SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934

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MATTHEWS INTERNATIONAL CORPORATION

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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~~2013~~2014

NOTICE

ANNUAL

MEETING

AND

PROXY

STATEMENT

Notice of

ANNUAL MEETING OF SHAREHOLDERS

To be held February ~~21, 2013~~20, 2014

To Our Shareholders:

The Annual Meeting of the Shareholders of Matthews International Corporation will be held at 6:9:00 PMAM on Thursday, February ~~21, 2013~~20, 2014 at the ~~Sheraton Station Square~~Renaissance Baltimore Harborplace Hotel, ~~300 West Station Square Drive, Pittsburgh, Pennsylvania,~~202 East Pratt Street, Baltimore, Maryland 21202 for the purpose of considering and acting upon the following:

1.	To elect ~~three directors~~one director of the Company for a term of three years and one director of the Company for a term of two years.

2.	To approve the adoption of the ~~2012 Equity Incentive~~2014 Director Fee Plan.

3.	To ratify the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting firm to audit the records of the Company for the fiscal year ending September 30, ~~2013.~~2014.

3.4.	To provide an advisory (non-binding) vote on the executive compensation of the Company’s named executive officers.

4.5.	To transact such other business as may properly come before the meeting.

Shareholders of record as of December 31, ~~2012~~2013 will be entitled to vote at the Annual Meeting or any adjournments thereof.

Please indicate on the enclosed proxy card whether you will or will not be able to attend this meeting. Return the card in the enclosed envelope as soon as possible. If you receive more than one proxy card (for example, because you own common stock in more than one account), please be sure to complete and return all of them.

We hope you can be with us for this important occasion.

Sincerely,

Steven F. Nicola

Corporate Secretary

January ~~22, 2013~~21, 2014

Matthews International Corporation

Proxy Statement

Table of Contents

	Page
Proxy Statement		1
Outstanding Stock and Voting Rights		2
General Information Regarding Corporate Governance		3
Board of Directors		3
Board Composition		3
Board Committees		4
Executive Committee		4
Nominating and Corporate Governance Committee		4
Audit Committee		5
Finance Committee		5
Compensation Committee		5
Meeting Attendance		6
Compensation of Directors		6
Director Compensation Table		7
Access to Directors		7
Proposal 1 – Election of Directors		7
Nominees		8
Continuing Directors		9
Proposal 2 – ~~Approval of the~~ Adoption of the ~~2012 Equity Incentive~~2014 Director Fee Plan		12
Proposal 3 – Selection of Independent Registered Public Accounting Firm		25	23
Proposal 4 – Advisory (non-binding) vote on the executive compensation of
the Company’s named executive officers		25	24
Stock Ownership		26	25
Stock Ownership Guidelines		27	26
Executive Compensation and Retirement Benefits		29	27
Compensation Committee Report		29	27
Compensation Discussion and Analysis		29	27
Annual Compensation of the Named Executive Officers		43
Summary Compensation Table		43
Grants of Plan-Based Awards Table		44
Outstanding Equity Awards at Fiscal Year-End Table		45
Option Exercises and Stock Vested Table		46
Retirement Benefits		46
Pension Benefits Table		47
Potential Payments Upon Termination or Change in Control		48
Audit Committee Matters		51
Report of the Audit Committee		51
Relationship with Independent Registered Public Accounting Firm		52
Certain Transactions		52
Compliance with Section 16(a) of the Exchange Act		53
Shareholder Proposals for the ~~2014~~2015 Annual Meeting		53
Other Matters		53
Exhibit A		55
Exhibit B		79	84

Matthews International Corporation

Two NorthShore Center

Pittsburgh, PA 15212 - 5851

412 / 442-8200

Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to Be Held on February ~~21, 2013~~20, 2014

The ~~2013~~2014 Proxy Statement and the Annual Report to Shareholders for the year ended September 30, ~~2012~~2013 are also available at www.matw.com under the section entitled “Reports”.

PROXY STATEMENT

The accompanying proxy is solicited by the Board of Directors of Matthews International Corporation (“Matthews” or the “Company”) whose principal executive offices are located at Two NorthShore Center, Pittsburgh, Pennsylvania 15212. This Proxy Statement and the accompanying proxy were first released to shareholders on or about January ~~22, 2013.~~21, 2014.

Execution of the proxy will not affect a shareholder's right to attend the meeting and vote in person. Any shareholder giving a proxy has the right to revoke it at any time before it is voted by giving notice to the Corporate Secretary or by attending the meeting and voting in person.

Matters to be considered at the Annual Meeting are those set forth in the accompanying notice. Shares represented by proxy will be voted in accordance with instructions. In the absence of instructions to the contrary, the proxy solicited will be voted ~~for~~FOR the proposals set ~~forth.~~forth therein.

Management does not intend to bring before the meeting any business other than that set forth in the Notice of Annual Meeting of Shareholders. If any other business should properly come before the meeting, it is the intention of management that the persons named in the proxy will vote in accordance with their best judgment.

OUTSTANDING STOCK AND VOTING RIGHTS

The Company has one class of stock outstanding: Class A Common Stock, par value $1.00 per share, referred to as the "Common Stock."

Each outstanding share of Common Stock of the Company entitles the holder to one vote upon any business properly presented at the shareholders' meeting. Cumulative voting is not applicable to the election of directors.

The Board of Directors of the Company has established December 31, ~~2012~~2013 as the record date for shareholders entitled to vote at the Annual Meeting. The transfer books of the Company will not be closed. A total of ~~27,674,765~~27,332,183 shares of Common Stock are outstanding and entitled to vote at the meeting. The holders of 13,666,092 shares will constitute a quorum at the meeting.

Abstentions and broker non-votes ~~have no effect on any proposal~~(explained herein) will be counted for purposes of determining a quorum. If your shares are held by a broker (in street name), the broker will ask you how you want your shares to be ~~voted upon. Broker non-votes as to any matter are shares held by brokers and other nominees which are voted at the meeting on matters as to which~~voted. If you give the broker ~~or nominee has discretionary authority, but which are~~instructions, your shares will be voted as you direct. If you do not ~~voted~~give instructions to your broker, one of two things can happen, depending on the type of proposal. For the ratification of the selection of independent auditors, which is considered a non-significant matter, ~~in question because~~ the broker ~~or nominee~~may vote your shares in its discretion. The broker does not have ~~discretionary~~the discretion to vote your shares for the election of directors, for the non-binding advisory vote to approve the compensation paid to our named executive officers, as disclosed in this Proxy Statement, or for the vote to approve the 2014 Director Fee Plan; these are considered significant matters. If you do not provide voting ~~authority as~~instructions to ~~such matter.~~your broker for these significant matters, the broker may not vote your shares on these proposals at all. When that happens, it is called a "broker non-vote."

GENERAL INFORMATION REGARDING CORPORATE GOVERNANCE

Board of Directors

The Board of Directors is the ultimate governing body of the Company. As such, it functions within a framework of duties and requirements established by statute, government regulations, court decisions and ~~court decisions.~~the Company’s organizational documents. Generally, the Board of Directors reviews and confirms the basic objectives and broad policies of the Company, approves various important transactions, appoints the officers of the Company and monitors Company performance in key results areas. The Board also has oversight responsibility of the processes established to report and monitor systems for material risks applicable to the Company. The full Board regularly reviews enterprise-wide risk management, which includes relationships with significant customers, volatility of commodity costs, changes in the markets in which the Company operates and existing and potential competitors. In addition, each Board committee plays a significant role in carrying out the risk oversight function. The Nominating and Corporate Governance Committee oversees risks related to corporate governance and ethics. The Audit Committee oversees risks related to financial reporting and control; environmental, health and sustainability matters; management policies and guidelines; legal claims and issues; and information technology. The Finance Committee ~~established in fiscal 2012,~~ oversees the Company’s financial policies, strategies and capital structure. The Compensation Committee oversees risks related to human resources, succession planning and compensation.

Board Composition

The Articles of Incorporation of the Company provide that the Board of Directors has the power to set the number of directors constituting the full Board, provided that such number shall not be less than five nor more than fifteen. Until further action, the Board of Directors has fixed the number of directors constituting the full Board at eight, divided into three classes. The terms of office of the three classes of directors end in successive years.

After reviewing the independence standards contained in the NASDAQ listing requirements, the Board of Directors has determined that each of its directors is independent under these standards, other than the Company’s President and Chief Executive Officer, Joseph C. Bartolacci. The Company’s Governance Guidelines provide that an employee member can remain on the Board for a period of no longer than one year following retirement from employment with the Company.

The Board of Directors has determined that an independent, non-employee member should be appointed to serve as Chairman of the Board. The Board believes that separation of the positions of Chairman of the Board and Chief Executive Officer, with the appointment of an independent, non-employee director as Chairman of the Board, strengthens the Company’s corporate governance. John D. Turner is the Company’s current independent, non-employee Chairman of the Board.

Mr. Turner and the other independent directors meet at such times as are necessary and generally on the dates of regularly scheduled Board meetings. The independent directors met a total of ~~four~~five times in fiscal ~~2012.~~2013.

During fiscal ~~2012,~~2013, there were ~~six~~five regularly scheduled meetings and ~~one~~two special ~~meeting~~meetings of the Board of Directors.

Board Committees

There are five standing committees appointed by the Board of Directors -- the Executive, Nominating and Corporate Governance, Audit, Finance and Compensation Committees.

Management has the same responsibility to each Committee as it does to the Board of Directors with respect to providing adequate staff services and information. Furthermore, each Committee has the same power as the Board of Directors to employ the services of outside consultants and to have discussions and interviews with personnel of the Company and others.

The principal functions of the five standing Committees are summarized as follows:

Executive Committee

The Executive Committee is appointed by the Board of Directors to have and exercise during periods between Board meetings all of the powers of the Board of Directors, except that the Executive Committee may not elect directors, change the membership of or fill vacancies on the Executive Committee, change the By-laws of the Company or exercise any authority specifically reserved by the Board of Directors. Among the functions customarily performed by the Executive Committee during periods between Board meetings are the approval, within limitations previously established by the Board of Directors, of the principal terms involved in sales of securities of the Company, and such reviews as may be necessary of significant developments in major events and litigation involving the Company. In addition, the Executive Committee is called upon periodically to provide advice and counsel in the formulation of corporate policy changes and, where it deems advisable, make recommendations to the Board of Directors.

The members of the Executive Committee are John D. Turner (Chairperson), Gregory S. Babe, Katherine E. Dietze, Alvaro Garcia-Tunon and John P. O’Leary, Jr. The Executive Committee holds meetings at such times as are required. The Executive Committee did not meet in fiscal ~~2012.~~2013.

Nominating and Corporate Governance Committee

The principal functions of the Nominating and Corporate Governance Committee are to (1) identify individuals qualified to become members of the Board of Directors, (2) recommend to the Board of Directors the director nominees for the next annual meeting of shareholders, (3) monitor and recommend to the Board of Directors changes, as necessary, to the Company’s Corporate Governance Guidelines, (4) lead the Board of Directors in complying with its Corporate Governance Guidelines and (5) review and make recommendations to the Board of Directors concerning director compensation. The Nominating and Corporate Governance Committee is also responsible for the annual evaluations of the performance of the Board of Directors and Committees of the Board, including individual directors. ~~This~~The Committee is committed to ensuring that (i) the nominees for membership on the Board of Directors are of the highest possible caliber and are able to provide insightful, intelligent and effective guidance to the management of the Company and (ii) the governance of the Company is in full compliance with law, reflects generally accepted principles of good corporate governance, encourages flexible and dynamic management without undue burdens and effectively manages the risks of the business and operations of the Company. From time to time, the Nominating and Corporate Governance Committee has retained the services of a third-party search firm to assist in the identification and evaluation of potential nominees for the Board of Directors. The Nominating and Corporate Governance Committee operates pursuant to a Charter and the Company’s Corporate Governance Guidelines, which are available for viewing on the Company’s website at www.matw.com under the section entitled “Corporate Governance”.

All members of the Nominating and Corporate Governance Committee are independent in accordance with the listing standards of NASDAQ. The Nominating and Corporate Governance Committee met ~~three~~seven times during fiscal ~~2012.~~2013. The current members of the Nominating and Corporate Governance Committee are John P. O’Leary, Jr. (Chairperson), Gregory S. Babe and Jerry R. Whitaker.

Audit Committee

The principal functions of the Audit Committee are to provide oversight of (1) the integrity of the Company's financial statements, reports on internal controls and other financial information provided by the Company, (2) the Company's compliance with legal and regulatory requirements, (3) the qualifications and independence of the Company's independent registered public accounting firm and (4) the performance of the Company's internal audit function (including disclosure controls and procedures for internal controls over financial reporting) and independent registered public accounting firm. The Committee will serve as a vehicle to provide an open avenue of communication between the Company's Board of Directors and financial management, the internal audit department, and the independent registered public accounting firm. The Audit Committee is responsible for appointing the Company's independent registered public accounting firm. The Audit Committee operates pursuant to a Charter, which is available for viewing on the Company’s website at www.matw.com under the section entitled “Corporate Governance”.

The Audit Committee members are Alvaro Garcia-Tunon (Chairperson), Katherine E. Dietze and Morgan K. O’Brien, all of whom the Board of Directors has determined in its business judgment are independent from the Company and its management as defined by the relevant provisions of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”). Mr. Garcia-Tunon has been designated as the Audit Committee financial ~~expert.~~expert as determined by the Sarbanes-Oxley Act. During fiscal ~~2012,~~2013, the Audit Committee met six times.

Finance Committee

The Finance Committee ~~established in fiscal 2012,~~ provides oversight of the Company’s financial policies, strategies and capital structure. The Committee’s principal responsibilities include review and monitoring of significant capital expenditures; mergers, acquisitions and divestitures; the Company’s capital structure, debt and equity offerings; the dividend policy and share repurchase program; risk management programs; and the Company’s investor relations program. The Committee also provides oversight to the Pension Board on employee benefit plan matters and related plan investment management. Members of the Finance Committee are Katherine E. Dietze (Chairperson), Morgan K. O’Brien and Jerry R. Whitaker. The Finance Committee met ~~three~~ten times in fiscal ~~2012.~~2013.

Compensation Committee

The principal functions of the Compensation Committee, the members of which are Gregory S. Babe (Chairperson), Alvaro Garcia-Tunon and Morgan K. O’Brien, are to review periodically the suitability of the remuneration arrangements (including benefits) for the principal executives of the Company, and to prepare an annual report on executive compensation for inclusion in the Company’s Proxy Statement. The Committee also reviews, at least annually, succession plans for the position of Chief Executive Officer and other senior executive positions of the Company. The Compensation Committee operates pursuant to a Charter, which is available for viewing on the Company’s website at www.matw.com under the section entitled “Corporate Governance”. During fiscal ~~2012,~~2013, the Compensation Committee met ~~five~~four times.

Meeting Attendance

Under the applicable rules of the ~~SEC,~~Securities and Exchange Commission, the Company's Proxy Statement is required to name those directors who during the preceding year attended fewer than 75% of the total number of meetings held by the Board and by the Committees of which they are members. During fiscal ~~2012,~~2013, all directors attended at least 75% of such meetings for which they were eligible.

The Company does not have a formal policy with regard to Board members attending the Annual Meeting of Shareholders, but it is customary for the Board members to do so, and in general all or most of the Board members have attended annual meetings in the recent past. All ~~but one~~ of the Board members attended the ~~2012~~2013 Annual Meeting of Shareholders.

Compensation of Directors

Director compensation is administered and determined by the Nominating and Corporate Governance Committee. In performing its duties, the Committee consults with various independent third-party advisors. In fiscal ~~2012,~~2013, the Committee consulted primarily with PayGovernance, an independent human resources consulting firm.

Under the Company’s 1994 Director Fee Plan, as amended, each eligible independent director received an annual retainer valued at $60,000 in ~~2012.~~2013. Such annual retainer may be paid either in cash or in shares of the Company’s Common Stock, as determined by the Nominating and Corporate Governance Committee. If the Nominating and Corporate Governance Committee decides to pay the annual retainer in cash, a director may instead elect to receive the annual retainer in current shares of the Company’s Common Stock or Common Stock credited to a deferred stock account as phantom stock. If the Nominating and Corporate Governance Committee chooses to pay such annual retainer in Common Stock, a director may defer the receipt of such Common Stock.

Each independent director also receives an annual stock-based grant (non-statutory stock options, stock appreciation rights and/or restricted shares). The value of this grant was ~~$80,000~~$100,000 in the form of restricted stock in ~~2012,~~2013, and will be $100,000 in the form of restricted stock in ~~2013.~~2014. The precise annual stock-based awards to be granted and their valuation are determined by the Nominating and Corporate Governance Committee. At December 31, ~~2012,~~2013, there were ~~99,955~~77,913 shares available for future grant under the 1994 Director Fee Plan.

The non-employee Chairman of the Board receives an additional annual retainer fee of $70,000 which, at the election of the Chairman, may be received in cash, current shares of the Company’s Common Stock or Common Stock credited to a deferred stock account as phantom stock. Each Committee chairperson receives an additional retainer fee for a year of service as a Committee chairperson. The chairperson retainer fee was $7,500 ($12,000 in the case of the Audit Committee chairperson) in ~~2012.~~2013. Meeting fees are not paid to Directors.

The Company is submitting the 2014 Director Fee Plan to a vote of the shareholders as Proposal 2 of this Proxy Statement. If adopted, each eligible independent director will be compensated as described in Proposal 2 of this Proxy Statement.

The Company does not provide any retirement benefits or perquisites to any of its non-employee directors.

The following table summarizes the director compensation earned by the non-employee directors of the Company for fiscal ~~2012.~~2013.

Director Compensation Table

Name	Fees Earned or Paid in Cash (1)		Stock Awards (2)		Option Awards		Non-Equity Incentive Plan Compen-sation		Change in Pension Value and Nonqualified Deferred Compensation Earnings		All Other Compen-sation		Total		Fees Earned or Paid in Cash (1)		Stock Awards (2)		Option Awards		Non-Equity Incentive Plan Compen-sation		Change in Pension Value and Nonqualified Deferred Compensation Earnings		All Other Compen-sation		Total
J.D. Turner		$130,000		$80,000		-		-		-		-		$210,000		$130,000		$100,000		-		-		-		-		$230,000
G.S. Babe		67,500		80,000		-		-		-		-		147,500		67,500		100,000		-		-		-		-		167,500
K.E. Dietze		67,500		80,000		-		-		-		-		147,500		67,500		100,000		-		-		-		-		167,500
A. Garcia-Tunon		72,000		80,000		-		-		-		-		152,000		72,000		100,000		-		-		-		-		172,000
M.K. O’Brien		60,000		80,000		-		-		-		-		140,000		60,000		100,000		-		-		-		-		160,000
J.P. O’Leary, Jr.		67,500		80,000		-		-		-		-		147,500		67,500		100,000		-		-		-		-		167,500
J.R. Whitaker		60,000		80,000		-		-		-		-		140,000		60,000		100,000		-		-		-		-		160,000

(1)	Mr. Babe elected to receive fees of $67,500 in shares of the Company’s Common Stock credited to a deferred stock account as phantom shares.

(2)

Amounts in this column reflect the grant date fair value of awards of restricted shares of the Company’s Common Stock granted during fiscal ~~2012~~2013 computed in accordance with Financial Accounting Standards Board ASC Topic 718; however, the estimate of forfeiture related to service-based vesting conditions is disregarded for purposes of this valuation. There were no forfeitures of restricted shares by any of the directors during fiscal ~~2012.~~2013. On March ~~8, 2012,~~14, 2013, Messrs. Turner, Babe, Garcia-Tunon, O’Brien, O’Leary, Whitaker and Ms. Dietze were each awarded ~~2,589~~2,872 restricted shares with a grant date fair value of ~~$80,000.~~$100,000.

Access to Directors

The shareholders of the Company may communicate in writing to the Board of Directors by sending such communication to the Board or a particular director in care of Steven F. Nicola, Corporate Secretary, at the Company. At present, such communications will be directly forwarded to the Board or such particular director, as applicable.

PROPOSAL 1

ELECTION OF DIRECTORS

Nominations for election to the Board of Directors may be made by the Nominating and Corporate Governance Committee or by the shareholders. ~~Alvaro Garcia-Tunon,~~Section 3.01 of the Company’s Bylaws provides that “no one shall be eligible for nomination as a Director for any term during which, or before which, he will attain 70 years of age.” John ~~P. O’Leary, Jr. and Jerry R. Whitaker,~~D. Turner, whose ~~terms~~term of office ~~are~~is expiring, ~~have~~has been nominated by the Nominating and Corporate Governance Committee to serve for a two-year term that will end in 2016. Gregory S. Babe, whose term of office is expiring, has been nominated by the Nominating and Corporate Governance Committee to serve for a three-year term that will end in ~~2016.~~2017. Nominations made by the shareholders must be made in writing in accordance with Section 6.1 of the Articles of Incorporation. No such nominations have been received.

The Company’s process for filling director vacancies includes determination of the professional skills and background desired to serve the best interests and current needs of the Company and its shareholders, retention of a third-party search firm to assist in the identification and evaluation of director candidates, consideration of candidates nominated by shareholders (if any), evaluation of candidate’s credentials and experience by the Nominating and Corporate Governance Committee (including personal interviews with selected candidates), and a formal recommendation by the Nominating and Corporate Governance Committee to the Board of Directors regarding the candidate considered to be the most qualified to fill the director vacancy.

The Committee assesses a candidate’s background, skills, diversity, personal characteristics and business experience and applies the the following criteria and qualifications. Candidates are to be of the highest ethical character, share the values of the Company, have reputations, both personal and professional, consistent with the image and reputation of the Company, be highly accomplished in their respective field, with superior credentials and recognition, and provide the relevant expertise and experience necessary to assist the Board and the Company to increase shareholder value. The Board may prioritize the criteria depending on the current needs of the Board and the Company. The Board does not have a formal diversity policy for selecting directors, but considers diversity of race, gender and national origin to be relevant factors that are weighed with other criteria in recommending and nominating directors for election to the Board of Directors of Matthews.

Under the Company’s Corporate Governance Guidelines, any director who experiences a change in principal occupation or primary business affiliation from that in which such director was engaged upon their last election to the Board, must offer to submit a letter of resignation from the Board.

The Board of Directors has no reason to believe that any of the nominees will become unavailable for election. If any nominee should become unavailable prior to the meeting, the accompanying proxy will be voted for the election in the nominee's place of such other person as the Board of Directors may recommend.

Only affirmative votes are counted in the election of directors. The ~~three nominees~~nominee for election as ~~directors~~a director at the Annual Meeting in the Class of 2016 and the Class of 2017 who ~~receive~~receives the highest number of votes cast for the election of directors by the holders of the Company’s Common Stock present in person or voting by proxy, a quorum being present, will be elected as directors.

The Board of Directors recommends that you vote FOR the election of the nominated directors.

The following information is furnished with respect to the persons nominated by the Board of Directors for election as directors and with respect to the continuing directors.

Nominees

Class of 2016

~~Alvaro Garcia-Tunon,~~John D. Turner, age ~~60, was elected~~67, has been a director of the Company since 1999. Mr. Turner retired as Chairman and Chief Executive Officer of Copperweld Corporation, a manufacturer of tubular and bimetallic wire products, in 2003, where he had served as Chief Executive Officer since 1988. Mr. Turner’s experience, knowledge and expertise as an executive in the metal manufacturing industry are valuable resources to the Company. During his tenure as a Director, Mr. Turner has also served or participated on each of the Committees of the Board, providing him with the experience and perspective of the Board’s decision making process in all areas of the Company’s operations. Mr. Turner also has experience as a director for several large public companies. Mr. Turner serves as Chairman of the Executive Committee. Mr. Turner received a Bachelor's Degree in Biology from Colgate University. He currently also serves on the Board of Directors ~~in October 2009. Mr. Garcia-Tunon was named Executive Vice President~~of Allegheny Technologies Incorporated, a position he has held since February, 2004, and ~~Chief Financial Officer for Wabtec Corporation, a provider~~is the chairman of ~~products and services for~~ the global rail industry, in February 2012. Prior to that, he was Executive Vice President, Chief Financial Officer and Secretary since December 2010. Prior thereto he served as Senior Vice President, Chief Financial Officer and Secretary since 2003. Mr. Garcia-Tunon was Senior Vice President, Finance of Wabtec from 1999 until 2003, and prior thereto was Vice President and Treasurer of Wabtec. As the current Chief Financial Officer of a public company with global operations, Mr. Garcia-Tunon has leadership skills in international business, corporate governance and risk management. He also provides the Board and the AuditTechnology Committee of ~~which he is a Chairman, the strong financial and accounting skills required to be considered a financial expert. Mr. Garcia-Tunon also is a member of the Executive and Compensation Committees.~~that Board.

~~Mr. Garcia-Tunon currently serves on~~Class of 2017

Gregory S. Babe, age 56, was elected to the Board of Directors ~~of MSA, a global leader~~ in the development, manufacture and supply of safety products that protect people and facility infrastructures. He also is a board member of the Pittsburgh Civic Light Orchestra and Senator John Heinz History Center, where heNovember 2010. Mr. Babe currently serves as its Treasurer. Mr. Garcia-Tunon graduated from the College of William and Mary with a Juris Doctor degree and is a graduate of the University of Virginia with a Bachelor of Science degree in Commerce and Accounting.

John P. O'Leary, Jr., age 66, has been a director of the Company since 1992. Mr. O'Leary retired as Senior Vice President, SCA North America, a packaging supplier, in June 2004, where he had served as Senior Vice President since May 2002. Prior thereto, he was President and Chief Executive Officer of ~~Tuscarora Incorporated (“Tuscarora”)~~start-up Liquid X Printed Metals, Inc., a wholly-owned subsidiary of SCA Packaging International B.V. and a division of SCA North America. Tuscarora is a producer and manufacturer of custom design protective packaging. Preceding SCA's acquisition of Tuscarora,Carnegie Mellon University spin out. From July 2012 to June 2013 Mr. ~~O'Leary~~Babe served ~~as Chairman of Tuscarora's Board of Directors. Mr. O’Leary’s background~~ as Chief Executive Officer of ~~Tuscarora (formerly~~Orbital Engineering, Inc., a ~~publicly-traded company)~~privately held engineering services company. Mr. Babe retired as President and Chief Executive Officer of Bayer Corporation and Bayer MaterialScience LLC in June 2012. Mr. Babe was appointed President and Chief Executive Officer of Bayer Corporation and Senior ~~Vice~~Bayer Representative for the United States and Canada in October 2008. Mr. Babe was responsible for the North American activities of the worldwide Bayer Group, an international health care, nutrition and high-tech materials group based in Leverkusen, Germany. In addition, he held the position of President and Chief Executive Officer of ~~SCA~~Bayer MaterialScience LLC, a producer of polymers and high-performance plastics in North America, ~~provide valuable experience for~~since July 2004. Mr. Babe is considered well-qualified to serve on the Company’s Board of Directors based on his experience as a Chief Executive Officer of ~~Matthews.~~a multinational manufacturing company. He ~~has also served on the Company’s Audit, Nominating~~possesses a strong background in manufacturing and ~~Corporate Governance~~regulatory and ~~Executive Committees, providing a broad knowledge of the Company’s operating, financial and compliance objectives.~~government affairs. Mr. ~~O’Leary~~Babe is ~~currently~~ Chairman of the ~~Nominating and Corporate Governance~~Compensation Committee and is a member of the Executive ~~Committee.~~and Nominating and Corporate Governance Committees. Mr. ~~O'Leary holds a Masters in Business Administration from the University of Pennsylvania Wharton School of Business and received a Bachelor's Degree in Economics from Gettysburg College. He currently~~Babe serves on the Board ~~of Directors of Pregis, Inc., a protective packaging company,~~ and ~~Kenson Plastics, a small private custom plastic converter. Mr. O’Leary has served on~~chairs the ~~Board of Directors of Pregis, Inc. from October 2005 to the present.~~

~~Jerry R. Whitaker, age 62, was elected to the Board of Directors~~Audit Committee of the Company in July 2011. Mr. Whitaker was President of Electrical Sector-Americas, Eaton Corporation, a global manufacturer of highly engineered products, until his retirement in June 2011. Prior thereto, he served in various management positions at Eaton Corporation since 1994. Prior to joining Eaton Corporation, Mr. Whitaker spent 22 years with Westinghouse Electric Corp. Mr. Whitaker’s experience and knowledge as an executive in global manufacturing industries and acquisition integration are valuable resources to the Company. Mr. WhitakerBenedum Foundation. He is also a member of the ~~Nominating and Corporate Governance and Finance Committees.~~Foundation Board of West Virginia University. Mr. ~~Whitaker received~~Babe holds a Bachelor of Science degree in mechanical engineering from Syracuse University and a Masters in Business Administration from George Washington University. He currently serves as a director on the boards of Crescent Electric Company, an independent distributor of electrical hardware and supplies, Sealed Air Corporation, a global leader in food safety and security, as well as on the advisory board for Universal Electric Company, a manufacturer of customizable power distribution systems. Mr. Whitaker also serves on the Board of Trustees for the Carnegie Museums of Pittsburgh as well as the boards of the Carnegie Science Center, the American Middle East Institute, Renewable Manufacturing Gateway and the Advisory Board of the L.C. Smith School of Engineering at SyracuseWest Virginia University.

Continuing Directors

Gregory S. Babe, age 55, was elected to the Board of Directors in November 2010. Mr. Babe currently serves as Chief Executive Officer of Orbital Engineering, Inc., a privately held engineering services company. Mr. Babe retired as President and Chief Executive Officer of Bayer Corporation and Bayer MaterialScience LLC in June 2012. Mr. Babe was appointed President and Chief Executive Officer of Bayer Corporation and Senior Bayer Representative for the United States and Canada in October 2008. Mr. Babe was responsible for the North American activities of the worldwide Bayer Group, an international health care, nutrition and high-tech materials group based in Leverkusen, Germany. In addition, he held the position of President and Chief Executive Officer of Bayer MaterialScience LLC, a producer of polymers and high-performance plastics in North America, since July 2004.

Mr. Babe is considered well-qualified to serve on the Company’s Board of Directors based on his experience as a Chief Executive Officer of a multinational manufacturing company. He possesses a strong background in manufacturing and regulatory and government affairs. Mr. Babe is Chairman of the Compensation Committee and is a member of the Executive and Nominating and Corporate Governance Committees. Mr. Babe serves on the Board of Directors and Executive Committees of the National Association of Manufacturers. He is also a member of the Foundation Board of West Virginia University. Mr. Babe holds a Bachelor of Science degree in mechanical engineering from West Virginia University.

Joseph C. Bartolacci, age ~~52,~~53, was appointed Chief Executive Officer of the Company in 2006. ~~He had been~~Prior to his appointment as Chief Executive Officer, he was President and Chief Operating Officer of the Company since 2005. Mr. Bartolacci was elected to the Board of Directors in 2005. Prior thereto, he held various positions within Matthews, including President, Casket Division; Executive Vice President of Matthews; President, Matthews Europe; President, Caggiati, S.p.A. (a wholly-owned subsidiary of ~~Matthews International Corporation)~~Matthews) and General Counsel of Matthews. As the only Matthews employee on the Board of Directors, Mr. Bartolacci provides management’s perspective in Board decisions about the business and strategic direction of the Company. He has first hand operating experience in many of the Company’s diverse global businesses, and brings a well-developed understanding of the industries in which the Company operates, and the opportunities within those industries to drive shareholder value. Mr. Bartolacci received a Bachelor of Science degree in Accounting from Saint Vincent College and a Juris Doctor from the University of Pittsburgh. Mr. Bartolacci serves on the Company’s Pension Board, the Board of the Jas. H. Matthews & Co. Educational and Charitable Trust, and on the boards of various subsidiaries of Matthews. Mr. Bartolacci is a member of the Board of Directors of Saint Vincent College and serves as a member of the Citizen’s Bank Mid-Atlantic Regional Advisory Board.

Katherine E. Dietze, age ~~55,~~56, was elected to the Board of Directors of the Company in July 2008. Ms. Dietze was Global Chief Operating Officer, Investment Banking Division of Credit Suisse First Boston, a financial services company, until her retirement in 2005. She had also held the position of Managing Director, Investment Banking. Prior to joining Credit Suisse First Boston, Ms. Dietze was a Managing Director for Salomon Brothers Inc, a financial services company. Ms. Dietze brings a strong background in global investment and financial matters.

With her background in investment banking, Ms. Dietze provides a unique and valuable perspective on global financial markets, investments and financial transactions. Ms. Dietze received a Bachelor of Arts degree from Brown University and graduated from Columbia University with a Masters in Business Administration in Finance and Marketing. Ms. Dietze serves as Chairperson of the Finance Committee and is a member of the Executive and Audit Committees. She is also a director and member of the Audit Committee and Governance Committee of Cowen Group, Inc., a financial services firm. She previously served as Chairperson of the Audit Committee and member of both the Governance and Compensation Committees for LaBranche, LLC, a financial services firm purchased by the Cowen Group in June 2011. In January 2011, Ms. Dietze was elected to the Board of Trustees of Liberty Property Trust, a real estate investment trust.

Alvaro Garcia-Tunon, age 61, was elected to the Board of Directors in October 2009. Mr. Garcia-Tunon retired as the Chief Financial Officer of Wabtec Corporation (“Wabtec”), a provider of products and services for the global rail industry, effective January 1, 2014. He will remain with Wabtec as a strategic advisor going forward. Mr. Garcia-Tunon was named Executive Vice President and Chief Financial Officer for Wabtec in February 2012. Prior to that, he was Executive Vice President, Chief Financial Officer and Secretary of Wabtec since December 2010. Prior thereto he served as Senior Vice President, Chief Financial Officer and Secretary of Wabtec since 2003. Having served as the Chief Financial Officer of a public company with global operations, Mr. Garcia-Tunon has leadership skills in international business, corporate governance and risk management. He also provides the Board and the Audit Committee, of which he is a Chairman, the strong financial and accounting skills required to be considered a financial expert. Mr. Garcia-Tunon also is also a member of the Executive and Compensation Committees. Mr. Garcia-Tunon currently is serving on the Board of Directors of Mine Safety Appliances Company, a global leader in the development, manufacture and supply of safety products that protect people and facility infrastructures, since 2012, and serves on the Audit, Legal and Finance Committees of that Board. He also is a board member of the Pittsburgh Civic Light Orchestra and Senator John Heinz History Center, where he serves as its Treasurer. Mr. Garcia-Tunon graduated from the College of William and Mary with a Juris Doctor degree and is a graduate of the University of Virginia with a Bachelor of Science degree in Commerce and Accounting.

Morgan K. O’Brien, age ~~52,~~53, was elected to the Board of Directors of the Company in July 2011. Mr. O’Brien has served as the President and Chief Executive Officer of Peoples Natural Gas Company LLC, a utility serving the southwestern Pennsylvania market, since February 2010. Prior thereto, Mr. O’Brien served as President and Chief Executive Officer of Duquesne Light Holdings, an electric utility company serving western Pennsylvania, since 2001. He held various senior executive positions at Duquesne Light Holdings since 1991. Prior to joining Duquesne Light Holdings, Mr. O’Brien served in various management positions at PNC Bank and at major accounting firms.

As a current Chief Executive Officer with more than 10 years experience in that role, Mr. O’Brien brings significant leadership skills to the Board of Directors. With his experience in the areas of accounting and taxation, he also provides the Board and the Audit Committee, of which he is a member, with strong financial skills. Mr. O’Brien is also a member of the Compensation and Finance Committees. Mr. O’Brien received a Bachelor’s degree in Business Administration and a Masters degree in taxation from Robert Morris University. Mr. O’Brien serves on the Board of Directors of Peoples Natural Gas Company LLC, HFF, Inc. and on the Board of Trustees of the University of Pittsburgh as Vice Chairman of the Board. He also serves on the Boards of several civic and charitable organizations in western Pennsylvania.

John ~~D. Turner,~~P. O'Leary, Jr., age ~~66,~~67, has been a director of the Company since ~~1999.~~1992. Mr. ~~Turner~~O'Leary retired as ~~Chairman~~Senior Vice President, SCA North America, a packaging supplier, in June 2004, a position that he held since May 2002. Prior thereto, he was President and Chief Executive Officer of ~~Copperweld Corporation,~~Tuscarora Incorporated (“Tuscarora”), a wholly-owned subsidiary of SCA Packaging International B.V. and a division of SCA North America. Tuscarora is a producer and manufacturer of ~~tubular and bimetallic wire products, in 2003, where he had~~custom design protective packaging. Preceding SCA's acquisition of Tuscarora, Mr. O'Leary served as Chairman of Tuscarora's Board of Directors. Mr. O’Leary’s background as Chief Executive Officer ~~since 1988. Mr. Turner’s~~of Tuscarora (formerly a publicly-traded company) and Senior Vice President of SCA North America provide valuable experience ~~knowledge and expertise as an executive in~~for the ~~metal manufacturing industry are valuable resources to the Company. During his tenure as a Director, Mr. Turner~~Board of Directors of Matthews. He has also served on ~~each of~~ the Company’s Audit, Nominating and Corporate Governance and Executive Committees, ~~of the Board,~~ providing ~~him with the experience and perspective of the Board’s decision making process in all areas~~a broad knowledge of the Company’s ~~operations.~~operating, financial and compliance objectives. Mr. ~~Turner also has experience as~~O’Leary is currently Chairman of the Nominating and Corporate Governance Committee and is a ~~director for several large public companies. Mr. Turner serves as Chairman~~member of the Executive Committee. Mr. ~~Turner~~O'Leary holds a Masters in Business Administration from the University of Pennsylvania Wharton School of Business and received a Bachelor's Degree in ~~Biology~~Economics from ~~Colgate University.~~Gettysburg College. He currently serves on the Board of Directors of ~~Allegheny Technologies Incorporated. During the past five years Mr. Turner served on~~Kenson Plastics, a small private custom plastic converter.

Jerry R. Whitaker, age 63, was elected to the Board of Directors of ~~Duquesne Light Holdings, Inc. from May 2002~~the Company in July 2011. Mr. Whitaker was President of Electrical Sector-Americas, Eaton Corporation, a global manufacturer of highly engineered products, until his retirement in June 2011. Prior thereto, he served in various management positions at Eaton Corporation since 1994. Prior to ~~May 2007~~joining Eaton Corporation, Mr. Whitaker spent 22 years with Westinghouse Electric Corp. Mr. Whitaker’s experience and ~~Allegheny Technologies Incorporated from February 2004~~knowledge as an executive in global manufacturing industries and acquisition integration are valuable resources to the ~~present.~~Company. Mr. Whitaker is a member of the Nominating and Corporate Governance and Finance Committees. Mr. Whitaker received a Bachelor of Science degree from Syracuse University and a Masters in Business Administration from George Washington University. He currently serves as a director on the boards of Crescent Electric Company, an independent distributor of electrical hardware and supplies, where he is a member of the Audit Committee and Chairman of the Compensation Committee; and Sealed Air Corporation, a global leader in food safety and security, where he serves on the Nominating and Governance Committee. He is also on the advisory board for Universal Electric Company, a manufacturer of customizable power distribution systems. Mr. Whitaker also serves on the Board of Trustees for the Carnegie Museums of Pittsburgh as well as the boards of the Carnegie Science Center, the American Middle East Institute, Renewable Manufacturing Gateway and the Advisory Board of the L.C. Smith School of Engineering at Syracuse University.

The term for each nominee and director is listed below:

Nominees:	Term to expire at Annual Meeting of Shareholders in:

~~Alvaro Garcia-Tunon~~John D. Turner	2016
~~John P. O’Leary, Jr.~~	~~2016~~
~~Jerry R. Whitaker~~Gregory S. Babe	~~2016~~2017

Continuing Directors:

~~Gregory S. Babe~~	~~2014~~
~~John D. Turner~~	~~2014~~

Joseph C. Bartolacci	2015
Katherine E. Dietze	2015
Morgan K. O’Brien	2015

Alvaro Garcia-Tunon	2016
John P. O’Leary, Jr.	2016
Jerry R. Whitaker	2016

PROPOSAL 2

~~APPROVAL~~ADOPTION OF ~~ADOPTION OF~~

THE ~~2012 EQUITY INCENTIVE~~2014 DIRECTOR FEE PLAN

~~Introduction~~

The Company’s 2012 Equity Incentive Plan (the “Plan”) was adopted by the Company’s Board of Directors on November 15, 2012. The affirmative vote of a majority of the votes cast in person or by proxy at a meeting held on or prior to November 14, 2013 in which the holders of at least a majority of the outstanding shares of the Company’s Common Stock are present (in person or by proxy) and voting is required for approval of adoption of the Plan. If the shareholders of the Company do not approve the Plan as proposed in this proxy statement, the Plan will not be used by the Company. Upon approval of the Plan, there will be no further grants under the existing 2007 Stock Incentive Plan, as amended through September 26, 2008 (the “2007 Equity Incentive Plan”).

~~At December 31, 2012, the status of the Company’s equity-based compensation plans (2007 Equity Incentive Plan, 1992 Stock Incentive Plan and 1994 Director Fee Plan) was as follows:~~

2007 Equity Incentive Plan 1992 Stock Incentive Plan 1994 Director Fee Plan Total
Stock Options
  Outstanding shares - 809,558 11,800 821,358
  Weighted-average exercise price - $37.58 $35.39 $37.55
  Average term to expiration (years) - 2.9 2.6 2.9

Full Value Awards (restricted shares only)
Outstanding unvested shares 666,168 - 29,288 695,456

Shares available for grant 335,492 - 99,955 435,447

The Plan is being adopted to replenish the existing share reserve to allow for future equity grants at the Compensation Committee’s discretion. The need for and value of such long term equity grants within the Company’s overall compensation structure is discussed in the “Long Term Incentive Compensation” section in the Compensation Discussion and Analysis. In addition, it is the appropriate time to have the shareholders of the Company re-approve the performance goals of the Plan, so that awards to employees who may be covered employees under Section 162(m) of the Internal Revenue Code can qualify under the performance-based exception to the limitations on compensation deductions under Section 162(m). See “Performance Goals,” below. The Plan also includes provisions that modernize the Company’s equity plan.

~~Description of Equity Incentive Plan~~

The full text of the 2014 Director Fee Plan (the “2014 Plan”) is set forth as Exhibit A to this Proxy Statement. The following description of the 2014 Plan is qualified in its entirety by reference to Exhibit A.

The 2014 Plan in General. The purposes of the 2014 Plan are to ~~encourage~~provide eligible non-employee directors of the Company with a fee arrangement that is not only competitive with those at corporations similar to the Company but which increases the alignment of interests between the non-employee directors and the shareholders of the Company, and to provide a program which is suitable for the recruitment and retention of capable people to serve as non-employee directors of the Company. As of December 31, 2013, there were seven (7) such directors. Directors who are employees of the Company are not separately compensated for service as a director.

The total number of shares of stock which may be issued under the 2014 Plan or credited to a deferred stock compensation account for subsequent issuance is 150,000 shares of Common Stock as of November 14, 2013. This total will be adjusted upon certain events such as a stock dividend on, or stock split of, the Common Stock. The shares which may be issued under the 2014 Plan may be either authorized but unissued shares or shares previously issued and ~~its subsidiaries to increase their efforts to make the Company and each subsidiary more successful, to provide an additional inducement for such employees to remain with~~thereafter acquired by the Company, or a ~~subsidiary, to reward such employees by providing an opportunity to acquire shares~~combination of each. On December 31, 2013, the fair market value of a share of the Company’s ~~Class A~~ Common Stock ~~par value $1.00 per share, on favorable terms~~was $42.61.

The Board of Directors of the Company will have full power and authority to administer the 2014 Plan. The Board may delegate some or all of those rights to the Nominating and Corporate Governance Committee or other committees of the Board. The Board of Directors also has, subject to certain limitations, the right to amend or terminate the 2014 Plan.

The 2014 Plan includes an annual director fee retainer (the “Retainer”). The Retainer is $60,000 for each non-employee director and, in the case of the non-employee chairperson (“NE Chairperson”), an additional $70,000 (or such other amounts determined by the Board or by any committee of the Board which the Board authorizes to determine such amounts). The 2014 Plan also provides that the Retainer can be paid in cash or in Common Stock of the Company. Whether the payment is made in cash or Common Stock will be determined by the Nominating and Corporate Governance Committee of the Company (or another committee of the Board designated to act for these matters) (the “Governance Committee”). Whether the Retainer is paid in cash or Common Stock, a director may elect to receive the Retainer in Common Stock or defer the Retainer payment into a deferred stock compensation account.

In addition to the annual Retainer, other cash fees to be paid under the 2014 Plan are as follows:

Board Meeting Fees:	None
Committee Meeting Fees:	None
Committee Chairperson Retainer Fees:	$7,500 (or $12,000 in the case of the Audit Committee Chairperson) for a year of service as a Committee Chairperson
Shareholders’ Meeting Fees:	None

In addition, if the Board elects a Lead Director, in addition to the annual Retainer, the Lead Director would receive other cash fees of $5,000 for a year of service as the Lead Director.

~~provide~~The 2014 Plan also permits the grant of stock options, stock appreciation rights and restricted shares under the 2014 Plan. The 2014 Plan provides that each director will receive an annual grant of non-statutory stock options, stock appreciation rights and/or restricted shares with a ~~means through~~total value of $100,000 (or such other amounts determined by the Board or by any committee of the Board which the ~~Company may attract able persons~~Board authorizes to ~~enter~~determine such amounts). The precise awards to be granted and their valuation will be determined by the ~~employ~~Governance Committee. The terms applicable to these awards are described below.

In certain instances, the 2014 Plan provides for the accelerated vesting of and extension of time to exercise stock options and stock appreciation rights and the accelerated vesting of restricted shares upon a change in control at the Company. A description of the ~~Company or one of its subsidiaries.~~ change in control provisions is set forth below.

The ~~eligible employees are those employees~~term of the ~~Company or any subsidiary who share responsibility~~2014 Plan runs until March 31, 2019.

The 2014 Plan also permits a director to name a death beneficiary with respect to the director’s deferred stock compensation account, provides for hardship withdrawals, and allows a director to make subsequent elections to further delay payments under a previous deferral made by the ~~management, growth or protection~~director.

Director Fees and Deferrals. Under the 2014 Plan, each eligible non-employee director will receive an annual Retainer valued at $60,000 and, in the case of the ~~business~~NE Chairperson, an additional $70,000 (or such other amounts determined by the Board or by any committee of the ~~Company~~Board which the Board authorizes to determine such amounts). Such annual Retainer will be paid either in cash or ~~any subsidiary,~~in shares of the Common Stock of the Company, as determined by the Governance Committee. ~~As of September 30, 2012 there were approximately 5,400 employees~~If the Governance Committee decides to pay the Retainer in cash, a director may instead elect to receive the ~~Company.~~

Under the Plan, which has a ten-year term through November 14, 2022, the maximum number of shares available for grants or awards is an aggregate of 2,500,000 shares. The Plan also includes a fixed sub-limit for the granting of incentive stock options. In general, without further shareholder approval, the maximum number of shares for which incentive stock options may be granted is 1,000,000 shares.

The Plan provides for (i) the grant of incentive stock options under Section 422 of the Internal Revenue Code, (ii) the grant of nonstatutory stock options, (iii) the grant of stock appreciation rights, either grantedRetainer in conjunction with stock options (i.e., tandem stock appreciation rights) or not in conjunction with options (i.e., freestanding stock appreciation rights), (iv) restricted share awards, (v) restricted stock units, (vi) performance units and (vii) other stock based awards. Although the Plan permits the grant of incentive stock options, the Company has not typically granted incentive stock options under its prior equity incentive plans.

The maximum number of shares as to which awards other than performance units or “other stock-based awards” may be made under the Plan to any one employee in any one calendar year is 250,000 shares. The maximum value of the property, including cash, that may be paid or distributed to any participant pursuant to a grant of performance units in any one calendar year is $5,000,000, and the maximum value of Common Stock and other property, including cash, that may be paid or distributed to any participant with respect to “other stock based awards” in any one calendar year is also $5,000,000.

~~Share Counting~~. For purposes of the limit on the number of shares available under the Plan and available for the sub-limit on incentive stock options (but not for the individual limit on shares that can be granted), each share of Common Stock which is subject to an award other than a stock option or a stock appreciation right is counted as two shares rather than one share, except that in case of performance units,current shares of Common Stock ~~are counted as two shares rather than one share~~or Common Stock credited to a deferred stock compensation account. If the Governance Committee chooses to pay such Retainer in Common Stock, a Director may defer the receipt of such Common Stock.

Upon inception, each non-employee director will not receive meeting fees for Board, Committee and Shareholder meetings attended, and each Committee chairperson will receive an annual retainer fee, in the amounts set forth above. Under the 2014 Plan, the Board has the authority to increase or decrease the amount of the annual Retainer, Committee chairperson retainer, and meeting fees.

Annual Retainer fees will be paid or credited fifteen (15) business days after the annual meeting of shareholders, for each ~~actual share issued only at~~non-employee director as of that payment or crediting date. Annual Retainer fees will thereby be paid or credited in advance and are not subject to proration or refund in the ~~time, if any, of the actual issuance of shares pursuant~~event that a director receiving such fees should die or resign prior to the ~~performance unit award.~~next annual meeting of shareholders.

~~Except~~Committee chairperson retainer fees will be paid on the fifteenth (15th) business day after a director’s annual election or re-election as a Committee chairperson. A director may elect to receive all committee chairperson retainer fees for a calendar year in ~~the case of performance unit awards (where~~ shares of Common Stock ~~are counted only upon actual issuance~~rather than cash, provided the director elects to defer the receipt of the shares), to the extent that any award is forfeited, or any option and tandem stock appreciation right (if any) or any free-standing stock appreciation right terminates, expires or lapses without being exercised, or any award is settled for cash, thesuch shares of Common Stock ~~subject~~through credit of shares to his or her deferred stock compensation account.

A director may elect to defer receipt of his or her annual Retainer or committee chairperson retainer fees by filing a notice of election with the Company. When such ~~awards will again be available for awards under~~election becomes effective, the ~~Plan. However, shares~~amount of Common Stock ~~subject to such awards will continue to be counted for purposes of the individual limits on shares that can be granted.~~

~~If the exercise price of any stock option and/or the tax withholding obligations relating to any awards are satisfied~~representing these fees is credited by delivering shares or withholding shares relating to such award, the gross number of shares subject to the award will nonetheless be deemed to have been granted for purposes of the Plan and any shares which are delivered back to the Company to a separate deferred stock compensation account for each director electing deferred treatment. An election to defer receipt of fees will ~~not be added to~~remain effective until a director files a notice of termination with the aggregate number of shares for which awards may be made under the Plan. If shares of Common Stock are issued upon the exercise of a stock appreciation right, all shares subject to the stock appreciation right are counted regardless of the number of shares issued upon exercise.

~~Administration. The Plan will be administered by a Committee appointed by the Board of Directors. At present, this is the Compensation Committee. None of the members of~~Company and such ~~Committee is eligible to participate in the Plan.~~notice becomes effective.

Payment of shares of Common Stock credited to a director’s deferred stock compensation account for any year would be made either in a lump sum or in installments. Payment would commence on April 1 of the year following the year a person ceases to be a director of the Company, or on a different date under conditions set forth in the 2014 Plan. Notwithstanding the foregoing, a director is permitted to further defer the receipt of payments from his or her deferred stock compensation account by making a further deferral election at least twelve months prior to the date on which payments would have otherwise commenced, and by deferring for at least five years from the date payments would have otherwise commenced. Further, a director may file a notice with the Company pursuant to which the director would be paid amounts credited to his or her deferred stock compensation account after the effective date of such notice upon the occurrence of certain changes in control at the Company as described in the 2014 Plan.

Upon the death of a director, payment would be made to the beneficiary designated by the director or to the estate of the director. Advance payment of deferred amounts may be permitted by the Board only to the extent necessary to avoid severe financial hardship resulting from an unanticipated financial emergency beyond the control of the director or his or her beneficiary.

Under the 2014 Plan, any deferral election will be valid only if technical timing rules have been met.

Stock Options, Stock Appreciation Rights and Restricted Stock. The 2014 Plan provides for the grant of nonstatutory stock options, stock appreciation rights, and restricted share awards.

Administration.Subject to the provisions of the 2014 Plan, the Governance Committee has full and final authority, in its discretion, to grant nonstatutory stock options and stock appreciation rights and to make restricted share awards under the 2014 Plan, ~~and~~totaling $100,000 per year per director (or such other amount determined by the Board or by any committee of the Board which the Board authorizes to determine such amount). Grants and awards will be made effective as of the ~~employees~~same date as annual Retainers are paid after the annual meeting. Under the 2014 Plan, the Board has the authority to ~~whom each award is made~~increase or decrease the value of the grants and awards to be made; the Governance Committee has the sole discretion to determine whether the grants and awards should be stock options, stock appreciation rights or restricted shares or partly of each.

The Board and the ~~number of shares covered thereby. In determining the eligibility of any employee, as well as in determining the number of shares covered by each award, the~~Governance Committee considers the position and responsibilities of the employee being considered, the nature and value to the Company or a subsidiary of his or her services, his or her present and/or potential contribution to the success of the Company or a subsidiary and such other factors as the Committee may deem relevant.

~~The Committee also has~~have the power to interpret the 2014 Plan and to prescribe such rules, regulations and procedures in connection with the operations of the 2014 Plan as ~~it deems~~they deem necessary and advisable in ~~its~~their administration of the 2014 Plan.

Terms of Stock Options and Stock Appreciation Rights. The option price for each stock option may not be less than 100% of the fair market value of the Company’s Common Stock on the date of the grant of the stock option except that, in the case of an incentive stock option granted to an employee who owns actually or constructively pursuant to the rules contained in Section 424(d) of the Internal Revenue Code more than 10% of the total combined voting power of all classes of stock of the Company or any subsidiary (a “Ten Percent Employee”), the option price may not be less than 110% of such fair market value.option. Fair market value of the Common Stock for all purposes under the 2014 Plan is the mean between the publicly reported highest and lowest sales prices per share of ~~Class A~~ Common Stock of the Company as quoted on the NASDAQ Exchange on the date as of which fair market value is determined. ~~As of December 31, 2012, the fair market value of the Common Stock of the Company as determined by the above-stated formula was $31.82 per share.~~

NoExcept in certain cases (principally certain change of control events) and as the Governance Committee may otherwise determine, no stock option may be exercised prior to two years from the date of grant or after the expiration of ten years from the date of ~~grant (five years in~~grant. Unless the ~~case of an incentive stock option granted to a Ten Percent Employee). Unless the~~Governance Committee, in its discretion, otherwise determines, an exercisable stock option may be exercised in whole or in part. Otherwise, stock options may be exercised at such times, in such amounts and subject to such restrictions as are determined in its discretion by the Governance Committee.

The option price for each stock option is payable in full in cash at the time of exercise; however, in lieu of cash the person exercising the stock option may, if authorized by the Governance Committee, ~~at the time of grant in the case of an incentive stock option or at any time in the case of a nonstatutory stock option,~~ pay the option price in whole or in part by delivering to the Company shares of Common Stock having a fair market value on the date of exercise of the stock option equal to the option price for the shares being purchased, except that any portion of the option price representing a fraction of a share must be paid in cash.

If the person exercising a stock option participates in a broker or other agent-sponsored exercise or financing program, the Company ~~may~~will cooperate with all reasonable procedures of the broker or other agent to permit participation by the person exercising the stock option in the exercise or financing ~~program, but~~program. But, in such a case, the exercise of the stock option shall not be deemed to occur and no shares of the Common Stock will be issued until the Company has received full payment in cash for the option price from the broker or other agent.

The ~~aggregate fair market value (determined as~~grant of stock appreciation rights provides the holder with the right, upon the exercise of the ~~time the incentive~~ stock ~~options are granted)~~appreciation rights, to receive a number of ~~the~~ shares of Common Stock with ~~respect to which incentive stock options are exercisable for the first time by~~ a participant in the Plan during any calendar year may not exceed $100,000. If the date on which any incentive stock options may first be exercised would be accelerated pursuant to any provision of the Plan or any stock option agreement, or amendment thereto, and the acceleration of such exercise date would result in a violation of this $100,000 restriction, then, notwithstanding any such provision, but subject to the authorization provided for in the following sentence, the exercise dates of such incentive stock options will be accelerated only to the date or dates, if any, that do not result in a violation of the $100,000

��

restriction, and in such event the exercise dates of the incentive stock options with the lowest option prices would be accelerated to the earliest such dates. The Committee may, in its discretion, authorize the acceleration of the exercise date of one or more incentive stock options even if such acceleration would violate the $100,000 restriction and one or more incentive stock options would thereby be converted in whole or in part to nonstatutory stock options.

~~Stock Appreciation Rights. A stock appreciation right (SAR) entitles the holder to receive, on exercise, the excess of the~~ fair market value ofequal to the Common Stock on the exercise date over the SAR grant price. The Committee may grant SAR awards as stand-alone awards or in tandem with a related option award under the Plan. The SAR grant price is set by the Committee and may not be less thandifference between the fair market value of the Common Stock on the date of exercise of the grant. Payment upon exercise will be in cash, shares of Common Stock, or both. Unless otherwise determined by the Committee, any related option will no longer be exercisable to the extent a tandem SAR has been exercised,stock appreciation rights and the ~~exercise~~base price of ~~an option will cancel~~ the ~~related tandem SAR.~~

~~Repricing Prohibited. The Plan prohibits repricing~~stock appreciation rights when granted (which may not be less than 100% of options or SARs without further shareholder approval. Repricing means the grant of a new option or SAR in return for the cancellation, exchange or forfeiture of an award that has a higher grant price than the new award, the amendment of an outstanding award to reduce the grant price, the cancellation or repurchase of an option or SAR at a time when grant price is greater than the fair market value of the Company’s Common Stock ~~or any action that would be treated, for accounting purposes, as a repricing. The~~on the date of the grant of ~~a substitute award under~~ the ~~anti-dilution and anti-enlargement provisions explained under “Miscellaneous,” below, is not a repricing.~~stock appreciation rights). The Governance Committee also has the right to pay cash upon the exercise of the stock appreciation rights in certain circumstances.

~~Other Terms of Options and SARS~~. Unless the Governance Committee determines otherwise, the ~~following~~ provisions of ~~this paragraph~~the following sentence will apply in the event that a grantee ceases to be a director of the Company for any termination of employment, except that the third preceding paragraph will apply in any event if the exercise date of any incentive stock option is accelerated. If the employment of a participant who is not a Disabled Participant (as defined in the Plan) is voluntarily terminated with thereason other than removal for cause or resignation without consent of the ~~Company or a subsidiary or a participant retires under any retirement plan of the Company or a subsidiary (i) any then~~Board. Any outstanding ~~incentive~~ stock option and stock appreciation right held by ~~the participant is~~such grantee will vest and be exercisable ~~(but only to the extent the stock option was exercisable immediately prior to the termination of employment)~~ at any time prior to the second anniversary of the date on which the grantee ceases to be a director or the expiration date of the stock option or ~~within three months after the date of termination of employment, whichever is the shorter period, and (ii) any nonstatutory~~ stock option or SAR held by the participant is exercisable (but only to the extent the stock option or SAR was exercisable immediately prior to the termination of employment of the participant) at any time prior to the expiration of the stock option or SAR or within one year after the date of termination of employment,appreciation right, whichever is the shorter period. IfUnless the ~~employment~~exercise period has been extended pursuant to the change in control provisions of ~~any participant~~the 2014 Plan, if a grantee is ~~voluntarily terminated with such~~removed from office for cause or resigns without the consent ~~and such termination occurs because~~of the ~~participant is a Disabled Participant,~~Board, any then outstanding stock option ~~or SAR~~and stock appreciation right held by ~~the participant is exercisable in full (whether or not so exercisable immediately prior to the termination of employment) at any time prior to the expiration~~such grantee will terminate as of the close of business on the last day on which the grantee is a director.

Unless the Governance Committee in its discretion otherwise determines, no stock option or ~~SAR~~stock appreciation right granted under the 2014 Plan is transferable other than by Will, by the laws of descent and distribution, or ~~within one year after the date~~to certain types of ~~termination of employment, whichever is the shorter period. In the event of the death of a participant during employment, any then outstanding~~trusts. A stock option or ~~SAR is exercisable in full (whether or not so exercisable immediately prior to the death of the participant)~~stock appreciation right may be exercised during a grantee’s lifetime only by the ~~person~~grantee or ~~persons entitled to do so under~~ the ~~Will~~trustee of ~~the participant or, if the participant shall fail to make testamentary disposition~~such trust.

Each grant of the stock option or SAR or shall die intestate, by the legal representative of the participant, in either case at any time prior to the expiration of the stock option or SAR or within one year after the date of death, whichever is the shorter period. In the event of the death of a participant after termination of employment during a period when a stock option or ~~SAR is exercisable, any outstanding~~ stock ~~option~~appreciation right must be confirmed by an agreement between the Company and the grantee which sets forth the terms of the grant.

Restricted Shares. Restricted share awards are subject to such restrictions (including restrictions on the right of the awardee to sell, assign, transfer or ~~SAR held~~encumber the shares awarded while such shares are subject to restrictions) as the Governance Committee may impose thereon and are subject to forfeiture to the extent events (which may, in the discretion of the Governance Committee, include termination of service as a director and/or performance-based events) specified by the ~~participant at~~Governance Committee occur prior to the time of death is exercisable by the person or persons entitled to do so under the Will of the participant or by the legal representative of the participant (but only to the extent the stock option or SAR was exercisable immediately prior to the death of the participant) at any time prior to the expiration of the stock option or SAR within one year after the date of death, whichever is the shorter period. restrictions lapse.

If the employment of any participant terminates for any other reason, unless the exercise period of a stock option or SAR following termination of employment has been extended upon the occurrence of one or more of the events described under “Additional Rights in Certain Events” below, the rights of the participant under any then outstanding stock option or SAR terminate at the time of such termination of employment.

Unless the Committee, in its discretion, otherwise determines, no stock option or SAR granted under the Plan is transferable other than by Will or by the laws of descent and distribution, and a stock option or SAR may be exercised during a participant’s lifetime only by the participant. If the Committee determines that an award is transferable, it may do so only to the extent that such transfer is made without the payment of value or consideration to the participant.

Each ~~grant of a stock option or SAR~~restricted share award must be confirmed by ana restricted share agreement between the Company and the ~~participant~~awardee, which sets forth the ~~terms of the stock option or SAR.~~

~~Performance Goals. The Committee may establish performance goals (“Performance Goals”) in connection with the grant~~number of restricted ~~stock, restricted stock units, performance units or “other stock-based awards.” In~~shares awarded, the ~~case~~restrictions imposed thereon, the duration of awards to participants who may be covered employees under Section 162(m) of the Internal Revenue Code where the Committee wishes to qualify the award for the performance-based exception to the limitations on compensation deductions under Section 162(m) of the Internal Revenue Code, the Committee may designate the award as a “Qualified Performance-Based Award” and must certify in writing when the Performance Goals have been achieved. In such cases, the Performance Goals will be based on one or more of the following:

~~(i)~~

The following criteria for the Company on a consolidated basis, one or more of its direct or indirect subsidiaries, and/or one or more divisions of the foregoing, either in absolute terms or relative to the performance of (x) the Company, its subsidiaries or divisions (for a different period), (y) one or more other companies or (z) an index covering multiple companies:

1.	~~Net Income~~

2.	~~Net Income Growth~~

3.	~~Economic Value Added (earnings less a capital charge)~~

4.	~~EBITDA (earnings before interest, taxes, depreciation and amortization) or adjusted EBITDA~~

~~Sales~~

6.	~~Revenue Growth~~

~~Costs~~

8.	~~Expenses~~

9.	~~Gross Margin~~

~~10.~~

~~Operating Margin~~

~~11.~~

~~Pre-tax Profit or Income~~

~~12.~~

~~Market Share~~

~~13.~~

~~Return on Net Assets~~

~~14.~~

~~Return on Assets~~

~~15.~~

~~Return on Capital~~

~~16.~~

~~Return on Invested Capital~~

~~17.~~

~~Cash Flow~~

~~18.~~

~~Free Cash Flow~~

~~19.~~

~~Operating Cash Flow~~

~~20.~~

~~Operating Income~~

~~21.~~

~~EBIT (earnings before interest and taxes)~~

~~22.~~

~~Debt to Earnings (including EBITDA and EBIT)~~

~~23.~~

~~Working Capital~~

~~24.~~

~~Working Capital as a percent of sales~~

~~25.~~

~~Performance versus budgeted amounts~~

~~26.~~

~~Innovation as measured by a percentage of sales from new products~~

~~27.~~

~~Environmental Emissions Improvement~~

~~28.~~

~~Workforce Diversity~~

~~29.~~

~~Safety Performance~~

(ii) The following criteria for the Company, either in absolute terms or relative to the performance of the Company (for a different period), one or more other companies or an index covering multiple companies:

~~1. Stock Price~~

~~2. Return on Shareholders’ Equity~~

~~3. Earnings per Share (basic, diluted, GAAP or non-GAAP)~~

~~4. Cash Flow per Share~~

~~5. Total Shareholder Return (stock price appreciation plus dividends)~~

~~Restricted Stock. Restricted stock awards are actual shares of Common Stock issued to a participant subject to~~ such restrictions, ~~(including restrictions on~~events the ~~right~~occurrence of the participant to sell, assign, transfer, pledge or otherwise encumber the shares awarded while such shares are subject to restrictions) as the Committee may impose thereon. Except as otherwise determined by the Committee, the participant shall have, with respect to the shareswhich would cause a forfeiture of the restricted ~~stock, all the rights of a shareholder of the Company, including the right to vote the~~ shares, and ~~receive cash dividends. Prior to or at the time of grant, the Committee shall condition the award on the continued employment by the participant, Performance Goals~~such other terms and conditions as ~~set by the Committee, or both. Except in the case of a Qualified Performance-Based Award, the Committee may modify or waive any restrictions it imposes.~~

~~In lieu of the payment of cash dividends to the participant,~~ the Committee in its discretion may determine that cash dividends on the shares of restricted stock will be (i) automatically deferred and reinvested in additional restricted stock, or (ii) held by the Company in cash (without any payment of interest thereon), and subject to the same vesting and forfeiture restrictions of the restricted stock with respect to which the dividends are payable.

deems appropriate. Following a restricted ~~stock~~share award and prior to the lapse of the applicable restrictions, toat the ~~extent that~~Company’s discretion, the Company may hold share certificates representing the restricted shares ~~are issued, such~~in escrow, issue share certificates ~~will either bear~~to the awardee with a legend ~~referencing~~referring to the restrictions, or ~~will~~issue the shares in book-entry form in the name of the awardee. Except in certain circumstances, the Governance Committee, in its discretion, may determine that dividends and other distributions on the restricted shares shall not be ~~held~~paid to the awardee until the lapse or termination of the applicable restrictions. Unless otherwise provided, in its discretion, by the ~~Company in escrow.~~Governance Committee, any such dividends or other distributions shall not bear interest. Upon the lapse of the applicable restrictions, ~~(and not before such time), any~~unlegended share certificates representing the restricted shares and unpaid dividends, if any, will be delivered to the ~~participant, or any shares evidenced by book-entry~~awardee. From the date a restricted share award is effective, however, the awardee will be ~~marked unrestricted. If~~a shareholder with respect to all of the ~~restrictions applicable~~restricted shares and will have all the rights of a shareholder with respect to the restricted ~~stock award are not satisfied within~~shares, including the ~~applicable period, the shares subject~~right to ~~the award will be forfeited, any certificates returned to the Company and any book entries changed to evidence transfer of the shares to the Company.~~

~~Restricted Stock Unit Awards. Restricted stock units are awards denominated in shares of Common Stock that will be settled, subject to the terms and conditions of~~vote the restricted ~~stock units~~shares and at the sole discretion of the Committee, in an amount of cash, shares of Common Stock, or both, based upon the fair market value of a specified number of shares of Common Stock. The vesting of such units will be conditioned upon the continued service of the participant, the attainment of Performance Goals as set by the Committee, or both. Except in the case of a Qualified Performance-Based Award, the Committee may modify or waive any of the conditions applicable to ~~restricted stock units. Restricted stock units generally may not be transferred by a participant. Participants granted restricted stock units will not be entitled to any~~receive all dividends ~~payable on the Common Stock unless the agreement relating to the award provides otherwise~~ and ~~shall not have any voting rights~~other distributions paid with respect to ~~such units.~~

~~Performance Units. Performance units may be granted~~the restricted shares, subject only to the preceding provisions of this paragraph and the restrictions imposed by the ~~Committee either alone or in addition to other awards under the Plan and subject to the satisfaction of Performance Goals specified by the~~Governance Committee. The Committee may select periods during which the Performance Goals chosen by the Committee are measured for the purpose of determining the extent to which a performance unit has been earned. The Committee decides whether the Performance Goals have been achieved, what amount of the award will be paid and the form of payment, which may be cash, shares of Common Stock or other property or any combination. Performance units will not have any voting rights and holders of performance units will not be shareholders of the Company unless and until shares of Common Stock are issued. Performance units generally may not be transferred by a participant.

~~Other Awards~~. The Committee may award Common Stock and other awards that are valued in whole or in part by reference to, or are otherwise based upon, Common Stock, including but not limited to, unrestricted stock or dividend equivalents. Any such award shall be subject to such terms and conditions as established by the Committee.

~~Certain Restrictions on Certain Awards~~. Except as otherwise provided in the Plan, and subject to certain exceptions set forth in the Plan, awards of restricted stock, restricted stock units, performance units, or other stock-based Awards are generally subject to vesting during a restriction period of at least three years following the date of grant. However, a restriction period of only at least one year following the date of grant may be used if vesting is conditional, in whole or in part, upon the achievement of performance goals. Awards with restriction periods of at least three years may vest in part on a pro rata basis prior to the expiration of such restriction period. The Committee may grant or accelerate awards without regard to the foregoing requirements for up to, collectively for all such awards, ten percent (10%) of the shares available for award under the Plan.

Additional Rights in Certain Events. The 2014 Plan provides for acceleration of the exercisability and extension of the expiration date of stock options and ~~SARs,~~stock appreciation rights, and for ~~the~~ lapse of the restrictions on restricted share awards, ~~and for the vesting of restricted stock units and performance units~~ upon the occurrence of one or more events described in Section 1113 of the 2014 Plan (“Section 1113 Events”). Such an event is deemed to have occurred when (i) the Company acquires actual knowledge that any person (other than the Company, a subsidiary or any employee benefit plan sponsored by the Company) has acquired beneficial ownership, directly or indirectly, of securities representing 20% or more of the voting power of the Company, (ii) at any time less than 60% of the members of the Board of Directors ~~(excluding vacant seats)~~ are persons who were either directors on November ~~15, 2012~~14, 2013 or individuals whose election or nomination for election was approved by a vote of at least two-thirds of the directors then still in office who were directors on November ~~15, 2012~~14, 2013 or who were so approved, ~~(other than individuals whose initial assumption of office is in connection with an election or proxy contest),~~ (iii) the consummation of a merger, consolidation, share exchange, division or sale or other disposition of assets of the Company as a result of which the shareholders of the Company immediately prior to such transaction doshall not hold, directly or indirectly, immediately following such transaction, a majority of the voting power of ~~(x)~~(a) in the case of a merger or consolidation, the surviving or resulting corporation, ~~(y)~~(b) in the case of a share exchange, the acquiring corporation, or ~~(z)~~(c) in the case of a division or a sale or other disposition of assets, each surviving, resulting or acquiring corporation which, immediately following the transaction, holds more than 30% of the consolidated assets of the Company immediately prior to the transaction, or (iv) ~~the~~ commencement of any liquidation or dissolution of the Company (other than pursuant to any transfer of 70% or more of the consolidated assets of the Company to an entity or entities controlled by the Company and/or its shareholders following such liquidation or dissolution). The Section 13 Events described above may be limited in effect and otherwise subject to the requirements of Section 409A of the Internal Revenue Code of 1986, which provides certain limitations on the ability to accelerate deferred compensation upon changes in control.

1816

Unless the confirming agreement or an amendment thereto otherwise provides, ~~but subject to the $100,000 restriction described above for incentive stock options and exceptions for certain participants described in Section 11 of the Plan,~~ notwithstanding any other provision contained in the 2014 Plan, upon the occurrence of any Section 1113 Event ~~(i)~~ all outstanding stock options and ~~SARs~~stock appreciation rights become immediately and fully exercisable whether or not otherwise exercisable by their terms, ~~(ii)~~and all stock options and ~~SARs~~stock appreciation rights held by a ~~participant~~director whose ~~employment with~~service on the ~~Company or a subsidiary~~Board terminates within one year of any Section 1113 Event for any reason ~~other than voluntary termination with the consent of the Company or a subsidiary, retirement under any retirement plan of the Company or a subsidiary or death~~ are exercisable for the longer of a period of three months from the date of such termination of ~~employment,~~service or the standard periods of expiration or termination as described above, but in no event after the expiration date of the stock option or ~~SARs, (iii)~~the stock appreciation rights.

Unless the restricted share agreement or an amendment thereto otherwise provides, notwithstanding any other provision contained in the 2014 Plan, upon the occurrence of any Section 13 Event prior to the scheduled lapse of all restrictions applicable to restricted ~~stock~~share awards under the 2014 Plan, ~~which have not previously lapsed will~~all such restrictions lapse regardless of the scheduled lapse of such restrictions and (iv) all restricted stock units and performance units are considered to be earned and payable in full, any vesting conditions are considered to have been satisfied, and such restricted stock units and performance units will be settled in cash as promptly as is practicable after the Section 11 Event. None of the provisions (i) to (iv) above in this paragraph will apply to a participant whose securities are included in those determining the beneficial ownership of a person referred to in subsection (i) of the Section 11 Events above.restrictions.

Miscellaneous. Deferred stock compensation accounts shall be maintained only on the books of the Company, and no shares of Common Stock or other assets shall be set aside until shares of Common Stock actually become payable to a director or his beneficiary. No person shall have voting rights with respect to shares of Common Stock credited to a deferred stock compensation account and not yet payable to the director or his beneficiary.

If, as of any payment or crediting date, insufficient shares are available to pay or credit the annual Retainer or meeting fees into a deferred stock compensation account, the Company shall pay or credit such fees in cash to the account.

In the event that any outstanding stock option or stock appreciation right is cancelled by mutual consent, terminates, or expires for any reason without having been exercised in full, the shares of Common Stock not purchased under the stock option or stock appreciation right are again available for all purposes of the 2014 Plan. If any shares of Common Stock are forfeited to the Company pursuant to the restrictions applicable to restricted shares awarded under the 2014 Plan, the number of shares so forfeited are again available for all purposes of the 2014 Plan. The number of shares of Common Stock which are surrendered in full or partial payment to the Company of the option price of a stock option will be available for the purpose of granting awards under the 2014 Plan.

The Board of Directors may alter or amend the 2014 Plan at any time, except that, without approval of the shareholders of the Company, no alteration or amendment may (i) increase the maximum aggregate number of shares of Common Stock for which awards may be made under the Plan, (ii) increase the maximum aggregate number of shares as to which incentive stock options may be granted pursuant to the sub-limit under the Plan, (iii) make any changes in the class of employees eligible to be granted awards under the Plan, (iv) change the maximum number of shares as to which awards may be made to any participant under the Plan, (v) change the maximum amount that may be paid or distributed to any participant in any one calendar year under the Plan pursuant to a grant of performance units or other stock-based awards, (vi) change the restrictions regarding repricing explained above, (vii) change the option price or base price of any SAR permitted under the Plan, (viii) be made if shareholder approval of the amendment is at the time required for ~~awards~~shares under the 2014 Plan to qualify for the exemption from Section 16(b) of the Securities and Exchange Act of 1934, ~~Act~~as amended, provided by Rule 16b-3, or by the rules of the NASDAQ Stock Exchange or any ~~other~~ stock exchange on which the Common Stock may then be ~~listed or (ix) be made to the extent such approval is needed for Qualified Performance-Based Awards to qualify for an exemption under Section 162(m) of the Internal Revenue Code.~~listed. In addition, no alteration or amendment of the 2014 Plan may, without the written consent of the holder of ~~any award theretofore~~a stock option, stock appreciation rights, or restricted shares granted or awarded under the 2014 Plan prior thereto, adversely affect the rights of such holder with respect thereto.

~~The~~No shares of Common Stock shall be issued or credited, nor any options or stock appreciation rights granted, nor restricted stock awarded under the 2014 Plan after March 31, 2019, provided that this does not preclude the issuance of shares in payment of the balance of a director’s deferred stock compensation account or the exercise of previously granted stock options or stock appreciation rights. Additionally, the Board of Directors may ~~also~~ terminate the 2014 Plan at any time, but termination of the 2014 Plan would not terminate any outstanding ~~awards~~stock options or stock appreciation rights granted under the 2014 Plan or cause a revocation or forfeiture of any restricted ~~stock~~share award under the 2014 Plan.

The 2014 Plan contains anti-dilution ~~and anti-enlargement~~ provisions providing for proportionate adjustment ~~or substitution~~ in the maximum aggregate number of shares ~~available~~of Common Stock for ~~awards under the Plan, in the various maximum limitations on awards under the Plan,~~which stock options and stock appreciation rights may be granted, as to which restricted shares may be awarded, and in the number of shares covered by outstanding ~~awards under the Plan~~stock options and ~~in the exercise price of outstanding awards~~stock appreciation rights in certain events, including ~~mergers, consolidations, acquisitions~~stock dividends on shares of outstanding Common Stock. The 2014 Plan also contains provisions providing for the substitution of shares ~~stock rights offering, liquidation, separation, spinoff, disaffiliation~~in the event of a ~~subsidiary,~~reorganization, recapitalization, merger or similar event. The 2014 Plan provides for adjustments to stock options and stock appreciation rights and restrictions on distributions with respect to, or exchanges for restricted shares in the case of, any spin-off, split-off, dividend in partial liquidation or in property other than cash, or extraordinary ~~dividend, stock dividend, stock split, revenue stock split, reorganization, share combination or recapitalization.~~distribution to holders of the Common Stock.

~~Awards to~~If a ~~participant may,~~director who has been granted stock options or stock appreciation rights or awarded restricted shares under the 2014 Plan engages in the ~~Committee’s sole discretion at any time between the date~~operation or management of ~~grant~~a business, whether as owner, partner, officer, director, employee or otherwise and ~~the third anniversary of any exercise, payment~~whether during or ~~vesting of such awards, be cancelled, suspended or required to be repaid to the Company if the participant (i) competes~~after Board service, which is in competition with the Company or ~~its subsidiaries, (ii) induces or attempts to induce any customer, supplier, licensee or certain others to cease doing business with the Company or its subsidiaries, or~~

~~interferes with the Company’s or~~ any of its ~~subsidiaries’ relationships with~~subsidiaries, the Governance Committee may in its discretion immediately terminate all stock options and stock appreciation rights held by such ~~customer, supplier, licensee~~person (except when the exercise period of a stock option or other person, (iii) solicits employees to leave the employment of the Company or its subsidiaries or interferes with their employment relationship, or (iv) defames or disparages the Company, its subsidiaries or certain related persons. Unless the agreement related to an award or an amendment otherwise provides, these provisions do not apply following the occurrence ofstock appreciation right has been extended because one or more of the events described under “Additional Rights in Certain Events” ~~above.~~above has occurred) and declare forfeited all restricted shares held by such person as to which the restrictions have not yet lapsed.

All awards under the Plan constitute a special incentive payment to the participant and are not taken into account in computing the amount of salary or compensation of the participant for the purpose of determining benefits under any other benefit plan or under any agreement between the Company and the participant, unless such plan or agreement specifically provides otherwise.

~~The Plan has indemnification provisions providing indemnity for actions taken under the Plan by members of the Company’s Board and the Company’s officers.~~

The Plan contains provisions intended to comply with both Section 409A of the Internal Revenue Code (related to deferred compensation) and, as discussed above under Performance Goals, Section 162(m) of the Internal Revenue Code (related to performance-based awards). The Committee may establish procedures allowing payment of an award to be deferred, provided any deferral is consistent with Section 409A of the Internal Revenue Code. In such cases of deferral, the participant may be entitled to receive interest or dividends, or dividend equivalents, with respect to shares covered by the award, but in no event will any of the same be paid on any unearned performance units or performance share units until such units vest.

Possible Anti-takeover Effect

The provisions of the 2014 Plan providing for the acceleration of the exercise date of outstanding stock options and ~~SARs~~stock appreciation rights upon the occurrence of a Section 1113 Event, the extension of the period during which outstanding stock options and ~~SARs~~stock appreciation rights may be exercised upon termination of ~~employment~~Board service following a Section 1113 Event and the lapse of restrictions applicable to restricted stock ~~and other~~ awards ~~and accelerated vesting of restricted stock units and performance units~~ upon the occurrence of a Section 1113 Event may be considered as having an anti-takeover effect.

~~Awards to Named Officers and Other Employees~~New Plan Benefits

The ~~Plan is new and no awards have been made under it. The~~Governance Committee has ~~not yet established guidelines or standards on~~determined that commencing in 2014 the ~~types~~annual Retainer will be paid in cash and grants of ~~awards it may grant under the Plan~~restricted shares to ~~the named officers or other participants or the number~~each independent director with a value of ~~shares that the awards~~$100,000 will ~~cover.~~

~~Share Repurchases May Prevent Dilution~~be made.

For a number of years, the Company has had and the Company currently has in place an active share repurchase program. The Company has no specific policy or practice with respect to the repurchase of shares under such program in order to offset grants of shares under its equity plans. However, the effect of any such share repurchase program will be to prevent or minimize the dilutive effect of stock-based compensation plans.

Federal Income Tax Consequences

The rules governing the federal tax treatment of an award are very technical. Consequently, the following ~~is a brief summary~~discussion of ~~certain of the Federal~~federal income tax consequences ~~of awards under the Plan. It~~ is ~~intended for the information of shareholders considering how to vote at the meeting~~necessarily general in nature and does not ~~as tax guidance to participants in the Plan. This summary is not intended~~purport to be exhaustive ~~is based on U.S. federal income tax law currently in effect, does not constitute tax advice~~or complete, and among other things, does not ~~address possible~~describe state, local or foreign tax ~~consequences~~consequences. Moreover, statutory provisions are subject to change, as are their interpretations, and their applications may vary in individual circumstances.

Although the Company may endeavor to (i) qualify the payment of fees or a grant or award for favorable United States tax treatment or avoid adverse tax treatment (e.g., under ~~present law nor does it describe consequences based~~Section 409A of the Code), the Company has made no representation to that effect and expressly disavows any covenant to maintain favorable or avoid unfavorable tax treatment. Section 409A is a provision of the Code that imposes a number of strict and complex requirements that deferred compensation plans and arrangements must satisfy in order for participants of such compensation plans or arrangements to avoid immediate taxation, plus a 20% penalty tax, on ~~particular circumstances.~~the deferred compensation provided by such plan or arrangement.

The Retainer

~~Incentive Stock Options~~Current Payment. ~~A participant does not recognize any taxable income upon receipt~~Directors who receive current payment of ~~an incentive stock option or generally, at~~ the ~~time of exercise of an incentive stock option, whether~~Retainer in cash or in shares ~~are used to pay the exercise price. The exercise~~ of ~~an incentive stock option, however,~~Common Stock generally ~~does result in an increase in a participant’s taxable~~recognize compensation income ~~for alternative minimum tax purposes.~~

If a participant exercises an incentive stock option and does not dispose of the shares received in a subsequent “disqualifying disposition” (generally, a sale, gift or other transfer within two years afteron the date on which they receive payment equal to the amount of ~~grant of the incentive stock option~~cash received or within one year after the shares are transferred to a participant), upon disposition of the shares any amount realized in excess of the participant’s tax basis in the shares disposed of is treated as a long-term capital gain, and any loss is treated as a long-term capital loss. In the event of a “disqualifying disposition”, the difference between the fair market value of the shares received on the payment date.

Deferred Stock Payment. Directors who properly elect to defer receipt of the Retainer in shares of Common Stock generally should recognize compensation income only on the date ~~of exercise and~~on which the ~~option price (limited, in the case of a taxable sale or exchange,~~Retainer is payable to the ~~excess of~~director from the ~~amount realized upon disposition over the participant’s tax basis~~director’s deferred stock compensation account in the shares) is treated as compensation income received by the participant in the year of disposition. Any additional gain is taxable as a capital gain and any loss as a capital loss, which is long-term or short-term depending on whether the shares were held for more than one year. Special rules apply in determining the compensation income recognized upon a disqualifying disposition if the option price of the incentive stock option is paid with shares of Common Stock. IfIn general, the compensation income to be recognized by a director upon distribution of Common Stock from a deferred stock compensation account is equal to the fair market value of the shares of Common Stock ~~received upon~~on the ~~prior exercise of an incentive stock option~~date on which the shares are ~~transferred~~payable to the ~~Company~~director from such account, plus the amount of cash, if any, received in ~~payment~~lieu of a fractional share.

Meeting Fees (Including Committee Chairperson Retainer Fees)

Current Cash Payment. Meeting fees paid in cash constitute compensation and must be recognized as compensation income by the ~~option price~~directors for the taxable year in which they are received.

Deferred Stock Payment. Directors who properly elect to defer receipt of ~~an incentive~~meeting fees otherwise payable in cash and receive a credit to a deferred stock ~~option within either~~compensation account should recognize compensation income only on the date on which meeting fees are payable to the director from the director’s deferred stock compensation account in shares of Common Stock. In general, the ~~periods referred~~compensation income to ~~above,~~be recognized by a director upon distribution of Common Stock from a deferred stock compensation account is equal to the ~~transfer is considered a “disqualifying disposition”~~fair market value of the shares ~~transferred, but only compensation income determined as stated above, and no capital gain or loss, is recognized.~~of Common Stock on the date on which the shares are payable to the director from such account, plus the amount of cash, if any, received in lieu of a fractional share.

Nonstatutory Stock Options

Neither the Company nor any of its subsidiaries is entitled to a deduction with respect to shares received by a participant upon exercise of an incentive stock option and not disposed of in a “disqualifying disposition.” If an amount is treated as compensation received by a participant because of a “disqualifying disposition,” the Company or one of its subsidiaries generally is entitled to a deduction in the same amount for compensation paid, subject to the “Limits on Deductions/Other Tax Matters” below.

~~Nonstatutory Stock Options~~. A ~~participant generally~~director does not recognize any taxable income for Federal income tax purposes upon receipt of a nonstatutory stock option. Upon the exercise of a nonstatutory stock option with cash, the amount by which the fair market value of the shares received, determined as of the date of exercise, exceeds the option price is generally treated as compensation income received ~~by the participant~~ in the year of exercise. If the option price of a nonstatutory stock option is paid in whole or in part in shares of Common Stock, no income, gain or loss is recognized ~~by a participant~~ on the receipt of shares equal in value on the date of exercise to the shares delivered in payment of the option price. The fair market value of the remainder of the shares received upon exercise of the nonstatutory stock option, determined as of the ~~date~~day of exercise, less the amount of cash, if any, paid upon exercise is generally treated as compensation income received ~~by the participant~~ on the date of ~~exercise of the stock option.~~exercise.

The Company or one of its subsidiaries generally is entitled to a deduction for compensation paid in the same amount that is treated as compensation received by the participant upon exercise of a nonstatutory stock option, subject to the “Limits on Deductions/Other Tax Matters” below.

Stock Appreciation Rights~~. A participant generally does~~

Generally a director would not recognize any taxable income upon receipt of a ~~SAR (whether as a stand-alone award or~~stock appreciation right. If the stock appreciation right is payable in ~~tandem with a related option award). Upon~~shares of the ~~exercise of a SAR~~Common Stock, the director would recognize compensation income in the year in which the stock appreciation right is exercised, in an amount ~~by which~~equal to the fair market value of the Common Stock ~~subject~~paid to the ~~SAR on~~director at the time of exercise. If the Company pays cash to a director upon the exercise ~~date exceeds~~of a stock appreciation right, the ~~SAR grant price is treated as~~director likely would recognize compensation income ~~received by the participant~~ in the year ~~of exercise, whether received~~ in ~~cash, shares of Common Stock or both. The Company or one of its subsidiaries generally~~which the stock appreciation right is ~~entitled to a deduction for compensation paid~~exercised in ~~the same~~an amount ~~that is treated as compensation received by the participant upon exercise of the SAR, subject~~equal to the ~~“Limits on Deductions/Other Tax Matters” below.~~cash paid to the director at the time of exercise.

Restricted Stock.

A ~~participant does~~director would not recognize any taxable income ~~upon~~for Federal income tax purposes in the ~~grant~~year of the award, provided the shares ~~are subject to restrictions (that is, they are~~were nontransferable and subject to a substantial risk of ~~forfeiture).~~forfeiture. However, the ~~participant may~~director could elect under Section 83(b) of the Internal Revenue Code to recognize compensation income in the year of the award in an amount equal to the fair market value of the shares on the date of the award, determined without regard to ~~the~~these restrictions. If this 83(b) election is made, the ~~participant~~director will recognize compensation income at the time of the award of the restricted stock even though such shares may remain subject to restrictions on transfer and risks of forfeiture. When the vesting and forfeiture restrictions lapse, no compensation will be includable in gross income. Rather, subsequent appreciation in the value of the stock will be taxed as capital gain or loss upon the sale of such stock. If, however, the stock is forfeited prior to becoming vested, the tax paid in connection with making an 83(b) election is not directly recoverable.

If the director does not make a Section 83(b) election, the fair market value of the shares on the date ~~the~~these restrictions lapse generally is treated as compensation income to the ~~participant~~director and is taxable in the year the restrictions lapse.

Disposition of Shares Received

If a director sells shares of Common Stock acquired under the ~~participant does not make~~2014 Plan, the difference between the amount realized on the sale and the director’s tax basis in the shares sold generally is taxed as a ~~Section 83(b) election, dividends paid~~capital gain or a capital loss, which is long-term or short-term depending on whether the more-than one-year holding period has been satisfied with respect to the ~~participant on the~~ shares ~~prior to the date the restrictions lapse will be~~sold.

The Company

In each instance that an amount is treated as compensation ~~income. The~~received by a director, the Company ~~or one of its subsidiaries~~ generally is entitled to a corresponding deduction ~~for compensation paid~~ in the same amount ~~that is treated as~~for compensation ~~income~~paid.

Other Considerations Related to the ~~participant, subject~~2014 Plan

By adopting the 2014 Plan, the Company is increasing the number of shares available for equity incentives under all of the Company’s equity incentive plans by one hundred fifty thousand (150,000) shares, which comprises only 0.55% of the Company’s outstanding Common Stock as of December 31, 2013. In order to determine the ~~“Limits on Deductions/Other Tax Matters” below.~~

~~Restricted Stock Units. A participant generally does not recognize any taxable income upon receipt~~number of ~~restricted stock units. Any cash and the fair market value of any~~ shares of Common Stock ~~received by a participant upon~~to be authorized under the ~~vesting of restricted stock units are treated as compensation income received~~2014 Plan, Nominating and Corporate Governance Committee and the Board considered the needs by the ~~participant in~~Company for the year of receipt. The Company or one of its subsidiaries generally is entitled to a deduction for compensation paid in the same amount that is treated as compensation income received by the participant upon vesting of the restricted stock units, subject to the “Limits on Deductions/Other Tax Matters” below.

~~Performance Units. A participant generally does not recognize any taxable income upon receipt of performance units. Any cash~~shares and the ~~fair market value~~potential dilution that awarding the requested shares may have on the existing shareholders. As set forth above in this proxy statement, the Nominating and Corporate Governance Committee consulted Pay Governance LLC as an independent compensation advisor to assist in this regard. The compensation advisor examined a number of ~~any~~factors, including the Company’s burn rate and an overhang analysis, which the Nominating and Corporate Governance Committee considered.

As of December 31, 2013, approximately 77,913 shares of Common Stock remained available for future grant under the current 1994 Director Fee Plan (the “1994 Plan”). The Nominating and other property received by a participant when performance units are earned are treated as compensation income received by the participant in the year of receipt. The Company or one of its subsidiaries generally is entitled to a deduction for compensation paid in the same amount that is treated as compensation income received by the participant upon the earning of performance units, subjectCorporate Governance Committee recommended to the ~~“Limits on Deductions/Other Tax Matters” below.~~

~~Other Awards. The tax consequences to the participant and the Company of awards of Common Stock and other awards~~Board that ~~are valued by reference to or otherwise based upon Common Stock will~~150,000 shares be ~~dependent upon the nature and structure of the award.~~

~~Deferred Compensation. While the Committee may establish procedures allowing payment of an award to be deferred, any deferral~~authorized under the ~~Plan is intended to comply with Section 409A of the Internal Revenue Code so as to avoid additional taxes under Section 409A of the Internal Revenue Code being imposed on the participant.~~

~~Limits on Deductions/Other Tax Matters. Certain events described above under “Additional Rights in Certain Events” may result in (i) a 20% Federal excise tax (in addition to Federal~~2014 Plan.

2220

~~income tax) to a participant on certain compensation resulting from awards previously received~~If the Plan is approved, no further grants will be made under the 1994 Plan, so the 77,913 shares referred to above would no longer be available for future awards. The Board is seeking shareholder approval for the 2014 Plan and ~~(ii)~~ the ~~loss~~pool of ~~a compensation deduction~~shares available under the 2014 Plan, which ~~would otherwise be allowable~~it expects is sufficient for up to approximately five years of awards based upon the historic rates of awards by the Compensation Committee under the predecessor plans, and if directors choose to defer cash fees into Company ~~or one of its subsidiaries as explained above.~~stock.

The Compensation Committee and the Board also considered the burn rate with respect to Company ~~or one of its subsidiaries generally~~equity awards. The burn rate is ~~entitled to a deduction for compensation paid provided~~ the compensation is reasonable. However, Section 162(m) of the Internal Revenue Code disallows a compensation deduction for compensation paid to the principal executive officer and any of the other three highest compensated officers (other than the principal financial officer) oftotal equity awards granted by the Company in ~~excess of $1 million each in any taxable~~a fiscal year divided by the total Common Stock outstanding at the beginning of the year. In fiscal 2011, 2012 and 2013, the Company ~~except~~made equity awards representing a total of 217,245 shares, 182,210 shares, and 258,542 shares, respectively. Using the ISS Proxy Advisory Services methodology for calculating burn rate as applied to our 2012 Omnibus Stock Plan, ISS applied a multiplier of 2.5 to any full value awards (like the restricted shares and performance restricted shares for which the participant does not pay for the shares) awarded by the Company. Under this methodology, the Company’s three-year average (ISS adjusted) burn rate for equity grants made in fiscal 2011, 2012, and 2013 was 1.97%, which was less than half of the allowable burn rate of 4.16% under ISS policy, based on the Company’s industry group and volatility. If the burn rate was not adjusted in accordance with ISS policy, the burn rate would decrease to 0.79%, which is below the median of 1.72% at S&P 1500 companies. The Compensation Committee and the Board were satisfied that ~~compensation~~the Company’s burn rate over the past three years was an acceptable level and well below limits established by ISS and the median of S&P 1500 companies.

An additional metric that the Nominating and Corporate Governance Committee and the Board used to measure the cumulative dilutive impact of the 2014 Plan is ~~performance-based may~~overhang. Overhang is defined as:

·	outstanding stock options, plus

·	outstanding full value awards, plus

·	the number of shares available for future grant under the Company’s 2012 Equity Incentive Plan and the proposed 2014 Plan (disregarding the remaining 1994 Plan shares because no future grants would be made if the 2014 Plan is approved),

·	collectively divided by the total outstanding shares of Common Stock as of the record date.

As of September 30, 2013, the Company had 773,087 outstanding stock options, 679,626 outstanding full value restricted and performance restricted shares, and 2,500,000 shares available for future grant under the 2012 Equity Incentive Plan, plus 150,000 shares available for future grant under the proposed Plan. As of that date, the Company had 27,249,902 outstanding shares of Common Stock. This results in an overhang of 13.07%, which is below our overhang of 14.88% at this time last year.

Because the Committee or the Board has discretion in granting awards under the 2014 Plan, and the number of shares to be ~~excluded from this deduction limitation. (The $1 million deduction limit~~awarded will vary with the stock price, Proposal 2 does not contemplate the amount or timing of specific equity awards in the future as it is ~~reduced by~~not possible to calculate with certainty the number of years of awards that will be available and the amount of ~~any compensation deduction disallowed~~subsequent dilution that may ultimately result from such awards. However, because the number of shares reserved under the ~~immediately preceding paragraph.) The~~2014 Plan ~~has been structured so~~is relatively small in relation to the total of number of shares outstanding it does not change the overhang or in the Nominating and Corporate Governance Committee view cause dilution in any material way.

In adopting the 2014 Plan, the Board also considered the compensation of non-employee directors of the Company’s peer group, the Company’s proxy advisor’s recommendation, the total shareholder return, the fair value transfer and shareholder value transfer, and the burn rate that ~~compensation arising~~would result from the ~~exercise~~2014 Plan. The Board discussed these additional concepts with its independent compensation consultant prior to approving the 2014 Plan.

The inclusion of ~~nonstatutory stock options, SARs or~~this information in this Proxy Statement should not be regarded as an indication that the ~~disqualifying disposition~~assumptions used to determine the number of additional shares ~~acquired upon exercise~~will be predictive of ~~incentive stock options should be performance-based~~actual future equity grants. These assumptions are forward-looking statements within the meaning of Section ~~162(m)~~27A of the ~~Internal Revenue Code. As indicated above, the Plan also permits the Committee to designate awards other than options~~Securities Act of 1933, as amended, and ~~SARs as Qualified Performance-Based Awards with the objective of qualifying such awards as performance-based within the meaning of~~ Section ~~162(m)~~21E of the ~~Internal Revenue Code. Nevertheless, it is possible~~Securities Exchange Act of 1934, as amended. These statements involve risks and uncertainties that could cause actual outcomes to differ materially from those in the forward-looking statements, including the Company’s ability to attract and retain talent, achievement of performance metrics with respective to certain equity-based awards, ~~may be made which may be subject to~~ the ~~limits~~extent of ~~Section 162(m) of the Internal Revenue Code.~~

~~In addition to the Plan, the Company also has a Director Fee Plan. The Director Fee Plan is more fully~~option exercise activity, and others described in the ~~“Compensation of Directors” section of this Proxy Statement.~~

Company’s Form 10-K for the year ended September 30, 2013.

Equity Plan Information

The following table provides information about grants under the ~~Company's~~Company’s equity compensation plans as of September 30, ~~2012:~~2013:

Equity Compensation Plan Information
Number of securities
remaining available
for future issuance
Number of securities Weighted-average under equity
to be issued upon exercise price compensation plans
exercise of of outstanding (excluding
outstanding options, options, warrants securities reflected
Plan category warrants and rights and rights in column (a))
(a) (b) (c)
Equity compensation plans
approved by security holders:
1992 Stock Incentive Plan 840,282 $37.15 - (1)
2007 Equity Incentive Plan - - 790,652 (2)
Employee Stock Purchase Plan - - 1,628,508 (3)
Director Fee Plan 26,867 35.39 99,955 (4)
Equity compensation plans not approved by security holders None None None
Total 867,149 $37.13 2,519,115

	Equity Compensation Plan Information

			Number of securities
			remaining available

	Number of securities	Weighted-average	for future issuance under equity
	to be issued upon	exercise price	compensation plans
	exercise of	of outstanding	(excluding
	outstanding options,	options, warrants	securities reflected
Plan category	warrants and rights	and rights	in column (a))
	(a)	(b)	(c)
Equity compensation plans approved by security holders
1992 Stock Incentive Plan	744,824	$ 37.76	- (1)
2007 Equity Incentive Plan	-	$ -	- (2)
2012 Equity Incentive Plan	-	$ -	2,500,000 (3)
Employee Stock Purchase Plan	-	$ -	1,609,270 (4)
1994 Director Fee Plan	28,805	$35.39	77,913 (5)

Equity compensation plans not approved by security holders(6)	None	None	None
Total	773,629	$ 37.72	4,187,183

(1)

As a result of the ~~shareholder~~ approval of the 2007 Equity Incentive Plan, no further grants or awards will be made under the 1992 Incentive Stock Plan.

(2)

As a result of the approval of the 2012 Equity Incentive Plan, no further grants or awards will be made under the 2007 Incentive Stock Plan.

(3)

The ~~2007~~2012 Equity Incentive Plan was approved in February ~~2008.~~2013. The Plan provides for the grant or award of stock options, restricted shares, stock-based performance units and certain other types of stock based awards, with a maximum of ~~2,200,000~~2,500,000 shares available for grants or awards. ~~Upon shareholder approval of the 2012 Equity Incentive Plan, no further grants or awards will be made under the 2007 Equity Incentive Plan.~~

~~(3)~~(4)

Shares under the Employee Stock Purchase Plan (the ~~“ESPP”~~“Plan”) are purchased in the open market by employees at the fair market value of the Company’s stock. The Company provides a matching contribution of 10% of such purchases subject to certain limitations under the ~~ESPP.~~Plan. As the ~~ESPP~~Plan is an open market purchase plan, it does not have a dilutive effect.

~~(4)~~(5)

Shares of restricted stock may be issued under the Director Fee Plan. The maximum number of shares authorized to be issued under the Director Fee Plan is 300,000 shares.

(6)

The 2014 Director Fee Plan is subject to a shareholder vote in Proposal 2 herein and the key provisions of the 2014 Director Fee Plan are outlined in the proposal.

Vote Required ~~for Approval of Proposal 2~~

The ~~vote required for approval~~2014 Plan becomes effective as of ~~Proposal 2 is~~November 14, 2013, provided that the shareholders of the Common Stock of the Company, by affirmative vote of a majority of the ~~votes cast by all~~shares represented at the ~~shareholders~~meeting and entitled to vote, ~~thereon.~~ a quorum being present, approve the Plan. Broker non-votes are not votes cast “for” or “against” the 2014 Plan and are therefore not counted in determining whether the required vote has been obtained. Abstentions will have the effect of a vote “against” the 2014 Plan.

The Board of Directors recommends ~~that you~~a vote FOR approval of ~~Proposal 2. The proxy holders~~the 2014 Plan, and unless otherwise directed therein, the proxies solicited by the Board of Directors will ~~vote your proxy~~be voted FOR ~~this item unless you give instructions to~~approval of the ~~contrary on the proxy.~~

2014 Plan.

PROPOSAL 3

SELECTION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Audit Committee of the Company's Board of Directors has appointed PricewaterhouseCoopers LLP as the independent registered public accounting firm to audit the records of the Company for the year ending September 30, ~~2013.~~2014.

The Audit Committee has determined that it would be desirable to request an expression of opinion from the shareholders on the appointment. Ratification of the appointment of PricewaterhouseCoopers LLP requires the affirmative vote of a majority of ~~all~~ the ~~votes cast by shareholders of Common Stock~~shares represented at the meeting and entitled to vote, ~~at the meeting.~~a quorum being present. If the shareholders do not ratify the selection of PricewaterhouseCoopers LLP, the selection of an alternative independent registered public accounting firm will be considered by the Audit Committee.

It is not expected that any representative of PricewaterhouseCoopers LLP will be present at the Annual Meeting of Shareholders.

The Board of Directors recommends that you vote FOR Proposal 3.

RESOLVED, that the shareholders approve the compensation of the Company’s named executive officers, as disclosed in the Compensation Discussion and Analysis, the compensation tables, and the related disclosure contained in the proxy statement set forth under the caption “Executive Compensation and Retirement Benefits.”

Compen-sation Shares (8)

Compen-sation Shares (7)

875 E. Wisconsin Avenue #800

Milwaukee, WI 53202-5408

525 Washington Boulevard

Wellington Management Co. LLP

280 Congress Street, 31st Floor

Franklin Advisory Services LLC

One Parker Plaza, 9th Floor

100 Vanguard Boulevard

Malvern, PA 19355-2331

One Parker Plaza, 9th Floor

Wellington Management Co. LLP

280 Congress Street, 31st Floor

(1)	Any shares that can be obtained within 60 days are included in beneficial ownership. Unless otherwise noted, the mailing address of each beneficial owner is the same as that of the Registrant.

(2) To the best of the Company’s knowledge, the nature of the beneficial ownership for all shares is sole voting and investment power, except as follows:

Artisan Partners is an investment advisor registered under section 203 of the Investment Advisors Act of 1940. Shares of Matthews International Corporation that Artisan Partners holds have been acquired on behalf of discretionary clients of Artisan Partners, including Artisan Funds. Persons other than Artisan Partners are entitled to receive all dividends from, and proceeds from the sale of, those shares. As of September 30, 2012, of the shares set forth above, Artisan Partners had shared voting authority with respect to 2,037,600 shares.

·	The Vanguard Group, Inc. reported that it does not have sole voting power or sole investing power with respect to all of the shares set forth above.

(3)

Includes options exercisable within 60 days of November 30, ~~2012~~2013 as follows: Mr. Bartolacci, 104,168 shares; Mr. Dunn, ~~29,001~~24,001 shares; Mr. Nicola, 79,334 shares; Mr. O’Leary, 8,300 shares; Mr. Turner, 3,500 shares; Mr. Walters, 11,000 shares and all directors, officers and executive management as a group, ~~272,969~~263,969 shares.

(4)	Includes restricted shares with performance and time vesting provisions as follows: Mr. Bartolacci, ~~226,867~~175,917 shares; Mr. Dunn, ~~40,500~~34,150 shares; Mr. Gackenbach, ~~23,033~~28,383 shares; Mr. Nicola, ~~70,890~~57,730 shares; and Mr. Walters, ~~27,000~~21,650 shares.

(5)	Includes 5,461 restricted shares with time vesting provisions as follows: Mr. Babe, 4,822 shares; Ms. Dietze, 4,822 shares; Mr. Garcia-Tunon, 4,822 shares; Mr. O’Brien, 2,589 shares; Mr. O’Leary, 4,822 shares; Mr. Turner, 4,822 shares; and Mr. Whitaker, 2,589 shares.provisions.

(6)	Includes ~~3,598 shares that are pledged as collateral for a loan.~~

~~(7)~~

~~Includes 29,288~~38,227 restricted shares with time vesting provisions and ~~462,973~~384,446 restricted shares with performance and time vesting provisions.

~~(8)~~(7) Represents shares of Class A Common Stock held in a deferred stock compensation account for the benefit of the director under the Company’s Director Fee Plan. See “General Information Regarding Corporate Governance--Compensation of ~~Directors.”~~Directors” of this Proxy Statement.

The Compensation Committee of the Board ofDirectors of Matthews International Corporation

G.S. Babe, Chairperson

Compensation Discussion and Analysis

Continuous improvement in operating results and the creation of shareholder value are key elements of the compensation philosophy of Matthews International Corporation. This philosophy serves as the framework for the Company’s executive compensation program. Our program is designed to provide incentive arrangements that reward executives for improvement in the Company’s operating results and appreciation in our stock value.

As a result of the Company’s operating performance in fiscal 2012, only one of our Named Executive Officers (“NEOs”) earned a cash bonus award for fiscal 2012 under our incentive compensation plan. In addition, none of the NEO’s performance-based restricted stock grants achieved price-vesting thresholds during fiscal 2012.

To underscore the importance of “pay-for-performance” in our compensation philosophy and our Company’s culture, the Committee has developed incentive arrangements based on rigorous performance standards. The incentive compensation plan component of compensation rewards executives for improvements in operating profit and economic value added which are generally greater than the respective targets set by the Committee at the beginning of the fiscal year. These targets are based upon the Company’s business plan. Accordingly, the incentive compensation plan is designed to motivate management to maintain and, more importantly, achieve higher levels of profits and economic value added for the Company. “Economic value added” is the measure of operating profit compared to the cost of the capital utilized to generate this profit.

Our long-term incentive program provides for grants of shares of restricted stock, with one-half of the shares vesting based on the achievement of performance targets and the remaining half of the shares being based on the continued employment of an NEO over a three-year ~~period~~period. For the fiscal 2013 grant, the Company established two criteria for the performance-vesting shares: one-half of the performance-vesting shares vest upon the attainment of non-GAAP annual earnings per share of $2.57, $2.83 and $3.12, with the remaining half of the performance-vesting shares ~~being performance-based and vesting upon continued employment plus the attainment of stock price goals. For the fiscal 2012 grant, the performance vesting shares~~to vest upon the attainment of 5%, 15% and 25% appreciation in the Company’s stock price. Failure to achieve the earnings per share targets within three years of the date of grant or the stock price hurdles within five years of the date of grant will result in

forfeiture of the ~~award.~~respective awards. Vested shares are subject to the Company’s stock ownership guidelines which require each executive to own shares the value of which equals a multiple of the executive’s base salary.

Other notable highlights of our executive compensation program include:

Both the incentive compensation plan and long-term incentive program provide the Committee with discretion to adjust for the recovery of previously paid awards if financial results are restated or adjusted, or to cancel, suspend, or require repayment to the Company of outstanding awards for violation of non-compete, non-solicitation or disparagement provisions.

·	The Company offers no employment, severance or change in control agreement to any executive, except as customary in certain foreign countries and in certain cases in connection with acquired companies.

·	The Company de-emphasizes the use of perquisites but does provide certain market competitive perquisites to executives.

·	Both the incentive compensation plan and long-term incentive programs are designed and administered to attempt to preserve the deductibility of NEO compensation under IRC Section 162(m) and have been approved by the Company’s shareholders.

At the annual shareholders’ meeting in February ~~2012,~~2013, the fiscal ~~2011~~2012 executive compensation of the Company’s NEO’s was approved by our shareholders, with approximately ~~95%~~89% of the votes cast voting in favor of the proposal.

In addition, during calendar 2013, the Company directly solicited feedback regarding its current executive compensation amounts, philosophy and program design from shareholders representing approximately 55% of the outstanding shares. In their feedback, shareholders expressed a favorable view and/or general satisfaction with the Company’s executive compensation amounts, philosophy and programs. There were no issues or concerns identified. Several shareholders specifically expressed a favorable view on the performance elements of the Company’s annual and long-term incentive programs.

The Committee considered ~~this~~the favorable shareholder vote in February 2013 and the results of the direct shareholder feedback in connection with its determination of compensation policies and decisions and concluded that the Company would maintain its existing compensation philosophy ~~for fiscal 2012.~~in determining current year compensation.

CEO Compensation Determination

In its determination of the specific elements of fiscal ~~2012~~2013 executive compensation for the Company’s CEO, the Committee considered the following:

Base Salary – CEO base salary for ~~2012~~2013 was established at the Committee’s meeting in November ~~2011.~~2012. Based on the competitive market assessment prepared by our independent executive compensation consultant, the Company’s CEO base salary was determined to be approximately ~~90%~~92% of the market median. As Mr. Bartolacci has held the CEO position since 2006 and his individual performance has been rated Commendable (above average), the Committee agreed that his annual base salary adjustments over the next several years should be determined with a goal of attaining market median, provided his individual performance remains at or above the current level. As a result, the base salary for Mr. Bartolacci was increased ~~5.9%~~4.0% for ~~2012.~~2013. After this adjustment, Mr. Bartolacci’s base salary remained below the “mid-point” for his position at approximately 95% of market median.

Incentive Compensation – Mr. Bartolacci’s incentive compensation target as a percent of base pay for fiscal ~~2012~~2013 was determined based on the competitive market assessment prepared by our independent consultant. Actual CEO incentive compensation for fiscal ~~2012~~2013 was determined based on the operating results and economic value added performance of the Company in comparison to targets established by the Committee. The Company’s consolidated operating results and economic value added performance ~~did not meet~~were within the ~~minimum performance thresholds~~specified ranges for fiscal ~~2012.~~2013. As a result, Mr. Bartolacci ~~did not receive~~received incentive compensation ~~for fiscal 2012.~~

equivalent to 78% of target as described later in this report.

Stock Awards – CEO equity compensation awards for fiscal ~~2012~~2013 were granted in November ~~2011.~~2012. In determining ~~these~~equity compensation grants, the Committee ~~considered~~considers total shareholder return (“TSR”) as an important factor in the alignment of CEO performance-based compensation with the interests of the Company’s shareholders. Despite a significant decline in the casketed burial rate (a key demographic affecting sales volume for the Memorialization group), the Company’s stock price remained relatively stable during fiscal 2012 as the Company launched several significant strategic initiatives designed to improve the performance of the Company. In fiscal 2013, the Company’s earnings (excluding unusual costs primarily related to these initiatives) increased over fiscal 2012 and the Company’s stock price appreciated 28% from September 30, 2012 to September 30, 2013.

The Committee also considers the individual performance evaluation of Mr. Bartolacci, ~~and the performance of the Company. Mr. Bartolacci’s performance~~which was rated as Commendable for fiscal ~~2011. In addition,~~2012. As a result, the ~~Company achieved growth in~~Committee determined an equity compensation award of 75,000 shares to Mr. Bartolacci for fiscal ~~2011 earnings over fiscal 2010.~~ 2013.

In its evaluation of executive compensation, the Committee ~~also~~ considers ~~the total shareholder return (“TSR”) performance of the Company. In its November 2011 meeting, the Committee reviewed the Company’s~~ TSR for the past one and three year periods relative to the Company’s industry group. Based on this analysis, the Company’s TSR was determined to be below median. As a result, in determining stock awards for fiscal 2012, the Committee reduced the equity compensation award to Mr. Bartolacci by 44% (from 70,000 shares in November 2010 to 39,000 shares in November 2011).

~~Additionally, TSR is~~ a significant factor in determining the total compensation that can be earned by the Company’s CEO. Specifically, one of the performance ~~nature~~elements of our equity compensation program requires the attainment of pre-defined stock appreciation thresholds to achieve vesting. Failure to achieve the stock price hurdles within five years of the date of grant will result in forfeiture of the shares. The other performance element of our equity compensation program requires the attainment of pre-defined earnings per share growth thresholds to achieve vesting. Failure to achieve these thresholds within three years of the date of grant will also result in forfeiture of the shares.

For awards granted during the past ~~four~~six fiscal years, an average of only ~~22.5%~~32.4% of the performance-based stock awards as included in the Summary Compensation Table have actually been earned by our CEO (see table under “Pay-For-Performance Alignment”).

Retirement Benefits – There were no changes in the Company’s executive retirement benefit formulas and, as such, Mr. Bartolacci did not ~~receive~~have a significant ~~increase~~change in his defined benefits under the plans. The change in the present value of Mr. Bartolacci’s retirement benefits for fiscal 2012 as shown in the Summary Compensation Table resulted primarily from a reduction in the actuarial discount rate. The discount rate (which declined from 4.75% at September 30, 2011 to 4.00% at September 30, 2012) is a significant factor in the determination of the present value of the retirement benefit obligation. The discount rate reduction reflected the recent market decline in long-term interest rates.

Compensation Committee Administration

The Company's executive compensation policies are administered by the Compensation Committee of the Board of Directors. The Committee consists of three independent directors: Mr. Babe (Chairperson), Mr. Garcia-Tunon and Mr. O’Brien. Compensation for the Company's Chief Executive Officer, Chief Financial Officer and the three other most highly compensated executives is presented in the Summary Compensation Table.

The principal function of the Compensation Committee is to review the Company’s compensation and benefit programs, including executive compensation and benefits, to ensure that total compensation is appropriate, competitive and consistent with the Company’s compensation philosophy. In performing its duties, the Committee consults with the Company’s Chief Executive Officer, the Company’s Vice President, Human Resources and various independent external advisors. In fiscal ~~2012,~~2013, the Committee consulted principally with Pay Governance, an independent executive compensation consulting firm. Pay Governance does no other work for the Company and reports directly to the Compensation Committee. The Committee has full authority to retain external advisors, consultants and agents, as necessary, in the fulfillment of its responsibilities. The Committee reviews the performance and the fees of the ~~Consultant~~independent consultant each year and determines whether to retain ~~the Consultant~~such consultant for the upcoming year.

·	2010 Incentive Compensation Plan

·	2007 Equity Incentive Plan (replaced by the 2012 Equity Incentive Plan)

·	2012 Equity Incentive Plan

·	Supplemental Retirement Plan

Compensation Philosophy

The principal objectives of the Company’s executive compensation program, including compensation provided to the NEOs, are to:

·	Attract, retain and motivate highly-qualified executives

·	Reward continuous improvement in operating results and the creation of shareholder value

·	Align the interests of Company executives with shareholders

The Company seeks to accomplish these objectives by maintaining a compensation philosophy that emphasizes rigorous performance-based programs. The foundation of its philosophy is ~~as follows:~~to:

·	Emphasize performance-based compensation elements while providing fixed compensation (base salary) commensurate with the market

·	Provide retirement and other benefits that are competitive with the market

·	Provide no employment contracts or other guarantees of employment except as customary in certain foreign countries or in connection with the negotiation of acquisitions

·	De-emphasize the use of perquisites except for business purposes

The Company believes that executive compensation should be designed to provide management with incentives for the achievement of annual and long-term strategic objectives, with the ultimate objective of delivering improvement in shareholder value. The Committee believes that an effective compensation structure should focus executives on the achievement of the Company’s business objectives and reward executives for achieving those objectives. As such, the Committee’s philosophy is to provide performance-based compensation that targets levels modestly above the market median while targeting fixed base salaries at the median of the market. The Committee has designed this approach in light of the rigorous performance standards of the Company’s incentive plans and because the Company does not in general provide any type of employment contracts or severance programs to executives. The Committee believes it has structured its annual and long-term performance-based compensation to encourage and reward high performance and achievement of Company objectives.

In pursuit of this philosophy, the Company’s executive compensation program includes the following key components:

·	Base salaries

·	Annual cash incentive payments under the Company’s 2010 Incentive Compensation Plan

·	Long-term incentive compensation under the Company’s ~~2007~~2012 Equity Incentive Plan

·	Retirement benefits

·	Other benefits (i.e., health & welfare benefits, insurance, certain perquisites)

In general, the Committee’s desire to align the executive compensation program with the market drives the allocation between short-term and long-term compensation as well as cash and equity components. The Committee believes that the level of compensation provided to an executive should be based on success against performance goals that indicate the creation of shareholder value. To achieve this objective, the Company has built its current short-term cash incentive plan based on growth in operating profit and economic value added. Over the long-term, the

Committee believes that stock price growth is one of the best indicators of the creation of shareholder value. Therefore, the Committee provides equity awards with a level of value and rate of vesting that are dependent on time and the achievement of earnings per share and stock price hurdles. The Company has no formal policy regarding the allocation of variable and fixed compensation for its NEOs.

The Committee has considered whether the executive compensation program promotes risk taking at levels that are unacceptable to the Company. The Committee considered the following factors related to risk:

·	Compensation philosophy that targets salaries at the market median and incentives modestly above median

·	Short-term incentive design that caps maximum awards for the achievement of operating profit and economic value added targets reflective of the Company’s business plan

·	Long-term incentives allocated to two separate vehicles

·	Stock ownership guidelines

·	Incentive compensation recoupment policy

The Committee believes that the above factors as well as the overall executive compensation design, policies and mix of compensation serve to manage risk in a manner that is acceptable to the Company and its shareholders.

The Committee makes decisions regarding executive compensation with input from its independent consultant. When making decisions regarding compensation for the Chief Executive Officer (“CEO”), the Committee has a process in which it considers comparative market data provided by its independent consultant and the CEO’s performance assessment prepared by the Company’s Board of Directors. When making decisions regarding compensation for executives other than the CEO, the Committee considers comparative market data and seeks input and evaluates recommendations from the CEO. In order to obtain comparative market data for evaluating executive compensation, the Company, through its independent consultant, utilizes compensation data published by Towers Watson. This survey contains hundreds of company participants, although the number of participants and the names of the companies that provided data for each position varies by position and is not provided by the survey publisher. The Company targets industrial / manufacturing companies of similar size, complexity, employment region and performance in developing this data. Because data sample sizes for these types of companies may not be sufficient, the Company supplements such data with broader and more general industry data to develop its market data.

In evaluating compensation for calendar ~~2012,~~2013, the Committee’s independent consultant developed a group of peer companies to make assessments of market compensation and to determine the alignment of compensation earned relative to company and peer performance. The peer group targeted industrial/manufacturing companies of similar size, complexity, employment region and performance. The peer group of companies used in evaluating compensation for calendar ~~2012~~2013 were:

CLARCOR Inc. Consolidated Graphics, Inc. ESCO Technologies Inc.

~~Graco Inc. Hillenbrand, Inc.~~

CLARCOR Inc.	Consolidated Graphics, Inc.	ESCO Technologies Inc.
Graco Inc.	Hillenbrand, Inc.	John Wiley & Sons, Inc.
Kaman Corporation	Middleby Corp.	Minerals Technologies Inc.
Mine Safety Appliances Co.	RTI International Metals, Inc.	Schweitzer-Mauduit International Inc.
Service Corp. International	Standex International Corp.	Stewart Enterprises Inc.
	Westinghouse Air Brake Technologies Corporation

Kaman Corporation Middleby Corp. Minerals Technologies Inc.

The Committee does not consider amounts from prior performance-based compensation, such as prior bonus awards or realized or unrealized ~~stock option~~equity compensation gains, in its decisions to increase or decrease compensation in the current year. The Committee believes that this would not be in the best interest of retaining and motivating the executive.

Pay-for-Performance Alignment

The Committee believes there are different ways of assessing whether compensation paid to executives aligns with the performance of the Company. For the Committee’s consideration in understanding the Company’s pay-for-performance alignment, the Committee’s compensation consultant examined the relationship of our CEO’s realizable compensation and the Company’s performance relative to the CEO compensation and performance of our peer group of 16 peer companies. Performance was defined as the relative ranking of the following four performance metrics:

·	Net sales growth

·	Return on invested capital

·	Growth in earnings before interest and taxes

·	Total shareholder return (stock price appreciation plus dividends)

The consultant evaluated each performance metric independently relative to the peer companies for the year ~~2011,~~2012, the three-year period ~~2009~~2010 through ~~2011,~~2012, and the five-year period ~~2007~~2008 through ~~2011.~~2012. The relative ranking of each performance metric was averaged to form a composite ranking. The Company’s relative composite performance ranking was aligned with the peer companies as follows:

·	~~2011: 27~~2012: 18th percentile

·	~~2009~~2010 through ~~2011: 34~~2012: 21thst percentile

·	~~2007~~2008 through ~~2011: 43~~2012: 30rdth percentile

The consultant compared the performance for ~~2011~~2012 to the CEO’s bonus for fiscal year ~~2011.~~2012. For this time frame, the CEO ~~received~~did not receive a bonus payment under our incentive compensation ~~plan of $948,800, which was equal to 148% of his target bonus opportunity.~~plan. This ~~bonus amount ($948,800)~~ ranked atas the 44th ~~percentile (second~~lowest (first quartile) of the peer group CEO’s, ~~respectively,~~ while the Company’s relative performance composite ranked at the 2718th percentile ~~(second quartile) of the peers and the Company’s return on invested capital ranked at the 40~~th ~~percentile (second~~(first quartile) of the peers. The Committee is satisfied with the alignment of the relative ranking of the CEO’s bonus with the relative ranking of Company performance.

For the three-year period ~~2009~~2010 through ~~2011,~~2012, the CEO’s three-year realizable compensation relative to peers ranked at the 1715th percentile (first quartile) while the Company’s performance composite ranked at the 3421thst percentile ~~(second~~(first quartile) of the peers. Realizable compensation includes base salary, actual bonuses paid, the intrinsic value of stock options and stock awards at the year-end ~~2009~~2012 stock price and performance shares earned or expected to be earned.

For the five-year period ~~2007~~2008 through ~~2011,~~2012, the CEO’s five-year realizable compensation relative to peers ranked at the 1615th percentile (first quartile) while the Company’s performance composite ranked at the 4330rdth percentile (second quartile) of the peers.

The Committee evaluated this information and concluded that the Company’s relative performance was higher than the relative realizable value of compensation paid to the CEO on both a three-year and five-year basis. ~~The Committee concluded that while~~

As further emphasis on the Committee’s philosophy to align long-term incentive compensation with the Company’s ~~return on invested capital has outperformed~~performance, below is a table which reflects the ~~peer group~~actual realized portion of long-term incentive compensation awards over the ~~one, three- and five-year~~past six years for our CEO:

Grant	Performance Measure	Grant Value		Grant Date Stock Price		Vesting Thresholds				Percent of Shares Earned		Forfeiture Date
2008	Stock Price		$575,244		$43.94		$48.34	$54.93	$61.52		33.3%		2013
2009	Stock Price		$811,710		$41.24		$45.37	$51.55	$57.74		0.0%		2014
2010	Stock Price		$829,635		$37.31		$41.05	$46.64	$52.24		0.0%		2015
2011	Stock Price		$985,250		$33.39		$35.06	$38.40	$41.74		66.7%		2016
2012	Stock Price		$570,700		$34.89		$36.63	$40.12	$43.61		33.3%		2017
2013	Non-GAAP EPS		$354,875		$28.39		$2.57	$2.83	$3.11		0.0%		2016
2013	Stock Price		$439,875		$28.39		$29.81	$32.65	$35.49		100.0%		2018
Totals			4,567,289								32.4%

~~periods, stock price returns have fallen short~~

The unvested portion (66.7%) of the ~~peer group median. Since the Company’s long-term incentive awards are based on achieving~~fiscal 2008 stock ~~price appreciation hurdles, the majority of our performance-based stock awards over the past five years have not vested as shown~~award was forfeited upon expiration in ~~the table below for our CEO:~~

~~This further emphasizes the alignment of our performance-based long-term incentive arrangements with Company stock price returns.~~November 2013.

Base Salaries

The Committee determines and approves the base salaries of the Company’s executives, including the CEO, and considers recommendations from the CEO with respect to the other executives. The Committee employs the same principles that are applied in developing the base salaries of all employees. Base salary ranges are determined for each executive position based on their level, responsibilities and complexity using the 50th percentile survey data for similar positions at comparable companies. A base salary “mid-point” is determined for each position based on this competitive market median data and ranges are established to provide that the Company’s salary levels are managed between 80% and 120% of such “mid-point.”

In determining base salary adjustments for each executive, the Committee considers the individual’s performance evaluation, the level of responsibility for the position, an individual’s current base salary in relation to “mid-point” and industry competition for executive talent. As discussed earlier, the Committee’s philosophy is to target fixed base salaries at the median of the market. On this basis, calendar ~~2012~~2013 base salaries were increased ~~in the range of 4% to 7% for each of the NEO’s, except Mr. Gackenbach.~~ as follows:

NEO	Percent Increase
Mr. Bartolacci	4.0%
Mr. Nicola	5.0%
Mr. Gackenbach	15.0%
Mr. Dunn	10.4%
Mr. Walters	4.6%

The base salary ofincreases for Mr. Gackenbach ~~was increased 11%~~and Mr. Dunn were determined based on their previous salary relative to ~~approximately 86% of mid-point (Mr. Gackenbach was promoted to his current position in October 2011).~~mid-point. As a result of these adjustments, when compared to the market median base salary data developed for each position by our consultant, each named executive officer’s fiscal ~~2012~~2013 base salary was positioned as follows: Mr. Bartolacci – 95%, Mr. Nicola – ~~98%~~101%, Mr. Gackenbach – ~~86%~~91%, Mr. Dunn – ~~93%~~92% and Mr. Walters – ~~94%~~93%.

Annual Incentive Compensation

·	growth in operating profit and

·	improvement in operating profit greater than the cost of the capital utilized to generate this profit.

Corporate (Mr. Bartolacci, Mr. Nicola and Mr. Walters)

Memorialization (Mr. Gackenbach)

Brand Solutions (Mr. Dunn)

Note: All targets exclude unusual items as approved by the Committee.

Actual results for fiscal ~~2012~~2013 compared to target levels were as ~~follows:~~follows. Actual amounts have been adjusted to exclude unusual items as approved by the Compensation Committee.

	Actual		Target		Relative Incentive %			Allocation			Incentive Earned
Operating profit	$	72,709	$	71,085		142	%		50	%		71	%
Economic value added	$	15,434	$	13,145		190	%		50	%		95	%
Total												166	%

Based on actual results, ~~Mr. Bartolacci, Mr. Nicola, Mr. Gackenbach and Mr. Walters did not earn an incentive amount for fiscal 2012. The~~the calculation of the earned incentive ~~amount for Mr. Dunn was~~amounts were as follows:

Long-Term Incentive Compensation

Long-Term Incentive Compensation isfor fiscal 2013 was provided to key managers and executives under the Company’s 2007 Equity Incentive Plan, as amended. ~~Prior to fiscal 2009,~~Effective upon shareholder approval in February 2013, long-term incentive compensation ~~was~~is administered under the ~~1992 Stock~~2012 Equity Incentive Plan.

Under the equity incentive plan, equity grants can be made in the form of:

·	Stock options,

·	Restricted share awards,

·	Restricted stock units,

·	Performance units,

·	Stock appreciation rights, and

·	Other stock-based awards.

Prior to fiscal 2008, equity grants were predominantly in the form of performance-vesting stock options. Since fiscal 2008, the Company has issued restricted shares with time and performance-vesting provisions.

The Committee considers growth in stock price as the best means of measuring shareholder value creation over the long-term. For this reason, the Committee believes that the use of stock-based compensation has provided a strong link to meeting this objective. In keeping with the Committee’s philosophy of providing performance-based incentives, the restricted shares awarded in fiscal ~~2012~~2013 generally contained performance-vesting provisions for one-half of the shares granted, such that vesting occurs in one-third increments upon the later to occur of the attainment of 5%, 15% and 25% appreciation, respectively, in the market value of the Company’s common stock or one year from the grant date. Failure to achieve the stock price hurdles within five years from the date of grant will result in forfeiture of the shares.granted. Further, in order to enhance the Company’s retention objectives, the remaining one-half of the shares granted contain a time-vesting feature in which such shares vest three years from the grant date subject to continued employment of the executive by the Company.

For the fiscal 2013 grant, the Company established two criteria for the performance-vesting shares: one-half of the performance-vesting shares vest upon the attainment of non-GAAP annual earnings per share of $2.57, $2.83 and $3.12, with the remaining half of the performance-vesting shares to vest upon the attainment of 5%, 15% and 25% appreciation in the Company’s stock price. Failure to achieve the earnings per share targets within three years of the date of grant or the stock price hurdles within five years of the date of grant will result in forfeiture of the respective awards.

Every year, the Committee determines individual grant levels through consultation with ~~our~~the independent compensation advisor. The Committee is provided grant guidelines, which provide recommended grant award ranges based on current market thresholds. The recommended ranges provide a minimum, maximum and target grant award for each position / salary level. The grant ranges are developed such that the minimum of the range aligns with the market 50th percentile, the maximum of the range aligns with the market 75th percentile and the target level in the range represents the average of the market 50th and 75th percentile opportunity. The Committee has chosen this approach since a portion of the grants contain performance-vesting criteria and to align with its philosophy of providing modestly above market variable compensation opportunities. Actual grants within this range are determined based on the individual performance assessments of each executive during the past fiscal year. Grants made to the NEOs in November ~~2011~~2012 were ~~generally~~ within the above range.

Grant recommendations are developed using a valuation model consistent with accounting policies for stock-based compensation and is based on the fair market value of the Company’s common stock on the dates of grant. Grants to executive officers are generally made only once a year in the Company’s first fiscal quarter (usually at the November meeting of the Committee), except for new hires and promotions. The Company does not time the release of material non-public information around the granting of equity compensation awards.

Stock options and restricted shares may also vest under certain change in control circumstances. Performance-based restricted shares cannot vest earlier than one year from the date of grant and expire on the earlier of three or five years (depending on the vesting criteria) from the date of grant, upon employment termination, or within specified time limits following voluntary employment termination (with consent of the Company), retirement or death. Stock options are not exercisable within six months from the date of grant and expire on the earlier of ten years from the date of grant, upon employment termination, or within specified time limits following voluntary employment termination (with consent of the Company), retirement or death.

The minimum holding periods for vested stock options and restricted share awards are governed by the Company’s stock ownership guidelines. The ownership policy mandates that at least 50% of the after-tax shares realized upon an option exercise or vesting of restricted stock must be retained until the ownership guideline is met.

Beginning with the November 2011 restricted share grant, dividends on unvested shares are no longer paid. Dividends will be accrued and only payable upon the vesting of the restricted shares.

Accordingly, dividends will not be paid if the restricted shares do not become vested and are forfeited.

For grants made in November 2012 for fiscal 2013, the Committee approved the use of non-GAAP earnings per share as a second performance metric to be used in addition to stock price appreciation under the performance-vesting restricted stock program.

Adjustments or Recovery of Prior Compensation

The Sarbanes-Oxley Act of 2002 requires the Chief Executive Officer and Chief Financial Officer to reimburse the Company for any awards received following the release of financial results that subsequently require an accounting restatement due to noncompliance with a material financial reporting requirement as a result of misconduct. Additionally, ~~under the~~our incentive compensation plan has a recoupment provision under which the Committee has the discretion to adjust for the recovery of previously paid awards from any participant, where appropriate, if financial results are restated or adjusted in future periods. No such adjustments have been necessary under these provisions.

The incentive compensation plan and the equity incentive plan provide the Committee the discretion over the three-year period following the grant of awards to cancel, suspend or require repayment to the Company of outstanding awards if the participant (i) competes with the Company or its subsidiaries, (ii) violates solicitation provisions with customers or employees, (iii) defames or disparages the Company, its subsidiaries or certain related persons.

Stock Ownership Guidelines

The Company has established stock ownership guidelines for executive officers and business unit management in order to support a culture of ownership among the management team. The Committee believes significant ownership levels will provide additional motivation to executives to perform in accordance with the interests of the Company’s shareholders. The ownership guidelines are expressed as a multiple of base salary and are as follows:

Position	Minimum Equivalent Stock Value
Chief Executive Officer	5 times base salary
Chief Financial Officer; Group Presidents	4 times base salary
Division Presidents; Vice President, Human Resources; Vice President and General Counsel; Vice President and Controller	3 times base salary
Managers directly reporting to Division Presidents	2 times base salary
Other managers eligible for equity compensation and other incentive compensation plan participants	1 time base salary

Retirement Benefits

Retirement benefits are generally provided to executives under the Company’s principal retirement plan and in some cases, a supplemental retirement plan. The purpose of both these plans is to provide post-retirement compensation and stability to executives. The Committee’s goal is to provide a benefit that is competitive with plans which would be available to executives of similar companies. The Committee believes this philosophy will allow the Company to effectively attract and retain talented executives.

Executive officers may become eligible to participate in the Company’s supplemental retirement plan. To be eligible for participation, the individual must be an executive officer of the Company as designated by the Board of Directors annually and meet certain length of service requirements as a designated executive officer and in total with the Company.

Of the named executives, Mr. Bartolacci, Mr. Nicola and Mr. Dunn are participants in the supplemental retirement plan. Unlike the principal retirement plan, the supplemental plan is an unsecured obligation of the company and is not a tax-qualified plan. Funding for the supplemental retirement plan is provided through a non-revocable trust arrangement. The supplemental retirement plan is intended to make-up the tax-related limitation of benefits under the principal retirement plan and to provide retirement benefits at competitive market rates. In addition, the supplemental retirement plan serves as a retention vehicle as benefits generally do not fully vest until the completion of a minimum of 15 years of service.

In 2009, the Committee modified the supplemental plan for any new executive going forward, including Mr. Gackenbach and Mr. Walters, limiting the benefit to restoring amounts lost to tax-related limitations.

The Company generally provides all domestic employees with the following:

·	401(k) plan,

·	Employee stock purchase plan,

·	Health and dental coverage,

·	Company-paid term life insurance,

·	Disability insurance,

·	Educational assistance, and

·	Paid time off (vacations and holidays).

These benefits are designed to be competitive with overall market practices. Educational assistance for dependent children is also provided to any employee of the Company whose child meets the scholastic eligibility criteria and is attending an eligible college or university. Educational assistance is limited to $1,200 for each semester and $2,400 annually.

The Company provides executives with other benefits, reflected in the “All Other Compensation” column in the Summary Compensation Table, which the Committee considers reasonable, competitive and consistent with the Company’s compensation philosophy. These benefits include supplemental life insurance coverage, costs associated with personal use of a vehicle ~~leased by the Company~~ and, in certain circumstances, club dues and financial counseling and tax preparation services.

Employment and Severance Agreements

Annual Compensation of the Named Executive Officers

Name and
Principal Position
Year (1)

Salary

Bonus
Stock
Awards (2)
Option
Awards
Non-Equity
Incentive Plan
Compen-sation (3)
Change in Pension Value and Nonqualified Deferred Plan Compen-sation (4)
All
Other Compen-sation (5)

Total
Joseph C. Bartolacci
Director, President and Chief Executive Officer
2012
2011
2010
$669,231
630,769
595,385
$            -
-
-
$1,251,055
2,153,783
1,893,065
$            -
-
-
$            -
948,800
851,049
$684,505
566,212
-
$  93,069
90,753
112,080
$2,697,860
4,390,317
3,451,579
Steven F. Nicola
Chief Financial Officer, Secretary and Treasurer
2012
2011
2010
399,231
371,231
339,369
-
-
-
481,175
692,288
585,854
   -
-
-
-
394,345
342,937
378,756
370,816
-
43,143
40,313
25,912
1,302,305
1,868,993
1,294,072
Brian J. Dunn
Group President,
Brand Solutions
2012
2011
2010
305,231
293,116
278,744
-
-
-
288,705
276,915
398,540
   -
-
-
96,253
225,751
101,437
149,902
177,697
133,397
30,264
29,243
21,267
870,355
1,002,722
933,385
Steven D. Gackenbach
Group President,
Memorialization (6)
2012
2011

293,077
202,500

-
-

192,470
39,978

-
-

-
16,281
7,629
-

53,283
183,996

546,459
442,755

Brian D. Walters
Vice President and General Counsel
2012
2011
2010
278,462
259,616
206,308
-
-
-
259,835
276,915
139,489
-
-
-
-
140,096
89,349
28,752
23,425
13,566
18,113
18,233
14,918
585,162
718,285
463,630

Name and Principal Position	Year (1)	Salary	Bonus	Stock Awards (2)	Option Awards	Non-Equity Incentive Plan Compen-sation (3)	Change in Pension Value and Nonqualified Deferred Plan Compen-sation (4)	All Other Compen-sation (5)	Total
Joseph C. Bartolacci Director, President and Chief Executive Officer	2013 2012 2011	$698,769 669,231 630,769	$ - - -	$2,036,813 1,251,055 2,153,783	$ - - -	$ 552,368 - 948,800	$ - 684,505 566,212	$ 77,107 93,069 90,753	$3,365,057 2,697,860 4,390,317
Steven F. Nicola Chief Financial Officer, Secretary and Treasurer	2013 2012 2011	420,577 399,231 371,231	- - -	651,780 481,175 692,288	- - -	233,228 - 394,345	- 378,756 370,816	36,033 43,143 40,313	1,341,618 1,302,305 1,868,993
Brian J. Dunn Group President, Brand Solutions	2013 2012 2011	332,615 305,231 293,116	- - -	407,363 288,705 276,915	- - -	50,687 96,253 225,751	- 149,902 177,697	25,646 30,264 29,243	816,311 870,355 1,002,722
Steven D. Gackenbach Group President, Memorialization (6)	2013 2012 2011	334,615 293,077 202,500	- - -	439,952 192,470 39,978	- - -	286,730 - 16,281	8,319 7,629 -	22,783 53,283 183,996	1,092,399 546,459 442,755
Brian D. Walters Vice President and General Counsel	2013 2012 2011	291,000 278,462 259,616	- - -	244,418 259,835 276,915	- - -	92,140 - 140,096	- 28,752 23,425	18,158 18,113 18,233	645,716 585,162 718,285

(1)

For the fiscal years ended September 30, 2013, 2012 ~~2011~~ and ~~2010.~~2011.

(2)

Amounts in this column reflect the grant date fair value of awards of restricted shares of the Company’s Common Stock granted during fiscal 2013, 2012 ~~2011~~ and ~~2010~~2011 computed in accordance with Financial Accounting Standards Board ASC Topic 718; however, the estimate of forfeiture related to service-based vesting conditions is disregarded for purposes of this valuation. For details of individual grants of restricted shares during fiscal ~~2012,~~2013, see the Grants of Plan-Based Awards table below. During fiscal 2013, restricted shares were forfeited by the named executive officers, as follows: Mr. Bartolacci, 11,600 shares; Mr. Nicola, 4,833 shares; Mr. Dunn, 1,800 shares; and Mr. Walters, 1,100 shares. There were no forfeitures of restricted shares by any of the named executive officers during fiscal 2012 ~~2011~~ or ~~2010.~~2011. The assumptions on which this valuation is based are set forth in Note 9 to the audited financial statements included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on November 27, ~~2012.~~2013.

(3)

The amounts shown in this column reflect amounts earned and paid under the 2010 Incentive Compensation Plan (“Incentive Compensation Plan”) ~~in fiscal 2012 and 2011, and the Company’s 2008 Management Incentive Plan in fiscal 2010.~~. For a full explanation of the operation of the Incentive Compensation Plan, refer to the narrative disclosure above and the Annual Incentive Compensation section of the Compensation Discussion and Analysis beginning on page 3635 of this Proxy Statement. ~~The amounts included in the Summary Compensation Table above include the following:~~

Name

Year

Amount Paid Under Current Year’s Award
Deferred Credits Under Awards made in Prior Years, Earned in the Current Year’s Award

Earnings on Deferred Credits

Total
J.C. Bartolacci

2012
2011
2010
$ -
948,800
749,795
N/A
N/A
$100,249
N/A
N/A
$1,005
$ -
948,800
851,049
S.F. Nicola
2012
2011
2010
-
394,345
299,168
N/A
N/A
43,335
N/A
N/A
434
-
394,345
342,937
B.J. Dunn
2012
2011
2010
96,253
225,751
101,437
N/A
N/A
-
N/A
N/A
-
96,253
225,751
101,437
S.D. Gackenbach
2012
2011

-
16,281
N/A
N/A
N/A
N/A
-
16,281
B.D. Walters
2012
2011
2010
-
140,096
79,291
N/A
N/A
9,958
N/A
N/A
100
-
140,096
89,349

(4)

The amount shown in this column for each of the named executive officers is the increase, if any, in the actuarial present value of the accumulated benefits under all defined benefit plans for the years ended September 30, 2013, 2012 ~~2011~~ and ~~2010.~~2011. A significant portion of the amounts listed for fiscal 2012 and 2011 resulted from a reduction in the discount rate, due to the decline in market interest rates. For additional information regarding defined benefit pension plans, see the Pension Benefits table below.

(5)

Amounts represent one or more of the following: premiums for officer’s life insurance, incremental premiums for long-term disability insurance, club dues, dividends on unvested restricted shares, the value for personal use of Company leased vehicles, matching contributions to the Company’s 401(k) Plan, educational assistance and, for Mr. Gackenbach, relocation reimbursement of $33,064 and $127,662 in fiscal 2012 and 2011, respectively. The fiscal 2011 amount for Mr. Gackenbach also includes an employment bonus of $42,500. The fiscal 2013, 2012 ~~2011~~ and ~~2010~~2011 amounts for Mr. Bartolacci include dividends on unvested restricted shares of $41,667, $58,851 and $56,848, ~~and $34,706,~~ respectively. ~~The fiscal 2010 amount for Mr. Bartolacci also includes club dues (including a club initiation fee) of $59,476.~~

(6)

Mr. Gackenbach joined the Company in ~~February~~January 2011.

(1)	All grants were effective as of the date on which the Compensation Committee of the Board of Directors met to approve them.

(2)

Amounts represent target payouts under the Company’s Incentive Compensation Plan. The target represents the named executive officer’s annual salary multiplied by his respective target incentive award percentage. The target incentive award percentages, expressed as a percentage of annual base salary are 100% for Mr. Bartolacci, 70% for Mr. Nicola, 55% for Mr. Dunn, ~~45%~~50% for Mr. Gackenbach and 40% for Mr. Walters. For a full explanation of the operation of the Incentive Compensation Plan, refer to the Annual Incentive Compensation section of the Compensation Discussion and Analysis beginning on page 3635 of this Proxy Statement.

(3)

Amounts represent the number of shares of restricted stock granted pursuant to the 2007 Equity Incentive Plan (“Equity Incentive Plan”) that vest upon certain performance criteria. Performance-based restricted shares were granted such that for 50% of such shares vesting occurs in one-third increments upon the attainment of annual adjusted earnings per share of $2.57, $2.83 and $3.11, respectively; and for 50% of such shares vesting occurs upon the attainment of 5%, 15% and 25% appreciation, respectively, in the market value of the Company’s Common Stock, but in no event prior to the expiration of one year from the date of the grant. Restricted shares may also vest under certain change in control circumstances. The restricted shares are forfeited if the adjusted earnings per share and stock price appreciation performance vesting criteria have not been met on the earlier of three and five years from the date of grant, respectively, upon employment termination, or within specified time limits following voluntary employment termination (with consent of the Company), retirement or death. For a full explanation of the operation of the ~~2007~~ Equity Incentive Plan, ~~(“Equity Incentive Plan”),~~ refer to the Long-Term Incentive Compensation section of the Compensation Discussion and Analysis beginning on page 3837 of this Proxy Statement.

(4)

Amounts represent the number of shares of restricted stock granted pursuant to the Equity Incentive Plan that fully vest on the third anniversary of the grant date. Restricted shares may also vest under certain change in control circumstances. The restricted shares are forfeited upon employment termination, or within specified time limits following voluntary employment termination (with consent of the Company), retirement or death. For a full explanation of the operation of the Equity Incentive Plan, refer to the Long-Term Incentive Compensation section of the Compensation Discussion and Analysis beginning on page 3837 of this Proxy Statement.

(5)

Grant date fair values are developed using a Binomial pricing model based on the fair market value of the Company’s common stock on the dates of grant. The assumptions on which this valuation is based are set forth in Note 9 to the audited financial statements included in Matthews International Corporation’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on November 27, ~~2012.~~2013.

The following table sets forth information concerning the fiscal ~~2012~~2013 year-end value of unexercised options and unearned restricted shares for each of the named executive officers.

Outstanding Equity Awards at Fiscal Year-End Table

(1)	Represents options that have met performance vesting thresholds, but have not met time vesting thresholds as of September 30, ~~2012~~2013 (unvested options).

(2)	Represents options that have not met performance vesting thresholds as of September 30, ~~2012~~2013 (unearned options).

(3)	The unearned portion of this option grant will be earned and vested upon the stock price of the Company’s common stock reaching 160% of the exercise price for ten consecutive trading days.

(4)

One-half of the unearned portion of this option grant will be earned and vested upon the stock price of the Company’s common stock reaching 133% of the exercise price for ten consecutive trading days; with the remainder to be earned and vested upon the stock price of the Company’s common stock reaching 160% of the exercise price for ten consecutive trading days.

(5)	Represents restricted shares that were fully vested on November 11, ~~2012.~~2013.

(6)	~~Represents restricted shares that will be earned and fully vested on November 10, 2013.~~

~~(7)~~

Represents restricted shares that will be earned and fully vested on January 20, 2014.

~~(8)~~(7)

Represents restricted shares that will be earned and fully vested on November 9, 2014.

(8)	Represents restricted shares that will be earned and fully vested on November 14, 2015.

(9)	Represents the value of all unvested restricted shares as of September 30, ~~2012.~~2013. The value is computed by multiplying all unvested restricted shares by the ~~$29.82,~~$38.08, the closing price of the Company’s common stock on September 30, ~~2012.~~2013.

(10)

Represents restricted shares that will be earned and vested as follows: one-half upon the stock price of the Company’s common stock reaching 125% of the grant date fair value of the Company’s common stock ($43.94 for Mr. Bartolacci and $43.72 for Messrs. Nicola, Dunn and Walters) for ten consecutive trading days and one-half upon the price of the Company’s common stock reaching 140% of the grant date fair value of the Company’s common stock for ten consecutive trading days. Neither of the requisite vesting thresholds was met within five years of the date of the grant, and the shares were forfeited on December 5, 2012 for Mr. Bartolacci and November 12, 2012 for Messrs. Nicola, Dunn and Walters.

~~(11)~~

Represents restricted shares that will be earned and vested as follows: one-third upon the stock price of the Company’s common stock reaching 110% of the grant date fair value of the Company’s common stock ($41.24) for ten consecutive trading days, one-third upon the stock price of the Company’s common stock reaching 125% of the grant date fair value of the Company’s common stock for ten consecutive trading days, and one-third upon the price of the Company’s common stock reaching 140% of the grant date fair value of the Company’s common stock for ten consecutive trading days. All of these restricted shares were forfeited on November 12, 2013.

~~(12)~~(11)

Represents restricted shares that will be earned and vested as follows: one-third upon the stock price of the Company’s common stock reaching 110% of the grant date fair value of the Company’s common stock ($37.31) for ten consecutive trading days, one-third upon the stock price of the Company’s common stock reaching 125% of the grant date fair value of the Company’s common stock for ten consecutive trading days, and one-third upon the price of the Company’s common stock reaching 140% of the grant date fair value of the Company’s common stock for ten consecutive trading days. One-third of these shares vested on November 25, 2013.

~~(13)~~(12)

Represents restricted shares that will be earned and vested upon the stock price of the Company’s common stock reaching 125% of the grant date fair value of the Company’s common stock ($33.39) for ten consecutive trading days. These shares vested on December 31, 2013.

(13)

Represents restricted shares that will be earned and vested as follows: one-half upon the stock price of the Company’s common stock reaching 115% of the grant date fair value of the Company’s common stock ($34.89) for ten consecutive trading days, and one-half upon the price of the Company’s common stock reaching 125% of the grant date fair value of the Company’s common stock for ten consecutive trading days. One-half of these shares vested on November 20, 2013.

(14)

Represents restricted shares that will be earned and vested as follows: ~~one-third~~one-sixth upon the stock price of the Company’s common stock reaching 105% of the grant date fair value of the Company’s common stock ($~~34.89)~~28.39) for ten consecutive trading days, ~~one-third~~one-sixth upon the stock price of the Company’s common stock reaching 115% of the grant date fair value of the Company’s common stock for ten consecutive trading days, ~~and one-third~~one-sixth upon the price of the Company’s common stock reaching 125% of the grant date fair value of the Company’s common stock for ten consecutive trading ~~days.~~days, one-sixth upon the adjusted earnings per share of the Company reaching $2.57, one-sixth upon the adjusted earnings per share of the Company reaching $2.83, and one-sixth upon the adjusted earnings per share of the Company reaching $3.11.

(15)	Represents restricted shares that will be earned and vested upon the stock price of the Company’s common stock reaching 125% of the grant date fair value of the Company’s common stock ($34.69) for ten consecutive trading days.

Option Exercises and Stock Vested

In 2009, the Committee closed the supplemental plan to new participants and created a separate plan for any new designated executive going forward, limiting its benefit to restoring amounts lost to tax-related limitations under the Company’s regular retirement and 401(k) plans.

(1)

As of September 30, ~~2012.~~2013. Years of credited service for the Matthews International Corporation Employees Retirement Plan begin on the first of the month following the completion of one year of service. Years of credited service for the Matthews International Corporation Supplemental Retirement Plan begin on the initial date of service.

(2)

The assumptions on which this valuation is based are set forth in Note 11 to the audited financial statements included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on November 27, ~~2012.~~2013.

The Company provides a 401(k) Plan covering substantially all domestic employees of the Company. Participants may make pre-tax contributions to their account of 1% up to 60% of their annual compensation. For employees covered under the Matthews International Corporation Employees Retirement Plan, which includes the named executive officers, the Company makes matching contributions to each participant at a rate of 50% of participants’ deferrals up to 1% their annual compensation. Participants are fully vested immediately in the value of their contributions and fully vested in the value of Company matching contributions after three years of service, provided they are a participant of the plan.

Potential Payments upon Termination or Change in Control

Voluntary Termination With

(1)

The stock option value represents the value of unvested stock options as of September 30, ~~2012~~2013 that had met performance vesting criteria as of that date and would meet time vesting criteria or before September 30, ~~2014~~2015 (two-year anniversary of assumed termination date of September 30, ~~2012)~~2013) (the “assumed vested options”). For this purpose, if the performance vesting threshold was less than ~~$29.82,~~$38.08, the closing price of the Company’s common stock on the last trading day of fiscal ~~2012,~~2013, the option was considered to be performance vested. ~~The~~Since the performance vesting thresholds for all unvested stock options exceeded $38.08, the incremental value of the options is computed by multiplying the number of assumed vested options by the difference between the option exercise price and $29.82. The option exercise prices for all assumed vested options exceed $29.82, and the value of the options is therefore $0 as of September 30, ~~2012.~~2013.

(2)

The stock option value represents the value of all unvested stock options as of September 30, ~~2012.~~2013. The value is computed by multiplying all unvested options ~~by the difference between the option~~with an exercise price ~~and $29.82,~~less than $38.08, the closing price of the Company’s common stock on the last trading day of fiscal ~~2012. The~~2013, by the difference between the option exercise ~~prices for all unvested stock options exceed $29.82,~~price and ~~the value of the options is therefore $0 as of September 30, 2012.~~$38.08.

(3)

The performance-based restricted share value represents the value of unvested restricted shares as of September 30, ~~2012~~2013 that had not met performance vesting criteria as of that date, but for which the performance vesting threshold was less than ~~$29.82,~~$38.08, the closing price of the Company’s common stock on the last trading day of fiscal ~~2012. At September 30, 2012, no performance-based restricted shares had a~~2013 (the “assumed performance ~~vesting threshold less than $29.82, and the~~vested shares”). The value of the ~~performance-based~~ restricted shares is ~~therefore $0 as~~computed by multiplying the number of ~~September 30, 2012.~~assumed performance vested shares by $38.08.

(4)

The time-based restricted share value represents the value of unvested restricted shares as of September 30, ~~2012~~2013 that would vest upon termination as of September 30, ~~2012~~2013 (the “assumed time vested shares”). The value of the restricted shares is computed by multiplying the number of assumed time vested shares by ~~$29.82,~~$38.08, the closing price of the Company’s common stock on the last trading day of fiscal ~~2012.~~2013.

(5)

The performance-based and time-based restricted share value represents the value of all unvested restricted shares as of September 30, ~~2012.~~2013. The value is computed by multiplying all unvested restricted shares by ~~$29.82,~~$38.08, the closing price of the Company’s common stock on the last trading day of fiscal ~~2012.~~2013.

(6)	The incremental value of the Supplemental Retirement Plan represents the increase in the accumulated benefit obligation resulting from an additional five years of vested service for eligible participants.

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MATTHEWS INTERNATIONAL CORPORATION

~~2012 EQUITY INCENTIVE~~2014 DIRECTOR FEE PLAN

~~1.1~~(a) ~~Purpose~~Purposes. The purposes of the ~~2012 Equity Incentive~~2014 Director Fee Plan (the ~~"Plan"~~“Plan”) are to encourage eligible employees of Matthews International Corporation (the "Corporation") and its Subsidiaries to increase their efforts to make the Corporation and each Subsidiary more successful, to provide an additional inducement for such employees to remain with the Corporation or a Subsidiary, to reward such employees by providing an opportunity to acquire shares of Common Stock on favorable terms and to provide a means through which the Corporation may attract able persons to enter the employ of the Corporation or one of its Subsidiaries.are:

~~1.2Certain Definitions. In addition to terms defined herein in the first place where they are used, the following terms are defined as set forth below:~~

(1)

to provide for each Director of Matthews International Corporation (the “Corporation”) who is not also an employee of the Corporation or any of its Subsidiaries (“Director”) the payment of retainer fees and, in the case of a Director who is Chairperson (the “NE Chairperson”), an additional retainer fee for future services to be performed by such Director (“Director Fees”) as a member of the Board of Directors of the Corporation (the “Board”) in cash or in shares of Class A Common Stock, par value $1.00 per share, of the Corporation (“Common Stock”) and, in the case of payment to the Directors of the Director Fees in shares of Common Stock, to increase the identification of interests between such Directors and the shareholders of the Corporation;

~~(a) “Award” means a stock option, a stock appreciation right, restricted stock, restricted stock units, performance units or other stock-based award granted under the Plan.~~

(2)

to provide current payment in cash (or if a Director shall elect to defer receipt, future payment in shares of Common Stock) to each Director (except the NE Chairperson shall only be entitled to the fees, if any, in (a) and (e)) for:

~~(b) “Base Price” shall have the meaning set forth in Section 5.3.~~

(a)	fees, if any, paid for attendance at meetings of the Board (“Board Meeting Fees”);

~~(c) "Common Stock" shall mean the Class A Common Stock, par value $1.00 per share, of the Corporation.~~

(b)	fees, if any, paid to Directors for attendance at meetings of Committees of the Board (“Committee Meeting Fees”);

(d) “Fair Market Value” with respect to a share of the Common Stock shall mean the mean between the following prices, as applicable, for the date as of which Fair Market Value is to be determined as quoted in such reliable publication as the Committee, in its sole discretion, may determine to rely upon: (i) if the Common Stock is listed on the New York Stock Exchange, the highest and lowest sales prices per share of the Common Stock as quoted in the NYSE-Composite Transactions listing for such date, (ii) if the Common Stock is not listed on such exchange, the highest and lowest sales prices per share of Common Stock for such date on (or on any composite index including) the NASDAQ Exchange or the principal United States of America securities exchange registered under the Securities Exchange Act of 1934, as amended (the “1934 Act”) on which the Common Stock is listed. If there are no such sale price quotations for the date as of which Fair Market Value is to be determined but there are such sale price quotations within a reasonable period both before and after such date, then Fair Market Value shall be determined by taking a weighted average of the means between the highest and lowest sales prices per share of the Common Stock as so quoted on the nearest date before and the nearest date after the date as of which Fair Market Value is to be determined. The average should be weighted inversely by the respective numbers of trading days between the selling dates and the date as of which Fair Market Value is to be determined. If there are no such sale price quotations on or within a reasonable period both before and after the date as of which Fair Market Value is to be determined, then Fair Market Value of the Common Stock shall be the weighted average of the means between such bona fide bid and asked prices on the nearest trading date before and the nearest trading date after the date as of which Fair Market Value is to be determined, if both such dates are within a reasonable period. The average is to be determined in the manner described above in this definition. If the Fair Market Value of the Common Stock cannot be determined on the basis previously set forth in this definition on the date as of which Fair Market Value is to be determined, the Committee shall in good faith and in conformance with the requirements of Section 409A of the Code, to the extent applicable to an Award, determine the Fair Market Value of the Common Stock on such date. Fair Market Value shall be determined without regard to any restriction other than a restriction which, by its terms, will never lapse.

(c)	annual retainer fees paid to the Chairperson of a Committee (“Committee Chairperson Retainer Fees”);

(d)	annual retainer fees paid to any Lead Director of the Board of Directors (“Lead Director Fees”); and

(e)	fees, if any, paid to a Director for attendance at the annual shareholders’ meeting of the Corporation (“Shareholders’ Meeting Fees”) (subsections (a)-(e)); and

(3)

to increase the identification of interests between the Directors and the shareholders of the Corporation by permitting the Nominating and Corporate Governance Committee of the Board or a Stock Compensation Subcommittee of the Committee (the “Subcommittee”) to award restricted stock, nonstatutory stock options and/or stock appreciation rights to each Director on the fifteenth (15th) business day after the annual shareholders’ meeting of the Corporation.

~~(f) “Participant” means an eligible employee selected by the Committee who has received an Award under~~For purposes of the Plan, ~~and any transferee or transferees of such employee to~~ the ~~extent the transfer is permitted under the Plan.~~

(g) “Performance Goals” means the performance goals, if any, established by the Committee in connection with the grant of restricted stock, restricted stock units, performance units or other Awards. In the case of Qualified Performance-Based Awards, the “Performance Goals” means such performance goals based on one or more of the following:

~~(i)~~

The following criteria for the Corporation on a consolidated basis, one or more of its direct or indirect Subsidiaries, and/or one or more divisions of the foregoing, either in absolute terms or relative to the performance of (x) the Corporation, its Subsidiaries or divisions (for a different period), (y) one or more other companies or (z) an index covering multiple companies:

1.	~~net income~~
2.	~~net income growth~~
3.	~~economic value added (earnings less a capital charge)~~
4.	~~EBITDA (earnings before interest, taxes, depreciation and amortization) or adjusted EBITDA~~
5.	~~sales~~
6.	~~revenue growth~~
7.	~~costs~~
8.	~~expenses~~
9.	~~gross margin~~
~~10.~~	~~operating margin~~
~~11.~~	~~pre-tax profit or income~~
~~12.~~	~~market share~~
~~13.~~	~~return on net assets~~
~~14.~~	~~return on assets~~
~~15.~~	~~return on capital~~
~~16.~~	~~return on invested capital~~
~~17.~~	~~cash flow~~
~~18.~~	~~free cash flow~~
~~19.~~	~~operating cash flow~~
~~20.~~	~~operating income~~
~~21.~~	~~EBIT (earnings before interest and taxes)~~
~~22.~~	~~debt to earnings (including EBITDA and EBIT)~~
~~23.~~	~~working capital~~
~~24.~~	~~working capital as a percent of sales~~
~~25.~~	~~performance versus budgeted amounts~~
~~26.~~	~~innovation as measured by a percentage of sales from new products~~
~~27.~~	~~environmental emissions improvement~~
~~28.~~	~~workforce diversity~~
~~29.~~	~~safety performance~~

~~(ii)~~

The following criteria for the Corporation, either in absolute terms or relative to the performance of the Corporation (for a different period), one or more other companies or an index covering multiple companies:

1.	~~stock price~~
2.	~~return on shareholders’ equity~~
3.	~~earnings per share (basic, diluted, GAAP or non-GAAP)~~
4.	~~cash flow per share~~
5.	~~total shareholder return (stock price appreciation plus dividends)~~

~~(h) “Qualified Performance-Based Award” means an Award intended to qualify for the Section 162(m) Exemption, as provided in Section 12.~~

~~(i) "Subsidiary"~~term “Subsidiary” means any corporation ~~partnership, joint venture, limited liability company or other entity~~ in an unbroken chain of ~~entities~~corporations beginning with the Corporation, if each of the ~~entities~~corporations other than the last ~~entity~~corporation in the unbroken chain owns ~~an equity interest~~stock possessing ~~at least~~ fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other ~~entities~~corporations in the chain.

~~(j) “Tandem SARs”~~ As used hereinafter, the term “Committee” shall ~~have~~mean either the ~~meaning set forth in Section 5.2.~~

~~2.1.~~ ~~Committee. The Plan shall be administered by a~~Nominating and Corporate Governance Committee ~~(the "Committee") appointed~~or the Subcommittee, if the Subcommittee is authorized by the Board ~~of Directors of~~to act under this Plan provided, however, that the ~~Corporation (the "Board") and consisting of not less than two members of the Board, who, at the time of their appointment to the Committee and at all times during their service as~~ members of the Committee ~~are (a) "Non-Employee Directors" as then defined under~~must be composed solely of two or more “non-employee directors” in accordance with Rule ~~16b-3~~16b-3(d) under the 1934 Act, or any successor rule, (b) "outside directors" under Section 162(m)(4)(C) of the Internal Revenue Code of 1986 as amended (the “Code”) or any successor provision, and (c) independent directors under the applicable rules of any applicable stock exchange, if the Common Stock is subject to such rules. The Committee shall have plenary authority to interpret the Plan and prescribe such rules, regulations and procedures in connection with the operations of the Plan as it shall deem to be necessary and advisable for the administration of the Plan consistent with the purposes of the Plan. Without limitation of the foregoing, the Committee shall have the authority, subject to the terms and conditions of the Plan:

~~(a)to select the employees to whom Awards may be made;~~Act.

(b) ~~to determine whether and to what extent incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock, restricted stock units, performance units, other Awards~~Reservation of ~~or based upon Common Stock, or any combination thereof, are to be granted hereunder;~~Shares

~~(c)to determine~~. Except as otherwise provided in this Section 1(b), the aggregate number of shares of Common Stock towhich may be ~~covered by each Award made hereunder;~~

~~(d)to determine the terms and conditions of each Award made hereunder, based on such factors as the Committee shall determine;~~

~~(e)subject to Section 2.5, to modify, amend or adjust the terms and conditions of any Award;~~

~~(f)to adopt, alter and repeal such administrative rules, guidelines and practices governing the Plan as it shall from time to time deem advisable;~~

~~(g)to interpret the terms and provisions of the Plan and any Award~~issued under the Plan ~~(and any agreement under Section 2.5 relating thereto);~~

~~(h)subject~~or credited to Section 2.5, to accelerate the vesting or lapse of restrictions on any outstanding Award, other than a Qualified Performance-Based Award, based in each case on such considerations as the Committee in its sole discretion determines;

~~(i)to decide all other matters that must be determined in connection with an Award;~~

~~(j)to determine whether, to what extent and under what circumstances cash, shares of Common~~Deferred Stock ~~and other property and other amounts payable with respect to an Award under this Plan shall be deferred either automatically or at the election of the employee;~~

~~(k)to establish any “blackout” period that the Committee in its sole discretion deems necessary or advisable; and~~

~~(l)to otherwise administer the Plan.~~

~~2.2.~~ ~~Committee Action~~. The Committee shall keep records of action taken at its meetings. A majority of the Committee shall constitute a quorum at any meeting and the acts of a majority of the members present at any meeting at which a quorum is present, or acts approved in writing by all members of the Committee, shall be the acts of the Committee.

~~2.3~~ ~~Committee Discretion~~. Any determination made by the Committee or by an appropriately delegated officer pursuant to delegated authority under the provisions of the Plan with respect to any Award shall be made in the sole discretion of the Committee or such officer at the time of the Award or, unless in contravention of any express term of the Plan, at any time thereafter. All decisions made by the Committee or any appropriately delegated officer pursuant to the provisions of the Plan shall be final and binding on all persons, including the Corporation and the employees eligible under the Plan.

~~2.4~~ ~~Cancellation; Suspension; Clawback~~. Any or all outstanding Awards to a Participant may, at any time between the date of grant and the third anniversary of any exercise, payment or vesting of such Awards, in the Committee’s sole discretion and subject to such terms and conditions established by the Committee, be cancelled, suspended, or required to be repaid to the Corporation if the Participant (whether during or after termination of employment with the Corporation and its Subsidiaries) (i) engages in the operation or management of a business (whether as owner, partner, officer, director, employee or otherwise) which is in competition with the Corporation or any of its Subsidiaries, (ii) induces or attempts to induce any customer, supplier, licensee or other individual, corporation or other business organization having a business relationship with the Corporation or any of its Subsidiaries to cease doing business with the Corporation or any of its Subsidiaries or in any way interferes with the relationship between any such customer, supplier, licensee or other person and the Corporation or any of its Subsidiaries, (iii) solicits any employee of the Corporation or any of its Subsidiaries to leave the employment thereof or in any way interferes with the relationship of such employee with the Corporation or any of its Subsidiaries, or (iv) makes any statements or comments, orally or in writing, of a defamatory or disparaging nature regarding the Corporation or any of its Subsidiaries (including but not limited to regarding any of their respective businesses, officers, directors, personnel, products or policies), provided, however, that this sentence shall not apply following the occurrence of a Section 11 Event (as defined in Section 11) unless the agreement under Section 2.5 specifically so provides. Whether a Participant has engaged in any such activities shall also be determined, in its sole discretion, by the Committee, and any such determination by the Committee shall be final and binding.

~~2.5~~ ~~Agreements~~. The terms and conditions of each Award shall be set forth in a written (or electronic) agreement, which shall be delivered to the Participant receiving such Award upon, or as promptly as is reasonably practicable following, the making of such Award. The effectiveness of an Award shall be subject to the agreement being signed by the Corporation and the Participant receiving the Award unless otherwise provided in the agreement. Unless otherwise provided in the agreement, each agreement or amendment thereto shall be executed on behalf of the Corporation by the Chief Executive Officer (if other than the President), the President or any Vice President and by the Participant. The agreement confirming a stock option shall specify whether the stock option is an incentive stock option or a nonstatutory stock option. The provisions of such agreements need not be identical. Without the consent of the Participant, upon notice to the Participant thereof, the Committee may amend any Award to the Participant and the corresponding agreement in any respect not materially adverse to the Participant. All other amendments to the agreement shall be in writing (including electronic amendments) and executed on behalf of the Corporation and by the Participant. Any reference in the Plan to the agreement under Section 2.5 shall include any amendment to such agreement.

Those employees of the Corporation or any Subsidiary (including, but not limited to, Covered Employees) who share responsibility for the management, growth or protection of the business of the Corporation or any Subsidiary shall be eligible to receive Awards as described herein, provided however, that incentive stock options may be granted only to employees of the Corporation and Subsidiaries which are its subsidiaries within the meaning of Section 424(f) of the Code.

~~4.1~~ ~~Number of Shares. Subject to adjustment as provided in Section 4.5, the maximum aggregate number of shares of the Common Stock for which Awards may be made~~subsequent issuance under the Plan ~~shall be 2,500,000 shares. The maximum number of shares of Common Stock that may be granted pursuant~~is limited to ~~options intended to be incentive stock options shall be 1,000,000 shares.~~

~~4.2~~ ~~Individual Limit. The maximum number of shares of Common Stock as to which Awards other than performance units under Section 8 or Awards under Section 9 may be made under the Plan to any~~ one ~~Participant in any one calendar year is 250,000~~hundred fifty thousand (150,000) shares, subject to adjustment and substitution as set forth in Section ~~4.5. For~~12 hereof. Shares issued under the ~~purposes of this limitation,~~Plan may be authorized but unissued shares or shares previously issued and thereafter acquired by the Corporation or partly each, as shall be determined from time to time by the Board. If any ~~adjustment~~stock option or substitution made pursuant to Section 4.5 in a calendar year with respect to the maximum number of shares set forth in the preceding sentence shall also be made with respect to any shares subject to Awards previouslystock appreciation right granted under the Plan ~~to such Participant~~is cancelled by mutual consent, forfeited, or terminates or expires for any reason without having been exercised in ~~the same calendar year.~~

~~4.3~~

~~Share Counting~~.

(a) For purposes of the limit set forth in the first sentence of Section 4.1 (but not for purposes of Section 4.2), each share of Common Stock which is subject to an Award other than a stock optionfull, or a stock appreciation right shall be counted as two (2) shares rather than one (1) share, provided, however, that in case of performance units, shares of Common Stock shall be counted as two (2) shares rather than one (1) share for each actual share issued only at the time, if any ofrestricted shares awarded under the ~~actual issuance~~Plan are forfeited, the number of shares ~~pursuant to the performance unit Award.~~

~~(b) Except~~subject thereto, in the case of ~~performance unit Awards (where~~stock options or stock appreciation rights, or the number of shares forfeited, in the case of ~~Common Stock are counted only upon actual issuance of the~~restricted shares, pursuant to Section 4.3(a)) to the extent that any Award is forfeited, or any option and the Tandem SAR (if any) or any Free-Standing SAR terminates, expires or lapses without being exercised, or any Award is settled for cash, the shares of Common Stock subject to such Awards shall again be available for ~~Awards under~~all purposes of the ~~Plan under Section 4.1. However,~~Plan. In addition to the number of shares of Common Stock ~~subject to such Awards shall continue to be counted~~authorized for ~~purposes~~issuance or crediting by the first sentence of this Section ~~4.2 or Section 9, as applicable.~~

~~(c) If~~1(b), the exercise price of any option and/or the tax withholding obligations relating to any Awards are satisfied by delivering shares (either actually or through attestation) or withholding shares relating to such Award, the gross number of shares subject to the Award shall nonetheless be deemed to have been granted for purposes of Sections 4.1 and 4.2 and any shares which are delivered will not be added to the aggregate number of shares under Section 4.1 for which Awards may be made under the Plan.

~~(d) If a Tandem SAR is granted, each share~~ of Common Stock ~~subject~~which are surrendered (or to ~~both~~which ownership has been certified) in full or partial payment to the ~~Tandem SAR and related stock~~Corporation of the option ~~shall be counted as only one share~~price of ~~Common Stock for purposes of Sections 4.1 and 4.2.~~

~~(e) Each share of Common Stock subject to~~ a stock option ~~(with or without a Tandem SAR) or a Free-Standing SAR~~granted under the Plan shall be ~~counted as one share of Common Stock~~available for all purposes of ~~Sections 4.1 and 4.2.~~

~~(f)~~the Plan. All shares of Common Stock covered by a stock appreciation right, to the extent it is exercised and shares of Common Stock are actually issued upon exercise of the right, shall be counted, ~~for purposes of Sections 4.1 and 4.2,~~ regardless of the number of shares used to settle the stock appreciation right upon exercise.

Any non-employee Director of the Corporation who is separately compensated in the form of Director Fees or Meeting Fees for services on the Board shall be eligible to participate in the Plan.

Payment of Director Fees in Cash or Common Stock

(a) Current Payment. Subject to the provisions of Section 3(b) hereof, on the fifteenth (15th) business day following the annual meeting of the shareholders of the Corporation (each such date of payment referred to as a “Payment Date”), each Director as of that date shall receive payment of Director Fees by:

(i)

the payment to the Director of cash of sixty thousand dollars ($60,000) and, in the case of the NE Chairperson, an additional seventy thousand dollars ($70,000) (or such other amounts determined by the Board or by any committee of the Board which the Board authorizes to determine such amounts) (the “Retainer Fee Amount”); or

(ii)

the issuance to the Director of a number of whole shares of Common Stock equal to the Retainer Fee Amount divided by the Fair Market Value of one share of the Common Stock, as defined in Section 15 hereof, on such Payment Date (rounded upward to the next whole share).

(b) Stock Deferral Election. Regardless of whether Director Fees are to be paid in either cash or shares of Common Stock, each Director may elect to defer the receipt of Director Fees in shares of Common Stock for a calendar year (a “Stock Deferral Election”) by filing a Notice of Election with the Secretary of the Corporation in the form prescribed by the Corporation.

(c) Election Procedures. Except as provided in the next succeeding sentence, both a Current Stock Election and a Stock Deferral Election (collectively, “Director Fee Elections”) shall be effective on January 1 of the year following the date on which the Notice of Election is filed. Director Fee Elections shall be effective on the date on which the Notice of Election is filed with respect to Director Fees payable after the time of a person’s initial election to the office of Director, or any subsequent re-election if immediately prior thereto such person was not serving as a Director, provided (i) the Director files such Notice of Election within ten (10) business days subsequent to being elected or re-elected as a Director and (ii) a Stock Deferral Election shall only be effective for Director Fees payable for services performed after the Notice of Election is filed. Director Fee Elections shall apply to all Director Fees otherwise payable while such Director Fee Election is effective. Each Director may terminate a Current Stock Election and receive current payment of Director Fees in cash (where the Committee has elected to pay Director Fees in cash) and may terminate a Stock Deferral Election and receive current shares of Common Stock or cash (where the Committee has elected to pay Director Fees in cash) by filing a Notice of Termination with the Secretary of the Corporation in the form prescribed by the Corporation, which shall be effective on January 1 of the year following the date on which a Notice of Termination is filed. A Director Fee Election shall continue in effect until the effective date of any Notice of Termination. Director Fee Elections may be made by a Director even if such Director has not made a Meeting Fee Deferral Election (as defined below).

(d) Evidence of Shares. As of the date on which the Director Fees are payable in shares of Common Stock pursuant to Section 3(a) hereof or, if a Stock Deferral Election was made, pursuant to Sections 5 and 6 hereof, (i) the Corporation, at its sole discretion, shall either issue share certificates to the Director for the shares of Common Stock received under the Plan or cause such shares to be registered in the name of the Director on any book-entry registration maintained by the Corporation or its transfer agent, and (ii) the Director shall be a shareholder of the Corporation with respect to any such shares.

Payment of Meeting Fees

(a) Current Cash Payment. Subject to the provisions of Sections 4(b) and 4(c) hereof, each Director shall receive payment of Meeting Fees in cash in the following amounts (or such other amounts determined by the Board or by any committee of the Board which the Board authorizes to determine such amounts), except that the NE Chairperson shall only be entitled to Board Meeting Fees and Shareholder’s Meeting Fees, if any:

Board Meeting Fees:	None
Committee Meeting Fees:	None
Committee Chairperson Retainer Fees:	$7,500 (or $12,000 in the case of the Audit Committee Chairperson) for a year of service as a Committee Chairperson
Lead Director Fees, if a Lead Director is elected:	$5,000 for a year of service as the Lead Director.
Shareholders’ Meeting Fees:	None

(b) Deferred Payment of Meeting Fees. Each Director may elect to receive all Meeting Fees for a calendar year in shares of Common Stock rather than cash, as set forth in Section 4(c) hereof, provided the Director elects to defer the receipt of such shares of Common Stock (a “Meeting Fee Deferral Election”). A Meeting Fee Deferral Election may be made only by filing a Notice of Election with the Secretary of the Corporation in the form prescribed by the Corporation, and shall be effective for meetings, and, if applicable, Committee Chairperson Retainer Fees or Lead Director Fees payable, on and after January 1 of the year following the date on which the Notice of Election is filed; provided, however, that a Meeting Fee Deferral Election shall be effective on the date on which the Notice of Election is filed after the time of a person’s initial election, or any subsequent re-election, to the office of Director with respect to Meeting Fees and, if applicable, Committee Chairperson Retainer Fees or Lead Director Fees, payable for services performed after the Meeting Fee Deferral Election is filed if (A) immediately prior thereto such person was not serving as a Director, and (B) such Notice of Election is filed within ten (10) business days subsequent to such person being elected or re-elected as a Director. A Meeting Fee Deferral Election shall apply to all Meeting Fees which would otherwise be payable for meetings held while such Meeting Fee Deferral Election is effective.

A Director may terminate a Meeting Fee Deferral Election only by filing a Notice of Termination with the Secretary of the Corporation in the form prescribed by the Corporation, which Notice of Termination shall be effective for meetings and, if applicable, Committee Chairperson Retainer Fees or Lead Director Fees payable on and after January 1 of the year following the date on which a Notice of Termination is filed. A Meeting Fee Deferral Election shall continue in effect until the effective date of any Notice of Termination, after which the Meeting Fees shall be payable in accordance with Section 4(a) hereof. A Meeting Fee Deferral Election may be made by a Director even if such Director has not made a Current Stock Election or a Stock Deferral Election. A Meeting Fee Deferral Election shall apply to all but not less than all Meeting Fees.

(c) Deferred Meeting Fees Credited in Shares of Common Stock. Each Director who has made a Meeting Fee Deferral Election effective for Meeting Fees otherwise payable in cash for a calendar year shall receive a credit to a Deferred Stock Compensation Account (as defined in Section 5(a) hereof) in the name of such Director on the first Payment Date following such calendar year. Such credit shall be a number of shares of Common Stock (including fractional shares to at least two decimal places) equal to (i) the aggregate amount of all Meeting Fees subject to such Meeting Fee Deferral Election otherwise payable during such calendar year to such Director in cash under Section 4(a) hereof if no Meeting Fee Deferral Election had been made, divided by (ii) the Fair Market Value of one share of the Common Stock, as defined in Section 15 hereof, on such Payment Date. No interest or other amount shall be paid or credited to a Director notwithstanding that Meeting Fees which otherwise would have been payable under Section 4(a) hereof in cash are not reflected as a credit to such Deferred Stock Compensation Account until the Payment Date.

(d) Evidence of Shares. If a Meeting Fee Deferral Election was made, then as of the date on which the Meeting Fees are payable in shares of Common Stock pursuant to Sections 5 and 6 hereof, (i) the Corporation, at its sole discretion, shall either issue share certificates to the Director for the shares of Common Stock received under the Plan or cause such shares to be registered in the name of the Director on any book-entry registration maintained by the Corporation or its transfer agent, and (ii) the Director shall be a shareholder of the Corporation with respect to any such shares.

Deferred Stock Compensation Account

(a) General. The amount of any Director Fees or Meeting Fees deferred in accordance with a Stock Deferral Election or a Meeting Fee Deferral Election shall be credited to a deferred stock compensation account maintained by the Corporation in the name of the Director (a “Deferred Stock Compensation Account”). A separate Deferred Stock Compensation Account shall be maintained for each amount of deferred Director Fees or Meeting Fees for which a Director has elected a different payment option or as otherwise determined by the Committee. Separate Deferred Stock Compensation Accounts shall be maintained for deferred Director Fees or Meeting Fees under the Plan as opposed to those under the 1994 Director Fee Plan, as amended. On each Payment Date or Interim Payment Date that a Stock Deferral Election is effective for a Director or on which a credit to a Deferred Stock Compensation Account is to be made under Section 4(c) hereof pursuant to a Meeting Fee Deferral Election, the Director’s Deferred Stock Compensation Account(s) shall be credited on the Payment Date or Interim Payment Date with the number of shares of Common Stock (including fractional shares to at least two decimal places) which (i) otherwise would have been payable to the Director under Section 3(a) hereof on such Payment Date or Interim Payment Date if the Director Fees had been payable to the Director in shares of Common Stock, whether the Director Fees were payable in cash or in shares of Common Stock, and/or (ii) are to be so credited in accordance with Section 4(c) hereof.

Name of Beneficial Owner (1)	Number of Class A Shares Beneficially Owned (2)				Percent of Class		Deferred Stock Compen-sation Shares (8)		Number of Class A Shares Beneficially Owned (2)				Percent of Class		Deferred Stock Compen-sation Shares (7)
Directors, Officers and Executive Management:

J.C. Bartolacci		420,339	(3	) (4)		1.5		-		402,785	(3	) (4)		1.5		-
G.S. Babe		4,822	(5	)		*		3,860		7,694	(5	)		*		5,798
K.E. Dietze		10,397	(5	)		*		-		13,269	(5	)		*		-
B.J. Dunn		99,569	(3	) (4)		0.4		-		98,398	(3	) (4)		0.4		-
S.D. Gackenbach		23,305	(4	)		0.1				32,811	(4	)		0.1		-
A. Garcia-Tunon		9,367	(5	)		*		-		12,239	(5	)		*		-
S.F. Nicola		212,021	(3	) (4)		0.8		-		207,264	(3	) (4)		0.8		-
M.K. O’Brien		2,589	(5	)		*		-		5,461	(5	)		*		-
J.P. O’Leary, Jr.		41,606	(3	) (5) (6)		0.2		6,900		34,583	(3	) (5)		0.1		6,900
J.D. Turner		20,397	(3	) (5)		0.1		4,307		23,269	(3	) (5)		0.1		4,307
B.D. Walters		44,348	(3	) (4)		0.2		-		43,466	(3	) (4)		0.2		-
J.R. Whitaker		3,439	(5	)		*		-		6,311	(5	)		*		-
All directors, officers and executive management as a group (17 persons)		1,082,225	(3	) (7)		3.9		15,067		1,080,427	(3	) (6)		3.9		17,005

Others:
Artisan Partners LP 875 E. Wisconsin Avenue #800 Milwaukee, WI 53202-5408		2,148,029	**			7.8
BlackRock Fund Advisors 525 Washington Boulevard Suite 1405 Jersey, NJ 07310		1,920,385	**			7.0				2,058,514	**			7.5
Wellington Management Co. LLP 280 Congress Street, 31st Floor Boston, MA 02210										1,863,999	**			6.8
Franklin Advisory Services LLC One Parker Plaza, 9th Floor 400 Kelby Street Fort Lee, NJ 07024										1,806,279	**			6.6
The Vanguard Group, Inc. 100 Vanguard Boulevard Malvern, PA 19355-2331		1,717,954	**			6.3				1,624,020	**			5.9
Franklin Advisory Services LLC One Parker Plaza, 9th Floor 400 Kelby Street Fort Lee, NJ 07024		1,583,700	**			5.8
Wellington Management Co. LLP 280 Congress Street, 31st Floor Boston, MA 02210		1,566,528	**			5.7

* Less than 0.1%
** Information as of September 30, 2012
** Information as of September 30, 2013

	Operating Profit	Economic Value Added	Relative Incentive %	Operating Profit		Economic Value Added		Relative Incentive %
Target	$81,500	$23,800	100%	$	71,085	$	13,145		125	%
Minimum	$73,350	$21,420	50%	$	63,977	$	10,516		50	%
Maximum	$89,650	$26,180	200%	$	78,194	$	15,774		200	%

	Operating Profit	Economic Value Added	Relative Incentive %	Operating Profit		Economic Value Added			Relative Incentive %
Target	$38,300	$(10,900)	100%	$	34,732	$	(13,928	)		100	%
Minimum	$32,775	$(13,325)	50%	$	29,741	$	(18,103	)		50	%
Maximum	$43,825	$( 8,475)	209%	$	39,723	$	(9,752	)		200	%

Name	Grant Date (1)	Estimated Future Payouts Under Non-Equity Incentive Plan Awards			Estimated Future Payouts Under Equity Incentive Plan Awards			All Other Stock Awards: Number of Shares of Stock or Units (#) (4)	All Other Option Awards: Number of Securities Underlying Options (#)	Exercise or Base Price of Option Awards ($/Share)	Grant Date Fair Value ($) (5)	Grant Date (1)	Estimated Future Payouts Under Non-Equity Incentive Plan Awards			Estimated Future Payouts Under Equity Incentive Plan Awards			All Other Stock Awards: Number of Shares of Stock or Units (#) (4)	All Other Option Awards: Number of Securities Underlying Options (#)	Exercise or Base Price of Option Awards ($/Share)	Grant Date Fair Value ($) (5)
Name	Grant Date (1)	Threshold ($)	Target ($) ( 2)	Maximum ($)	Threshold (#)	Target (# ) (3)	Maximum (#)			Exercise or Base Price of Option Awards ($/Share)	Grant Date Fair Value ($) (5)	Grant Date (1)	Threshold ($)	Target ($) ( 2)	Maximum ($)	Threshold (#)	Target (# ) (3)	Maximum (#)			Exercise or Base Price of Option Awards ($/Share)	Grant Date Fair Value ($) (5)
J.C. Bartolacci	11/9/11					6,500					$207,675	11/14/12					6,250					$ 177,438
												11/14/12					6,250					177,438
												11/14/12					6,250					177,438
												11/14/12					6,250					160,937
	11/9/11					6,500					189,670	11/14/12					6,250					146,437
	11/9/11					6,500					173,355	11/14/12					6,250					132,500
	11/9/11							19,500			680,355	11/14/12							37,500			1,064,625
	11/9/11	$339,000	$678,000	$1,356,000								11/14/12	$352,500	$705,000	$1,410,000
S.F. Nicola	11/9/11					2,500					79,875	11/14/12					2,000					56,780
	11/9/11					2,500					72,950	11/14/12					2,000					56,780
	11/9/11					2,500					66,675	11/14/12					2,000					56,780
	11/9/11							7,500			261,675	11/14/12					2,000					51,500
	11/9/11	141,750	283,500	567,000								11/14/12					2,000					46,860
												11/14/12					2,000					42,400
												11/14/12							12,000			340,680
												11/14/12	148,838	297,675	595,350
B.J. Dunn	11/9/11					1,500					47,925	11/14/12					1,250					35,488
												11/14/12					1,250					35,488
												11/14/12					1,250					35,488
												11/14/12					1,250					32,187
	11/9/11					1,500					43,770	11/14/12					1,250					29,287
	11/9/11					1,500					40,005	11/14/12					1,250					26,500
	11/9/11							4,500			157,005	11/14/12							7,500			212,925
	11/9/11	84,700	169,400	354,200								11/14/12	93,500	187,000	374,000
S.D. Gackenbach	11/9/11					1,000					31,950	11/14/12					1,350					38,327
	11/9/11					1,000					29,180	11/14/12					1,350					38,327
	11/9/11					1,000					26,670	11/14/12					1,350					38,327
	11/9/11							3,000			104,670	1/14/12					1,350					34,762
	11/9/11	67,500	135,000	270,000								11/14/12					1,350					31,630
												11/14/12					1,350					28,620
												11/14/12							8,100			229,959
												11/14/12	86,250	172,500	345,000
B.D. Walters	11/9/11					1,350					43,132	11/14/12					750					21,293
	11/9/11					1,350					39,393	11/14/12					750					21,293
	11/9/11					1,350					36,005	11/14/12					750					21,293
	11/9/11							4,050			141,305	11/14/12					750					19,312
	11/9/11	56,200	112,400	224,800								11/14/12					750					17,572
												11/14/12					750					15,900
												11/14/12							4,500			127,755
												11/14/12	58,800	117,600	235,200

		Option Awards					Stock Awards					Option Awards					Stock Awards
	Number of Securities Underlying Unexercised Options (#) Exercisable	Number of Securities Underlying Unexercised Options (#) Unexercisable (1)	Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) (2)		Option Exercise Price	Option Expiration Date	No. of Shares or Units of Stock That Have Not Vested (#)	Market Value of Shares or Units of Stock That Have Not Vested ($) (9)	Equity Incentive Plan Awards: Number of Unearned Shares, units or Other Rights That Have Not Vested (#)	Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (9)	Number of Securities Underlying Unexercised Options (#) Exercisable	Number of Securities Underlying Unexercised Options (#) Unexercisable (1)	Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) (2)		Option Exercise Price	Option Expiration Date	No. of Shares or Units of Stock That Have Not Vested (#)	Market Value of Shares or Units of Stock That Have Not Vested ($) (9)	Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)	Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (9)
J.C. Bartolacci	16,667	0	16,666	(3)	$36.03	11/16/2014					16,667	0	16,666	(3)	$36.03	11/16/2014
	53,334	0	26,666	(3)	$37.29	11/16/2015					53,334	0	26,666	(3)	$37.29	11/16/2015
	34,167	0	68,333	(4)	$40.56	11/15/2016					34,167	0	68,333	(4)	$40.56	11/15/2016
									11,600 (10)	$ 345,912									26,100 (10)	$ 993,888
									26,100 (11)	778,302									28,500 (11)	1,085,280
							28,500 (5)	$ 849,870	28,500 (12)	849,870							35,000 (5)	1,332,800	11,667 (12)	442,279
							35,000 (6)	1,043,700	11,667 (13)	347,910							19,500 (7)	742,560	13,000 (13)	495,040
							19,500 (8)	581,490	19,500 (14)	581,490							37,500 (8)	1,428,000	37,500 (14)	1,428,000
S.F. Nicola	28,000	0	14,000	(3)	$36.03	11/16/2014					28,000	0	14,000	(3)	$36.03	11/16/2014
	36,667	0	18,333	(3)	$37.29	11/16/2015					36,667	0	18,333	(3)	$37.29	11/16/2015
	14,667	0	29,333	(4)	$40.56	11/15/2016					14,667	0	29,333	(4)	$40.56	11/15/2016
									4,833 (10)	144,120									8,070 (10)	307,306
									8,070 (11)	240,647									8,820 (11)	335,866
							8,820 (5)	263,012	8,820 (12)	263,012							11,250 (5)	428,400	3,750 (12)	142,800
							11,250 (6)	335,475	3,750 (13)	111,825							7,500 (7)	285,600	5,000 (13)	190,400
							7,500 (8)	223,650	7,500 (14)	223,650							12,000 (8)	456,960	12,000 (14)	456,960
B.J. Dunn	5,000	0	0		$28.58	12/15/2013					5,000	0	0		$28.58	12/15/2013
	8,000	0	4,000	(3)	$36.03	11/16/2014					8,000	0	4,000	(3)	$36.03	11/16/2014
	10,667	0	5,333	(3)	$37.29	11/16/2015					10,667	0	5,333	(3)	$37.29	11/16/2015
	5,334	0	10,666	(4)	$40.56	11/15/2016					5,334	0	10,666	(4)	$40.56	11/15/2016
									1,800 (10)	53,676									4,500 (10)	171,360
									4,500 (11)	134,190									6,000 (11)	228,480
							6,000 (5)	178,920	6,000 (12)	178,920							4,500 (5)	171,360	1,500 (12)	57,120
							4,500 (6)	134,190	1,500 (13)	44,730							4,500 (7)	171,360	3,000 (13)	114,240
							4,500 (8)	134,190	4,500 (14)	134,190							7,500 (8)	285,600	7,500 (14)	285,600
S.D. Gackenbach							625 (7)	18,638	208 (15)	6,203							625 (6)	23,800	208 (15)	7,921
							3,000 (8)	89,460	3,000 (14)	89,460							3,000 (7)	114,240	2,000 (13)	76,160
																	8,100 (8)	308,448	8,100 (14)	308,448
B.D. Walters	8,333	0	4,167	(3)	$37.29	11/16/2015					8,333	0	4,167	(3)	$37.29	11/16/2015
	2,667	0	5,333	(4)	$40.56	11/15/2016					2,667	0	5,333	(4)	$40.56	11/15/2016
									1,100 (10)	32,802									1,800 (10)	68,544
									1,800 (11)	53,676									2,100 (11)	79,968
							2,100 (5)	62,622	2,100 (12)	62,622							4,500 (5)	171,360	1,500 (12)	57,120
							4,500 (6)	134,190	1,500 (13)	44,730							4,050 (7)	154,224	2,700 (13)	102,816
							4,050 (8)	120,771	4,050 (14)	120,771							4,500 (8)	171,360	4,500 (14)	171,360

	Grant Date								Percent of		Forfeiture
Grant	Grant Value		Stock Price		Stock Price Vesting Hurdles				Shares Earned		Date
2008		$575,244		$43.94		$48.34	$54.93	$61.52		33.3%		2013
2009		$811,710		$41.24		$45.37	$51.55	$57.74		0.0%		2014
2010		$829,635		$37.31		$41.05	$46.64	$52.24		0.0%		2015
2011		$985,250		$33.39		$35.06	$38.40	$41.74		66.7%		2016
2012		$570,700		$34.89		$36.63	$40.12	$43.61		0.0%		2017
Totals		3,772,539								22.5%

	Net Income		Economic Value Added		Relative Incentive %			Net Income		Economic Value Added		Relative Incentive %
Target	$	73,000	$	20,600		100	%	$	64,901	$	12,150		100	%
Minimum	$	65,700	$	18,540		50	%	$	58,411	$	9,720		50	%
Maximum	$	80,300	$	22,660		200	%	$	71,391	$	14,580		200	%

Named Executive Officer	Target Incentive Award as a Percent of Base Salary			Minimum Incentive Award as a Percent of Base Salary			Maximum Incentive Award as a Percent of Base Salary			Target Incentive Award as a Percent of Base Salary			Minimum Incentive Award as a Percent of Base Salary			Maximum Incentive Award as a Percent of Base Salary
J.C. Bartolacci		100	%		50	%		200	%		100	%		50	%		200	%
S.F. Nicola		70	%		35	%		140	%		70	%		35	%		140	%
S.D. Gackenbach		45	%		22.5	%		90	%		50	%		25	%		100	%
B.J. Dunn		55	%		27.5	%		115	%		55	%		27.5	%		110	%
B.D. Walters		40	%		20	%		80	%		40	%		20	%		80	%

Named Executive Officer	Base Salary		Target Incentive			Target Incentive Amount		Earned Incentive			Earned Incentive Amount		Base Salary		Target Incentive			Target Incentive Amount		Earned Incentive			Earned Incentive Amount
J.C. Bartolacci													$	705,000		100	%	$	705,000		78	%	$	552,368
S.F. Nicola													$	425,250		70	%	$	297,675		78	%	$	233,228
S.D. Gackenbach													$	345,000		50	%	$	172,500		166	%	$	286,730
B.J. Dunn	$	308,000		55	%	$	169,400		57	%	$	96,253	$	340,000		55	%	$	187,000		27	%	$	50,687
B.D. Walters													$	294,000		40	%	$	117,600		78	%	$	92,140

Name	Year	Amount Paid Under Current Year’s Award	Deferred Credits Under Awards made in Prior Years, Earned in the Current Year’s Award	Earnings on Deferred Credits	Total
J.C. Bartolacci	2012 2011 2010	$ - 948,800 749,795	N/A N/A $100,249	N/A N/A $1,005	$ - 948,800 851,049
S.F. Nicola	2012 2011 2010	- 394,345 299,168	N/A N/A 43,335	N/A N/A 434	- 394,345 342,937
B.J. Dunn	2012 2011 2010	96,253 225,751 101,437	N/A N/A -	N/A N/A -	96,253 225,751 101,437
S.D. Gackenbach	2012 2011	- 16,281	N/A N/A	N/A N/A	- 16,281
B.D. Walters	2012 2011 2010	- 140,096 79,291	N/A N/A 9,958	N/A N/A 100	- 140,096 89,349

Name	Plan Name	Number of Years Credited Service (#) (1)		Present Value of Accumulated Benefit ($) (2)		Payments During Last Fiscal Year ($)		Plan Name	Number of Years Credited Service (#) (1)		Present Value of Accumulated Benefit ($) (2)		Payments During Last Fiscal Year ($)
J.C. Bartolacci	Matthews International Corporation Employees Retirement Plan		14	$	321,740		-	Matthews International Corporation Employees Retirement Plan		15	$	294,464		-
	Matthews International Corporation Supplemental Retirement Plan		15		2,039,094		-	Matthews International Corporation Supplemental Retirement Plan		16		1,965,599		-
S.F. Nicola	Matthews International Corporation Employees Retirement Plan		18		417,911		-	Matthews International Corporation Employees Retirement Plan		19		376,801		-
	Matthews International Corporation Supplemental Retirement Plan		19		1,041,518		-	Matthews International Corporation Supplemental Retirement Plan		20		969,948		-
B.J. Dunn	Matthews International Corporation Employees Retirement Plan		12		329,284		-	Matthews International Corporation Employees Retirement Plan		13		319,393		-
	Matthews International Corporation Supplemental Retirement Plan		13		299,961		-	Matthews International Corporation Supplemental Retirement Plan		14		202,234		-
S.D. Gackenbach	Matthews International Corporation Employees Retirement Plan		-		7,629		-	Matthews International Corporation Employees Retirement Plan		1		15,948		-
B.D. Walters	Matthews International Corporation Employees Retirement Plan		6		82,749		-	Matthews International Corporation Employees Retirement Plan		7		70,710		-

Named Executive	Executive Benefit and Payment upon Separation	Voluntary Termination Without Consent		Voluntary Termination With Consent (1) (3) (4)		Involuntary Termination Without Cause		Involuntary Termination With Cause		Death or Disability (2) (3) (4)		Retirement (1) (3) (4)		Change in Control (2) (5) (6)		Executive Benefit and Payment upon Separation	Voluntary Termination Without Consent		Voluntary Termination With Consent (1) (3) (4)		Involuntary Termination Without Cause		Involuntary Termination With Cause		Death or Disability (2) (3) (4)		Retirement (1) (3) (4)		Change in Control (2) (5) (6)
J.C. Bartolacci	Stock Options	$	0	$	0	$	0	$	0	$	0	$	0	$	0	Stock Options	$	0	$	0	$	0	$	0	$	55,448	$	0	$	55,448
	Performance-based Restricted Shares		0		0		0		0		0		0		2,903,484	Performance-based Restricted Shares		0		714,000		0		0		714,000		714,000		4,446,487
	Time-based Restricted Shares		0		2,475,060		0		0		2,475,060		2,475,060		2,475,060	Time-based Restricted Shares		0		3,503,360		0		0		3,503,360		3,503,360		3,503,360
	Supplemental Retirement Plan		0		0		0		0		0		0		2,940,388	Supplemental Retirement Plan		0		0		0		0		0		0		5,227,591
	Total		0		2,475,060		0		0		2,475,060		2,475,060		8,318,932	Total		0		4,217,360		0		0		4,272,808		4,217,360		13,232,886

S.F. Nicola	Stock Options		0		0		0		0		0		0		0	Stock Options		0		0		0		0		43,345		0		43,345
	Performance-based Restricted Shares		0		0		0		0		0		0		983,255	Performance-based Restricted Shares		0		228,480		0		0		228,480		228,480		1,617,372
	Time-based Restricted Shares		0		822,137		0		0		822,137		822,167		822,167	Time-based Restricted Shares		0		1,170,960		0		0		1,170,960		1,170,960		1,170,960
	Supplemental Retirement Plan		0		0		0		0		0		0		1,496,058	Supplemental Retirement Plan		0		0		0		0		0		0		2,856,882
	Total		0		822,167		0		0		822,167		822,167		3,301,480	Total		0		1,399,440		0		0		1,442,785		1,399,440		5,688,559

B.J. Dunn	Stock Options		0		0		0		0		0		0		0	Stock Options		0		0		0		0		12,460		0		12,460
	Performance-based Restricted Shares		0		0		0		0		0		0		545,706	Performance-based Restricted Shares		0		142,800		0		0		142,800		142,800		856,800
	Time-based Restricted Shares		0		447,300		0		0		447,300		447,300		447,300	Time-based Restricted Shares		0		628,320		0		0		628,320		628,320		628,320
	Supplemental Retirement Plan		0		0		0		0		0		0		649,086	Supplemental Retirement Plan		0		0		0		0		0		0		1,100,241
	Total		0		447,300		0		0		447,300		447,300		1,642,092	Total		0		771,120		0		0		783,580		771,120		2,597,821

S.D .Gackenbach	Stock Options		0		0		0		0		0		0		0	Performance-based Restricted Shares		0		154,224		0		0		154,224		154,224		392,529
	Performance-based Restricted Shares		0		0		0		0		0		0		95,663	Time-based Restricted Shares		0		446,488		0		0		446,488		446,488		446,488
	Time-based Restricted Shares		0		108,098		0		0		108,098		108,098		108,098	Total		0		600,712		0		0		600,712		600,712		839,017
	Total		0		108,098		0		0		108,098		108,098		203,761

B.D. Walters	Stock Options		0		0		0		0		0		0		0	Stock Options		0		0		0		0		3,313		0		3,313
	Performance-based Restricted Shares		0		0		0		0		0		0		314,601	Performance-based Restricted Shares		0		85,680		0		0		85,680		85,680		479,808
	Time-based Restricted Shares		0		317,583		0		0		317,583		317,583		317,583	Time-based Restricted Shares		0		496,944		0		0		496,944		496,944		496,944
	Total		0		317,583		0		0		317,583		317,583		632,184	Total		0		582,624		0		0		585,937		582,624		980,065

1.~~Election of Directors~~
		~~FOR~~	~~WITHHOLD~~
	~~01 – Alvaro Garcia-Tunon~~	~~[ ]~~	~~[ ]~~
	~~02 – John P. O’Leary, Jr~~	~~[ ]~~	~~[ ]~~
	~~03 – Jerry R. Whitaker~~	~~[ ]~~	~~[ ]~~

	~~FOR~~	~~AGAINST~~	~~ABSTAIN~~
2. To approve the adoption of ~~the~~ ~~2012 Equity Incentive Plan~~		[ ]	[ ]	[ ]

	FOR	AGAINST	ABSTAIN
~~3. To ratify the appointment of~~ ~~PricewaterhouseCoopers LLP as the~~ ~~independent registered public accounting~~ ~~firm to audit the records of the Company for~~ ~~the fiscal year ending September 30, 2013.~~	~~[ ]~~	~~[ ]~~	~~[ ]~~