HDNG » Topics » Pension Plan:

This excerpt taken from the HDNG DEF 14A filed Mar 28, 2006.
Pension Plan:

The Company maintains a non-contributory defined benefit Pension Plan for all employees first employed prior to March 1, 2004. Normal retirement is at age 65; however, retirement before age 65 can be selected under certain conditions. Annual pensions are computed on the basis of adjusted career average compensation, excluding bonuses. The adjusted career average compensation formula is the sum of (a) for service prior to December 1, 1993, 1.25% of the annual compensation rate as of December 1, 1993, times the number of years of service prior to December 1, 1993, plus (b) 1.5% of the annual compensation on or after December 1, 1993. Pension amounts are not subject to reductions for Social Security benefits or offset amounts but are subject to federal law limitations on pensions payable under tax qualified plans.

The Company also maintains a non-qualified, unfunded benefit plan called the Executive Supplemental Pension Plan (“Supplemental Plan”) currently covering Mr. Ervin. The annual benefits under the Supplemental Plan are determined on the basis of the average of the three highest years base salary of the final five years of employment plus cash bonuses (limited each year to 50% of said year’s base salary) times 1.25% for each year of service. Benefits under the Supplemental Plan are reduced by benefits payable under the Pension Plan.

For the Named Executive Officers who were first employed prior to March 1, 2004 and remained employed on December 31, 2005, and who remain continuously employed at current compensation levels until retirement at the normal retirement age of 65, the estimated annual pension amounts payable under the Pension and Supplemental Plans for Messrs. Ervin, Rich, Colvin and Tifft would be $196,733, $54,426, $27,390 and $68,006, respectively. Pensions described are straight-life annuity amounts not reduced by joint and survivorship provisions which are available to all retirees through reductions in pensions otherwise payable. Mr. Trego, hired subsequent to March 1, 2004, is not eligible for participation in the Company’s Pension Plan, but he is eligible for its Retirement Plan, a 401(k) defined contribution plan, which provides significantly greater benefits to those hired after March 1, 2004 than those employees hired before said date. The other Executive Officers received no benefits under the Retirement Plan during 2005.

The Company also provides Messrs. Ervin, Colvin and Tifft a contractual retirement lump sum payment. These obligations are funded with life insurance policies on the lives of said executives, which policies are owned by the Company with the Company being the sole beneficiary in the event of the death of the executive. Upon retirement on or after age 55, the executive is entitled to an amount equal to the then cash surrender value of said policies payable in one lump sum payment, and in the case of death while in service, the executive’s named beneficiary is entitled to an amount equal to the death benefit proceeds received by the Company. The cash surrender values of said policies on December 31, 2005 for Messrs. Ervin, Colvin and Tifft were $48,265, $91,785 and $55,625, respectively.

This excerpt taken from the HDNG DEF 14A filed Mar 30, 2005.

Pension Plan:

        The Company maintains a non-contributory defined benefit Pension Plan for all employees. Normal retirement is at age 65; however, retirement before age 65 can be selected under certain conditions. Annual pensions are computed on the basis of adjusted career average compensation, excluding bonuses. The adjusted career average compensation formula is the sum of (a) for service prior to December 1, 1993, 1.25% of the annual compensation rate as of December 1, 1993, times the number of years of service prior to December 1, 1993, plus (b) 1.5% of the annual compensation on or after December 1, 1993. Pension amounts are not subject to reductions for Social Security benefits or offset amounts but are subject to federal law limitations on pensions payable under tax qualified plans.

        If the Named Executive Officers remain continuously employed at current compensation levels until retirement at the normal retirement age of 65, the estimated annual pension amounts payable under the Pension Plan for Messrs. Ervin, Simons, Rich, Colvin and Tifft would be $93,757, $79,603, $59,413, $28,086 and $67,185, respectively. Pensions described are straight-life annuity amounts not reduced by joint and survivorship provisions which are available to all retirees through reductions in pensions otherwise payable.

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