Supplemental Executive Retirement Plan

A Defined Benefit Plan is a type of employer-sponsored retirement plan where employees receive a guaranteed "fixed" payout upon retirement. The benefit amount is typically calculated based on factors such as salary history, years of service, and a predetermined formula. The employer is responsible for funding and managing the plan’s assets to ensure payouts.

A Defined Contribution Plan is a type of retirement plan in which employees and/or employers contribute a set amount to individual accounts, but the final retirement benefit depends on investment performance. Common examples include 401(k) plans, 403(b) plans, and profit-sharing plans. Employees manage their own accounts and decide how to invest their funds.

A Performance-Based Plan is a compensation or retirement plan where benefits are tied to the achievement of specific performance goals. These goals can be based on individual, team, or company-wide metrics. Performance-Based Plans are often used to incentivize executives by aligning their financial rewards with company success.

A Profits Interest Plan is an equity-based compensation arrangement typically used by partnerships and LLCs to grant employees a share of future profits and appreciation in company value without giving them ownership stake. A profits interest plan does not provide recipients with rights to existing company value but instead rewards for future growth.