GCI » Topics » Pension Plans

This excerpt taken from the GCI DEF 14A filed Mar 10, 2006.

Pension Plans

 

All executive officers of the Company other than Paul Davidson, the Chairman and Chief Executive Officer of Newsquest PLC, participate in the Gannett Retirement Plan, a defined benefit pension plan that is qualified under Section 401 of the Internal Revenue Code, and the Gannett Supplemental Retirement Plan, an unfunded, nonqualified plan. (Mr. Davidson participates instead in the Newsquest Pension Scheme, a defined benefit pension plan that is approved in the UK by HM Revenue & Customs under Chapter 1 of Part XIV of the Income and Corporation Taxes Act 1988.) The annual benefit under the plans, taken together, is in general determined by the number of years of employment multiplied by a percentage of the participant’s Final Average Earnings (during the executive officer’s five highest consecutive years). As described under “Employment Contracts, Retirement and Change in Control Arrangements,” in the event of his or her termination before a specified date (other than by the Company for “good cause,” by the executive officer without “good reason” or by reason of the executive officer’s death), the annual benefits of Mr. Dubow, Ms. Martore and Mr. Moon under the Gannett Supplemental Retirement Plan will be calculated using additional months of service determined by subtracting the number of full months of service credited to the executive between the date of his or her contract and the date of termination from 52 months, in the case of Mr. Dubow, and 36 months, in the case of Ms. Martore and Mr. Moon.

 

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The Internal Revenue Code places limitations on the amount of pension benefits that may be paid under qualified plans. Any benefits payable above those limitations will be paid under the Gannett Supplemental Retirement Plan. In addition, deferred compensation is excluded from earnings under the Gannett Retirement Plan, but is included in the calculation of the Gannett Supplemental Retirement Plan benefits. Also, certain participants who were actively employed as of January 1, 1998, shall receive a total retirement benefit at least equal to the benefit to which they would have been entitled had the qualified plan not been amended as of January 1, 1998. For these participants, the total retirement benefit is as described above, i.e., based on years of employment and Final Average Earnings. For all U.S. executive officers, the benefit under the Supplemental Retirement Plan is equal to the difference between (i) the amount of the benefit the participant would have been entitled to under the Retirement Plan benefit formula in effect on December 31, 1997 absent the Section 401 limitations and including deferred compensation, and (ii) the amount of the benefit actually payable under the Retirement Plan.

 

The table below may be used to calculate the approximate annual benefits payable at retirement at age 65 and after under the two U.S. retirement plans to the Company’s named executive officers in specified compensation and years-of-service classifications.

 

This excerpt taken from the GCI DEF 14A filed Mar 11, 2005.

Pension Plans

 

All executive officers of the Company other than Mr. Davidson participate in the Gannett Retirement Plan, a defined benefit pension plan that is qualified under Section 401 of the Internal Revenue Code, and the Gannett Supplemental Retirement Plan, an unfunded, nonqualified plan. The annual benefit under the plans, taken together, is, in general, determined by the number of years of employment multiplied by a percentage of the participant’s Final Average Earnings (during the executive officer’s five highest consecutive years). As described under “Employment Contracts, Retirement and Change in Control Arrangements,” in the event of his or her termination before a specified date (other than by the Company for “good cause,” by the executive officer without “good reason” or by reason of the executive officer’s death), the annual benefits of Messrs. Chapple, Dubow, Moon and Watson and Ms. Martore under the Gannett Supplemental Retirement Plan will be calculated using additional months of service determined by subtracting the number of full months of service credited to the executive between the date of the contract and the date of termination from 56 months, in Mr. Dubow’s case, and 36 months for Mr. Watson, Ms. Martore, Mr. Moon and Mr. Chapple.

 

The Internal Revenue Code places limitations on the amount of pension benefits that may be paid under qualified plans. Any benefits payable above those limitations will be paid under the Gannett Supplemental Retirement Plan. In addition, deferred compensation is excluded from earnings under the Gannett Retirement Plan, but is included in the calculation of the Gannett Supplemental Retirement Plan benefits. Also, certain participants who were actively employed as of January 1, 1998, shall receive a total retirement benefit at least equal to the benefit to which they would have been entitled had the qualified plan not been amended as of January 1, 1998. For these participants, the total retirement benefit is as described above, i.e., based on years of employment and Final Average Earnings. For all U.S. executive officers, the benefit under the Supplemental Retirement Plan is equal to the difference between (i) the amount of the benefit the participant would have been entitled to under the Retirement Plan benefit formula in effect on December 31, 1997 absent the Section 401 limitations and including deferred compensation, and (ii) the amount of the benefit actually payable under the Retirement Plan.

 

Mr. Davidson participates in the Newsquest Pension Scheme, a defined benefit pension plan that is approved in the UK by the Inland Revenue under Chapter 1 of Part XIV of the Income and Corporation Taxes Act 1988. The annual pension benefit payable under the plan is, in general, determined by the number of years’ membership in the plan multiplied by a percentage of the Final Average Salary. Under UK law, the Inland Revenue places a maximum limit on the amount of pension that may be paid under an approved pension plan. This maximum pension limit is equal to two-thirds of Final Average Salary.

 

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Beginning in April 2006, this maximum pension limit will be replaced by a limit on the capital value of the pension benefit. Subject to any applicable transitional relief, if the capital value exceeds £1.5 million (approximately $2.75 million, based on the average exchange rate in effect for the Company’s 2004 fiscal year) then a tax charge will be levied on Mr. Davidson on any excess. The £1.5 million limit will gradually increase to £1.8 million (approximately $3.30 million based on the same exchange rate) in April 2010; thereafter the limit will be reviewed under UK law. In the event of Mr. Davidson’s death while still an employee, the Newsquest plan provides that the trustees of the plan may pay, at their discretion, a death benefit equal to four times Mr. Davidson’s annual salary at the time of death and an additional pension to Mr. Davidson’s qualifying dependents.

 

The first table below may be used to calculate the approximate annual benefits payable at retirement at age 65 under the two U.S. retirement plans to the U.S. executives named in the above Summary Compensation Table in specified compensation and years-of-service classifications. The second table below may be used to calculate the approximate annual benefits payable at retirement at age 65 under the UK pension plan to Mr. Davidson in specified compensation and years-of-service classifications.

 

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