o Preliminary
Proxy Statement
|
||
o Confidential,
for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
|
||
x Definitive
Proxy Statement
|
||
o Definitive
Additional Materials
|
||
o Soliciting
Material Pursuant to § 240.14a-12
|
(1)
|
Title
of each class of securities to which transaction
applies:
|
(2)
|
Aggregate
number of securities to which transaction
applies:
|
(3)
|
Per
unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing fee
is calculated and state how it was
determined):
|
(4)
|
Proposed
maximum aggregate value of
transaction:
|
(5)
|
Total
fee paid:
|
o
|
Fee
paid previously with preliminary materials.
|
o
|
Check
box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its
filing.
|
(1)
|
Amount
previously paid:
|
(2)
|
Form,
Schedule or Registration Statement
No.:
|
(3)
|
Filing
Party:
|
(4)
|
Date
Filed:
|
VOTE BY INTERNET
|
VOTE BY TELEPHONE
|
VOTE BY MAIL
|
|||
http://www.proxyvote.com
24 hours
a day/7 days a week
Use
the Internet to vote your
proxy.
Have your proxy card
in
hand when you access the
web
site.
|
1-800-690-6903
toll-free
24 hours
a
day/7 days a week
Use
any touch-tone telephone
to
vote your proxy. Have your
proxy
card in hand when you call.
|
Sign
and date the proxy card and
return
it in the enclosed postage-
paid
envelope.
|
|||
Sincerely,
|
MARK
SARVARY
|
|
President,
Chief Executive Officer and Director
|
|
Dale
E. Williams
|
|
Executive
Vice President, Chief Financial Officer, and Secretary
|
|
Lexington,
Kentucky
|
|
March
24, 2010
|
Page
|
|||
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14 | |||
14 | |||
15 | |||
17 | |||
17 | |||
28 | |||
29 | |||
30 | |||
30 | |||
Grants of Plan-Based Awards | 31 | ||
32 | |||
33 | |||
33 | |||
33 | |||
38 | |||
39 | |||
39 | |||
40 | |||
40 | |||
41 | |||
42 | |||
43 | |||
43 | |||
45 | |||
46 | |||
46 | |||
46 | |||
46 | |||
46 | |||
47 |
Q:
|
Who may vote at the meeting? | |
A:
|
Our
Board set March 5, 2010 as the record date for the meeting. All
stockholders who owned Tempur-Pedic International common stock of record
at the close of business on March 5, 2010 may attend and vote at the
meeting. Each stockholder is entitled to one vote for each share of common
stock held on all matters to be voted on. On March 5,
2010, 71,869,119 shares of Tempur-Pedic International common stock
were outstanding. The common stock is the only class of securities
eligible to vote at the meeting.
|
|
|
||
Q:
|
How
many votes does Tempur-Pedic International need to be present at the
meeting?
|
|
A:
|
A
majority of Tempur-Pedic International’s outstanding shares of common
stock as of the record date must be present at the meeting in order to
hold the meeting and conduct business. This is called a quorum. Shares are
counted as present at the meeting if you:
|
|
•
|
Are
present and vote in person at the meeting; or
|
|
•
|
Have
properly submitted a proxy card, by submitting the proxy card via the
Internet, telephone or in writing.
|
|
Q: |
What
proposals will be voted on at the meeting?
|
|
A: |
There
are three proposals scheduled to be voted on at the
meeting:
|
|
•
|
Election
of ten (10) directors to each serve for a one-year term and until the
director’s successor has been duly elected and qualified (Proposal
One).
|
|
•
|
Ratification
of the appointment of the firm of Ernst & Young LLP as
Tempur-Pedic International’s independent auditors for the year ending
December 31, 2010 (Proposal Two).
|
|
•
|
Approval
of the Amended and Restated Annual Incentive Bonus Plan for Senior
Executives (Proposal Three).
|
|
Q:
|
What
is the voting requirement to approve the proposal?
|
|
A:
|
At
an annual meeting at which a quorum is present, the following votes will
be necessary to elect directors, to ratify the appointment of the
independent auditors and to approve the Amended and Restated Annual
Incentive Bonus Plan for Senior Executives described in this proxy
statement:
|
|
• | Each director shall be elected by the vote of a majority of the votes cast with respect to the director. For purposes of this vote, a majority of the votes cast means that the number of shares voted “for” a director must exceed the number of shares voted “against” that director (excluding abstentions). |
|
• |
Ratification
of the appointment of Ernst & Young LLP as independent auditors
for the year ending December 31, 2010 requires the affirmative vote
of the majority of shares present and entitled to vote. Abstentions are
counted as votes present and entitled to vote and have the same effect as
votes against the proposal.
|
|
||
• | Approval of the Amended and Restated Annual Incentive Bonus Plan for Senior Executives described in this proxy statement requires the affirmative vote of the majority of shares present and entitled to vote. Abstentions are counted as votes present and entitled to vote and have the same effect as votes against the proposal. Broker non-votes, if any, will be handled as described below. |
|
|
|
Q: |
If
I hold my shares in a brokerage account and do not provide voting
instructions to my broker, will my shares be voted?
|
|
|
|
|
A:
|
Under
New York Stock Exchange (“NYSE”) rules, brokerage firms may vote in their
discretion on certain matters on behalf of clients who do not provide
voting instructions at least 15 days before the date of the annual
meeting. Generally, brokerage firms may vote to ratify the appointment of
independent auditors and on other “discretionary” items. In
contrast, brokerage firms may not vote to elect directors or on
stockholder proposals because those proposals are considered
“non-discretionary” items. Accordingly, if your shares are held
in a brokerage account and you do not return voting instructions to your
broker by its deadline, your shares may be voted by your broker on some,
but not all, of the proposals described in this proxy
statement. Broker non-votes will not be considered in
determining the number of votes cast in connection with non-discretionary
items.
|
|
Q: |
How
would my shares be voted if I do not specify how they should be
voted?
|
|
A: |
If
you sign and return your proxy card without indicating how you want your
shares to be voted, the Proxy Committee appointed by the Board will vote
your shares as follows:
|
|
•
|
Proposal One: “FOR” the election of ten directors to each serve for a one-year term and until the director's successor has been duly elected and qualified. | |
•
|
Proposal Two: “FOR” the ratification of the appointment of the firm of Ernst & Young LLP as Tempur-Pedic International's independend auditors for the year ending December 31, 2010. | |
•
|
Proposal Three: “FOR” the approval of the Amended and Restated Annual Incentive Bonus Plan for Senior Executives. | |
Q:
|
How
may I vote my shares in person at the meeting?
|
|
A:
|
Shares
held directly in your name as the stockholder of record may be voted in
person at the meeting. If you choose to attend the meeting, please bring
the enclosed proxy card and proof of identification for entrance to the
meeting. If you hold your shares in street name, you must request a legal
proxy from the stockholder of record (your stockbroker or bank) in order
to vote at the
meeting.
|
Q:
|
How
can I vote my shares without attending the meeting?
|
|
A:
|
You
may vote in person at the meeting or by proxy. We recommend you vote by
proxy even if you plan to attend the meeting. You can always change your
vote at the meeting. Giving us your proxy means you authorize us to vote
your shares at the meeting in the manner you direct.
If
your shares are held in your name, you can vote by proxy in three
convenient ways:
|
|
•
|
Via Internet: Go to http://www.proxyvote.com and follow the instructions. You will need to enter the control number printed on your proxy materials. | |
• | By Telephone: Call toll-free 1-800-690-6903 and follow the instructions. You will need to enter the control number printed on your proxy materials. | |
• | In Writing: Complete, sign, date and return your proxy card in the enclosed envelope (if you have received a paper copy of the voting materials). | |
If
your shares are held in street name, you may vote by submitting voting
instructions to your stockbroker or nominee. In most cases, you will be
able to do this by mail. Please refer to the summary instructions included
on your proxy card. For shares held in street name, the voting instruction
card will be included by your stockbroker or nominee.
|
||
|
||
You
may submit your proxy by mail by signing your proxy card or, for shares
held in street name, by following the voting instruction card included by
your stockbroker or nominee and mailing it in the enclosed, postage-paid
envelope. If you provide specific voting instructions, your shares will be
voted as you have
instructed.
|
|
|
|
Q: |
How
can I change my vote after I return my proxy
card?
|
|
|
|
|
A: |
You
may revoke your proxy and change your vote at any time before the final
vote at the meeting. You may do this by signing and submitting a new proxy
card with a later date via internet, telephone or mail or by attending the
meeting and voting in person. Attending the meeting will not revoke your
proxy unless you specifically request it.
|
|
Q: |
What
is Tempur-Pedic International’s voting
recommendation?
|
|
A: |
Our
Board of Directors recommends that you vote your shares “FOR” each of the
nominees to the Board (Proposal One), “FOR” the ratification of the
appointment of Ernst & Young LLP as Tempur-Pedic International’s
independent auditors for the year ending December 31, 2010 (Proposal Two)
and “FOR” approval of the Amended and Restated Annual Incentive Bonus Plan
for Senior Executives (Proposal Three).
|
|
Q:
|
|
Where
can I find the voting results of the
meeting?
|
A:
|
|
The
preliminary voting results will be announced at the meeting. The final
results will be published on Form 8-K within four days after the meeting
date.
|
Name
|
Age
|
Position
|
||
Mark
Sarvary
|
50
|
|
President
and Chief Executive Officer
|
|
Dale E. Williams
|
47
|
Executive
Vice President, Chief Financial Officer and Secretary
|
||
Richard
W. Anderson
|
49
|
Executive
Vice President and President, North America
|
||
Matthew D. Clift
|
50
|
|
Executive
Vice President of Global Operations
|
|
Lou
H. Jones
|
59
|
Executive
Vice President and General Counsel
|
||
David Montgomery
|
49
|
|
Executive
Vice President and President of International
Operations
|
|
Bhaskar
Rao
|
44
|
Chief
Accounting Officer and Senior Vice President of Strategic Planning,
Corporate Development
|
•
|
Mission
Statement
|
•
|
Core
Values
|
•
|
Corporate
Governance Guidelines
|
•
|
Code
of Business Conduct and Ethics for Employees, Executive Officers and
Directors
|
•
|
Policy
on Complaints of Accounting, Internal Accounting Controls and Auditing
Matters
|
•
|
Audit
Committee Charter
|
•
|
Compensation
Committee Charter
|
•
|
Nominating
and Corporate Governance Committee Charter
|
•
|
Committees
Membership
|
•
|
Contact
the Presiding Director
|
•
|
Fourth Amended and Restated By-Laws |
• | Amended and Restated Certificate of Incorporation |
The
Audit Committee
|
•
|
reviewing
the scope of internal and independent audits;
|
•
|
reviewing
the Company’s quarterly and annual financial statements and annual report
on Form 10-K;
|
•
|
reviewing
the adequacy of management’s implementation of internal
controls;
|
•
|
reviewing
the Company’s accounting policies and procedures and significant changes
in accounting policies;
|
•
|
reviewing
the Company’s business conduct and ethics policies and
practices;
|
•
|
reviewing
the Company’s policies with respect to risk assessment and risk
management;
|
•
|
reviewing
information to be disclosed and types of presentations to be made in
connection with the Company’s earnings press releases, as well as
financial information and earnings guidance provided to analysts and
rating agencies;
|
•
|
preparing
an annual evaluation of the committee’s performance;
|
•
|
reporting
regularly to the Board on the committee’s activities;
and
|
•
|
appointing
the independent public accountants and reviewing their independence and
performance and the reasonableness of their
fees.
|
The
Compensation Committee
|
• |
reviewing
and approving on an annual basis the corporate goals and objectives with
respect to compensation for the chief executive officer, evaluating at
least once a year the chief executive officer's performance in light of
these established goals and objectives and, based upon these evaluations,
determining and approving the chief executive officer's annual
compensation, including salary, bonus, incentive and equity
compensation;
|
•
|
reviewing
on an annual basis the Company's compensation structure for officers and
employees other than the chief executive officer and making
recommendations to the Board regarding the compensation of these officers
and employees;
|
•
|
oversee
the development of executive succession plans and the leadership
development and training of the Company’s executive
team;
|
•
|
reviewing
on an annual basis the Company’s compensation structure for its directors
and making recommendations to the Board regarding the compensation of
directors;
|
•
|
reviewing
the Company's incentive compensation and stock-based plans and
recommending changes in such plans to the Board as needed, having and
exercising all the authority of the Board with respect to the
administration of such plans;
|
•
|
reviewing
executive officer compensation for compliance with Section 16 of the
Exchange Act and Section 162(m) of the Internal Revenue Code of 1986, as
amended (Code), and other applicable laws, rules and
regulations;
|
•
|
reviewing
and approving employment agreements, severance arrangements and change in
control agreements and provisions when, and if, appropriate, as well as
any special supplemental benefits;
|
•
|
reviewing
with management the “Compensation Discussion and Analysis” section in the
Company’s Proxy Statement;
|
•
|
preparing
and publishing an annual executive compensation report in the Company's
Proxy Statement;
|
•
|
preparing
an annual evaluation of the committee's
performance;
|
•
|
reporting
regularly to the Board on the committee's
activities;
|
•
|
performing
any other activities consistent with the committee’s charter, the
Company's by-laws and governing law, as the committee or the Board deems
appropriate; and
|
•
|
with
respect to any reference in the committee’s charter to NYSE or SEC
requirements, complying with these requirements when listed by the NYSE or
subject to the requirements of the
SEC.
|
The
Nominating and Corporate Governance
Committee
|
•
|
identifying
individuals qualified to become members of the Board;
|
•
|
recommending
to the Board director nominees to be presented at the annual meeting of
stockholders and to fill vacancies on the Board;
|
•
|
developing
appropriate criteria for identifying properly qualified directorial
candidates;
|
•
|
annually
reviewing and recommending to the Board members to each standing committee
of the Board;
|
•
|
preparing
an annual evaluation of the committee’s performance and reporting
regularly to the Board concerning actions and recommendations of the
committee;
|
•
|
establishing
procedures to assist the Board in developing and evaluating potential
candidates for executive positions, including the chief executive
officer;
|
•
|
reviewing
and evaluating related party transactions; and
|
•
|
developing
and recommending to the Board corporate governance guidelines for the
Company.
|
•
|
a
reputation for integrity, honesty and adherence to high ethical
standards;
|
•
|
the
ability to exercise sound business
judgment;
|
•
|
substantial
business or professional experience and the ability to offer meaningful
advice and guidance to the Company’s management based on that experience;
and
|
•
|
the
ability to devote the time and effort necessary to fulfill their
responsibilities to the Company.
|
• |
each
person known to beneficially own more than 5% of Tempur-Pedic
International’s outstanding common stock;
|
•
|
each
of Tempur-Pedic International’s directors and Named Executive Officers (as
defined below in “Executive Compensation and Related
Information”); and
|
•
|
all
of Tempur-Pedic International’s directors and executive officers as a
group.
|
Shares Beneficially
Owned
|
||||||||
Number
of
|
Percentage
|
|||||||
Name of Beneficial Owner:
|
Shares
|
of Class
|
||||||
5%
Stockholders:
|
||||||||
FMR
LLC (1)
|
10,443,537
|
14.5 |
%
|
|||||
Wellington
Management Company (2)
|
3,889,520
|
5.4 | % | |||||
BlackRock,
Inc. (3)
|
3,698,993
|
5.1 | % | |||||
Vanguard
Group, Inc. (4)
|
3,670,935
|
5.1 |
%
|
|||||
Executive
Officers and Directors:
|
||||||||
Mark
Sarvary (5)
|
225,000
|
*
|
%
|
|||||
Dale
E. Williams (5)
|
548,687
|
*
|
%
|
|||||
Richard
W. Anderson (5)
|
193,750
|
*
|
%
|
|||||
Matthew
D. Clift (5)
|
412,034
|
*
|
%
|
|||||
David
Montgomery (5)
|
715,066
|
1.0
|
%
|
|||||
P.
Andrews McLane (5),(6)
|
387,625
|
*
|
%
|
|||||
Christopher
A. Masto (5),(7)
|
186,595
|
*
|
%
|
|||||
Francis
A. Doyle (5)
|
148,122
|
*
|
%
|
|||||
Nancy
F. Koehn (5)
|
113,850
|
*
|
%
|
|||||
Sir
Paul Judge (5)
|
88,850
|
*
|
%
|
|||||
Robert
B. Trussell, Jr. (5),(8)
|
118,700
|
*
|
%
|
|||||
Peter
K. Hoffman (5)
|
77,650
|
*
|
%
|
|||||
John
A. Heil (5)
|
32,800
|
*
|
%
|
|||||
H.
Thomas Bryant (5)
|
69,836
|
*
|
%
|
|||||
Evelyn
S. Dilsaver (5)
|
8,791
|
*
|
%
|
|||||
All
executive officers and directors as a group (17 persons)
(5):
|
3,443,267 |
4.8
|
%
|
*
|
Represents
ownership of less than one percent
|
(1)
|
Amounts
shown reflect the aggregate number of shares of common stock held by FMR
LLC based on information set forth in a schedule 13G/A filed with the SEC
on March 10, 2010. The address of FMR LLC is 82 Devonshire
Street, Boston, MA, 02109.
|
|
(2)
|
Amounts
shown reflect the aggregate number of shares of common stock held by
Wellington Management Company LLP based on information set forth in a
schedule 13G filed with the SEC on February 12, 2010. The
address of Wellington Management Company LLP is 75 State Street, Boston,
MA, 02109.
|
|
(3)
|
Amounts
shown reflect the aggregate number of shares of common stock held by
BlackRock Inc. based on information set forth in a schedule 13G/A filed
with the SEC on February 10, 2010. The address of BlackRock
Inc. is 40 East 52nd
Street, New York, NY, 10022.
|
|
(4)
|
Amounts
shown reflect the aggregate number of shares of common stock held
by Vanguard Group, Inc. based on information set forth in a schedule
13F-HR/A filed with the SEC on March 3, 2010. The address of Vanguard
Group, Inc. is 100 Vangaurd Blvd., Malvern, PA,
19355.
|
|
(5)
|
Includes
the following number of shares of common stock which a director or
executive officer has the right to acquire upon the exercise of stock
options that were exercisable as of March 5, 2010, or that will become
exercisable within 60 days after that date:
|
|
Name:
|
Number of Shares | Name: | Number of Shares | |||
Mark
Sarvary
|
225,000 | Nancy F. Koehn | 113,850 | |||
Dale
E. Williams
|
325,000 |
Sir
Paul Judge
|
88,850 | |||
Richard
W. Anderson
|
193,750 |
Robert
B. Trussell, Jr.
|
53,600 | |||
Matthew
D. Clift
|
390,000 |
Peter
K. Hoffman
|
77,650 | |||
David
Montgomery
|
287,500 |
John
Heil
|
32,800 | |||
P.
Andrews McLane
|
22,100 |
H.
Thomas Bryant
|
12,000 | |||
Christopher
A. Masto
|
57,200 |
Evelyn
S. Dilsaver
|
8,791 | |||
Francis
A. Doyle
|
95,600 |
|
||||
|
All executive officers and directors as a group | 2,080,302 |
(6)
|
Includes
254,943 shares of common stock which Mr. McLane may be deemed to have an
indirect pecuniary interest as his spouse is the trustee of 10 trusts
holding these shares in the aggregate for the benefit of his children and
grandchildren.
|
|
(7)
|
Includes
129,395 shares of common stock held in revocable trust for the benefit of
Mr. Masto’s children.
|
|
(8)
|
Includes
65,100 an aggregate number of shares of common stock, owned by RBT
Investments, LLC and Robert B. Trussell, Jr. and Martha O. Trussell,
Tenants in Common.
|
Callaway
Golf
Carter’s
Central
Garden & Pet
Columbia
Sportswear
Deckers
Outdoor
Elizabeth
Arden
Ethan
Allen
|
Fossil
Guess
Herman
Miller
Movado
Group
Nautilus
Nu
Skin Enterprises
|
Sealy
Select
Comfort
Timberland
Tupperware
Brands
Under
Armour
Warnaco
Group
Wolverine
World Wide
|
•
|
Base
Salary
|
•
|
Annual
Incentive Bonus
|
•
|
Long-Term
Incentives
|
Named
Executive Officer
|
Targeted
Annual Incentive Bonus
|
|||||||
2010
|
2009
|
|||||||
Mark
Sarvary
|
100 | % | 100 | % | ||||
Dale
E. Williams
|
55 | % | 55 | % | ||||
Matthew
D. Clift
|
55 | % | 55 | % | ||||
David
Montgomery
|
55 | % | 55 | % | ||||
Richard
W. Anderson
|
55 | % | 55 | % |
•
|
improve
the Company’s cost structure;
|
•
|
manage
the Company effectively in the uncertain business
environment;
|
•
|
continue
to strengthen the Company
organization;
|
•
|
improve
the Company’s performance and relationships with the retailer
base;
|
•
|
increase
the Company’s actual and perceived product
differentiation;
|
•
|
meet
and form relationships with key external constituencies;
and
|
•
|
strengthen
U.S. Direct response channel sales.
|
•
|
significant
gross margin and overhead expense cost
improvements;
|
•
|
business
managed very tightly during period of significant
uncertainty;
|
•
|
excellent
Strategic Business Plan created with key areas of growth
defined;
|
•
|
strong
additions to management team in key
positions;
|
•
|
redesign
of sales organization and better focus on retail
partners;
|
•
|
development
and launch of new Tempur-Pedic Cloud mattress and product line
architecture; and
|
•
|
reestablished
growth in Direct response channel.
|
•
|
strengthen
oversight of the Company’s financial
objectives;
|
•
|
maintain
a strong balance sheet;
|
•
|
continue
to strengthen relationships with investors and
analysts;
|
•
|
manage
the Company effectively in the uncertain business environment;
and
|
•
|
strengthen
the organization and improve employee engagement
scores.
|
•
|
streamlining
the financial monitoring process;
|
•
|
effecting
the repatriation of foreign
earnings;
|
•
|
keeping
corporate costs low and exceeding expectations on certain budget
items;
|
•
|
increasing
investor relations activity;
|
•
|
contributing
to development of a strong strategic plan;
and
|
•
|
strong
improvements in employee engagement
scores.
|
•
|
manage
North American financial
objectives;
|
•
|
increase
actual and perceived product
differentiation;
|
•
|
improve
performance with retailers;
|
•
|
strengthen
U.S. Direct Response by focusing on
internet;
|
•
|
manage
the Company effectively in the uncertain business environment;
and
|
•
|
strengthen
the organization and improve employee engagement
scores.
|
•
|
improved
Net sales ahead of budget target;
|
•
|
developing
and successfully launching the Cloud and Cloud Supreme
mattresses;
|
•
|
creating
a high potential new advertising and marketing
campaign;
|
•
|
redesigning
the sales organization and improved retail partner
focus;
|
•
|
increasing
U.S. Direct response sales; and
|
•
|
strengthening
organizational talent and
engagement.
|
•
|
improve
the effectiveness of factory
operations;
|
•
|
improve
gross margin;
|
•
|
increase
the Company’s actual and perceived product
differentiation;
|
•
|
improve
performance with the Company’s
retailers;
|
•
|
manage
the Company effectively in this uncertain business environment;
and
|
•
|
strengthen
the organization and improve employee engagement
scores.
|
•
|
increasing
global factory productivity and global
safety;
|
•
|
attainment
of significant cost reductions;
|
•
|
delivering
major new technology and new products on
schedule;
|
•
|
achievement
of new product performance goals via consumer testing;
and
|
•
|
improving
the operations and IT organization through new
hires.
|
•
|
manage
international financial objectives;
|
•
|
improve
margins;
|
•
|
increase
the Company’s actual and perceived product
differentiation;
|
•
|
improve
performance with retailers;
|
•
|
manage
the Company effectively in the uncertain business environment;
and
|
•
|
strengthen
the organization and improve employee engagements
scores.
|
•
|
increases
in international gross profit
margin;
|
•
|
achieved
EBIT and free cash flow targets;
|
•
|
successful
launch of new products;
|
•
|
increasing
the store base in Japan and channels in Austria and the Czech
Republic;
|
•
|
tight,
proactive management of International business during uncertainty;
and
|
•
|
upgrading
and operating the International team
effectively.
|
Named
Executive Officer
|
Percentage
of Overall Incentive Bonus Target
|
|||
Mr.
Sarvary
|
169.4 | % | ||
Mr.
Williams
|
172.1 | % | ||
Mr.
Anderson
|
172.1 | % | ||
Mr.
Clift
|
169.4 | % | ||
Mr.
Montgomery
|
164.0 | % |
Named
Executive Officer
|
Date
of Grant
|
Stock
Option Award
|
|||
Dale
E. Williams
|
2/27/2009
|
180,000 | |||
Richard
W. Anderson
|
2/27/2009
|
150,000 | |||
Matthew
D. Clift
|
2/27/2009
|
210,000 | |||
David
Montgomery
|
2/27/2009
|
180,000 |
Named
Executive Officer
|
Date
of Grant
|
Performance
Restricted Stock Unit Awards (1)
|
|||
Mark
Sarvary
|
2/22/2010
|
35,224 | |||
Dale
E. Williams
|
2/22/2010
|
7,221 | |||
Richard
W. Anderson
|
2/22/2010
|
7,221 | |||
Matthew
D. Clift
|
2/22/2010
|
7,221 | |||
David
Montgomery
|
2/22/2010
|
7,221 | |||
(1) Recipients of PRSUs may earn a total award ranging from 0% to 300% of the initial grant. Actual payout under this program is dependent upon the achievement of certain financial goals, including Net sales and EBIT margin targets. |
Non-equity
|
||||||||||||||||||||||||
Stock
|
Incentive
Plan
|
All
Other
|
||||||||||||||||||||||
|
Bonus
|
Awards
|
Option
|
Compensation
|
Compensation
|
Total
|
||||||||||||||||||
Name
and Principal Position
|
Year
|
Salary
($)
|
($)
(3)
|
($)
|
Awards($)
(4)
|
($)
(3)
|
($)
(5)
|
($)
|
||||||||||||||||
Mark
Sarvary — President and Chief Executive Officer(1)
|
2009
|
$
|
750,000
|
$
|
383,500
|
$
|
—
|
$
|
—
|
$
|
987,000
|
$
|
15,155
|
$
|
2,135,655
|
|||||||||
2008
|
360,577
|
218,750
|
—
|
2,412,000
|
175,000
|
104,115
|
3,270,442
|
|||||||||||||||||
Dale
E. Williams — Executive
Vice-President, Chief Financial Officer and
Secretary
|
2009
|
340,000
|
75,735
|
—
|
405,000
|
246,092
|
14,909
|
1,081,736
|
||||||||||||||||
2008
|
341,601
|
68,567
|
—
|
204,000
|
—
|
17,230
|
631,398
|
|||||||||||||||||
2007
|
309,987
|
67,158
|
—
|
—
|
198,673
|
17,230
|
593,048
|
|||||||||||||||||
Richard
W. Anderson — Executive Vice-President, President North
America
|
2009
|
328,000
|
73,062
|
—
|
337,500
|
237,406
|
21,415
|
997,383
|
||||||||||||||||
2008
|
328,700
|
54,120
|
—
|
902,000
|
—
|
20,645
|
1,305,465
|
|||||||||||||||||
2007
|
314,711
|
68,182
|
—
|
—
|
201,701
|
8,230
|
592,824
|
|||||||||||||||||
Matthew
D. Clift — Executive Vice-President, Global Operations
|
2009
|
360,000
|
74,844
|
—
|
472,500
|
260,568
|
24,313
|
1,192,225
|
||||||||||||||||
2008
|
360,795
|
66,000
|
—
|
204,000
|
—
|
17,230
|
648,025
|
|||||||||||||||||
2007
|
344,867
|
86,224
|
—
|
—
|
221,066
|
17,230
|
669,387
|
|||||||||||||||||
David
Montgomery — Executive Vice-President, President of International
Operations (2)
|
2009
|
375,865
|
64,152
|
—
|
405,000
|
260,568
|
70,807
|
1,176,392
|
||||||||||||||||
2008
|
444,613
|
60,439
|
—
|
204,000
|
—
|
81,254
|
790,306
|
|||||||||||||||||
2007
|
461,455
|
68,671
|
—
|
—
|
293,437
|
86,790
|
910,353
|
(1)
|
Mr.
Sarvary joined the Company on June 30, 2008 and became our President and
Chief Executive Officer on August 4, 2008. Mr. Sarvary received a bonus of
$100,000 at the time he accepted employment with us. The remainder of the
2008 amount is representative of annual bonus payouts which were earned in
2008 and paid in February 2009. The amount in the “Bonus” column for 2009
includes the second installment of Mr. Sarvary’s signing bonus which was
payable under his employment agreement on the first anniversary of his
employment with the Company.
|
|
(2)
|
Mr.
Montgomery’s salary is paid in British Pounds (₤) and is converted to
United States Dollars ($) using the monthly payments translated at the
monthly average rate for each month in the year ended December 31, 2009.
Mr. Montgomery’s Non-Equity Incentive Plan Compensation is denominated in
British Pounds and has been converted to United States Dollar using the
spot conversion rate for the date paid to Mr.
Montgomery.
|
|
(3)
|
Bonus
and Non-equity Incentive Plan Compensation payouts were earned in 2009 and
paid in 2010 to Mr. Sarvary, Mr. Williams, Mr. Clift, Mr. Montgomery and
Mr. Anderson, pursuant to the 2009 Executive Incentive Bonus Plan. The
amount paid upon the achievement of the Individual goals appear in the
column “Bonus” and the amounts paid upon the achievement of the Company
performance appear in the column “Non-equity Incentive Plan
Compensation.”
|
|
(4)
|
For
stock options granted, the value set forth is the full grant date fair
value, in accordance with FASB ASC 718. See the Company’s Annual Report
for the year ended December 31, 2009 for a complete description of
the valuation.
|
|
(5)
|
Represents
amounts paid on behalf of each of the Named Executive Officers for the
following three respective categories of compensation: (i) premiums
for life, accidental death and dismemberment insurance and long-term
disability benefits, (ii) contributions to our defined contribution
plans and (iii) car allowance. Amounts for each of the Named Executive
Officers for each of the three respective preceding categories is as
follows: Mr. Sarvary: (2009 – $973,$6,983, $7,200); Mr. Williams:
(2009 – $973, $6,737, $7,200); Mr. Clift (2009 – $973, $16,140, $7,200);
Mr. Montgomery: (2009 – $7,748, $48,628, $13,703 ); and Mr. Anderson:
(2009 – $973, $13,242, $7,200). Mr. Montgomery also received tax
preparation fees in the amount of $728 which is included under
“All Other Compensation” for the year ended December 31,
2009.
|
Estimated
Possible Payouts
Under
Non-Equity Incentive
Plan Awards
(1)
|
||||||||||||||
Name/Type
of Award
|
Grant Date | Threshold ($) | Target ($) | Maximum ($) | All
Other Option Awards: Number of Securities Underlying
Options
(#) (2)
|
Exercise or Base Price of Option Awards ($/Sh)
|
Grant
Date Fair Value of Stock and Option Awards
($)
(3)
|
|||||||
Mark
Sarvary
|
||||||||||||||
Annual
Incentive Bonus
|
2/27/09
|
— | 750,000 | 1,500,000 | ||||||||||
Dale
E. Williams
|
||||||||||||||
Annual
Incentive Bonus
|
2/27/09
|
— | 187,000 | 374,000 | ||||||||||
Stock
Option
|
2/27/09
|
180,000 | 6.14 | 405,000 | ||||||||||
Matthew
D. Clift
|
||||||||||||||
Annual
Incentive Bonus
|
2/27/09
|
— | 198,000 | 396,000 | ||||||||||
Stock
Option
|
2/27/09
|
210,000 | 6.14 | 472,500 | ||||||||||
David
Montgomery
|
||||||||||||||
Annual
Incentive Bonus (4)
|
2/27/09
|
— | 189,196 | 378,391 | ||||||||||
Stock
Option
|
2/27/09
|
180,000 | 6.14 | 405,000 | ||||||||||
Richard
W. Anderson
|
||||||||||||||
Annual
Incentive Bonus
|
2/27/09
|
— | 180,400 | 360,800 | ||||||||||
Stock
Option
|
2/27/09
|
150,000 | 6.14 | 337,500 |
(1)
|
These
columns show the 2009 annual award opportunities under the Annual
Incentive Bonus Plan for Senior Executives. They do not reflect
the actual amounts paid out under the program which are included in the
Summary Compensation Table and discussed in detail in the Compensation
Discussion and Analysis Section under “Compensation Components – Annual
Incentive Bonus”.
|
|
(2)
|
This
column shows the stock options granted in 2009 under the Company’s Amended
and Restated 2003 Equity Incentive Plan. The stock
options vest over a four year period as follows: 25% vesting on
each of the first four anniversaries of the grant date, subject to the
named executive officer’s continued employment with the
Company.
|
|
(3) |
For
stock options granted, the value set forth is the full grant date fair
value, in accordance with FASB ASC 718. See the Company’s Annual Report
for the year ended December 31, 2009 for a complete description of
the valuation.
|
|
|
|
|
(4)
|
Mr.
Montgomery’s salary is paid in British Pounds (₤). As a result, the Annual
Incentive Bonus, target and maximum opportunities were converted to United
States Dollars ($) based on the exchange spot rate on the date the award
was granted (February 27, 2009).
|
Option
Awards
|
||||||||||||
Number
of
|
Number
of
|
|||||||||||
|
Securities
Underlying
|
Securities
Underlying
|
||||||||||
Unexercised
|
Unexercised
|
|||||||||||
Name
|
Options
(#)
Exercisable
|
Options (#)
Unexercisable
|
Option Exercise
Price
($)
|
Option
Expiration Date
|
||||||||
Mark
Sarvary
|
225,000
|
675,000
|
(1)
|
$
|
7.81
|
6/30/2018
|
||||||
Dale
E. Williams
|
65,625
|
—
|
|
2.38
|
7/7/2013
|
|||||||
156,250
|
93,750
|
(2)
|
13.47
|
6/28/2016
|
||||||||
25,000
|
25,000
|
(3)
|
11.76
|
5/15/2018
|
||||||||
—
|
180,000
|
(4)
|
6.14
|
2/27/2019
|
||||||||
Matthew
D. Clift
|
225,000
|
—
|
19.30
|
12/1/2014
|
||||||||
112,500
|
—
|
12.37
|
12/15/2015
|
|||||||||
25,000
|
25,000
|
(3)
|
11.76
|
5/15/2018
|
||||||||
—
|
210,000
|
(4)
|
6.14
|
2/27/2019
|
||||||||
David
Montgomery
|
240,625
|
109,375
|
(5)
|
13.47
|
6/28/2016
|
|||||||
25,000
|
25,000
|
(3)
|
11.76
|
5/15/2018
|
||||||||
—
|
180,000
|
(4)
|
6.14
|
2/27/2019
|
||||||||
Richard
W. Anderson
|
50,000
|
25,000
|
(6)
|
13.16
|
7/18/2016
|
|||||||
56,250
|
18,750
|
(7)
|
20.27
|
12/21/2016
|
||||||||
25,000
|
75,000
|
(8)
|
20.02
|
1/29/2018
|
||||||||
25,000
|
25,000
|
(3)
|
11.76
|
5/15/2018
|
||||||||
—
|
150,000
|
(4)
|
6.14
|
2/27/2019
|
(1)
|
These
options, granted on June 30, 2008, have a 10-year term and become
exercisable in four equal installments over four years, beginning with the
one-year anniversary date of the grant.
|
|
(2)
|
These
options, granted on June 28, 2006, have a 10-year term. Twenty-five
percent (25%) of these options became exercisable on July 7, 2008 and the
remaining shares become exercisable in equal installments on a quarterly
basis over the subsequent twelve (12) quarters.
|
|
(3)
|
These
options, granted on May 15, 2008, have a 10-year term and become
exercisable in two equal installments over two years, beginning with the
one-year anniversary date of the grant.
|
|
(4)
|
These
options, granted on February 27, 2009, have a 10-year life and became
exercisable in equal installments over four years, beginning with the
one-year anniversary of the grant date.
|
|
(5)
|
These
options, granted on June 28, 2006, have a 10-year term. Twenty-five
percent (25%) of these options became exercisable on February 24, 2008 and
the remaining shares become exercisable in equal installments on a
quarterly basis over the subsequent twelve quarters.
|
|
(6)
|
These
options, granted on July 18, 2006, have a 10-year life and became
exercisable in equal installments over four years, beginning with the
one-year anniversary of the grant date.
|
|
(7)
|
These
options, granted on December 21, 2006, have a 10-year life and became
exercisable in equal installments over four years, beginning with the
one-year anniversary of the grant date.
|
|
(8)
|
These
options, granted on January 29, 2008, have a 10-year life and became
exercisable in equal installments over four years, beginning with the
one-year anniversary of the grant date.
|
|
Termination
|
||||||||||||||||||||
Termination
|
Employee
|
Termination
|
Due
to
|
Change
of
|
||||||||||||||||
By
Company
|
Resignation
|
By
Company
|
Death
or
|
Change
of
|
Control
and
|
|||||||||||||||
Without
Cause
|
For
Good Reason
|
For
Cause
|
Disability
|
Control
|
Termination
|
|||||||||||||||
Name
|
Benefits
and Payments
|
($)
(1)
|
($)
(1)
|
($)
|
($)
(1)
|
($)
|
($)
|
|||||||||||||
Mark
Sarvary
|
Cash
Severance (2)
|
$ | 2,228,542 | $ | 2,228,542 | — | $ | 750,000 | — | — | ||||||||||
Bonus
Payment (3)
|
750,000 | 750,000 | — | 750,000 | — | — | ||||||||||||||
Acceleration
of equity awards (4)
|
603,000 | 603,000 | — | 603,000 | — | 603,000 | ||||||||||||||
Health
and Welfare Continuation (5)
|
21,458 | 21,458 | — | — | — | — | ||||||||||||||
Dale
E. Williams
|
Cash
Severance (6)
|
340,000 | 340,000 | — | — | — | — | |||||||||||||
Bonus
Payment (3)
|
187,000 | 187,000 | — | 187,000 | — | — | ||||||||||||||
Acceleration
of equity awards (7)
|
— | — | — | — | 289,219 | 203,250 | ||||||||||||||
Health
and Welfare Continuation (5)
|
11,028 | 11,028 | — | — | — | — | ||||||||||||||
Matthew
D. Clift
|
Cash
Severance (6)
|
360,000 | 360,000 | — | — | — | — | |||||||||||||
Bonus
Payment (3)
|
198,000 | 198,000 | — | 198,000 | — | — | ||||||||||||||
Acceleration
of equity awards (8)
|
— | — | — | — | — | 220,125 | ||||||||||||||
Health
and Welfare Continuation (5)
|
9,430 | 9,430 | — | — | — | — | ||||||||||||||
David
Montgomery
|
Cash
Severance (9)
|
375,865 | 375,865 | — |
See
FN 10
|
— | — | |||||||||||||
Bonus
Payment
|
— | — | — | — | — | — | ||||||||||||||
Acceleration
of equity awards (11)
|
— | — | — | — | 327,578 | 203,250 | ||||||||||||||
Health
and Welfare Continuation
|
— | — | — | — | — | — | ||||||||||||||
Pension
Benefits (12)
|
48,628 | 48,628 | — | — | — | — | ||||||||||||||
Car
Allowance (13)
|
13,703 | 13,703 | — | — | — | — | ||||||||||||||
Richard
W. Anderson
|
Cash
Severance (6)
|
328,000 | 328,000 | — | — | — | — | |||||||||||||
Bonus
Payment (3)
|
180,400 | 180,400 | — | 180,400 | — | — | ||||||||||||||
Acceleration
of equity awards (14)
|
— | — | — | — | 148,281 | 360,875 | ||||||||||||||
Health
and Welfare Continuation (5)
|
10,729 | 10,729 | — | — | — | — |
(1)
|
Excludes
amounts for both unpaid, earned salary and for accrued, unused
vacation.
|
(2)
|
For
Mr. Sarvary, the amount presented under Cash Severance for Termination by
Company without Cause and for Employee Resignation for Good Reason
includes two years of base salary reduced by benefit continuation payments
and a lump sum amount equal to the pro-rata portion of base salary. Upon
Termination as a result of Death or Disability, Mr. Sarvary will receive a
lump sum payment equal to the pro-rata portion of base
salary.
|
(3)
|
Bonus
is calculated at target and represents the pro-rata portion of the
performance bonus with respect to the bonus year in which the termination
or death/disability occurs. Refer to “Compensation Discussion and Analysis
– Compensation Components – Annual Incentive Bonus” for a discussion of
each Named executive officer’s Target
bonus.
|
(4)
|
The
acceleration of equity awards represents the fair value of awards that
would accelerate upon vesting as of the event date. Mr. Sarvary’s stock
option agreement dated June 30, 2008 provides that if he is terminated
without cause, resigns for good reason, is terminated as a result of death
or disability or is terminated upon the Company’s election not to renew
his employment agreement, his next installment of 225,000 unvested options
as of the date preceding his termination will accelerate. In the event of
a change in control, if Mr. Sarvary is terminated without cause or resigns
for good reason (as defined in his employment agreement) within twelve
months of the change in control, his next installment of 225,000 unvested
options will accelerate as of the date preceding his
termination.
|
(5)
|
For
Mr. Sarvary, the continuation of welfare benefits will continue for a
period of two years. For all other NEO’s (except for Mr. Montgomery) the
continuation of welfare benefits is for a period of twelve
months.
|
(6)
|
For
Messrs. Williams, Clift and Anderson, the amount presented under Cash
Severance for Termination by Company without Cause and for Employee
Resignation for Good Reason represents twelve months of base
salary.
|
(7)
|
The
acceleration of equity awards represents the fair value of awards that
would accelerate upon vesting as of the event date. Mr. Williams’s stock
option agreement dated June 28, 2006 provides that if a change in control
occurs, fifty percent of his unvested options will vest upon the date of
the change in control. Mr. William’s stock option agreements dated May 15,
2008 and February 27, 2009 provide that if he is terminated without cause
or resigns for good reason (as defined in his employment agreement) within
twelve months of the change in control, his next installment of unvested
options will accelerate as of the date preceding his termination. The
option agreements dated May 15, 2008 and February 27, 2009 do not
accelerate vesting if only a change in control
occurs.
|
(8)
|
The
acceleration of equity awards represents the fair value of awards that
would accelerate upon vesting as of the event date. Mr. Clift’s stock
option agreements dated May 15, 2008 and February 27, 2009 provides that
if he is terminated without cause or resigns for good reason (as defined
in his employment agreement) within twelve months of the change in
control, his next installment of unvested options will accelerate as of
the date preceding his termination.
|
(9)
|
For
Mr. Montgomery, the amount presented under Cash Severance for Termination
by Company without Cause and for Employee Resignation for Good Reason
includes a lump sum payment equal to one year of base
salary.
|
(10)
|
For
Mr. Montgomery, the amount presented under “Termination due to Death or
Disability” includes: For death while in service to the Company, insurance
coverage up to four (4) times base salary and widow’s pension up to an
amount of 25% of base salary; For critical illness, insurance coverage up
four times base salary at the time of the illness or injury preventing him
from future service and in the case of long term disability, permanent
health insurance coverage beyond the amount covered for twelve months
equal to 55% of salary until normal retirement
age.
|
(11)
|
The
acceleration of equity awards represents the fair value of awards that
would accelerate upon vesting as of the event date. Mr. Montgomery’s stock
option agreement dated June 28, 2006 provides that if a change in control
occurs, fifty percent of his unvested options will vest upon the date of
the change in control. Mr. Montgomery’s stock option agreements dated May
15, 2008 and February 27, 2009 provides that if he is terminated without
cause or resigns for good reason (as defined in his employment agreement)
within twelve months of the change in control, his next installment of
unvested options will accelerate as of the date preceding his termination.
The option agreements dated May 15, 2008 and February 27, 2009 do not
accelerate vesting if only a change in control
occurs.
|
(12)
|
For
Mr. Montgomery, the amount presented under Pension benefits for
Termination by Company without Cause and for Employee Resignation for Good
Reason includes continuation of pension benefits for a period of twelve
months.
|
(13)
|
For
Mr. Montgomery, the amount presented under Car allowance benefits for
Termination by Company without Cause and for Employee Termination for Good
Reason includes continuation of car allowance benefits for a period of
twelve months.
|
(14)
|
The
acceleration of equity awards represents the fair value of awards that
would accelerate upon vesting as of the event date. Mr. Anderson’s stock
option agreements dated July 18, 2006 and December 21, 2006 provide that
if a change in control occurs, fifty percent of his unvested options will
vest upon the date of the change in control. Mr. Anderson’s stock option
agreements dated January 29, 2008, May 15, 2008 and February 27, 2009
provides that if he is terminated without cause or resigns for good reason
(as defined in his employment agreement) within twelve months of the
change in control, his next installment of unvested options will
accelerate as of the date preceding his termination. The option agreements
dated January 29, 2008, May 15, 2008 and February 27, 2009 do not
accelerate vesting if only a change in control
occurs.
|
Fees
Earned or
|
Option
|
|||||||||
Name
|
Paid
in
Cash ($) (1)
|
Awards
($)(4)
|
Total
($)
|
|||||||
Francis
A. Doyle
|
$
|