Ben E. Keith Company Retirement Plan Change Effective July 1, 2018 FAQs

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1 Ben E. Keith Company Retirement Plan Change Effective July 1, 2018 FAQs General Questions Q: What is changing? On July 1, 2018, Ben E. Keith will introduce a new 401(k) savings plan for employees under age 55, employees over age 55 with less than one year of service, and new employees. Ben E. Keith s pension plan will be frozen for these employees, meaning pension accruals will stop. These employees will be enrolled in a new 401(k) savings plan and will accrue future retirement benefits in the 401(k) plan. Employees aged 55 or older who have at least one year of company service on June 30, 2018, will be grandfathered in the pension plan; these employees will continue to accrue pension benefits and will not be eligible for the 401(k) plan. Q: How does this impact me? If, on June 30, 2018, you are an employee under age 55, over age 55 with less than one year of service, or a newly hired employee: o Your accrued benefit in the pension plan (if any) will be frozen on June 30, Your benefit will be calculated using your service and pay as of that date, and no future service or pay increases will impact your benefit. You keep the benefit you earn as of June 30, 2018 as long as you are vested before you leave or retire from Ben E. Keith. (Vesting gives you a permanent right to the money. You are vested in the pension plan benefit after five years of service.) If you are an employee aged 55 or older with at least one year of company service on June 30, 2018: o You will be grandfathered in the pension plan; you will continue to accrue pension benefits. If you are a new employee: o New employees hired on or after July 1, 2017, will not participate in the pension plan. (The pension plan requires one year of service, so these employees will not be a participant on the date the plan is frozen and closed to new entrants.) You will participate in the 401(k) plan starting July 1, Q: What is the 401(k) savings plan and what does it include? The new 401(k) savings plan will include: Employee contributions. You will be able to make tax-advantaged contributions to your 401(k) account. Company matching contributions. When you save in the plan, Ben E. Keith will match your contributions 100% up to 4% of your pay. That means, for every $1 you contribute up to 4% of your pay, the company will add $1 to your account. 1

2 Q: Will grandfathered employees (those age 55 or older with more than one year of service on June 30, 2018) participate in the 401(k) plan? No, grandfathered employees will not participate in the new 401(k) plan. They will continue to accrue pension benefits. Q: Why is Ben E. Keith making these changes? Ben E. Keith Company is making changes to our retirement plans that will allow us to continue offering competitive benefits to help you build a secure financial future. The changes give you more control over your retirement benefits, and give the company a more predictable and sustainable way to contribute to your retirement savings. We regularly review the competitiveness of our total compensation package against our peers and strive to provide competitive benefits while carefully managing our business. Our approach has helped us maintain our success for over 110 years and the new retirement plan will help position us for the next 110 years. The changes we are making will more closely align our plans with the marketplace. And, our overall benefits package remains very competitive. We are committed to helping you and your family live well today and prepare for a secure tomorrow. Q: How does our new benefit compare with other companies? Very well we believe our retirement programs will allow us to attract and keep great people. Of the nine food and beverage companies we benchmark our benefits against, all of them offer a 401(k) plan. Only one still offers a pension plan to a limited group of employees. Our new 401(k) plan will more closely align our retirement benefits with the market and with what employees and new hires expect. And our $1 for $1 match is generous when compared to others. We re confident our new retirement program will be among the best in our industry. Q: What vendor will provide the 401(k) savings plan? Ben E. Keith is currently examining and identifying the best vendor to service the 401(k) savings plan. We will choose a vendor whose reputation, investment options and credibility match the level Ben E. Keith employees deserve. Q: Who is impacted by these changes? The changes affect employees under age 55 as of June 30, 2018, employees over age 55 who have less than one year of service as of June 30, 2018, and all new hires to Ben E. Keith. Employees who are over age 55 and have more than one year of service will be grandfathered into the pension plan and will continue to accrue retirement benefits as they do today. Q: Does this apply to senior management? Yes. The changes apply to all current employees who are under age 55, or over age 55 with less than one year of service, and new employees hired after July 1, Q: What do our competitors offer? Of the nine food and beverage companies we regularly compare our benefits against, all of them offer a 401(k) plan. One of the competitors offers a 401(k) match as generous as ours. Only one continues to offer a pension plan, and it is available to a limited group of employees. Two others have frozen their pension plan; the remaining six have never offered a pension plan. The Ben E. Keith Company retirement program is very competitive, and the changes effective in 2018 will help to keep our program among the best in the industry. 2

3 Q: Is the primary purpose of the retirement program changes to save money? No. The primary purpose in making these changes is to make our costs more predictable from year to year and more manageable over the long term, while providing employees with competitive benefits. The amount of money required to fund the pension plan varies significantly from year to year with multi-million dollar swings that are based on factors we can t control. This unpredictability makes forecasting difficult and impacts our ability to run the business effectively. The new 401(k) plan will be easier for the company to manage and budget, while still providing you and your family with a valuable benefit. Q: What factors did Ben E. Keith consider when designing this new program? Here are a few of the driving factors: The new plan must offer a competitive benefit level to employees and a predictable, stable, and affordable cost to the company. The plan should also help employees achieve their retirement and financial goals of achieving a sufficient retirement income through a combination of company contributions and employee savings. Planning and saving for retirement is a shared responsibility. Ben E. Keith wanted to make sure that our current and future employees have a consistent and competitive retirement program that will support them during retirement. Q: Will the profit sharing plan continue? Yes. We re proud that we ve contributed over $40 million dollars to the Profit Sharing Plan for Employees of Ben E. Keith and Its Affiliates (the profit sharing plan) in the last 10 years. Q: What happens to my pension benefit if I leave Ben E. Keith? If you are under age 55 or over age 55 with less than one year of service as of June 30, 2018, or you are a newly hired employee: o You will not lose any vested benefit you earn through June 30, 2018, as long as you are vested in the pension plan (after five years of service) before you leave the company. The pension plan benefit you have earned will be available to you when you are eligible for retirement under the terms of the pension plan. When you are eligible, and want to begin receiving benefits, your pension benefit will be calculated using your pay and service as of June 30, If you are grandfathered in the pension plan (over age 55 with at least one year of service as of June 30, 2018): o You will continue to accrue pension benefits as long as you continue working for Ben E. Keith. As long as you are vested in the pension plan (after five years of service) before you leave the company, the pension plan benefit you have earned will be available to you when you are eligible for retirement under the terms of the pension plan. When you are eligible, and want to begin receiving benefits, your pension benefit will be calculated using your pay and service as of your termination date. Q: Is the Pension Plan financially protected? Your benefit will continue to be managed and funded by Ben E. Keith and be backed by the Pension Benefit Guaranty Corporation (PBGC), the government agency that insures employee pension benefits. 3

4 401(k) Savings Plan Q: How will the new 401(k) plan work? The new 401(k) plan features include: Employee contributions. You will be able to save a percentage of your pay through payroll deductions, up to the annual 401(k) limit set by the IRS. (In 2017, the limit is $18,000, or $24,000 if you are age 50 or older.) Company matching contributions. For every $1 you contribute up to 4% of your pay, the company will add $1, for a maximum match of 4%. Automatic enrollment. Ben E. Keith wants to help employees take full advantage of the new program, so we will automatically enroll you with a contribution rate of 4% of your pay. You may increase, decrease or stop your contributions at any time. Automatic escalation. To help you maximize your savings and build momentum over time, each year on July 1 your contribution will be increased by 1%, up to a maximum contribution of 10% of pay. You will be able to opt out of this or change your contributions at any time. Investment choices. The plan will offer a variety of investment choices, and the company that administers the plan will provide you with resources that can help you make smart choices. You decide how your account is invested based on your savings goals and tolerance for risk, and you can make changes when you need to. Loans and withdrawals. The plan will give you the ability to borrow against your account or take out hardship withdrawals while you re still working, should you have a need. Portability. Your 401(k) account is your money. You are always 100% vested in your own contributions. You ll be vested in Ben E. Keith s matching contributions after two years of service. (Your current and prior service count so if you ve worked at Ben E. Keith for at least two years when the plan begins, you ll be vested in the 401(k) matching contributions immediately. If you are a newer employee, you ll be vested once you ve completed two years of service.) If you leave Ben E. Keith, you can transfer your account to an individual retirement account (IRA) and may be able to transfer your funds to a new employer s qualified retirement plan. Q: How do my savings grow in the new 401(k) plan? The new 401(k) plan will provide you with a more flexible way to save for the future and more control over your savings: Personal contributions You and Ben E. Keith can make contributions to your plan account. You can choose to make tax-advantaged contributions up to Internal Revenue Service (IRS) limits, which help you build your savings. Ben E. Keith Matching Contributions Ben E. Keith will also match your personal contributions $1 for $1 up to 4% of your pay. If you contribute at least 4% of your pay, you ll receive contributions from Ben E. Keith of 4% of your pay. Investments You ll have the opportunity to control how your account balance is invested both the contributions you make and those Ben E. Keith makes. You can adjust investments as desired to keep up with changes in your savings strategy, and your account balance growth will depend on the investment decisions you make. You ll learn more about investment options available through the plan administrator in Once the new 401(k) plan is effective in 2018, you will be able to track your savings progress and make adjustments to your contributions and investments online. Q: Do I have to contribute money to the 401(k) plan to get the company match? Yes. You will need to participate to receive matching contributions from Ben E. Keith. We are committed to helping you save for a financially secure future. To help you reach your savings goals, we will match your contributions to the 401(k) plan $1 for $1 (up to 4% of your pay). 4

5 Q: How much will the company match? For every $1 you contribute up to 4% of your pay, the company will add $1, for a maximum match of 4%. You need to contribute at least 4% of your pay to receive the maximum match the company is committed to giving you. Q: When and how will my contributions be matched? Eligible employees will be able to contribute to the 401(k) plan through payroll deductions. When you contribute to the 401(k) plan, the company will match your contributions (100% match up to 4% of your pay). The company matching contributions you receive will be invested the same way as your contributions. Q: Is there a vesting period for the plan? Vesting gives you a permanent right to the benefit. You are always 100% vested in your own contributions. You will vest in company matching contributions after completing two years of service. Your service prior to 2018 will be counted for vesting purposes. (If you ve already worked at Ben E. Keith for two or more years, you ll be vested in all contributions to your 401(k) plan immediately.) Q: How will my 401(k) account be invested? You control how your account is invested, including your contributions and company matching contributions. You can change your investment elections at any time. Once the plan administrator is selected and the plan is effective, you ll be able to choose from a variety of investment options and you ll have access to education and resources that can help you choose. Q: Do I have to participate in the 401(k) plan? No. But your contributions and the matching contributions from Ben E. Keith will help you prepare for a financially secure future. To encourage you to participate, eligible employees will be enrolled automatically at a contribution rate of 4% of your pay. (This way, you are contributing enough to receive the maximum matching contribution; when you contribute 4% of your pay, Ben E. Keith will match 4% of your pay, for total savings of 8% of your pay.) You may increase, decrease or stop your contributions at any time. To help you maximize your savings and build momentum over time, each year on July 1 your contribution will be increased by 1%, up to a maximum contribution of 10% of pay. You will be able to opt out of this or change your contributions at any time. Pension Plan Participants Under Age 55 as of June 30, 2018 Q: When will I stop accruing benefits? Your pension benefit is based on a formula. When you are eligible to begin receiving pension payments, your pension benefit will be calculated using your pay and service as of June 30, Your benefit will not change based on changes in your pay or service after that date. Q: What happens to the retirement benefits I have already earned? Benefits you earn in the pension plan through June 30, 2018, are yours to keep. Vested benefits will be available to you when you are eligible for early or normal retirement. Your benefit will be calculated using your pay and service as of June 30, 2018, when you are eligible and decide to start receiving monthly benefit payments. 5

6 Q: What happens to my pension benefit if I leave the company before June 30, 2018? Nothing. You leave with the vested benefit you earn as of your termination date. (You are vested in your pension plan benefit after completing five years of service.) Q: Since the plan is closing to new entrants and my benefit will be frozen, will my pension be guaranteed in the future when I retire? Your benefit will continue to be funded by Ben E. Keith and be backed by the Pension Benefit Guaranty Corporation (PBGC), the government agency that insures employee pension benefits. The Ben E. Keith pension plan is well funded and we are committed to keeping it well funded. Q: What does frozen mean? Does it mean the amount I ve earned in my pension plan as of June 30, 2018 will not change? Your pension benefit is based on pay and service as of a particular date. In the case of a frozen plan, your benefit will be calculated when you are eligible and elect to begin receiving pension benefits using your pay and service as of June 30, 2018, no matter how long beyond that date you work for Ben E. Keith. The amount of your benefit may still vary, depending on when you begin benefit payments. Q: Will new employees be able to participate in the pension plan? No, new hires to Ben E. Keith since July 1, 2017 forward will not participate in the pension plan. (Employees are eligible for the pension plan after one year of service; these employees will not be eligible for the plan before it is frozen.) New employees will participate in the 401(k) plan and the profit sharing plan. Q: What is the vesting period for the pension plan? The vesting period is five years. You must complete five years of service to be eligible to receive a benefit in the plan. Q: If I m not vested in my pension benefit on June 30, 2018, will I lose previous accruals? You will continue to earn vesting service after the freeze date. So, if you continue working for Ben E. Keith until you earn at least five years of service, you will not lose your frozen pension benefit. However, if you leave before you reach five years of vesting service, then you will not be eligible to receive a pension benefit. Q: At what age can I retire from active service? You can retire as early as age 50 and be eligible to receive a benefit if you have 10 years of service. However, to receive the full benefit amount, the normal retirement is age 65 with five years of service. See the summary plan description at for early retirement age reduction factors. Q: If I terminate employment and don t retire, when can I collect by benefit? Assuming you are vested and terminate employment prior to age 65, the full benefit amount will be available the month after you turn age 65 with 5 years of service. However, you can start collecting as early as age 50 if you have 10 years of service. Please refer to the summary plan description for early retirement age reduction factors for vested terminated employees. Q: How do my pension benefits accrue? Your pension benefit accrues each year based on a formula using your service and pay. Benefit accruals in your current formula will end on June 30,

7 Pension Plan Participants Age 55 or older with at least 1 year of service as of June 30, 2018 (Grandfathered Employees) Q: When will I stop accruing benefits? You will continue to accrue pension benefits until your termination or retirement date, whichever comes first. Q: What happens to my pension benefit if I leave the company before June 30, 2018? Nothing. You leave with the vested benefit you earn as of your termination date. (You are vested in your pension plan benefit after completing five years of service.) Q: Will my pension be guaranteed in the future when I retire? Your benefit will continue to accrue. The pension plan is funded by Ben E. Keith and be backed by the Pension Benefit Guaranty Corporation (PBGC), the government agency that insures employee pension benefits. The Ben E. Keith pension plan is well funded, and we are committed to keeping it well funded. Q: What is the vesting period for the pension plan? The vesting period is five years. You must complete five years of service to be eligible to receive a benefit in the plan. Q: At what age can I retire from active service? You can retire as early as age 50 and be eligible to receive a benefit if you have 10 years of service. However, to receive the full benefit amount, the normal retirement is age 65 with five years of service. See the summary plan description for early retirement age reduction factors. Q: If I terminate employment and don t retire, when can I collect by benefit? Assuming you are vested and terminate employment prior to age 65, the full benefit amount will be available the month after you turn age 65 with 5 years of service. However, you can start collecting as early as age 50 if you have 10 years of service. Please refer to the summary plan description for early retirement age reduction factors for vested terminated employees. Need Help? Q: Where do I go if I have questions about these changes? We encourage you to review the materials sent to your home, and in the Retirement section of the BEK Benefits Portal. Please submit additional questions via to CORP-MBX- Benefits@benekeith.com or leave a voic with your question at We will provide an answer as soon as we can, and we ll continue to update the Benefits Portal as new information and resources become available. For information on your existing pension plan, please contact John Hancock online at mylife.jhrps.com or by calling Participant Services at (for Spanish, call ). Q: Where can I get help planning my retirement savings? What s available to me online? Over the next few months, we will be working to choose a 401(k) plan administrator that will be the best partner for Ben E. Keith. Once the plan is effective, you will have access to education, tools and resources that can help you understand your options and make investment choices that match your goals and tolerance for risk. 7

8 Q: Do I need to take any action now? There are no actions you are required to take now. However, we encourage you to review the materials sent to your home, and in the Retirement section of the BEK Benefits Portal. You may submit additional questions via to CORP-MBX-Benefits@benekeith.com or leave a voic with your question at We will provide an answer as soon as we can, and we ll continue to update the Benefits Portal as new information and resources become available. Planning for Retirement Q: What do I need to consider in planning for retirement? There are several things to consider as you plan for retirement: your current age, the age you want to retire, your income and how much income you anticipate needing in retirement, future medical costs, your current retirement resources (pension plan, profit sharing plan, new 401(k) savings plan effective July 1, 2018, personal savings, property, etc.) and how much those resources will be worth in the future, your savings rate, your investment mix, your health, etc. The new 401(k) plan will give you more control over how to invest your resources, but it also means you bear more of the risk your eventual balance in the plan will depend on how the investments you select perform. How much you save and how you save (which investments you choose) will influence how your account grows. Ben E. Keith and our 401(k) plan administrator, once selected, will provide you with support and resources to take on that responsibility. 8