This excerpt taken from the HBI 10-K filed Sep 28, 2006.
Hanesbrands Inc. Pension and Retirement Plan and Hanesbrands Inc. Supplemental Employee Retirement Plan
Our executive officers participate in the Hanesbrands Inc. Pension and Retirement Plan and the Hanesbrands Inc. Supplemental Employee Retirement Plan, or the Hanesbrands SERP. The Hanesbrands Inc. Pension and Retirement Plan is a frozen defined benefit pension plan, intended to be qualified under Section 401(a) of the Code, that provides the benefits that had accrued for our employees, including our executive officers, under the Sara Lee Corporation Consolidated Pension and Retirement Plan as of December 31, 2005. The Hanesbrands SERP is an unfunded deferred compensation plan that, in part, will provide the nonqualified supplemental pension benefits that had accrued for certain of our employees, including our executive officers, under the Sara Lee Corporation Supplemental Executive Retirement Plan.
The following table shows the approximate annual pension benefits payable under the Hanesbrands Inc. Pension and Retirement Plan and the Hanesbrands SERP for our executive officers. The compensation covered by these plans is based on an employees average annual salary and cash bonus for the highest five consecutive years in the ten years ending December 31, 2005. The amounts payable under the pension program are computed on the basis of a straight-life annuity and are not subject to deduction for Social Security benefits or other amounts.
Benefits under the pension program were frozen as of December 31, 2005. As a frozen program, no additional employees will become eligible to participate in the program, and participants in the plan will not accrue any additional benefits after December 31, 2005. Messrs. Chaden, Noll, Evans and Flatow have 14, 14, 14 and 19 years of credited service, respectively, with respect to the pension benefits described above.
In addition to the benefits described in the table above, Mr. Evans will receive an estimated annual pension of $4,402 for approximately 8 years of credited service earned under an alternate formula and Mr. Flatow will receive an estimated annual pension of $1,515 for approximately one year of credited service earned under an alternate formula. Further, as a result of a minimum benefit formula, Mr. Flatow will receive an estimated annual pension $18,531 in excess of that shown in the table as of December 31, 2005.
The nonqualified benefits accrued by Mr. Chaden historically have been funded with periodic payments made by Sara Lee to trusts established by him. Sara Lee will make final payment to Mr. Chadens trust in the amount of $1.85 million approximately six months after the spin off. All nonqualified benefits other than those payable to Mr. Chaden will be paid out of our general assets.