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This excerpt taken from the DKS DEF 14A filed May 3, 2007. Dick’s
Sporting Goods Supplemental Smart Savings Plans
On July 1, 2006, the Company’s Supplemental Smart
Savings Plan became effective, which allows certain members of
management to annually defer a portion of their existing
compensation. We implemented the Supplemental Smart Savings Plan
because certain members of management had historically been
restricted in their ability to participate in the Company’s
existing 401(k) Plan because of qualified plan testing rules.
Under the Supplemental Smart Savings Plan, as amended, we give
eligible employees the opportunity to enter into agreements to
defer up to 15% of their compensation (defined as base salary,
quarterly bonus compensation and annual incentive bonus
payments) up to a maximum of $12,000 for calendar year 2007.
Employees may elect to receive distributions from the
Supplemental Smart Savings Plan on the earlier of (i) a
specific date which occurs no earlier than the second plan year
following the plan year in which deferrals designated for
distribution were credited or the date the employee’s
employment is terminated for any reason, or (ii) the date
the employee’s employment is terminated for any reason. The
form of distribution may be, at the employee’s election,
paid in a single lump sum
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payment, or monthly, quarterly, semi-annual or annual
installments, with any installment term between two (2) and
fifteen (15) years.
Once the deferral has been made, deferred amounts are recorded
in accounts maintained by the Company. The Company’s
Executive Benefits Committee is responsible for administration
of the plan, subject to Rule 303A.05 of the New York Stock
Exchange Listed Company Manual and the Company’s
Compensation Committee Charter. The Company has the ability to
match amounts deposited into plan accounts, up to a
discretionary percentage of compensation determined annually by
the Company, not to exceed 7% of a participant’s
compensation, and less any matching amounts contributed through
the Company’s 401(k) Plan. We have established a rabbi
grantor trust, with a third party trust company as trustee, for
the purpose of providing the Company with funds for the payment
of matching amounts under the Supplemental Smart Savings Plan.
The Supplemental Smart Savings Plan is intended to constitute a
non-qualified, unfunded plan for federal tax purposes and for
purposes of Title I of the Employee Retirement Income
Security Act of 1974, as amended and is also intended to comply
with Internal Revenue Code Section 409A, and contains
restrictions to help ensure compliance. Our obligations to pay
deferred compensation under the Supplemental Smart Savings Plan
are unsecured general obligations of the Company. We may amend
or terminate the Supplemental Smart Savings Plan at any time in
whole or in part; provided that no amendment or termination may
reduce the amount credited to accounts at the time of such
amendment or termination.
The Supplemental Smart Savings Plan was amended on
December 7, 2006, to provide that all executive officers
were ineligible to participate in the Supplement Smart Savings
Plan after December 31, 2006. As a result of the amendment,
in March of 2007 our Compensation Committee approved the
implementation of the Dick’s Sporting Goods Officers’
Supplemental Savings Plan, which allows certain key executives,
including our named executive officers, the opportunity to defer
under it up to 25% of their base salary and up to 100% of their
annual bonus under the plan, to be allocated among a range of
investment choices. For additional discussion of the terms of
the Officers’ Plan, see “Compensation Discussion
and Analysis” on page 19 of this proxy statement.
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