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SMG » Topics » Executive Retirement Plans and Deferred Compensation Benefits (long-term compensation element)This excerpt taken from the SMG DEF 14A filed Dec 20, 2007. Executive
Retirement Plans and Deferred Compensation Benefits (long-term
compensation element)
The Scotts Company LLC Executive Retirement Plan (the
“ERP”) is a non-qualified deferred compensation plan.
The ERP provides executives, including the NEOs, the ability to
defer compensation above the Internal Revenue Service
(“IRS”) limits applicable to The Scotts Company LLC
Retirement Savings Plan (the “RSP”), a qualified
401(k) plan. The ERP is an unfunded plan and is subject to the
claims of the Company’s general creditors. The ERP consists
of three parts:
The Company matching contributions and Base Retirement
Contributions to the ERP are based on the same contribution
formulae used for the RSP. The Company matches the Compensation
Deferral at 100% for the first 3% of pay that is contributed to
the ERP and 50% for the next 2% of pay contributed to the ERP.
The Company also makes a Base Retirement Contribution in an
amount equal to 2% of eligible earnings for all eligible
associates, whether or not they make deferral elections to the
ERP. This amount increases to 4% once an associate’s annual
earnings reach 50% of the Social Security (FICA) wage base. Base
Retirement Contributions are only made to the ERP once an
executive exceeds the maximum allowable pay under the RSP.
Participant account balances in the ERP are invested in a
Company stock fund and other mutual fund investments that are
generally consistent with the investment alternatives permitted
with respect to the RSP. Accordingly, there were no above-market
or preferential earnings on investments associated with the ERP
for any of the NEOs for the 2007 fiscal year.
The Scotts Company LLC Excess Benefit Plan (the “Excess
Pension Plan”) is an unfunded plan that provides benefits
which cannot be provided under The Scotts Company LLC
Associates’ Pension Plan (the “Associates’
Pension Plan”) due to IRS limits. The Associates’
Pension Plan was frozen effective December 31, 1997 and,
therefore, no service is earned after that date under the Excess
Pension Plan for participating executives.
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