Attached files
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EX-10.1 - Verso Paper Holdings LLC | v169749_ex10-1.htm |
8-K - Verso Paper Holdings LLC | v169749_8k.htm |
EXECUTIVE
RETIREMENT PROGRAM
The
Executive Retirement Program (ERP) is a non-qualified retirement plan provided
to a select group of executives that is competitive with benefit practices for
senior and executive management. ERP is part of the Verso Deferred
Compensation Plan (DCP). However, ERP is used to describe a new type
of contribution made by Verso on behalf of the selected executives.
Effective
The ERP
is scheduled to become effective for calendar years beginning on and after
January 1, 2010.
Eligibility
The
Compensation Committee reserves the sole and exclusive right to select the
executives who will be included in ERP for each calendar year. If you
are selected to be included in ERP, you will receive written notice of that
selection. The selection is based on the following
criteria:
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Selection
is done on an individual basis.
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·
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Selection
is done annually.
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Selection
is not based solely on grade level; however, typically it would be limited
to those employees in positions graded E13 and
above.
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The
Compensation Committee evaluates:
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the
nature of the job;
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·
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the
market competitive level of total
compensation;
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the
strategic and long term nature of the
role;
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·
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the
degree of value creation or revenue generation of the
role;
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·
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the
degree of impact on the overall financial performance of the company;
and
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the
long-term potential of employees to assume a Senior Vice President and
above role with the company.
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2
Contribution
Level
Verso’s
annual ERP contribution is based on a percentage of the executive’s Eligible
Compensation (as defined below). The following matrix sets forth the
contribution percentage for each pay grade.
Pay Grade
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ERP
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SSRP
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TOTAL
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E17
and above
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10%
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2.75%
or 5.00%
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12.50%
- 15.00%
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E15
– E16
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8%
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2.75%
or 5.00%
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10.50%
- 13.00%
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E14
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6%
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2.75%
or 5.00%
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8.75%
- 11.00%
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E13
and others
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4%
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2.75%
or 5.00%
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6.75%
- 9.00%
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Eligible
Compensation
The
executive’s base salary plus the annual target incentive opportunity calculated
on January 1 of each year would be used to determine the ERP
contribution.
Timing
of Contribution
A lump
sum contribution for each selected executive will be made under ERP during the
first quarter of each calendar year. We are on schedule to make the initial 2010
contribution on or before January 31, 2010.
Plan
Guidelines
Executives
in the 2010 ERP would see an adjustment to the Verso Salaried Supplemental
Retirement Plan (SSRP) contributions at:
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•
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2.75%
if hired after June 30, 2004.
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•
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5.00%
if hired on or before June 30,
2004.
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Temporary
Grandfather Contribution
To ensure
that no executive selected to be included in ERP experiences a decline in total
benefit level as a result of the reduction to SSRP, a transition contribution
will be offered in 2010 and 2011. This means that the ERP
contribution in these two (2) calendar years may be more than set forth in the
above matrix. At the time you are notified of coverage under ERP,
your contribution formula will also be specified for the calendar year of
coverage. The Compensation Committee retains the sole and exclusive
right to determine the amount of transition contribution to be made for each
covered executive.
Grandfathered
Example:
A current
executive is at Pay Grade E13 and is receiving a 12% SSRP contribution (5% basic
and 7% five year enhancement). Temporary Grandfather
Contribution: This executive if selected for coverage under ERP will
receive 12% contribution for 2010 and 2011 (5% for SSRP and 7% for ERP) and in
2012, this executive would be scheduled to receive 4% from ERP and 5% from SSRP,
for a total of 9%.
Investment
Options
Investing
options are similar to the Deferred Compensation Plan and will be managed by
Fidelity.
3
Beneficiary
Form
A
separate Beneficiary Form is required.
Deferral
and Payment Options
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The
2010 ERP contribution will be subject to a two year deferral requirement,
or payable in the event that separation, death, or permanent disability
occurs before the two year
requirement.
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Future
ERP contributions will be subject to deferral elections by the
executive. This deferral election will be separate from the
deferral election made under the regular
DCP.
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