number of full years in which a
Participant has been continuously employed by the Company. For purposes of this
definition, a year of employment shall be a 365 day period (or 366 day period in
the case of a leap year) that, for the first year of employment, commences on
the employee's date of hire and that, for any subsequent year, commences on an
anniversary of that hiring date. The Committee may, in its sole discretion,
credit a Participant with any partial year of employment. Periods during which
an Eligible Employee is on a paid leave of absence or suffers from a Disability
shall be deemed to be periods of continuous employment.
"Salary" shall mean the Participant's base pay.
"Termination of Employment" shall mean the ceasing of a Participant's
employment with the Company for any reason other than a leave of absence
approved by the Committee, death, or Disability. A Participant shall not be
considered to have had a Termination of Employment by virtue of a change in
employment from one corporation which is a member of the controlled group of
corporations (within the meaning of Section 414(b) of the Code) constituting the
Company to another such member. However, if the corporation which employs a
Participant ceases to be a member of the controlled group of corporations
constituting the Company as a result of a sale or other corporate
reorganization, such sale or other corporate reorganization shall be treated as
the Participant's Termination of Employment unless, immediately following such
sale or reorganization and without any break in employment, the Participant
remains employed by another member of the controlled group of corporations
constituting the Company, or the former member of the controlled group which
employs the Participant assumes liability for the benefits of the Participant
under this Plan.
ARTICLE II
PARTICIPATION
2.1 PARTICIPATION.
An Eligible Employee shall become a Participant in the Plan by electing
to defer all or a portion of his or her Compensation in accordance with Section
3.1. The Committee, in its discretion, may require an Eligible Employee, as a
condition to becoming a Participant, to complete an application for the life
insurance benefit described in Section 6.3(a), and to comply with various
medical underwriting requirements of the insurance company.
<PAGE> 4
2.2 CONTINUING PARTICIPATION.
An Eligible Employee who becomes a Participant shall continue to be a
Participant until all of his benefits are distributed under this Plan. The
Committee may determine at any time, in its sole discretion, that a Participant
is no longer an Eligible Employee. Such a Participant shall continue to be a
Participant in this Plan until all of his benefits are distributed under this
Plan, but, from and after the first day of the first Plan Year beginning after
such determination, such Participant shall not be entitled to make any further
deferrals of Compensation under Article III.
ARTICLE III
DEFERRAL ELECTIONS
3.1 ELECTIONS TO DEFER COMPENSATION.
(a) Initial Election Period. Each Eligible Employee may elect to defer
Compensation by filing with the Committee an election that conforms to the
requirements of this Section 3.1, on a form provided by the Committee, no later
than the last day of his or her Initial Election Period.
(b) General Rule. Subject to the limitations set forth in paragraphs (c)
and (d) below, the amount of Compensation which an Eligible Employee may elect
to defer is as follows:
(1) Any whole percentage of Salary up to 100%; and/or
(2) Any whole percentage or dollar amount of Bonus up to 100%.
(c) Maximum Deferrals. A Participant shall not be entitled to defer an
amount of his Salary or Bonus for any Plan Year to the extent that the amount of
the Salary or Bonus remaining undeferred for that Plan Year is less than the
amount of payroll taxes which the Company will owe on his Compensation and all
other compensation he receives from the Company in that Plan Year. An election
to defer Salary or Bonus shall not be effective to the extent it exceeds the
maximum amount set forth in this Section 3.1(b).
(d) Minimum Deferrals. For each Plan Year for which a Participant elects
to defer any portion of his Salary, the minimum percentage of Salary which may
be deferred under paragraph (b)(1) of this Section 3.1 is 5%. This 5% minimum
deferral for any Plan Year shall be reduced to a lesser percentage (but not
below zero percent) if the Participant deferred any portion of his or her Bonus
paid with respect to the preceding Plan Year. The amount of such reduction shall
be the number of percentage points determined by (1) dividing the amount of the
Bonus deferred with respect to such preceding Plan Year by the amount of the
Participant's annual Salary at the beginning of the Plan Year for which the
minimum deferral is being computed, and (2) multiplying by 10. For example, if a
Participant receives a Salary of $200,000 for the Plan Year for which the
minimum deferral is being computed, and deferred $20,000 of his bonus for the
prior Plan Year, the minimum deferral will be reduced by (1) $20,000 divided by
$200,000, or .10, multiplied by (2) 10, to arrive at a reduction in the maximum
percentage of 1.0%. The maximum deferral percentage will therefore be 5% minus
1%, or 4%.
(e) Effect of Initial Election. An election to defer Compensation made
during an Initial Election Period shall be effective with respect to Salary
earned during the first pay period beginning after the end of the Initial
Election Period and with respect to the Bonus payable for services rendered
during the Company's fiscal year ending with or within the Plan Year in which
the election is made.
(f) Duration of Salary Deferral Election. Any Salary deferral election
made under paragraph (a) or paragraph (h) of this Section 3.1 shall be
irrevocable with respect to the Plan Year for which it is made, and shall remain
in effect, notwithstanding any change in the Participant's Salary, until changed
or terminated in accordance with the terms of this paragraph (f); provided,
however, that such election shall terminate under Section 2.2 for any Plan Year
for which the Participant is not an Eligible Employee. Subject to the maximum
deferral requirement of Section 3.1(c) and the minimum deferral requirement of
Section 3.1(d), a Participant may increase, decrease or terminate his or her
Salary deferral election, effective for Salary earned during pay periods
beginning after any January 1, by filing a new election, in accordance with the
terms of this Section 3.1, with the Committee during the preceding December.
(g) Duration of Bonus Deferral Election. Any Bonus deferral election
made under paragraph (a) or paragraph (h) of this Section 3.1 shall be
irrevocable and shall apply only to the Bonus payable with respect to services
performed during the Plan Year for which the election is made. For each
subsequent Plan Year, an Eligible Employee may make a new election, subject to
the limitations set forth in this Section 3.1, to defer a percentage of his or
her Bonus payable with respect to services performed during such subsequent Plan
Year. Such election shall be on forms provided by the Committee and shall be
made during the month of December preceding the Plan Year for which the election
is to apply.
<PAGE> 5
(h) Elections other than Elections during the Initial Election Period.
Subject to the limitations of paragraphs (c) and (d) above, any Eligible
Employee who fails to elect to defer compensation during his or her Initial
Election Period may subsequently become a Participant, and any Eligible Employee
who has terminated a prior Salary deferral election may elect to again defer
Salary, by filing an election, on a form provided by the Committee, to defer
Compensation as described in paragraph (b) above. An election to defer Salary
and/or Bonus must be filed during the month of December and will be effective
for Salary earned during pay periods beginning after the following January 1 and
the Bonus paid with respect to services performed in the Plan Year beginning on
the following January 1.
3.2 INVESTMENT ELECTIONS.
(a) The Committee shall select the Funds whose performance will measure
the amounts to be credited to the Deferral Accounts of Participants under
paragraph (c) of Article IV. The selection of funds shall be for bookkeeping
purposes only, and the Company shall not be obligated actually to invest any
money in the Funds, or to acquire or maintain any actual investment. The
Committee may, in its discretion, change its selection of the Funds at any time.
If a Participant has elected pursuant to Section 3.2(b) to invest all or a
portion of his Deferral Account in a Fund which the Committee decides to
discontinue, his Deferral Account shall be invested after such discontinuance in
the continuing Fund which the Committee determines, in its discretion, most
nearly resembles the discontinued Fund.
(b) The Committee shall provide each Participant with a list of the
Funds available for hypothetical investment, and the Participant shall
designate, when the Participant makes deferral elections under Section 3.1, on a
form provided by the Committee, one or more of such Funds in which his or her
Deferral Account will be deemed to be invested. The Participant may make a
separate designation for deferrals to be made after such designation than for
amounts credited to his or her Deferral Account as of the date of such
designation. In making the designation pursuant to this Section 3.2(b), the
Participant may specify that all or any whole percentage of at least 10% of his
or her future deferrals or Deferral Account balance, as the case may be, be
deemed to be invested in one or more of Funds.
(c) On or prior to the twentieth day of any calendar month (or later day
prescribed by the Committee, but not later than the last day of the calendar
month), a Participant may change the designation of the Funds in which his
Deferral Account balance or future deferrals will be deemed to be invested. Such
change may be made with respect to any whole percentage of at least 10% of the
Deferral Account balance or amount of future deferrals, as the case may be.
Such change shall be made by filing with the Committee an election on a form
provided by the Committee. Such change shall be effective as of the first day
of the following calendar month.
ARTICLE IV
DEFERRAL ACCOUNT
The Committee shall establish and maintain a Deferral Account for each
Participant under the Plan, which shall be merely a bookkeeping account and
which need not represent any actual assets. 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(b). A Participant's Deferral Account shall be credited as follows:
(a) As of the last day of each calendar month, the Committee shall
credit each Participant's Fund Subaccounts with amounts equal to Salary deferred
by the Participant during each pay period ending in that month in accordance
with the Participant's election under Section 3.2(b); that is, the portion of
the Participant's deferred Salary that the Participant has elected to be deemed
to be invested in a certain Fund shall be credited to the Fund Subaccount
corresponding to that Fund.
(b) As of the last day of the month in which the Bonus is paid, the
Committee shall credit the Participant's Fund Subaccounts with amounts equal to
the portion of the Bonus which the Participant has deferred in accordance with
the Participant's election under Section 3.2(b); that is, the portion of the
Participant's deferred Bonus that the Participant has elected to be deemed to be
invested in a certain Fund shall be credited to the Fund Subaccount
corresponding to that Fund.
(c) As of the last day of each month, each Fund Subaccount of a
Participant's Deferral Account shall be credited with deemed earnings in an
amount equal to the product of the balance credited to such Fund Subaccount as
of the last day of the preceding month multiplied by the Interest Rate for the
corresponding Fund for the month for which earnings are credited.
(d) Any distribution on the entire balance in a Participant's Deferral
Account shall be charged to the Deferral Account on the last day of the calendar
month before the distribution is made. If distributions are made to a
Participant or his Beneficiary in the form of installments, or if a distribution
or withdrawal is made of less than the entire Distributable Amount, the amount
of each such installment, distribution or withdrawal shall be charged to such
Participant's Deferral Account on the last day of the month on which such
installment, distribution or withdrawal is paid. The amount of an installment,
distribution or withdrawal charged to a Participant's Deferral Account on the
last
<PAGE> 6
day of a month shall be charged to the Fund Subaccounts in such Deferral Account
in the proportions of the relative balances of such Fund Subaccounts on the
first day of such calendar month.
ARTICLE V
VESTING
Subject to the provisions of Sections 6.4, 6.6, 11.1, 11.2 and 11.6, a
Participant's Deferral Account shall be 100% vested at all times.
ARTICLE VI
DISTRIBUTIONS
6.1 DISTRIBUTION ON RETIREMENT OR DISABILITY.
(a) A Participant who becomes Disabled or whose Payment Eligibility Date
occurs on or after the date of his Retirement shall, unless he makes a valid
election under Section 6.1(b) and except as provided in Section 6.1(c), receive
his Distributable Amount in the form of quarterly installments over 15 years
beginning as soon as practicable after his Payment Eligibility Date, or, in the
case of Disability, as soon as practicable after the first day of the calendar
quarter following the calendar quarter in which his Disability occurs.
(b) Notwithstanding the foregoing, a Participant may elect, pursuant to
this Section 6.1(b), to have his Distributable Amount paid in one of the
following optional forms on his Disability, or on his Payment Eligibility Date
occurring on or after the date of his Retirement:
(1) a cash lump sum payable as soon as practicable following the
Participant's Payment Eligibility Date, or, in the case of Disability, as soon
as practicable after the first day of the calendar quarter following the
calendar quarter in which his Disability occurs, or
(2) quarterly installments over five or 10 years beginning as soon
as practicable after his Payment Eligibility Date, or, in the case of
Disability, as soon as practicable after the first day of the calendar quarter
following the calendar quarter in which the Participant's Disability occurs.
An election under this Section 6.1(b) shall be valid only if it is made in
writing in a form prescribed by the Committee either (i) during the Initial
Election Period, or (ii) at least one year before the Participant's Disability
or Payment Eligibility Date.
(c) Notwithstanding the provisions of Sections 6.1(a) and (b), if the
Distributable Amount is $25,000 or less, the Distributable Amount shall
automatically be distributed in the form of a cash lump sum as soon as
practicable following the Payment Eligibility Date, or, in the case of
Disability, the first day of the calendar quarter after the Participant's
Disability or Payment Eligibility Date occurs.
(d) If a Participant's benefits are paid in installments, the
Participant's Deferral Account shall continue to be credited monthly with deemed
earnings pursuant to paragraph (c) of Article IV until all amounts credited to
his or her Deferral Account have been distributed. Such installments shall be as
nearly equal as possible consistent with the requirement of the preceding
sentence.
6.2 SITUATIONS OTHER THAN RETIREMENT, DISABILITY OR DEATH.
The Distributable Amount of a Participant whose Payment Eligibility Date
occurs before his Retirement, Disability or death shall be paid to the
Participant in the form of a cash lump sum as soon as practicable following the
Participant's Payment Eligibility Date.
6.3 DEATH.
(a) If a Participant dies while employed by the Company, the following
benefits shall be provided: That portion of the death benefit of any life
insurance policy purchased by the Company to insure the life of the Participant
(the "Policy") which is equal to two times the Participant's annual Salary at
the time the Participant dies shall be paid to Participant's beneficiary under
the Policy by the insurance company which issued the Policy. Any such Policy
shall be subject to the conditions set forth in a "Split-Dollar Life Insurance
Agreement" between the Participant and the Company, pursuant to which the
Participant may designate a beneficiary with respect to the portion of the
Policy proceeds described in the preceding sentence in the event the Participant
dies prior to terminating employment with the Company. The Participant shall
have the right to designate and change such beneficiary (which need not be his
Beneficiary as determined under Article VIII) at any time on a form provided by
and filed with the insurance company, and the life insurance proceeds designated
in this Section 6.3(a) shall be paid to such beneficiary. The benefit payable
pursuant to this Section 6.3(a) shall be paid only if a Policy has been issued
on the Participant's life and is in force at the time of the Participant's death
and any such payment shall be subject to all conditions and
<PAGE> 7
exceptions set forth in the Policy. A Participant who is entitled to a death
benefit pursuant to this Section 6.3(a) shall not be entitled to any other
Company-paid group term life insurance benefits from the Company under this Plan
or any other Policy provided by the Company. Notwithstanding any provision of
this Plan or any other document to the contrary, the Company shall not have any
obligation to pay the Participant or his Beneficiary any amounts described in
this Section 6.3(a). Any such amounts shall be payable solely from the proceeds
of the Policy, and if no Policy is in force, no payment shall be made.
Furthermore, the Company is not obligated to maintain any Policy; and no death
benefit shall be payable under this Section 6.3(a) if the Company has been
notified by the Committee to discontinue the Policy for the Participant. In
addition, no Policy shall be allocated to any Deferral Account.
(b) If a Participant dies before his Payment Eligibility Date, or after
his Payment Eligibility Date but before payment of benefits under this Plan has
begun, the Distributable Amount shall be paid to the Participant's Beneficiary
in a cash lump sum as soon as practicable after the first day of the calendar
quarter following the calendar quarter in which the Participant dies. If a
Participant dies after the beginning of installment payments under Sections
6.1(a) or (b) but before receiving all of such installments, his beneficiary
shall receive a cash lump sum payment as soon as practicable following the last
day of the calendar month in which he dies equal to the remaining balance of his
Deferral Account as of such last day.
6.4 WITHDRAWALS.
A Participant shall be permitted to elect to withdraw amounts from his
Deferral Account as soon as practicable after the first day of any calendar
quarter, whether before or after his Termination of Employment or Payment
Eligibility Date, subject to the following restrictions:
(a) The election to take a withdrawal shall be made by filing a form
provided by and filed with the Committee prior to the end of any calendar month.
(b) The amount of the withdrawal shall equal 90% of the Distributable
Amount as of the end of the calendar month in which the withdrawal election is
made.
(c) The amount described in subsection (b) above shall be paid in a
single cash lump sum as soon as practicable after the end of the calendar month
in which the withdrawal election is made.
(d) If a Participant receives a withdrawal, the remaining 10% of the
balance (including the withdrawn amount) in his Deferral Account as of the date
of the withdrawal shall be permanently forfeited and the Company shall have no
obligation to the Participant or his Beneficiary with respect to such forfeited
amount.
(e) If a Participant receives a withdrawal, the following rules will
apply for the balance of the Plan Year in which the withdrawal election is made
and for the following Plan Year: (i) the Participant will be ineligible to
Participate in the Plan, and (ii) neither the Participant (nor his Beneficiary
or Beneficiaries) shall be entitled to death benefits under Section 6.4.
(f) A Participant will be limited to a maximum of two withdrawals during
all of his periods of Plan Participation.
6.5 UNFORESEEABLE EMERGENCY.
The Committee may, pursuant to rules adopted by it and applied in a
uniform manner, accelerate the date of distribution of a Participant's Deferral
Account because of an Unforeseeable Emergency at any time; provided, however,
that any determination to accelerate the distribution of the Deferral Account of
any member of the Committee shall be made by the Board. Any acceleration shall
be limited to the amount necessary to meet the "Unforeseeable Emergency."
"Unforeseeable Emergency" shall mean an unforeseeable, severe financial
condition resulting from (a) a sudden and unexpected illness or accident of the
Participant or his dependent (as defined in Section 152(a) of the Code); (b)
loss of the Participant's property due to casualty; or (c) other similar
extraordinary and unforeseeable circumstances arising as a result of events
beyond the control of the Participant, but which may not be relieved through
other available resources of the Participant (including reimbursement or
compensation by insurance, liquidation of the Participant's assets, to the
extent the liquidation of the assets would not itself cause severe financial
hardship, or by the cessation of deferrals under the Plan), as determined by the
Committee in accordance with uniform rules adopted by it. Subject to the
foregoing, payment of any amount with respect to which a Participant has filed a
request under this Section 6.5 shall be made as soon as practicable after
approval of such request by the Committee.
6.6 INABILITY TO LOCATE PARTICIPANT.
If the Committee is unable to locate a Participant or his or her
Beneficiary on any date on which a distribution is to be made from such
Participant's Deferral Account, the Company shall retain the distribution which
was to be made on such date until such time as the Committee can locate the
Participant or Beneficiary; provided, however, that
<PAGE> 8
the Company may deduct from such retained distributions all taxes which are
required to be withheld by the Company. No additional earnings shall be credited
pursuant to paragraph (c) of Article IV on any distribution retained pursuant to
this Section . If the Committee is unable to locate a Participant or Beneficiary
within five years following a date on which a distribution is to be made from
such Participant's Deferral Account, the amount of such distribution shall be
forfeited. In seeking to locate a Participant or Beneficiary, the Committee may
take any reasonable action, but shall not be required to take any action other
than communicating by registered mail to the address or addresses last provided
to the Committee by the Participant or Beneficiary.
ARTICLE VII
ADMINISTRATION
7.1 COMMITTEE.
A Committee, consisting of not less than one person, shall be appointed
by and serve at the pleasure of the Board of Directors. The number of members
comprising the Committee shall be determined by the Board, which may from time
to time vary the number of members. A member of the Committee may resign by
delivering a written notice of resignation to the Board. The Board may remove
any member by resolution at any time. Vacancies in the membership of the
Committee shall be filled by the Board.
7.2 COMMITTEE ACTION.
The Committee shall act at meetings by affirmative vote of a majority of
the members of the Committee. Any action permitted to be taken at a meeting may
be taken without a meeting if, prior or subsequent to such action, a written
consent to the action is signed by all members of the Committee, and such
written consent is filed with the minutes of the proceedings of the Committee. A
member of the 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 the Committee designated by the Chairman may execute any
certificate or other written direction on behalf of the Committee.
7.3 POWERS AND DUTIES OF THE COMMITTEE.
The Committee shall enforce the Plan in accordance with its terms, shall
be charged with the general administration of the Plan and shall have full
discretion, power, and authority 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 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;
(f) 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 Committee may from time to time prescribe; and
(g) To determine who are Eligible Employees, subject to the
limitations described in the Plan.
7.4 CONSTRUCTION AND INTERPRETATION.
The Committee shall have full discretion to construe and interpret the
terms and provisions of this Plan, which interpretation or construction shall be
final and binding on all parties, including but not limited to the Company and
any Participant or Beneficiary. The 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; provided, however, the Committee shall
have the discretion to determine whether an otherwise Eligible Employee is
selected to participate in the Plan.
<PAGE> 9
7.5 INFORMATION.
To enable the Committee to perform its functions, the Companies shall
supply full and timely information to the Committee on all matters relating to
the Compensation of all Participants, their death or other cause of termination,
and such other pertinent facts as the Committee may require.
7.6 COMPENSATION AND EXPENSES.
The members of the Committee shall serve without compensation for their
services hereunder. The Committee is authorized at the expense of
Williams-Sonoma, Inc. to employ such legal counsel, accountants, and other
advisers 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 by Williams-Sonoma, Inc.
7.7 INDEMNITY.
To the fullest extent permitted by applicable law, Williams-Sonoma, Inc.
shall indemnify, hold harmless, and defend the Committee and each member
thereof, the Board of Directors, and any delegate of the Committee who is an
employee of a Company against any and all expenses, liabilities and claims,
including legal fees as they are incurred 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 or provided by the Company
under any bylaw, agreement or otherwise.
7.8 PARTICIPANT STATEMENTS.
Under procedures established by the Committee, a Participant shall
receive a statement with respect to such Participant's Deferral Account on a
periodic basis at least once with respect to each Plan Year.
ARTICLE VIII
BENEFICIARY DESIGNATION
8.1 BENEFICIARY.
Each Participant shall have the right, at any time, to designate his or
her Beneficiary(ies) (both primary as well as contingent) to receive any
benefits payable under the Plan to a beneficiary upon the death of a
Participant. The Beneficiary designated under this Plan may be the same as or
different from the Beneficiary designation under any other plan of the Company
in which the Participant participates.
8.2 BENEFICIARY DESIGNATION; CHANGE; SPOUSAL CONSENT.
A Participant shall designate his or her Beneficiary by completing and
signing the Beneficiary Designation Form, and returning it to the Committee or
its designated agent. A Participant shall have the right to change a Beneficiary
by completing, signing and otherwise complying with the terms of the Beneficiary
Designation Form and the Committee's rules and procedures, as in effect from
time to time. If the Participant names someone other than his or her spouse as a
Beneficiary, a spousal consent, in the form designated by the Committee, must be
signed by that Participant's spouse and returned to the Committee. Upon the
acceptance by the Committee of a new Beneficiary Designation Form, all
Beneficiary designations previously filed shall be cancelled. The Committee
shall be entitled to rely on the last Beneficiary Designation Form filed by the
Participant and accepted by the Committee prior to his or her death.
8.3 ACKNOWLEDGMENT.
No designation or change in designation of a Beneficiary shall be
effective until received, accepted and acknowledged in writing by the Committee
or its designated agent.
8.4 NO BENEFICIARY DESIGNATION.
If a Participant fails to designate a Beneficiary as provided in
Sections 8.1, 8.2 and 8.3 above or, if all designated Beneficiaries predecease
the Participant or die prior to complete distribution of the Participant's
benefits, then the Participant's spouse shall be the designated Beneficiary. If
the Participant has no surviving spouse, the benefits remaining under the Plan
shall be paid to 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 Committee determines is reasonably
necessary to allow such personal representative to be appointed, but not to
exceed 180 days
<PAGE> 10
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
Committee that they are legally entitled to receive the benefits under this
Plan.
8.5 DOUBT AS TO BENEFICIARY.
If the Committee has any doubt as to the proper Beneficiary to receive
payments pursuant to this Plan, the Committee shall have the right, exercisable
in its discretion, to cause the Company to withhold such payments until this
matter is resolved to the Committee's satisfaction.
8.6 DISCHARGE OF OBLIGATIONS.
The payment of benefits under the Plan to a Beneficiary shall fully and
completely discharge the Company and the Committee from all further obligations
under this Plan with respect to the Participant, and that Participant's rights
under the Plan shall terminate upon such full payment of benefits.
8.7 DEATH OF SPOUSE OR DISSOLUTION OF MARRIAGE.
A Participant's Beneficiary designation shall be deemed automatically
revoked if the Participant names a spouse as Beneficiary and the marriage is
later dissolved. Without limiting the generality of the preceding sentence, the
interest in benefits of a spouse of a Participant who has predeceased the
Participant or whose marriage has been dissolved shall automatically pass to the
Participant, and shall not be transferrable by such spouse in any manner,
including but not limited to such spouse's will, nor shall such interest pass
under the laws of intestate succession.
ARTICLE IX
CLAIMS PROCEDURE
9.1 PRESENTATION OF CLAIM.
Any Participant or Beneficiary of a deceased Participant (such
Participant or Beneficiary being referred to below as a "Claimant") may deliver
to the Committee a written claim for a determination with respect to the amounts
distributable to such Claimant from the Plan. If such a claim relates to the
contents of a notice received by the Claimant, the claim must be made within 60
days after such notice was received by the Claimant. The claim must state with
particularity the determination desired by the Claimant. All other claims must
be made within 180 days of the date on which the event that caused the claim to
arise occurred. The claim must state with particularity the determination
desired by the Claimant.
9.2 NOTIFICATION OF DECISION.
The Committee shall consider a Claimant's claim within a reasonable
time, and shall notify the Claimant in writing:
(1) that the Claimant's requested determination has been made,
and that the claim has been allowed in full; or
(2) that the Committee has reached a conclusion contrary, in
whole or in part, to the Claimant's requested determination, and such notice
must set forth in a manner calculated to be understood by the Claimant:
(i) the specific reason(s) for the denial of the claim, or
any part of it;
(ii) specific reference(s) to pertinent provisions of the
Plan upon which such denial was based;
(iii) a description of any additional material or information
necessary for the Claimant to perfect the claim, and an explanation of why such
material or information is necessary; and
(iv) an explanation of the claim review procedure set forth
in Section 9.3 below.
9.3 REVIEW OF A DENIED CLAIM.
Within 60 days after receiving a notice from the Committee that a claim
has been denied, in whole or in part, a Claimant (or the Claimant's duly
authorized representative) may file with the Committee a written request for a
<PAGE> 11
review of the denial of the claim. Thereafter, but not later than 30 days after
the review procedure began, the Claimant (or the Claimant's duly authorized
representative):
(a) may review pertinent documents;
(b) may submit written comments or other documents; and/or
(c) may request a hearing, which the Committee, in its sole
discretion, may grant.
9.4 DECISION ON REVIEW.
The Committee shall render its decision on review promptly, and not
later than 60 days after the filing of a written request for review of the
denial, unless a hearing is held or other special circumstances require
additional time, in which case the Committee's decision must be rendered within
120 days after such date. Such decision must be written in a manner calculated
to be understood by the Claimant, and it must contain:
(a) specific reasons for the decision;
(b) specific reference(s) to the pertinent Plan provisions upon
which the decision was based; and
(c) such other matters as the Committee deems relevant.
9.5 ARBITRATION.
A Claimant's compliance with the foregoing provisions of this Article 9
is a mandatory prerequisite to a Claimant's right to commence any arbitration
proceeding with respect to any claim for benefits under this Plan.
ARTICLE X
ARBITRATION
Arbitration shall be the exclusive remedy for resolving any dispute or
controversy between the Company and any employee, Participant or Beneficiary,
including, but not limited to, any dispute regarding an employee's status as a
Participant, a Participant's employment or the termination of a Participant's
employment or any dispute regarding the application, interpretation or validity
of this Plan not otherwise resolved through the claims procedure set forth in
Article 9. Such arbitration shall be conducted in accordance with the then most
applicable rules of the American Arbitration Association. The arbitrator shall
be empowered to grant only such relief as would be available in a court of law.
In the event of any conflict between this Agreement and the rules of the
American Arbitration Association, the provisions of this Agreement shall be
determinative. If the parties are unable to agree upon an arbitrator, they shall
select a single arbitrator from a list designated by the office of the American
Arbitration Association having responsibility for the city in which the
Participant or Beneficiary last resided while employed by the Employer of seven
arbitrators, all of whom shall be retired judges who are actively involved in
hearing private cases or members of the National Academy of Arbitrators. If the
parties are unable to agree upon an arbitrator from such list, they shall each
strike names alternatively from the list, with the first to strike being
determined by lot. After each party has used three strikes, the remaining name
on the list shall be the arbitrator. The fees and expenses of the arbitrator
shall initially be borne equally by the parties; provided, however, that each
party shall initially be responsible for the fees and expenses of its own
representatives and witnesses. If the parties cannot agree upon a location for
the arbitration, the arbitrator shall determine the location. Judgment may be
entered on the award of the arbitrator in any court having jurisdiction. The
prevailing party in the arbitration proceeding, as determined by the arbitrator,
and in any enforcement or other court proceedings, shall be entitled to the
extent provided by law to reimbursement from the other party for all of the
prevailing party's costs (including but not limited to the arbitrator's
compensation), expenses and reasonable attorney's fees.
ARTICLE XI
MISCELLANEOUS
11.1 UNSECURED GENERAL CREDITOR.
Participants and their Beneficiaries, heirs, successors, and assigns
shall have no legal or equitable rights, claims, or interests in any specific
property or assets of any Company. No assets of the Company shall be held under
any trust, or held in any way as collateral security for the fulfilling of the
obligations of the Company under this Plan. This Plan shall not cause the
Company's assets to be pledged or restricted. The Company's obligation under the
Plan shall be merely that of an unfunded and unsecured promise of that 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 of the Company.
The Company may, but need not, acquire investments corresponding to the Funds,
and it is not under any obligation to maintain any investment it may make. Any
such investments, if made, shall be in the name of the
<PAGE> 12
Company, and shall be its sole property in which no Participant shall have any
interest. The Plan is intended to be an unfunded plan for purposes of Title I of
ERISA.
11.2 RESTRICTION AGAINST ASSIGNMENT.
The Company shall pay all amounts payable hereunder only to the person
or persons designated by the Plan and not to or for any other person. No part of
a Participant's Deferral Account 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 Deferral Account 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, transfer,
commute, pledge, encumber, or assign any benefits or payments hereunder in any
manner whatsoever, except with regard to debts, contracts and engagements owed
to the Company. Any purported alienation, anticipation, transfer, commutation,
pledge, encumbrance, or assignment shall be void and of no effect, except with
regard to debts, contracts and engagements owed to the Company. If any
Participant, Beneficiary or successor in interest is adjudicated bankrupt, and
the Participant's rights to distribution or payment under the Plan are subject
to involuntary transfer or assignment in any such proceeding, the Committee may
in its discretion cancel such distribution or payment (or any part thereof) to
or for the benefit of such Participant, Beneficiary or successor in interest.
11.3 WITHHOLDING.
There shall be deducted from each payment to a Participant or
Beneficiary made under the Plan all taxes which are required to be withheld by
the Company from such payment. If any taxes, including employment taxes with
respect to the Deferral Account, are required to be withheld prior to the time
of payment, the Company may withhold such amounts from other compensation paid
to the Participant.
11.4 AMENDMENT, MODIFICATION, SUSPENSION OR TERMINATION.
The Board of Directors 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 Deferral Account on the date of such termination. On the
termination of this Plan, the Board may cause the Deferral Accounts of
Participants to be immediately paid out in cash lump sum payments, or to be paid
at any other time or in any other manner the Board may determine, but not later
than the times such Deferral Accounts would otherwise be paid to Participants or
Beneficiaries.
11.5 GOVERNING LAW.
This Plan shall be construed, governed and administered in accordance
with the laws of the State of California, to the extent not preempted by ERISA.
11.6 RECEIPT AND 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 Committee and the Company. The
Committee may require such Participant or Beneficiary, as a condition precedent
to such payment, to execute a receipt and release to such effect.
11.7 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 Committee, is considered by reason of physical
or mental condition to be unable to give a valid receipt therefor, the Committee
may direct that such payment be made to any person found by the 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 Committee and the Company.
11.8 NO EMPLOYMENT RIGHTS.
Participation in this Plan shall not confer upon any person any right to
be employed by the Company nor any other right not expressly provided hereunder.
11.9 HEADINGS NOT PART OF AGREEMENT.
Headings and subheadings in this Plan are inserted for convenience of
reference only and are not to be considered in the construction of the
provisions hereof.
<PAGE> 13
11.10 ERISA.
This Plan constitutes a pension benefit plan within the meaning of
Section 3(2) of ERISA, which is unfunded and maintained for the purpose of
providing deferred compensation for a select group of management or highly
compensation employees. This Plan constitutes the "Summary Plan Description"
required under ERISA, as well as the governing document of the Plan. The
Committee is the Administrator of the Plan, within the meaning of Section 3(16)
of ERISA, and the Named Fiduciary thereof, within the meaning of Section 402 of
ERISA, is the Committee.
11.11 VALIDITY.
In case any provision of this Plan shall be illegal or invalid for any
reason, said illegality or invalidity shall not affect the remaining parts
hereof, but this Plan shall be construed and enforced as if such illegal and
invalid provision had never been inserted herein.
11.12 DISTRIBUTION IN THE EVENT OF TAXATION.
If, for any reason, all or any portion of a Participant's benefit under
this Plan becomes taxable to the Participant prior to receipt, a Participant may
petition the Committee for a distribution of that portion of his or her benefit
that has become taxable. Upon the grant of such a petition, which the Committee
may grant or refrain from granting in its sole discretion, the Company shall
distribute to the Participant immediately available funds in an amount equal to
the taxable portion of his or her benefit (which amount shall not exceed the
balance in such Participant's Deferral Account as of the last day of the
calendar month before such distribution). If the petition is granted, the tax
liability distribution shall be made within ninety (90) days of the date when
the Participant's petition is granted.
IN WITNESS WHEREOF, Williams-Sonoma, Inc. has caused this document to be
executed on this 6th day of November, 1997.
WILLIAMS-SONOMA, INC.
By: /s/ Dennis A. Chantland
----------------------------------------
Dennis A. Chantland
Its: Executive Vice President, Chief
Administrative Officer and Secretary
<PAGE> 1
Exhibit 5
Opinion of Irell & Manella LLP
<PAGE> 2
November 7, 1997
Williams-Sonoma, Inc.
100 North Point Street
San Francisco, California 94133
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-8 (the
"Registration Statement") to be filed by you with the Securities and Exchange
Commission in connection with the registration of up to $13 million in executive
deferral obligations (the "Obligations") pursuant to the terms of the First
Amendment and Restatement of the Williams-Sonoma, Inc. Executive Deferral Plan
(the "Executive Deferral Plan") of Williams-Sonoma, Inc., a California
corporation (the "Company"). As your counsel in connection with this
transaction, we have examined the proceedings proposed to be taken in connection
with the Executive Deferral Plan and the issuance of the Obligations pursuant
thereto and such other matters and documents as we have deemed necessary or
relevant as a basis for this opinion.
Based on these examinations, it is our opinion that upon completion of
the proceedings being taken or which we, as your counsel, contemplate will be
taken prior to the issuance of the Obligations, such Obligations, when issued in
the manner referred to in the Registration Statement and the Executive Deferral
Plan, will be duly authorized, legally and validly issued and binding
obligations of the Company.
We consent to the use of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
/s/ Irell & Manella LLP
----------------------------------
Irell & Manella LLP
<PAGE> 1
Exhibit 23.1
Independent Auditors' Consent
<PAGE> 2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement on
Form S-8 of Williams-Sonoma, Inc. of our reports dated March 26, 1997 and June
17, 1997, appearing in the Annual Report on Form 10-K of Williams-Sonoma Inc.
for the year ended February 2, 1997 and in the Annual Report on Form 11-K of
Williams-Sonoma, Inc. Employee Profit Sharing and Stock Incentive Plan for the
year ended December 31, 1996, respectively.
DELOITTE AND TOUCHE LLP
/s/ DELOITTE AND TOUCHE LLP
- -------------------------------
San Francisco, California
November 6, 1997
