In addition, all our named executive officers participate in our Retirement Savings Plan (RSP), which is a
qualified defined contribution plan. Any named executive officer who joined the Company after September 30, 2010, would not be eligible to participate in the PAP. However, in lieu thereof, he or she would receive a fixed annual company
contribution (FACC) which is equal to 4% of his or her eligible earnings to the RSP. Ms. Hartsfield and Mr. Robbins receive this FACC. See the discussion under Retirement Savings Plan on page 47 for
more information about this plan.
Mr. Akers also participates in the Supplemental Executive Retirement Plan (SERP), which provides retirement
benefits (as well as supplemental disability and death benefits). A named executive officer who has participated in the plan for at least two years and who has attained the age of 55 is entitled to a lump sum payment. The lump sum payment is
actuarially equivalent to an annual supplemental pension in an amount that, when added to the annual retirement amount payable to him under the PAP, equals 60% of his total cash compensation. The annual supplemental retirement amount will generally
be equal to 60% of the sum of the amount of the participants last annual base salary and the amount of their last award under the Incentive Plan, subject to reductions for less than ten years of employment with the Company and for retirement
prior to age 62.
Mr. Forsythe, Mr. Park, Ms. Hartsfield, and Mr. Robbins participate in the Account Balance SERP, which is a non-qualified defined contribution plan, under which the Company currently provides an annual contribution of 25% of the participants total annual earnings (base salary and incentive payment under our
Incentive Plan) into a notional supplemental retirement account, as well as provides supplemental disability and death benefits.
The HR Committee believes that
these retirement benefits are an important component of Total Rewards and are required to ensure that our overall executive compensation package remains competitive with executive compensation packages offered by other major public companies in our
industry. See the discussion under Retirement Plans, beginning on page 46, for more information on our retirement benefits.
Change in Control Severance Benefits. We have severance agreements in place with each of our named executive officers to provide
certain severance benefits for them in the event of the termination of their employment within three years following a change in control of the Company (as defined in the severance agreements and described generally in Change in
Control Severance Agreements, beginning on page 49). The severance agreement for each named executive officer generally provides that the Company will pay such officer as severance pay in one lump sum an amount equal to
(a) 2.5 times their total compensation (annual base salary and the higher of the last annual award under the Incentive Plan or the average of the three highest annual awards received under such plan) and (b) the total of (i) an
amount that is actuarially equivalent to an additional three years of annual age and service credits payable to the officer under the PAP or the FACC, as applicable, and (ii) an amount that is actuarially equivalent to an additional three years
of Company matching contributions payable to the officer under the RSP.
In addition, each named executive officer is paid (i) an amount that is
generally actuarially equivalent to an additional 36 months of health and welfare benefits and (ii) an amount that is actuarially equivalent to 36 months of accident and life insurance coverage, along with disability coverage. If the total of
such lump sum severance payment results in the imposition of excise taxes imposed by Section 4999 of the IRC, the named executive officer has the ability to elect to have the payment reduced to a level that will result in no payment of such
excise tax. In lieu of reducing the severance payment under the agreement, each named executive officer may elect to have the Company pay the full severance payment amount, thereby leaving such officer responsible for personally paying the excise
tax penalties imposed on such excess parachute payments.
The HR Committee believes that providing severance protection to our named executive officers
following a change in control is a key component to ensuring that our executive compensation program remains competitive and that our named executive officers remain engaged before and during any potential change in control transaction.
Additional Information on Named Executive Officer Compensation
We do not have any individual compensation policies or plans that are not applied consistently to all our named executive officers. Each year, we set our target
opportunities in incentive compensation based solely upon competitive market conditions and the other factors discussed below. In addition, in determining executive compensation, the HR