| | Annual Evaluation:The board annually conducts a self-evaluation to determine whether the board as a whole and its individual members, including the Chairman are performing effectively.
| | Committees of the Board of Directors and Certain Other Information Concerning the Board | | | | | | Committee Structure | | | | | | The Board has established four standing committees: the Audit Committee, the Executive Compensation & Development Committee, the Governance Committee, and the Executive Committee. Each Committee conducts an annual self-evaluation of performance and reviews compliance with the current charter of the committee. Copies of the committee charters can be found on our website atwww.wiley.com. | | | | | | The following table indicates current membership and total meetings of the Board and its standing committees: |
| | Name | | Board | | | Audit | | | Compensation | | | Executive | | | Governance | | | | Mari Jean Baker | | | X | | | | X | | | | X | | | | | | | | | | | | Linda P.B. Katehi | | | X | | | | | | | | | | | | | | | | X | | | | Matthew S. Kissner | | | X | | | | | | | | | | | | | | | | X* | | | | Raymond W. McDaniel, Jr. | | | X | | | | X* | | | | | | | | | | | | | | | | Eduardo Menascé | | | X | | | | | | | | X* | | | | X* | | | | | | | | William J. Pesce | | | X | | | | | | | | | | | | X | | | | X | | | | William B. Plummer | | | X | | | | X | | | | | | | | X | | | | | | | | Kalpana Raina | | | X | | | | | | | | X | | | | | | | | | | | | Stephen M. Smith | | | X | | | | | | | | | | | | X | | | | X | | | | Jesse Wiley | | | X | | | | | | | | | | | | | | | | X | | | | Peter Booth Wiley | | | X* | | | | | | | | | | | | | | | | | | | | FY2014 Meetings | | | 9 | | | | 6 | | | | 5 | | | | 1 | | | | 4 | |
Name | | Board | | Audit | | Compensation | | Executive | | Governance | Mari Jean Baker | | | X | | | | | | | | X | | | | | | | | | | Jean-Lou Chameau | | | X | | | | X | | | | | | | | | | | | | | Linda P.B. Katehi | | | X | | | | | | | | | | | | | | | | X | | Matthew S. Kissner | | | X | | | | | | | | | | | | | | | | X | * | Raymond W. McDaniel, Jr. | | | X | | | | X | | | | | | | | | | | | | | Eduardo Menascé | | | X | | | | | | | | X | * | | | X | * | | | | | William J. Pesce | | | X | | | | | | | | | | | | X | | | | | | William B. Plummer | | | X | | | | X | | | | | | | | X | | | | | | Kalpana Raina | | | X | | | | | | | | X | | | | | | | | | | Stephen M. Smith | | | X | | | | | | | | | | | | X | | | | X | | Jesse Wiley | | | X | | | | | | | | | | | | | | | | X | | Peter Booth Wiley | | | X | | | | | | | | | | | | | | | | | | FY2012 Meetings | | | 7 | (a) | | | 7 | | | | 5 | (b) | | | 5 | | | | 5 | |
* | | * Committee Chairman | | | | | | | (a) | The Board acted once by Unanimous Written Consent. | | | (b) | The Executive Compensation and Development Committee acted twice by Unanimous Written Consent. |
During Fiscal 2013,2014, all of the Directors attended at least 75% of the meetings of the Board of Directors and the respective committees of the Board of Directors of which they were a member. | | | | | | Executive Committee.The Executive Committee exercises the powers of the Board as appropriate in any case where immediate action is required and the matter is such that an emergency meeting of the full Board is not deemed necessary or possible. | | | | | | Audit Committee.The Audit Committee assists the Board in fulfilling its fiduciary responsibilities relating to the Company’s financial statements filed with the Securities and Exchange Commission, accounting policies, and the adequacy of disclosures, internal controls and reporting practices of the Company and its subsidiaries; reviews Company policies with respect to risk management and risk assessment; evaluates, retains, compensates and, if appropriate, terminates the services of the independent public accounting firm which is to be engaged to audit the Company’s financial statements, including reviewing and discussing with such firm their independence and whether providing any permitted non-audit services is compatible with their independence; maintains financial oversight of the Company’s employees’ retirement and other benefit plans and makes recommendations to the Board with respect to such matters; and reviews and approves related party transactions. The Committee holds discussions with management prior to the release of quarterly earnings, and also reviews quarterly results prior to filings. | | | | | | The Board has determined that all members of the Committee except Jean-Lou Chameau are Audit Committee “financial experts,” as defined under the rules of the Securities and Exchange Commission. All members of the Committee are independent under the rules of the New York Stock Exchange currently applicable to the Company.
| | Executive Compensation and Development Committee.The Executive Compensation and Development Committee evaluates the performance of the CEO and reports its decisions to the Board; reviews and approves the principles and policies for compensation and benefit programs | |
| | company-wide, and monitors the implementation and administration of such programs; oversees compliance with governmental regulations and accounting standards with respect to employee compensation and benefit programs; monitors executive development practices in order to insure succession alternatives for the organization; and grants options and makes awards under the 2009 Key Employee Stock Plan. All members of the Committee are independentoutside directors as defined by Treasury Regulation Section 1.162-27(e)(3) under the rulesSection 162 (M) of the New York Stock Exchange, currently applicable to the Company.Internal Revenue Code. | | | | | | Governance Committee.The Governance Committee assists the Board in the selection of Board members by identifying appropriate general qualifications and criteria for directors as well as qualified candidates for election to the Board; assists the Chairman of the Board in proposing committee assignments; assists the Board in evaluating, maintaining and improving its own effectiveness; evaluates the Chairman of the Board’s performance; evaluates director compensation and benefits; and makes recommendations to the Board regarding corporate governance policies. | | | | | | Shareholders who wish to recommend a director candidate to the Governance Committee should follow the procedures set forth under “Deadline for Submission of Shareholder Proposals” on page 5164 of this proxy statement. The recommendation should include the candidate’s name, biographical data, and a description of his or her qualifications. | | | | | | Board and Committee Oversight of Risk As a publishing company, the Company does not face the same level of risk associated with other companies, for example companies in the financial services and technology industries. However, appropriate risk-taking is a necessary part of managing any business.
| | | | | | Management of risk is the direct responsibility of the Company’s President & CEO and the senior leadership team. The Board has oversight responsibility, focusing on the adequacy of the Company’s risk management and risk mitigation processes. | | | | | | The Company’s Board of Directors administers its risk oversight function directly and through its Audit Committee and Executive Compensation & Development Committee. The Board receives regular reports from these committees, which include reports on those areas over which they have risk oversight responsibility, as appropriate. | | | | | | Audit Committee:The Audit Committee has oversight responsibility for Enterprise Risk Management (ERM), and specifically, oversight of major financial risk exposures, including litigation and compliance risk and the steps management has taken to monitor and mitigate such exposures. The Committee also receives regular updates from management, including the General Counsel, on litigation risk. | | | | | | Executive Compensation & Development Committee:The Executive Compensation & Development Committee has oversight responsibility for the management of risk relating to the Company’s annual and long-term compensation program. The Committee ensures that the Company’s annual and long-term incentive plans do not incentivize or encourage excessive or unnecessary risk-taking. | | | | | | How Do We Address Risk in Our Compensation Program? | | | | | | The Company’s compensation program is designed to attract, retain, motivate and reward talented executives and colleagues whose efforts will enable the Company to produce superior results and maximize return to shareholders. Our pay-for-performance philosophy focuses colleagues’ efforts on delivering short-term and long-term financial success for our shareholders without encouraging excessive risk taking. The Executive Compensation & Development Committee, which consists entirely of independent Board members, oversees the executive compensation program for the named executive officers, as well as other senior officers of the Company. | | | | | | The following is a description of both Committee and management processes related to the compensation risk assessment process, as well as a description of the Company’s compensation risk mitigation techniques. | | The Executive Compensation & Development Committee reviews and approves the annual and long-term plan performance measures and goals annually. This includes setting appropriate threshold and outstanding performance levels for each performance metric. As a part of this process, the Committee focuses on what behavior it is attempting to incentivize and the potential associated risks. The Committee periodically receives financial information from the Chief Financial Officer, and information on accounting matters that may have an impact on the performance goals, including any material changes in accounting methodology and information about extraordinary/special items excluded in the evaluation of performance, as permitted by the 2009 Executive Annual Incentive Plan and the 2009 Key Employee Stock Plan (i.e. the shareholder plans), so that the Committee members may understand how the exercise of management judgment in accounting and financial decisions affects plan payouts.pay-outs. Members of the Executive Compensation & Development Committee approve the final incentive compensation awards after reviewing executive, corporate and business performance, and may utilize negative discretion if they believe the level of compensation is not commensurate with performance. | | | | | | The following compensation policies and practices serve to reduce the likelihood of excessive risk taking: |
| · | | | ● | An appropriate compensation mix that is designed to balance the emphasis on short-term and long-term performance. |
| · | | | | | | | | | ● | The majority of incentive compensation for top level executives is associated with the long term performance of the Company. This discourages short-term risk taking. |
| · | The mix of stock options and restricted performance shares | | | | | | | | | ● | The mix of stock options, restricted performance share units and restricted share units used in our executive long-term plans ensure a correlation between executive and shareholder rewards. |
| · | Conservative vesting provisions (5 year) for all performance shares and stock options | | | | | | | | | ● | Conservative vesting provisions (5 year) for all equity awards granted under our long-term incentive plans. |
| · | | | | | | | | | ● | Financial performance measures used for incentive plans covering colleagues at all levels of the Company include a mix of financial metrics that are in line with operating and strategic plans. |
| · | | | | | | | | | ● | A significant portion of annual and long-term incentive payments are based on Company and business profitability, ensuring a correlation between pay and performance. |
| · | | | | | | | | | ● | Financial targets are appropriately set, and if not achieved, result in a large percentage loss of compensation. |
| · | | | | | | | | | ● | Executive and broad-based incentive plans cap the maximum award payable to any individual. Annual and long-term incentive plans have a maximum payout of 1.5 times the target amount. |
| · | | | | | | | | | ● | Recoupment or “clawback” provisions for top executives and key finance executives in the event that an executive’s conduct leads to a restatement of the Company’s financial results. |
| · | | | | | | | | | ● | Stock ownership guidelines and stock retention requirements for our named executive officers, other senior officers and directors discourage excessive risk taking. |
| | We are confident that our compensation program rewards for performance, is aligned with the interests of our shareholders and does not involve risks that are reasonably likely to have a material adverse effect on the company. A more detailed discussion of the Company’s executive compensation program can be found in the Compensation Discussion and Analysis beginning on page 22.32. | | | | | | Transactions with Related Persons | | | | | | We are required to disclose material transactions with the Company in which “related persons” have a direct or indirect material interest. Related persons include any Director, nominee for Director, executive officer of the Company, and any immediate family members of such persons. The term “transaction” is broadly defined under Securities and Exchange
Commission rules to include any financial transaction, arrangement or relationship, including any indebtedness transaction or guarantee of indebtedness. |
| | Based on information available to us and provided to us by our Directors and executive officers, we do not believe that there were any such material transactions in effect since May 1, 2012,2013, or that any such material transactions are proposed to be entered into during fiscal 2014.2015. | | | | | | The Company’s Board of Directors has adopted a written policy that requires the Audit Committee to review and approve any related party transactions. Management is expected to provide the Audit Committee with specific information with respect to any such transaction expected to be entered into or continued during the current fiscal year. After reviewing this information, the Audit Committee will approve such transactions only if the following two conditions are met: (1) the transaction must be in the best interests of the Company and its shareholders; and (2) the transaction must be entered into by the Company on terms that are comparable to those that would be obtained in an arm’s length transaction with an unrelated third party. | | | | | | Corporate Governance Principles | | | | | | To promote the best corporate governance practices, the Company adheres to the Corporate Governance Principles set forth below, many of which have been in effect for more than a decade. The Board of Directors and management believe that these Principles, which are consistent with the requirements of the Securities and Exchange Commission and the New York Stock Exchange, are in the best interests of the Company, its shareholders and other shareholders, including employees, authors, customers and suppliers. The Board is responsible for ensuring that the Company has a management team capable of representing these interests and of achieving superior business performance. | | | | | | Pursuant to the New York Stock Exchange’s Corporate Governance regulations, the Company is considered a “controlled company,” defined as a company where more than 50 percent of the voting power is held by an individual, a group, or another company. As such, the Company would be exempt from certain corporate governance standards. However, the Board believes it is in the best interest of the Company and its shareholders to abide by all of the regulations, except for the requirement that the Governance Committee be comprised of independent directors only. The Board has chosen to take an exemption to this requirement because it believes that a Wiley family member’s participation on this Committee will result in a collaborative process to promote the highest standards in the recruitment of new directors and in governance generally. | | | | | | I. Primary Duties | | | | | | The Board, which is elected annually by the shareholders, exercises oversight and has final authority and responsibility with respect to the Company’s affairs, except with respect to those matters reserved to shareholders. All major decisions are considered by the Board as a whole. | | | | | | The Board elects the Chief Executive Officer (“CEO”) and other corporate officers, acts as an advisor to and resource for management, and monitors management’s performance. | | | | | | The Board plans for the succession of the CEO. The Executive Compensation and Development Committee annually evaluates the CEO’s performance, approves the CEO’s compensation, and informs the Board of its decisions. The Board also oversees the succession process for certain other management positions, and the CEO reviews with the Board annually his assessment of key management incumbents and their professional growth and development plans. The Board also: |
| | | a) | reviews the Company’s business and strategic plans and actual operating performance; |
| | | | | | | | b) | reviews and approves the Company’s financial objectives, investment plans and programs; and |
| c) | provides oversight of internal and external audit processes and financial reporting. | | | | | |
15 | | | | c) | provides oversight of internal and external audit processes and financial reporting. |
| | II. Director Independence | | | | | | The Board has long held that it is in the best interests of the Company for the Board to consist of a substantial majority of independent Directors. The Board annually determines that a Director is independent if he or she has no material relationship, either directly or indirectly, with the Company, defined as follows: |
| | | a) | The Director is not and has not been employed in an executive capacity by the Company or its subsidiaries within the three years immediately prior to the annual meeting at which the nominees of the Board will be voted upon. |
| | | | | | | | b) | The Director is not a significant advisor or consultant to the Company (including its subsidiaries); does not have direct, sole responsibility for business between the Company and a material supplier or customer; and does not have a significant personal services contract with the Company. |
| | | | | | | | c) | The Director is not an executive officer, an employee, and does not have an immediate family member who is an executive officer or employee, of an organization that makes payments to, or receives payments from, the Company in an amount which, in any single fiscal year, exceeds 2% of such other organization’s consolidated gross revenues. |
| | | | | | | | d) | The Director is not, and has not been within the past three years, employed by or affiliated with a firm that provided independent audit services to the Company; the Director is not, and does not have an immediate family member who is a current partner of the firm that is the Company’s external auditor; and the Director or an immediate family member was not within the past three years a partner or employee of the Company’s external audit firm and personally worked on the Company’s audit within that time. |
| | | | | | | | e) | The Director is not, and has not been in the past three years, part of an interlocking directorship involving compensation committees; and |
| | | | | | | | f) | The Director is not a member of the immediate family of Peter Booth Wiley, Bradford Wiley II, Deborah E. Wiley and Jesse Wiley, or management, as listed in the Company’s proxy statement. |
| | When determining the independence of a Director, the ownership of, or beneficial interest in, a significant amount of stock, by itself, is not considered a factor. | | | | | | III. Composition of the Board | | | | | | Under the Company’s By-Laws, the Board has the authority to determine the appropriate number of directors to be elected so as to enable it to function effectively and efficiently. The Governance Committee makes recommendations to the Board concerning the appropriate size of the Board, as well as selection criteria for candidates. Each candidate is selected based on background, experience, expertise, and other relevant criteria, including other public and private company boards on which the candidate serves. In addition to the individual candidate’s background, experience and expertise, the manner in which each board member’s qualities complement those of others and contributes to the functioning of the Board as a whole are also taken into account. The Governance Committee nominates a candidate, and the Board votes on his or her candidacy. The shareholders vote annually for the entire slate of Directors. | | | | | | Any nominee Director who receives a greater number of “withheld” votes from his or her election than “for” votes shall tender his or her resignation for consideration by the Governance Committee. The Governance Committee shall recommend to the Board the action to be taken with respect to such resignation. | | | | | | IV. Director Eligibility | | | | | | Directors shall limit the number of other board memberships in order to insure adequate attention to Company business. Prior to joining the board of another organization, including a public or private company, as well as a not-for profit organization, directors are required to advise the Chairman of the Board, the Chair of the Governance Committee and the President
| | and Chief Executive Officer so that a review can be performed to ensure that there are no conflicts of interest or other issues. While the Board of Directors does not believe it appropriate to establish an arbitrary limit on the number of outside boards upon which a Director may serve, the Board (based on the review and recommendation of the Governance Committee), has the responsibility to evaluate each situation and approve membership. | | | | | | Whenever there is a substantial change in the Director’s principal occupation, a Director shall tender his or her resignation and shall immediately inform the Board of any potential conflict of interest. The Governance Committee will recommend to the Board the action, if any, to be taken with respect to the resignation or the potential conflict of interest. | | | | | | The Board has established a retirement age of 70 for its Directors. The Board may, in its discretion, nominate for election a person who has attained age 70 if it believes that under the circumstances it is in the Company’s best interests. | | | | | | V. Board and Management Communication | | | | | | The Board has access to all members of management and external advisors. As appropriate, the Board may retain independent advisors. | | | | | | The CEO shall establish and maintain effective communications with the Company’s shareholder groups. The Board schedules regular executive sessions at the end of each meeting. Non-management directors meet at regularly scheduled sessions without management. The Chairman of the Board presides at these sessions. In addition, the independent directors meet at least once each year in an executive session presided over by the Chairman of the Governance Committee. | | | | | | Employees and other interested parties may contact the non-management directors via email at: non-managementdirectors@wiley.com, or by mail addressed to Non-Management Directors, John Wiley & Sons, Inc., Mail Stop 9-12, 111 River Street, Hoboken, NJ 07030-5774 | | | | | | VI. Board Orientation and Evaluation | | | | | | The Board annually conducts a self-evaluation to determine whether the Board as a whole and its individual members, including the Chairman, are performing effectively. | | | | | | The Board sponsors an orientation process for new Directors, which includes background materials on governance, law, board principles, financial and business history and meetings with members of management. The Board also encourages all of its Directors to take advantage of educational programs to improve their effectiveness. | | | | | | VII. Director Compensation | | | | | | The Governance Committee periodically reviews and recommends to the Board its members’ annual retainer, which is composed of cash and stock grants for all non-employee Directors. In determining the appropriate amount and form of director compensation, the Board regularly evaluates current trends and compensation surveys, as well as the amount of time devoted to Board and committee meetings. As a long-standing Board principle, non-employee Directors receive no compensation from the Company other than for their service as Board members and reimbursement for expenses incurred in connection with attendance at meetings. | | | | | | Share ownership by each Director is encouraged. To this end, each Director is expected to own, at a date no later than three years after election to the Board, shares of Wiley common stock valued at not less than three times that Director’s annual cash compensation to which the Director is entitled for Board service. | | | | | | VIII. Board Practices and Procedures | | | | | | The Chairman of the Board and the CEO jointly set the agenda for each Board meeting. Agenda items that fall within the scope and responsibilities of Board committees are reviewed with the chairs of the committees. Any Board member may request that an item be added to the agenda.
| | Board materials are provided to Board members sufficiently in advance of meetings to allow Directors to prepare for discussion at the meeting. | | | | | | Various managers regularly attend portions of Board and committee meetings in order to participate in and contribute to relevant discussions. | | | | | | Beneficial Ownership of Directors and Management | | | | | | The table below shows the number of shares of the Company’s Class A and Class B Stock beneficially owned by the current directors, director nominee, and the executive officers named in the Summary Compensation Table on page 3348 and all directors and executive officers of the Company as a group as of July 23, 2013.22, 2014. The percent of total voting power reflected below represents the voting power on all matters other than the election of directors, as described on page 3. | | | | | | Section 16(a) Beneficial Ownership Reporting Compliance | | Shares of | | | | | | | | | | | Percent | | | | | Class A and | | | Additional | | | | | | | | of | | | | | Class B Stock | | | Shares | | | | | | Percent | | Total | Deferred | | | | Beneficially | | | Beneficially | | | | | | of | | Voting | Stock | | | | Owned(1) | | | Owned(2) | | | Totals | | | Class(1) | | Power | Units(3) | | Mark Allin(4) | | A | 5,844 | | | | 20,847 | | | | 26,691 | | | | .05 | % | | | — | | | | — | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Mari Jean Baker | | A | — | | | | — | | | | — | | | | — | | | | — | | | | 2,712 | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Ellis E. Cousens(4) | | A | 89,405 | | | | 195,000 | | | | 284,405 | | | | .18 | % | | | — | | | | — | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Jean-Lou Chameau | | A | — | | | | — | | | | — | | | | — | | | | — | | | | 3,186 | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Linda P.B. Katehi | | A | — | | | | — | | | | — | | | | — | | | | — | | | | 2,712 | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Matthew S. Kissner | | A | — | | | | — | | | | — | | | | — | | | | — | | | | 18,774 | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Raymond W. McDaniel, Jr. | | A | 500 | | | | — | | | | 500 | | | | — | | | | — | | | | 17,039 | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Eduardo Menascé | | A | — | | | | — | | | | — | | | | — | | | | — | | | | 7,892 | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Steven J. Miron(4) | | A | 6,037 | | | | 23,400 | | | | 29,437 | | | | .01 | % | | | — | | | | — | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | William J. Pesce | | A | 111,375 | | | | — | | | | 111,375 | | | | .22 | % | | | — | | | | — | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | William B. Plummer | | A | — | | | | — | | | | — | | | | — | | | | — | | | | 27,054 | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Stephen M. Smith(4) | | A | 48,268 | | | | 17,205 | | | | 65,473 | | | | .1 | % | | | — | | | | — | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Kalpana Raina | | A | — | | | | — | | | | — | | | | — | | | | — | | | | 5,871 | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Gary Rinck(4) | | A | 35,634 | | | | 100,000 | | | | 135,634 | | | | .07 | % | | | — | | | | — | | | | B | — | | | | — | | | | — | | | | — | | | | — | | | | — | | Jesse Caleb Wiley | | A | — | | | | — | | | | | | | | | | | | | | | | — | | | | B | 800 | | | | — | | | | 800 | | | | | | | | | | | | — | | Peter Booth Wiley(5)(6)(7) | | A | 1,346,483 | | | | — | | | | 1,346,483 | | | | 2.7 | % | | | 0.9 | % | | | — | | | | B | 2,720,752 | | | | — | | | | 2,720,752 | | | | 29 | % | | | 19 | % | | | — | | All directors and executive | | A | 4,663,529 | | | A | 901,355 | | | A | 5,564,884 | | | | 11 | % | | | 3.8 | % | | | — | | officers as a group | | | | | | | | | | | | | | | | | | | | | | | | | (29 persons) | | B | 8,292,369 | | | | — | | | B | 8,292,369 | | | | 87 | % | | | 58 | % | | | — | |
(1) | This table is based on the information provided by the individual directors or executives. In the table, percent of class was calculated on the basis of the number of shares beneficially owned as determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, divided by the total number of shares issued and outstanding plus the number of shares of the class issuable to the individual director or executive officer pursuant to the options exercisable under the Company’s stock option plans on or before September 23, 2013. |
| | | | Shares of Class A and Class B Stock Beneficially Owned(1) | | Additional Shares Beneficially Owned(2) | | Totals | | Percent of Class(1) | | Percent of Total Voting Power | | Deferred Stock Units(3) | | | Mark Allin(4) | | A | 8,492 | | | 38,932 | | | 48,242 | | .09 | % | | — | | | — | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | Mari Jean Baker | | A | — | | | — | | | — | | — | | | — | | | 4,344 | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | George Bell | | A | — | | | — | | | | | — | | | — | | | | | | | | B | — | | | — | | | — | | — | | | — | | | | | | Ellis E. Cousens | | A | 126,211 | | | 97,500 | | | 223,711 | | .46 | % | | — | | | — | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | Linda P.B. Katehi | | A | — | | | — | | | — | | — | | | — | | | 4,344 | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | Matthew S. Kissner | | A | — | | | — | | | — | | — | | | — | | | 20,711 | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | John Kritzmacher | | A | 12,500 | | | — | | | 12,500 | | .03 | % | | — | | | — | | | | | B | — | | | — | | | — | | — | | | — | | | | | | Raymond W. McDaniel, Jr. | | A | 500 | | | — | | | 500 | | — | | | — | | | 18,943 | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | Eduardo Menascé | | A | — | | | — | | | — | | — | | | — | | | 9,623 | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | Steven J. Miron(4)(8) | | A | 13,026 | | | — | | | 13,026 | | .042 | % | | — | | | — | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | William J. Pesce | | A | 61,275 | | | — | | | 61,275 | | .12 | % | | — | | | — | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | William B. Plummer | | A | — | | | — | | | — | | — | | | — | | | 30,621 | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | Stephen M. Smith(4) | | A | 85,376 | | | 202,495 | | | 287,871 | | .62 | % | | — | | | — | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | Kalpana Raina | | A | — | | | — | | | — | | — | | | — | | | 7,564 | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | Gary Rinck(4) | | A | 37,358 | | | 72,500 | | | 109,858 | | .23 | % | | — | | | — | | | | | B | — | | | — | | | — | | — | | | — | | | — | | | Jesse Caleb Wiley | | A | — | | | — | | | — | | — | | | — | | | — | | | | | B | 800 | | | — | | | 800 | | — | | | — | | | — | | | Peter Booth Wiley(5)(6)(7) | | A | 1,346,483 | | | — | | | 1,346,483 | | 2.7 | % | | 0.9 | % | | — | | | | | B | 2,727,154 | | | — | | | 2,727,154 | | 29 | % | | 19 | % | | — | | | All directors and executive | | A | 1,764,210 | | A | 472,702 | | A | 2,236,912 | | 5.4 | % | | 3.8 | % | | — | | | officers as a group | | | | | | | | | | | | | | | | | | | | (29 persons) | | B | 8,311,074 | | | — | | B | 8,311,074 | | 87 | % | | 58 | % | | — |
| | | | | | (1) | This table is based on the information provided by the individual directors or executives. In the table, percent of class was calculated on the basis of the number of shares beneficially owned as determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, divided by the total number of shares issued and outstanding plus the number of shares of the class issuable to the individual director or executive officer pursuant to the options exercisable under the Company’s stock option plans on or before September 22, 2014. |
| | (2) | Shares issuable pursuant to options exercisable under the Company’s stock option plans on or before September 23, 2013. | | Shares issuable pursuant to options exercisable under the Company’s stock option plans on or before September 22, 2014. | | | | (3) | This amount represents the number of shares of Class A Common Stock credited to the participating director’s account pursuant to the Deferred Compensation Plan for Directors’ Fees, described on pages 49-50. The shares will be issued upon the director’s retirement. | | | (4) | Includes Class A shares of restricted stock subject to forfeiture awarded under the Company’s long-term incentive plans as follows: Mr. Allin—22,500 shares; Mr. Cousens—62,602 shares; Mr. Smith—91,474 shares; Mr. Miron—18,260 shares and Mr. Rinck—29,988 shares. | | | (5) | Peter Booth Wiley, as co-member with Bradford Wiley II and Deborah E. Wiley, of the E.P. Hamilton Trusts LLC, share voting and investment power with respect to 462,338 shares of Class A Stock and 8,125,536 shares of Class B Stock. For purposes of this table, each is shown as the owner of one-third of such shares. | | | (6) | Peter Booth Wiley, as co-trustee with Bradford Wiley II and Deborah E. Wiley, share voting and investment power with respect to 55,072 shares of Class A Stock and 36,720 shares of Class B Stock under the Trust of Esther B. Wiley. For purposes of this table, each is shown as the owner of one-third of these shares. | | | | | (3) | This amount represents the number of shares of Class A Common Stock credited to the participating director’s account pursuant to the Deferred Compensation Plan for Directors’ Fees, described on page 61. The shares will be issued upon the director’s retirement. | | | | | | | (4) | Includes Class A shares of restricted stock subject to forfeiture awarded under the Company’s long-term incentive plans as follows: Mr. Allin, 5,545 shares; Mr. Kritzmacher, 12,500 shares; Mr. Miron 3,245 shares and Mr. Rinck 6,394 shares and Mr. Smith, 38,347 shares. | | | | | | | (5) | Peter Booth Wiley, as co-member with Bradford Wiley II and Deborah E. Wiley, of the E.P. Hamilton Trusts LLC, share voting and investment power with respect to 462,338 shares of Class A Stock and 8,125,536 shares of Class B Stock. For purposes of this table, each is shown as the owner of one-third of such shares. | | | | | | | (6) | Peter Booth Wiley, as co-trustee with Bradford Wiley II and Deborah E. Wiley, share voting and investment power with respect to 55,072 shares of Class A Stock and 36,720 shares of Class B Stock under the Trust of Esther B. Wiley. For purposes of this table, each is shown as the owner of one-third of these shares. | | | | | | (7) | Peter Booth Wiley, as general partner of a limited partnership with Bradford Wiley II and Deborah E. Wiley, share voting and investment power with respect to 301,645 shares of Class A Stock owned by the partnership. For purposes of this table, each is shown as the owner of one-third of such shares. |
| | | | | | (8) | Includes 920 shares of Common Class A shares held in 401(k) plan. | | | | | | | Section 16(a) of the Securities Exchange Act of 1934 requires the Company’s officers and directors, and persons who own more than ten percent of a registered class of the Company’s equity securities, to file reports of ownership and changes in ownership with the Securities and Exchange Commission and the New York Stock Exchange. Officers, directors and greater than ten percent shareholders are required by SEC regulation to furnish the Company with copies of all Section 16(a) forms they file. | | | | | | Based on our review we believe that during fiscal 2013,2014, our directors, officers and greater than ten percent beneficial owners met all filing requirements except for a late filings of a Forms 4 for Mr. Semel,Mr.Plummer, which was filed late due to administrative error. | | | | | | REPORT OF THE AUDIT COMMITTEE | | | | | | The following is the report of the Audit Committee of the Company with respect to the Company’s audited financial statements for the fiscal year ended April 30, 2013.2014. | | | | | | Fees of Independent Auditor | | | | | | Audit Fees | | | | | | Total aggregate fees billed by KPMG LLP (“KPMG”) for professional services in connection with the audit and review of the Company’s Consolidated Financial Statements, and statutory audits of the Company’s international subsidiaries were $2,124,000$2,379,000 and $2,242,000$2,124,000 in fiscal years 2014 and 2013, and 2012, respectively. | | | | | | Audit Related Fees | | | | | | The aggregate fees billed for audit related services, including due diligence related to acquisitions, employee benefit plan audits and consultation on acquisitions were $105,400$106,900 and $103,000$105,000 in fiscal years 2014 and 2013, and 2012, respectively. | | | | | | Tax Fees | | | | | | The aggregate fees billed for services rendered by KPMG tax personnel, except those services specifically related to the audit of the financial statements, were $270,000$307,000 and $350,000$270,000 in fiscal years 20132014 and 2012,2013, respectively. Such services include tax planning, tax return reviews, advice related to acquisitions, tax compliance and compliance services for expatriate employees.
| | Other Non-Audit Fees | | | | | | The aggregate non-audit fees were $0 and $182,000$0 in fiscal years 2014 and 2013, and 2012, respectively. | | | | | | The Audit Committee has advised the Company that in its opinion the services rendered by KPMG LLP are compatible with maintaining their independence. | | | | | | The Audit Committee is responsible for oversight of the Company’s accounting, auditing and financial reporting process on behalf of the Board of Directors. The Committee consists of three members who, in the judgment of the Board of Directors, are independent and financially literate, as those terms are defined by the Securities and Exchange Commission (the “SEC”) and the listing standards of the New York Stock Exchange (the “NYSE”). The Board of Directors has determined that all the members of the Committee satisfy the financial expertise requirements and have the requisite experience to be designated “audit committee financial experts” as that term is defined by the rules of the SEC and NYSE. | | | | | | Management has the primary responsibility for the preparation, presentation and integrity of the financial statements of the Company; for maintaining appropriate accounting and financial reporting policies and practices; and for internal controls and procedures designed to assure compliance with generally accepted US accounting standards and applicable laws and regulations. The Committee is responsible for the oversight of these processes. In this fiduciary capacity, the Committee has held discussions with management and the independent auditors regarding the fair and complete presentation of the Company’s results for the fiscal year ended April 30, 2013.2014. Management has represented to the Committee that the Company’s financial statements were prepared in accordance with generally accepted US accounting principles. The Committee has discussed with the independent auditors significant accounting principles and judgments applied by management in preparing the financial statements as well as alternative treatments. The Committee discussed with the independent auditors matters required to be discussed by Statement on Auditing Standards No. 61 (Communication with Audit Committees). | | | | | | The Audit Committee has had discussions with, and received regular status reports from, the independent auditors and the Vice President of Internal Audit regarding the overall scope and plans for their audits of the Company, including their scope and plans over management’s assessment of the effectiveness of internal control over financial reporting. The independent auditors provided the Audit Committee with written disclosures and the letter required by applicable professional and regulatory standards relating to KPMG’s independence from the Company, including the Public Company Accounting Oversight Board pertaining to the independent accountant’s communication with the Audit Committee concerning independence, and the Audit Committee discussed with the independent auditors their independence. | | | | | | The Committee also considers whether providing non-audit services is compatible with maintaining the auditor’s independence. The Audit Committee has adopted a policy of pre-approving all audit and non-audit services performed by the independent auditors. The Audit Committee may delegate authority to one or more of its members to grant pre-approvals of non-audit services, provided that the pre-approvals are presented to the Audit Committee for ratification at its next scheduled meeting. | | | | | | Persons with complaints or concerns about accounting, internal controls or auditing matters may contact the Audit Committee by addressing a letter to: Chairman of the Audit Committee, John Wiley & Sons, Inc., P. O. Box 1569, Hoboken, NJ 07030-5774. | | | | | | Based upon the review and discussions referred to above, the Committee recommended to the Company’s Board of Directors that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended April 30, 2013,2014, as filed with the Securities and Exchange Commission. | | | | | | Audit Committee | | | | | | Raymond W. McDaniel, Jr., Chairman, Jean-Lou Chameau,Mari Jean Baker, William B. Plummer
| EXECUTIVE COMPENSATION Report of the Compensation Committee The Executive Compensation & Development Committee has reviewed and discussed with Company management the Compensation Discussion and Analysis found on pages 2232 through 4961 of this Proxy Statement. Based on this review and discussion, the Executive Compensation and Development Committee has recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the Company’s Annual Report on Form 10-K and this Proxy Statement. Eduardo Menascé, Chairman
Mari Jean Baker
Kalpana Raina Compensation Committee Interlocks No member of the Executive Compensation & Development Committee has served as one of our officers or employees at any time. None of our executive officers serves as a member of the compensation committee of any other company that has an executive officer serving as a member of our Board of Directors. None of our executive officers serves as a member of the board of directors of any other company that has an executive officer serving as a member of our Board’s Executive Compensation and Development Committee. Performance Graph
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| | | | | | | | | | | | | | | | | | | | | | | 2009 | | | 2010 | | | 2011 | | | 2012 | | | 2013 | | | 2014 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | John Wiley & Sons, Inc. Class A | | $ | 100.00 | | | $ | 126.54 | | | $ | 154.71 | | | $ | 139.63 | | | | $120.62 | | | $ | 185.29 | | | Russell 1000 | | | 100.00 | | | | 137.38 | | | | 159.06 | | | | 162.21 | | | | 185.99 | | | | 220.24 | | | Dow Jones Publishing Index | | | 100.00 | | | | 132.93 | | | | 157.07 | | | | 158.19 | | | | 169.72 | | | | 220.68 | | | S&P 400 Midcap | | | 100.00 | | | | 146.68 | | | | 180.93 | | | | 176.66 | | | | 206.73 | | | | 241.64 | |
| | 2008 | | | 2009 | | | 2010 | | | 2011 | | | 2012 | | | 2013 | | | | | | | | | | | | | | | | | | | John Wiley & Sons, Inc. Class A | | $ | 100.00 | | | $ | 74.70 | | | $ | 94.52 | | | $ | 115.57 | | | $ | 104.31 | | | $ | 90.08 | Russell 1000 | | | 100.00 | | | | 63.07 | | | | 86.64 | | | | 100.32 | | | | 102.31 | | | | 117.31 | Dow Jones Publishing Index | | | 100.00 | | | | 64.33 | | | | 85.51 | | | | 101.04 | | | | 101.76 | | | | 109.17 | S&P 400 Midcap | | | 100.00 | | | | 66.89 | | | | 98.12 | | | | 121.03 | | | | 118.18 | | | | 138.29 |
| The above graph provides an indicator of the cumulative total return to shareholders of the Company’s Class A Common Stock as compared with the cumulative total return on the Russell 1000, the Dow Jones Publishing Index and the S&P 400 Midcap, for the period from April 30, 20082009 to April 30, 2013.2014. The Company has elected to use the Russell 1000 Index and the S&P 400 Midcap index as its broad equity market indices because it is currently included in these indices. Cumulative total return assumes $100 invested on April 30, 20082009 and reinvestment of dividends throughout the period.
| | FY2013FY2014 Compensation Discussion & Analysis
Introduction This Compensation Discussion and Analysis, or “CD&A,” describes the fiscal year 20132014 compensation program for John Wiley & Sons, Inc.’s senior executives.executive officers. The overarching goals that guide the design and administration of our executive compensation program consist of the ability to: | · | Recruit and retain the highest caliber of executive talent by offering a competitive compensation program; | | · | Motivate and reward executives for achieving strategic and financial objectives through the use of annual cash incentives; and | | · |
| | | | | | ● | Recruit and retain the highest caliber of executive talent by offering a competitive compensation program; | | | | | | | ● | Motivate and reward executives for achieving strategic and financial objectives, which drive shareholder value, through the use of annual cash incentives; and | | | | | | | ● | Align executives’ and shareholders’ interests through awards of equity that are dependent upon the performance of the Company and encourage the acquisition of a significant ownership stake in the Company. |
| | This CD&A describes how the Executive Compensation and Development Committee (the “Committee”) of the Board of Directors (the “Board”) considered our business strategy, our compensation philosophy, and the overarching goals that guide our executive compensation program to arrive at fiscal year 20132014 compensation decisions for our executives, including our named executive officers (“NEOs”) whose compensation is set forth in the 20132014 Summary Compensation Table and other compensation tables contained in this proxy statement. Our fiscal year 20132014 NEOs are: | · | Stephen M. Smith, President and Chief Executive Officer | | · | Ellis E. Cousens, Executive Vice President, Chief Financial and Operations Officer | | · | Steven J. Miron, Senior Vice President, Research | | · | Gary Rinck, Senior Vice President, General Counsel | | · | Mark J. Allin, Senior Vice President, Professional Development |
| | ● | Stephen M. Smith,President and Chief Executive Officer | | | | | | | ● | Ellis E. Cousens,Executive Vice President, Chief Financial and Operations Officer (from May 1, 2013 through June 30, 2013), Executive Vice President, Chief Operations Officer (from July 1, 2013 through April 30, 2014) | | | | | | | ● | John A. Kritzmacher,Executive Vice President (from June 17, 2013 through June 30, 2013), Executive Vice President, Chief Financial Officer (from July 1, 2013 through April 30, 2014) | | | | | | | ● | Steven J. Miron,Senior Vice President, Global Research | | | | | | | ● | Gary Rinck,Senior Vice President, General Counsel | | | | | | | ● | Mark J. Allin,Senior Vice President, Professional Development |
| | Executive Summary FiscalThe Company’s fiscal year 2014 operational performance was strong. We exceeded our annual guidance for adjusted revenue growth and earnings, successfully executed on our restructuring plans to achieve a lower and more flexible cost structure, and generated cash flow 10% ahead of the prior year. Net debt at fiscal year-end was $214 million, down from $339 million at the end of the prior year. During fiscal year 2014, we repurchased 1.25 million shares for $63.4 million, an average cost of $50.79, and in June 2013, waswe increased the quarterly dividend by 4% to $0.25. The Company’s Total Shareholder Return (“TSR”) improved significantly during fiscal year 2014, to 53.6%, up from -13.6% in 2013.
We continued progress in expanding Wiley’s depth and breadth as a difficult yearprovider of knowledge-enabled solutions, recently acquiring two companies that position Wiley to become a solutions leader in whichprofessional learning and development. Through organic investment and targeted acquisitions, and by integrating content, technology, and services, we have accelerated the pace of change in the publishing environment accelerated considerably. Revenue (+1%) and profitability (-5%) fell substantially shortexecution of our guidance for the year, although the Company delivered strong Free Cash Flow performance ($270M in fiscal year 2013 versus $260M in fiscal year 2012).strategy to provide professionals, students, and researchers with valued solutions that serve their needs from education through employment. Some noteworthy business highlights during fiscal year 20132014 include: | · | The largest non-content acquisition in the Company’s history with the purchase of Deltak, an online program provider for higher education institutions. It not only transforms our educational institutional services business in a high growth area of the market, it also provides the Company with a new institutional sales channel, and moves us well along the path towards digital content and services. | | · | A Professional Development business that is more sharply focused on professional communities today than a year ago. We have sold our consumer publishing programs while recently acquiring a workplace assessment provider in Inscape and a test preparatory platform provider in Efficient Learning Systems. |
| | ● | Adjusted revenue of $1.78B (+4% growth) | | | | | | | | ● | Steady growth in the Research segment coming from journals subscriptions, author-funded open access, and digital books | | | | | | | | ● | Strong growth in Professional and Education solutions, including Online Training and Assessment, Online Program Management (Deltak), and WileyPLUS | | · | Winning the largest society deal in our history, a $23 million contract with the American Geophysical Union (“AGU”). |
32 | | · | Outstanding growth in China. |
| | · | Calendar year 2013 journal billings that are up about 3% as of the end of May. | | · | Strong performance by the Company’s recent acquisitions and digital products. | | · | Initiation of the largest restructuring and reinvestment program in the Company’s history, which is on track to realize its goal of $80 million in run rate savings by the end of fiscal 2014. |
| | | ● | Share of revenue from digital and solutions now at 55% of revenue; print book revenue share down to 29% |
| | ● | Adjusted Earnings Per Share (“EPS”) of $3.05 (+4% growth) | | | | | | | ● | Free cash flow of $250M, an increase of $22M (+10%) over prior year | | | | | | | ● | Restructuring plans completed for $80M run-rate savings before reinvestment | | | | | | | ● | The recent acquisitions of Profiles International and CrossKnowledge help to create an end-to-end talent management solution from assessment through development, a significant value proposition for customers | | | | | | | ● | Strong double-digit growth for WileyPLUS, Online Program Management, and Digital Books |
Executive Compensation Program | | We urge stockholders to read our Annual Report for the fiscal year ended April 30, 2013,2014, filed with the SEC on June 26, 2013,27, 2014, which describes our businesses and 20132014 financial results in greater detail.
These financial results and business achievements formed the basis of the Committee’s cash compensation and equity award determinations.
Executive Compensation Program
The Company’s executive compensation programs are designed to foster and maintain a capable, experienced and motivated executive team with the ability to manage the business during challenging times and to evolve the Company’s practices as changes in the market warrant, while always aligning compensation with business performance. The compensation program emphasizes variable, performance-based compensation that promotes the achievement of short-term and long-term business objectives aligned with the Company’s business strategy and rewards performance when those objectives are met. The 20132014 annual and long-term incentive plansprograms were structured so that actual realized compensation received was aligned with Company performance based on key metrics such as corporate and business revenue, earnings per shareEPS, business contribution to profit (“EPS”), business earnings before interest, taxes and amortization (“EBITA”CTP”), free cash flow (“FCF”), Company stock price, and strategic milestonesobjectives that benefited the Company in fiscal year 20132014 and will benefit the Company in the future. We believe these metrics are aligned with driving long-term shareholder value and provide appropriate line-of-sight. Superior performance by our executive officers is essential to achieving our goal of increasing shareholder value. The charts below illustrate the mix of target total direct compensation for fiscal year 2014 for our CEO and, on average, for our other NEOs, excluding Mr. Cousens who retired at the end of fiscal year 2014. For all NEOs, to ensure alignment between executive and shareholder rewards, between 68% and 78% of our NEOs target total direct compensation for fiscal year 2014 was at risk. The targeted annual incentive compensation was payable based on achievement of performance-based financial measures and strategic objectives, and performance-based equity comprised 50% of the targeted long term incentive compensation. |
| | The following chart provides a brief summary of the principal elements of John Wiley & Sons, Inc.’sthe Company’s executive compensation program for 2013,2014, which are described in more detail later in this CD&A.Compensation
Element | Form | Compensation
Objective | Relation
to Performance | 2013
Actions / Results | Base Salary
(Discussed in greaterdetail on page 31.) | Fixed annual cash, paid on a semi-monthly basis | Fixed compensation that is externally competitive, and allows us to attract and retain executive talent. | Increases in base salary reflect market positioning, economic conditions, and the Committee’s assessment of Company and individual performance over the prior year. | The Company’s US merit budget was 2.5% with a range of 0–5%, and an additional 0.75% was budgeted for promotions and adjustments, for a total salary increase budget of 3.25%. The NEOs salary increases ranged from 3.1% to 5.3%, reflecting the continued movement toward the market median of our recently-promoted, internally-developed executives. | Short-Term Incentive
(Discussed in greaterdetail on page 31.) | Cash, paid on an annual basis | Motivate the executive to contribute to the Company’s success in achieving annual corporate and business financial goals and strategic objectives. When combined with a competitive base salary, provides total targeted cash compensation above the market median which helps the Company attract and retain executive talent. | 75% of the target annual incentive is based on financial goals, including corporate and business revenue, EPS, business EBITA, and FCF. The remaining 25% of the target annual incentive is based on achievement of strategic milestones | | | | | | Compensation | | Compensation | Relation | 2014 | | | Element | Form | Objective | to Performance | Actions / Results | | | Base Salary
(Discussed in greaterdetail on page 41.) | Fixed annual cash, paid on a semi-monthly basis | Fixed compensation that is externally competitive with median market rates, and allows us to attract and retain executive talent. | Increases in base salary reflect market positioning, economic conditions, and the Committee’s assessment of Company and individual performance over the prior year. | The Company’s budget for US Salary increases was a total of 3.25%, including a merit budget of 2.5%, with a range of 0-5%, and an additional 0.75% for promotions and adjustments. The NEOs total salary increases ranged from 3.0% to 4.2%. | | | Annual Incentives
(Discussed in greater detail on page 42.) | Variable, performance-based cash bonus, paid on an annual basis | Motivate the executive to contribute to the Company’s success in achieving annual corporate and business financial goals and strategic objectives. | 75% of the target annual incentive is based on financial goals, including corporate and business revenue, EPS, business CTP, and FCF. The remaining 25% of the target annual incentive is based on achievement of strategic objectives that are intended to further the Company’s success.
Payout can range from 0% to 150% of target.
Beginning in fiscal year2013, the maximumannual incentivepayout was reducedfrom 200% to 150%or target. | Target incentives for the NEOs range from 75% to 120% of base salary.
Actual short-term incentives earned for the NEOs ranged from 73.4% of target to 81.4% of target.
Beginning in fiscal year2013, the maximum annualincentive payout wasreduced from 200% to150% or target. | Target incentives for the NEOs range from 75% to 130% of base salary.
Actual short-term incentives earned by the NEOs ranged from 96.3% of target to 126.2% of target. | | | Long-Term Stock-Based Incentives
(Discussed in greaterdetail on page 44.) | Restricted performance share units granted each year with a 3-year performance cycle. If earned, share units continue to be subject to time-based vesting conditions and are payable as equivalent Class A shares upon vesting 50% on April 30th of the fourth and fifth years after grant | Motivates the executive to contribute to the Company’s success in achieving long-term corporate financial goals that drive shareholder value. | EPS and cumulative FCF are the performance measures used, with a weight of 60% and 40%, respectively.
Payout can range from 0% to 150% of target. | NEOs received approximately 50% of their target long-term value in restricted performance share units for the fiscal year 2014-16 performance cycle.
For the fiscal year 2012-14 cycle that just ended, the NEOs earned 47.7% of their targeted performance shares.
Beginning in fiscal year 2014, the weight on restricted performance share units was increased from 40% to 50% of the targeted long-term value. |
| | | | Non-qualified stock options granted each year, with vesting 50% on April 30th of the fourth and fifth years after grant | Ensures alignment of executive and shareholder interests and rewards increases in stock price. | Exercise price of non- qualified stock options is fair market value on date of grant. Accordingly, the increase in value of non-qualified stock options is directly dependent on improvements in stock price. | June 2013 grants of non- qualified stock options represent approximately 30% of the NEOs’ target long-term value.
23 Beginning in fiscal year2014, the weight on stockoptions was decreased from60% to 30% of the targeted long-term value. | | | | Restricted share units granted each year, payable as equivalent Class A shares upon vesting 50% on April 30th of the fourth and fifth years after grant | Promotes retention objective and facilitates stock ownership, expediting achievement of the stock ownership multiple. | The value of restricted share units is directly correlated with improvements in stock price. | Beginning in fiscal year2014, restricted shareunits were introduced asa long-term incentiveelement,and NEOs received approximately 20% of their target long-term value in restricted share units. |
Compensation
Element | Form | Compensation
Objective | Relation
to Performance | 2013
Actions / Results | Long-Term Incentives
(Discussed in greaterdetail on page 33.) | Non-qualified stock options granted each year, with vesting 50% on April 30th of the fourth and fifth years after grant | Ensures alignment of executive and shareholder interests and rewards. When combined with a competitive target cash compensation package and restricted performance shares, stock options provide a competitive total target direct compensation package above the market median that helps the Company attract and retain executive talent. | The increase in value of non-qualified stock options is dependent on improvements in stock price. | June 2012 grants of non-qualified stock options represent approximately 60% of the NEOs’ target long-term value.
Beginning in fiscal year2014, stock options willrepresent 30% of thetargeted long-term value,and restricted stock will beadded to the equity mix,representing 20% of thelong-term value. | | Restricted performance shares granted each year with a 3-year performance cycle, and if earned, shares become restricted and vest 50% on April 30th of the fourth and fifth years after grant | Motivates the executive to contribute to the Company’s success in achieving long-term corporate financial goals that drive shareholder value. When combined with a competitive target cash compensation package and stock options, restricted performance shares provide a competitive total target direct compensation package that helps the Company attract and retain executive talent. | EPS and cumulative FCF are the performance measures used, with a weight of 60% and 40%, respectively.
Payout can range from 0% to 150% of target.
Beginning in fiscalyear 2013, themaximum payout wasreduced from 200% to150% of target. | NEOs received approximately 40% of their target long-term value in restricted performance shares for the fiscal year 2013–15 performance cycle.
For the fiscal year 2011–13 cycle that just ended, the NEOs earned 129.8% of their targeted restricted performance shares.
Beginning in fiscal year 2013,the maximum payout wasreduced from 200% to150% of target.
Beginning in fiscal year 2014, restricted performanceshares will represent 50%of the targeted long-termvalue. |
The Company also provides the following health and retirement benefits to our senior executives, for the financial security and current / future well-being of the executives and their families, as described in more detail later in this CD&A: Benefit | Form | | | | | | | | | | | Benefit | Form | Purpose | | | | | Health and Welfare Benefits
(Discussed in greaterdetail on page 46.) | Flexible benefits program provided to all US employees, where “flex dollars” are provided to help pay the cost of health insurance, life, disability and AD&D insurance. | Health and welfare benefits are market competitive and are provided primarily for the safety and well-being of the executive and his/her family. | | | | | Retirement Plans
(Discussed in greaterdetail on page 46.) | Qualified Defined Contribution Savings Plan (401(k)), provided to all US employees | Qualified savings plan benefits including company basic, matching and discretionary contributions, are market competitive and provide post- retirement income for the executive.
Company contributionsto the US-based 401(k)were enhancedfollowing the cessationof accruals and freezeof participation in theUS defined benefitretirement plans,effective July 1, 2013. | | | | | | Qualified Defined Benefit Retirement Plan, provided to US employees hired before July 2012 | Qualified retirement plan benefits provide additional post- retirement income for executives hired before July 2012.
The Company ceasedaccruals and frozeparticipation in theUS Retirement Plan,effective June 30, 2013. | | | | | | Non-qualified Supplemental Benefit Plan (the “Excess Plan”), provided to US employees hired before July 2012 with pay in excess of IRC section 401(a)(17) limit on eligible compensation | Restore benefits lost under the qualified Retirement Plan due to limitations imposed by Internal Revenue Code regulations to the same level as other colleagues who are not restricted by Internal Revenue Code limitations.
The Company ceasedaccruals and frozeparticipation in theUS SupplementalBenefit (“Excess”) Plan,effective June 30, 2013. | | | | | | Non-qualified Supplemental Executive Retirement Plan (the “SERP”) | Provide executives who entered the SERP prior to June 2013 with enhanced retirement income due to tax rules governing qualified retirement plans that place significant limitations on the benefits which can be paid to executives. Helps the Company retain executive talent.
The Company ceasedaccruals and frozeparticipation in theUS SupplementalExecutive RetirementPlan (“SERP”), effectiveJune 30, 2013. | | Health and Welfare Benefits
(Discussed in greaterdetail on page 35.) | Flexible benefits program provided to all US employees, where flex dollars are provided to help pay the cost of health insurance, life, disability and AD&D insurance. | Health and welfare benefits are market competitive and are provided primarily for the safety and well-being of the executive and his/her family. | Retirement Plans
(Discussed in greaterdetail on page 42.) | Qualified Defined Contribution Savings Plan (401(k)), provided to all US employees | Qualified savings plan benefits are market competitive and provide some post-retirement income for the executive.
Company contributionsto the US-based 401(k)will be enhancedfollowing the cessationof accruals and freezeof participation in theUS defined benefitretirement plans. |
Benefit | Form | | | Benefit | Form | Purpose | | | | | | Non-qualified Deferred Compensation Plan (“DCP”) | Enables US executives to prepare for future financial security by allowing the deferral of otherwise taxable income on a pre-tax basis, with various investment options and flexible payment options. Provides for Company contributions mirroring those made under the qualified Savings Plan.
Company contributionsto the DCP wereenhanced following thecessation of accrualsand freeze ofparticipation in theUS defined benefitretirement plans,effective July 1, 2013. | | | | | | The John Wiley & Sons Limited Retirement Benefits Scheme (“UK Qualified Plan”) | Approved (qualified) retirement plan benefits are market competitive and provide retirement income for UK employees on a defined benefit basis in addition to providing an incentive for a long-term career with the Company. This scheme is closed to new entrants. | | | | | | The Unapproved Supplemental UK Plan (the “UK Non- Qualified Plan”) | Restores benefits “lost” under the UK Qualified Plan due to limitations imposed by the UK Revenue authorities to the same level as other colleagues in the UK Qualified Plan who are not affected by those restrictions. This UK Non- Qualified Plan is by Company invitation only. | | | | | Perquisites
(Discussed in greaterdetail on page 46.) | Physical exams, financial planning, tax preparation, health club membership | Limited perquisites are provided primarily for the financial security and productivity of the executive. | | Retirement Plans
(Discussed in greaterdetail on page 42.) | Qualified Defined Benefit Retirement Plan, provided to all US employees | Qualified retirement plan benefits provide additional post- retirement income for the executive, in addition to providing incentive for a long-term career with the Company.
In fiscal year 2013, theCompany announced acessation of accrualsand freeze ofparticipation in the USRetirement Plan,effective June 30, 2013. | | Non-qualified Supplemental Benefit Plan (the “Excess Plan”), provided to all US employees with pay in excess of IRC section 401(a)(17) limit on eligible compensation | Restore benefits lost under the qualified Retirement Plan due to limitations imposed by Internal Revenue Code regulations to the same level as other colleagues who are not restricted by Internal Revenue Code limitations.
In fiscal year 2013, the Company announced a cessation of accruals and freeze of participation in the US Supplemental Benefit (“Excess”) Plan, effective June 30, 2013. | | Non-qualified Supplemental Executive Retirement Plan (the “SERP”) | Assure that executives are provided with an adequate retirement income due to tax rules governing qualified retirement plans that place significant limitations on the benefits which can be paid to executives. Helps the Company attract and retain executive talent.
In fiscal year 2013, the Company announced a cessation of accruals and freeze of participation in the US Supplemental Executive Retirement Plan (“SERP”), effective June 30, 2013. | | Non-qualified Deferred Compensation Plan (“DCP”) | Enables the US executives to prepare for future financial security by allowing the deferral of otherwise taxable income on a pre-tax basis, with various investment options and flexible payment options.
Company contributions to the DCP will be enhanced following the cessation of accruals and freeze of participation in the US defined benefit retirement plans. |
Benefit | Form | Purpose | Retirement Plans
(Discussed in greaterdetail on page 42.) | The John Wiley & Sons Limited Retirement Benefits Scheme (“UK Qualified Plan”) | Approved (qualified) retirement plan benefits are market competitive and provide retirement income for UK employees on a defined benefit basis in addition to providing an incentive for a long-term career | The table below highlights our current compensation practices – those we have implemented because we believe they drive performance and are aligned with the Company. This scheme is closed to new entrants. | | The Unapproved Supplemental UK Plan (the “UK Non- Qualified Plan”) | Restores benefits “lost” under the UK Qualified Plan due to limitations imposed by the UK Revenue authorities to the same level as other colleagues in the UK Qualified Plan who are not affected by those restrictions. This UK Non-Qualified Plan is by Company invitation only. | Perquisites
(Discussed in greaterdetail on page 35.) | Physical exams, financial planning, tax preparation, health club membership | Limited perquisites are provided primarily for the financial security and productivity of the executive. |
We endeavor to maintain sound governance standards reflective—and those we have not implemented because we do not believe they would serve our shareholders’ long term interests.
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| | Executive Compensation Practices We Have Implemented (What We Do) | | Executive Compensation Practices We HaveNotImplemented (What We Don’t Do) | | ü | We ensure a correlation between pay and performance by having a significant portion of market trends, with respectcompensation that is performance-based and at-risk. Payment of the performance-based compensation is based on achievement of corporate and business financial goals and individual performance against pre-set strategic objectives. | X | We prohibit the repricing of stock options and stock appreciation rights, without shareholder approval. We do not allow cash buyouts for underwater stock options or stock appreciation rights, without shareholder approval. | | ü | We review media and general industry survey data when setting compensation for our executive officers. | X | We do not pay dividends on unearned performance-based equity awards. | | ü | We mitigate risk by: | X | We do not maintain compensation programs that we believe create risks reasonably likely to have a material adverse effect on the Company. | | | ● | placing substantial emphasis on long term equity-based incentives; | | | | ● | setting performance levels that correspond to a range of payment for performance-based compensation; | | | | ● | capping payouts of annual and long-term performance-based compensation; | | | | | ● | including clawback provisions in our annual and long-term incentive plans; | | | | | ● | utilizing conservative five-year vesting of equity, except in certain situations; | | | | | ● | requiring retention of 50% of the net shares upon exercise or vesting until the stock ownership multiple is met. | | | | ü | We have competitive post-employment and change in control provisions that apply to all executive officers. | X | We do not provide significant additional health and retirement benefits to executive officers that differ from those provided to all other employees. | | ü | We have double-trigger vesting of equity awards following a change in control, when the acquiring company is a publicly traded company and outstanding equity is assumed or replaced. | X | We do not provide excise tax gross-ups upon a change of control. | | ü | We generally provide limited perquisites that we believe are beneficial to the Company. | X | We do not provide tax gross-ups on perquisites. | | ü | The Committee, currently composed of three independent directors, retains an external, independent compensation consulting firm to advise on matters related to executive compensation and governance. | X | The Committee’s independent compensation consulting firm does not provide any other services to the Company. |
| The following changes to our executive compensation program. The following policies and practicesprogram were implemented during fiscal year 2013: | · | The range of payout under the annual cash incentive plan, and the long-term performance-based incentive plan was narrowed from 25% at threshold and 200% at outstanding, to 50% at threshold and 150% at outstanding, reflecting a more traditional incentive plan design. In response to continued volatility in our markets during fiscal year 2013, the range of revenue and profit performance required to achieve these payout levels was expanded from between 93% to 95% at threshold and 104% to 107% at outstanding, to 90% at threshold and 110% at outstanding. | | | | | · | In fiscal year 2013, the Company announced a cessation of accruals and freeze of participation in the US defined benefit retirement plans, including the US Retirement Plan, the Supplemental Benefit (“Excess”) Plan, and the Supplemental Executive Retirement Plan (“SERP”), effective June 30, 2013. At the same time, the Company announced enhancements to its Defined Contribution Savings Plan (401(k)). | | | | | · | Beginning with the equity grants made in June 2013, for fiscal year 2014, half of the target long-term equity value will be delivered in performance-based restricted shares, up from 40% in prior years. |
Compensation Best Practices
In addition to the new corporate governance practices noted above, the Company continues to implement and maintain best practices in its executive compensation program. These practices include the following:
| · | The Committee, currently composed of three independent directors, has engaged an independent compensation consultant that has no other ties to the Company or its management, and that meets the selection criteria developed by the Committee (see “Role of Compensation Consultant” below). | | | | | · | An appropriate compensation mix that is designed to balance the emphasis on short-term and long-term performance, in line with the Company’s operating and strategic plans. The majority of incentive compensation for executive officers is associated with the long-term performance of the Company, which ensures a correlation between executive and shareholder rewards.2014: |
26 | ● | Beginning in fiscal year 2014, half of the target long-term equity value was granted as performance-based restricted share units, up from 40% in prior years. A portion of the remaining half of the target long-term equity value was granted as restricted share units to reduce share usage and enhance retention. | | | | | ● | The Company ceased accruals and froze participation in the US defined benefit retirement plans, including the US Retirement Plan, the Supplemental Benefit (“Excess”) Plan, and the Supplemental Executive Retirement Plan (“SERP”), effective June 30, 2013. At the same time, the Company enhanced its Defined Contribution Savings Plan (401(k), aligning Wiley with current market practices. |
| · | Financial targets used in both the short and long-term incentive plans are appropriately set and if not achieved, result in a large percentage reduction in compensation. | | | | | · | The Company’s equity awards under the Executive Long-Term Incentive Plan provide for a conservative five-year vesting, except in limited circumstances involving performance shares for completed cycles upon executive retirement, death or permanent disability. | | | | | · | The Committee believes that the ultimate goal of the long-term incentive program is to align the interests of Company stockholders and management. To reinforce this principle, the Committee established stock ownership guidelines for all officers participating in the long-term incentive program. The ownership guideline for the President and CEO is six times base salary. The ownership guideline for the other senior executives, including the NEOs, is two and one-half times base salary. Shares counted toward the ownership guidelines consist of: | | | |
| · | Shares owned outright | | | | | · | Half of the performance shares earned (i.e. where the performance cycle has been completed) but not yet vested. (Assumes half will be surrendered to pay taxes.) | | | | | · | Half of any time-based restricted shares granted. (Assumes half will be surrendered to pay taxes.) | | | |
| | Mr. Cousens and Mr. Rinck have exceeded their targeted shareholdings. Messrs. Smith, Miron and Allin are all relatively new to their roles and have not yet met their targeted shareholdings, although they have made progress toward meeting their targets. | | | | | · | For all equity grants awarded in June 2011 and later, there is a stock retention requirement for our executive officers, including the NEOs, that requires retention of 50% of the net shares acquired upon the exercise of stock options or the payment or vesting of any performance shares and restricted stock until the executive satisfies our stock ownership salary multiple. | | | | | · | To insure that our compensation program does not encourage excessive risk taking, in July 2010 the Company introduced a clawback provision in both the annual and long-term incentive plans covering the top 350 colleagues in the Company. The clawback provision allows the Company to recoup incentive payments to covered incentive participants in the event that the Company needs to restate its financial results because of fraud, gross negligence or intentional misconduct on the part of one or more employees and/or because of material non-compliance with Securities laws. | | | | | · | Mr. Smith’s base salary severance in the event of a “without cause termination” or “constructive discharge” with or without a change of control is 24 months, the same as when he was EVP and Chief Operating Officer. The base salary severance in the event of a “without cause termination” or “constructive discharge” with or without a change of control for the remaining NEOs is between 12 and 24 months. These amounts are consistent with market practice. | | | | | · | In fiscal year 2012, the Company eliminated tax “gross-ups” for the limited perquisites provided to our executive officers. | | | | | · | In fiscal year 2012, the Company modified the executive employment agreements to eliminate excise tax “gross-ups” upon a change of control. | | | | | · | For all equity grants awarded in June 2011 and later, double-trigger vesting of equity upon a change of control (i.e., change of control followed by termination without cause or constructive discharge) will apply in cases where the acquiring company is a publicly traded company, and that company assumes or replaces the outstanding equity. |
| | To demonstrate the linkage between CEO pay and Company performance/performance / changes in shareholder value, a comparison of realizable pay to reported pay and total shareholder return (“TSR”) is presented below. While not intended to replace the Summary Compensation Table (“SCT”) on page 37,48, which includes targeted equity grants based on accounting values, this information includes the value realized from stock option exercises and the vesting of full-value
awards during the fiscal year, and the change in the intrinsic value of outstanding equity awards as of the end of the fiscal year. SCT data is included in the chart and the accompanying table below for comparison purposes. | | | | | | | | | | | | Realizable Compensation Analysis ($000s) |
| Compensation Element | | Fiscal 2012 | | Fiscal 2013 | | Fiscal 2014 | | | Cash Compensation | | | | | | | | | | | | Base Salary | | $800 | | | $833 | | | $869 | | | | Annual Incentive Earned | | $930 | | | $753 | | | $1,435 | | | | Total Cash Compensation | | $1,730 | | | $1,586 | | | $2,304 | | | | Long-Term Incentives | | | | | | | | | | | | Value of Realized Awards at Exercise/Vesting | | $855 | | | $347 | | | $1,307 | | | | Change in Value of Outstanding Awards at FYE | | –$401 | | | –$1,306 | | | $8,790 | | | | Total | | $454 | | | –$958 | | | $10,097 | | | | Total Realizable Compensation | | $2,184 | | | $627 | | | $12,401 | | | | | | | | | | | | | | | | Summary Compensation Table Values ($000s) | | | | | | | | | | | | | | Compensation Element | | Fiscal 2012 | | Fiscal 2013 | | Fiscal 2014 | | | Base Salary | | $800 | | | $833 | | | $869 | | | | Annual Incentive | | 930 | | | 753 | | | 1,435 | | | | Stock Awards | | 1,982 | | | 961 | | | 1,403 | | | | Stock Options | | 1,428 | | | 1,229 | | | 608 | | | | Total | | $5,140 | | | $3,776 | | | $4,315 | | |
Realizable Compensation Analysis ($000s) | | | | | | | | Fiscal 2011 | | Fiscal 2012 | | Fiscal 2013 | | Compensation Element | | COO | | CEO | | CEO | | | | | | | | | | | | | Cash Compensation | | | | | | | | | | | Base Salary | | $621 | | | $800 | | | $833 | | | Annual Incentive Earned | | $966 | | | $930 | | | $753 | | | Total Cash Compensation | | $1,587 | | | $1,730 | | | $1,586 | | | | | | | | | | | | | | Long-Term Incentives | | | | | | | | | | | Value of Realized Awards at Exercise/Vesting | | $308 | | | $855 | | | $347 | | | Change in Value of OutstandingAwards at FYE | | $2,656 | | | –$401 | | | –$1,306 | | | Total | | $2,964 | | | $454 | | | –$958 | | | Total Realizable Compensation | | $4,551 | | | $2,184 | | | $627 | | |
Summary Compensation Table Values ($000s) | | | | | | | | Fiscal 2011 | | Fiscal 2012 | | Fiscal 2013 | | Compensation Element | | COO | | CEO | | CEO | | | | | | | | | | | | | Base Salary | | $621 | | | $800 | | | $833 | | | Annual Incentive | | 966 | | | 930 | | | 753 | | | Stock Awards | | 520 | | | 1,982 | | | 961 | | | Stock Options | | 858 | | | 1,428 | | | 1,229 | | | Total | | $2,965 | | | $5,140 | | | $3,776 | | |
2012
| | 2013 “Say-on-Pay” Advisory Vote on Executive Compensation | | | | | | The Company provides stockholdersshareholders with an annual “say-on-pay” advisory vote to approve its executive compensation, in accordance with Section 14A of the Exchange Act. At the 20122013 annual meeting, stockholdersshareholders expressed substantial support for the compensation of our NEOs, with approximately 93%99.5% of the votes cast for approval of our executive compensation.compensation program. The Committee evaluated the results of the 20122013 advisory vote and believes the strong shareholder support signals approval of the current pay-for-performance executive |
| | compensation program and support of the sound governance practices in place at Wiley. As noted above in the Executive Summary, the Company has adopted governance practices that it believes best serve its
stockholders, shareholders, while also incorporating best practices that allow it to meet the overarching goals of our executive compensation program. TheIn furtherance of that goal, the Committee did notdetermined to make any changes to our executive compensation program and policies as a result of the 2012 “say-on-pay” advisory vote, but did announce and/or makecertain changes to the executive compensation program, noted on page 26,37, in a continuing effort to reflect sound governance and competitivemarket practices.
| | | | | | Compensation Principles and Practices
| | | | Principles of Wiley’s Executive Compensation Program. | | The following principles and practices shaped the design and implementation of the Company’s compensation program for fiscal year 2013:2014: |
| · | Compensation is merit based | | ● | The compensation mix is designed to balance emphasis on short-term and long-term performance, in line with the Company’s operating and strategic plans. | | | | | | | ● | Compensation is merit-based in that the total compensation opportunity and actual payout for each executive is based on current responsibilities, future leadership potential and sustained performance against financial and strategic objectives. |
| · | There is a correlation between compensation (both annual and long-term) and the Company’s performance. The program is structured such that at executive levels a larger portion of annual and total compensation is variable driven by performance and significantly composed of stock-based compensation. | | | | |
| · | | | ● | There is a correlation between compensation (both annual and long-term) and the Company’s performance. Financial targets used in both the short- and long-term incentive plans are aligned with the Board-approved strategic plan and, if not achieved, result in a large percentage reduction in compensation. The program is structured such that at executive levels a larger portion of annual and total compensation is variable, driven by performance and significantly composed of stock-based compensation, ensuring a correlation between executive and shareholder rewards. | | | | | | | ● | Senior executives, including the NEOs, have a significant, ongoing ownership stake in the Company to strengthen the alignment of our executives’ interests with those of our shareholders. | | | | | | | ● | The program is competitive with the total compensation program of competitor companies in the publishing / information and media industries when performance goals are achieved. To that end the Committee reviews a report based on an independently researched compensation survey as a guidepost to determine whether the Company’s compensation levels and programs are competitive and meet the Company’s stated objectives. The report includes publishing/media companies with whom Wiley competes for business and talent and for whom data is available, as well as other companies in general industry for positions that are not unique to our industry. Base salaries, annual incentive awards and long-term incentive grants are determined within the framework of position responsibilities, assessments of individual performance and future leadership potential, and competitive market data adjusted to reflect the size of the Company. |
| · | The program is competitive with the total compensation program of competitor companies in the publishing / information and media industries when performance goals are achieved. To that end the Committee reviews a report based on an independently researched compensation survey as a guidepost to determine whether the Company’s compensation levels and programs are competitive and meet the Company’s stated objectives. The report includes publishing/media companies with whom Wiley competes for business and talent and for whom data is available, as well as other companies in general industry for positions that are not unique to the publishing industry. Base salaries, annual incentive awards and long-term incentive grants are determined within the framework of position responsibilities, assessments of individual performance and future potential and competitive market data adjusted to reflect the size of the Company. |
Role of Compensation Consultant. | | The Committee, currently composed of three independent directors, has engaged Frederic W. Cook & Co., Inc. (“Cook”) as its independent compensation consultant, to advise the Committee on matters related to executive compensation. The executive compensation consultant reports directly to the Committee, and works collaboratively with management with regard to the administration and any required analysis in support of the executive compensation program. In addition, Cook provides competitive benchmarking for non-employee director pay to the Governance Committee. Cook does not offer noror provide any other services to the Company, and the Committee determined that the retention of Cook has not raised any conflict of interest. | | | | | | Following are the services provided to the Committee by Cook during fiscal year 2013:2014: |
| · | Provide market analysis and a competitive range of compensation based on the Company’s compensation philosophy for purview executives, to be used for fiscal year 2013 | | ● | Provide market analysis and a competitive range of target compensation based on the Company’s compensation philosophy for executive officers, to be used for fiscal year 2014 executive compensation recommendations. Confer with the Committee and management, as needed. |
| · | Present the market analysis report with respect to fiscal year 2013 compensation at the March 2012 Committee meeting. Attend any other meetings as requested by the Committee. | | | | |
| · | | | ● | Present the market analysis report with respect to fiscal year 2014 target compensation at the March 2013 Committee meeting. Attend any other meetings as requested by the Committee. |
| | ● | Monitor the Company’s executive compensation program and advise the Committee of plans or practices that might be modified to improve effectiveness, competitiveness and alignment with good corporate governance principles. |
| · | | | | | | | ● | Review the Company’s executive compensation philosophy and competitive positioning for reasonableness and recommend modifications where appropriate. |
| · | | | | | | | ● | Advise the Committee on management proposals, as requested. |
| · | | | | | | | ● | Undertake special projects at the request of the Committee. |
| · | | | ● | Review the Compensation Discussion and Analysis, compensation tables and other compensation-related disclosures included in the Company’s proxy statement. |
| · | Proactively advise the Committee on best-practices | | | | | | | ● | Proactively advise the Committee on best practices for governance of executive compensation as well as areas of concern and risk in the Company’s program. | | | | | | | ● | Proactively advise the Committee on legislative and regulatory developments related to compensation policies and programs and compensation-related disclosure. |
| · | Proactively advise the Committee on legislative and regulatory developments related to compensation policies and programs and compensation-related disclosure. |
Roles of the Committee and Management in Recommending Compensation | | As described in greater detail below, individual base salaries, annual cash incentive awards and long-term incentive grant amounts are determined within the framework of the executive’s position and responsibilities, individual and Company / business performance, and future leadership potential, as well as with regard to time in position and compensation relative to the external marketplace. The President and CEO presents compensation recommendations for the senior executives, including the NEOs,other executive officers to the Committee for its review and approval. The Committee evaluates the performance of the President and CEO, determines his compensation, and discusses its recommendation with the Board of Directors in executive session. | | | | | | Determination of Target Compensation Levels
| | | | Compensation Philosophy | | The Company’s executive compensation program for the senior executives, including the NEOs,executive officers consists of base salaries, a targetsalary, targeted cash incentive expressed as a percent of base salary and targettargeted long-term equity awards. Each executive’sexecutive officer’s base salary, target annual cash incentive and long-term incentive award value are reviewed annually and adjusted when and if needed, based on the criteria noted above and depending on market conditions, to remain competitive with the external market. The program is designed to pay median base salaries, above-median total cash compensation for the achievement of challenging financial targets and strategic objectives, and below-median total cash compensation when those targets are not attained.attained, thereby aligning executive compensation with shareholder interests. Third quartile levels of total direct compensation can be attainedrealized when challenging, long-term financial goals are achieved and accompanied by future share price appreciation. An executive’s position against the market may be abovebelow or belowabove our target positioning based on a number of factors specific to the individual, including scope of responsibility, performance, tenure in position, level of experience and skill, and market conditions.
| | | | Compensation Benchmarking | | The compensation for each senior executive positionofficer is benchmarked using publishing / media and general industry survey data. The Committee’s independent compensation consultant prepares an annual review of executive compensation competitiveness, using data from the Towers Watson U.S. Media Industry Survey and the Towers Watson U.S. General Industry Survey. The Towers Watson survey data was for 83included a cut of 67 publishing and information services companies in the 20102013 Towers Watson U.S. Media Industry Survey, and over 317332 companies in the 20112013 Towers Watson U.S. General Industry Survey, adjusted to be appropriate for the Company’s revenue size. The 2011 Towers Watson U.S. Media Industry Survey experienced a significant decrease in participation relative to prior year. As a result, Cook used the 2010 results, adjusted to reflect each executive’s current revenue responsibility. For the senior executivesexecutive officers who lead the Company’s three global businesses, only the publishing / media industry survey data is used, since that represents the competitive market for the leaders of our global businesses. For corporate executives, the data is weighted two thirds on the publishing / media industry data and one-third on general industry data, recognizing that the competitive market for our corporate executives is broader than the publishing / media industry. The independent compensation consultant presents its reviewsreport to the Committee at its March meeting as a way of assisting the Committee in ascertaining the competitiveness of the executive compensation program within the publishing and information industry, as well as general industry. |
| | Each year, compensation decisions covering base salary, annual incentives and stock-based awards are primarily driven by assessments of individual and Company performance. Comparisons are also made to the compensation survey data. Individual annual and long-term incentive payments from preceding years are not a significant factor in determining recommendations for the total compensation opportunity for an upcoming year. | | | | | | Compensation for the President and CEO is established using the same process and philosophy previously discussed for the other senior executives, including the NEOs.executive officers. The Committee establishes the President and CEO’s base salary, target annual incentive and stock-based awards using the executive compensation competitive review report, based on an
independently researched compensation survey prepared annually by the independent compensation Consultant.consultant as indicated above. In addition, the President and CEO’s compensation relative to the next two highest-compensated executives is evaluated.
| | | | Weighting of Pay
Elements— Elements – Fixed Versus
“At “At Risk” CompensationCompensation. | | As noted more fully below and in other sections of this Proxy Statement, a significant portion of target total direct compensation (defined as base salary, target annual incentives and the target value of stock-based awards) granted to our NEOsexecutive officers in fiscal year 20132014 is based on the attainment of annual and long-term financial objectives, which we believe drive shareholder value. The following chart illustrates the target pay mix for our NEOs in fiscal year 2013.2014. Between 66%63% and 79%78% of our NEOs target compensation for fiscal year 20132014 is “at risk”, in the form of restricted performance shares,share units, stock options, restricted share units and annual incentives. The pay mix for EllisMr. Cousens our Executive Vice President, Chief Financial and Operations Officer reflectsis not included in the fact thatchart below since he received a prorated performance share grant, and a prorated cash incentive in lieu of stock optionsdid not receive equity awards in fiscal year 2013,2014 given his advance notice of his intention to retire at the end of fiscal yearin June 2014. The target prorated cash incentive in lieupay mix for Mr. Kritzmacher includes the annualized value of stock options granted in FY2013 is included under the “stock options” section in the chart below.his new hire restricted share grant. | | | | | | |
| | We believe that this pay mix, with about 70% of pay variable based on achievement of annual and long-term financial objectives, and commensurate improvement in share price, provides strong motivation to focus on attaining results that create shareholder value. | | | | | | Compensation Elements
| | | | Base salaries | | Base salaries are provided to our senior executives, including our NEOs,executive officers for performing their day-to-day responsibilities. Competitive base salaries allow the Company to attract and retain executive talent. For fiscal year 2014, the Company’s budget for US salary increases was 3.25%, including a merit budget of 2.5%, with a range of 0-5% and an additional 0.75% for promotions and adjustments. Base salary increases, if any, are effective July 1 of each year. The base salaries of our NEOsexecutive officers are based on a review of the competitive median marketplace for equivalent executive positions as previously discussed, assessment of the senior executive’sexecutive officer’s individual performance by the President and CEO (or in the case of the President and CEO, by the Committee), the performance of the Company and/and / or relevant business unit, internal pay relationships among senior executivesexecutive officers based on relative duties and responsibilities, the tenure of |
| | the executive officer in his / her role, the individual’s future advancement potential, and the Company’s annual salary increase budget. Base salary increases, if any, are effective July 1 of each year. For fiscal year 2013,After taking into consideration the Company’s US merit budget was 2.5%, with a range of 0–5%. An additional 0.75% was budgeted for promotions and adjustments, for a total salaryforegoing, the Committee determined to increase budget of 3.25%. Thethe NEOs’ salary increases rangedsalaries ranging from 3.1%3.0% to 5.3%, reflecting the continued movement toward the market median of our recently-promoted, internally-developed executives.
| | | | Annual incentivesincentives. | | Annual incentives are intended to motivate and reward senior executives for achieving short-term business objectives that drive Company and business unit performance. Annual incentives are payable for the achievement of annual financial performance goals established by the Committee and for individual performance and contributions. The financial goals represent 75% of the targeted annual incentive, and strategic objectives represent 25% of the targeted annual incentive, to ensure payment of annual incentives is commensurate with Company, and where applicable, business unit performance. The range of payout of annual incentives is 50% for achievement of financial performance at the threshold level to 150% of target for achievement of financial performance at the outstanding level. Beginning in fiscal year 2013, the range ofmaximum payout of annual incentives was changed to 0%reduced to 150% from 200% of target, (from 0% to 200% previously), and threshold payout movedwas increased from 25% to
50% of target, reflecting ato be more typical incentive plan design. Additionally,aligned with market practice. There is no payout of the rangefinancial portion of the annual incentives if achievement of financial performance betweenis below the threshold and outstanding was wider for fiscal year 2013 than in the past, in response to continued volatility in our markets during this period. level. | | | | | | Financial goals are based upon a strategic plan presented to and approved by the Board of Directors annually. At the end of the performance cycle a payout factor is calculated using actual results against the target for the financial measures. This results in a payout from 0 to 150% for financial objectives. A rating from 0 to 150% is also established for performance on strategic objectives. The results are combined to produce an annual incentive award of between 0 and 150% of the targeted award for each executive officer participating in the plan. Quantitative and qualitative strategic objectives are set based on the following over-arching goals:
| | | | | · | Increase profitability, cash flow and return on investment |
| · | Build long-term relationships with our customers |
| · | Enhance Wiley’s position as the “place to be” for all stakeholders |
Following are the fiscal year 20132014 target annual incentives for the NEOs: |
Named Executive Officer | Target Annual Incentive
as a % of Base Salary | | Target Annual Incentive | | | Named Executive Officer | as a % of Base Salary | | | | | | | Stephen M. Smith | 130% | | | | Ellis E. Cousens | 100% | | | | John A. Kritzmacher | 90% | | | | Steven J. Miron | 95% | | | | Gary Rinck | 75% | | | | Mark J. Allin | 95% | | Stephen M. Smith | 120 | % | | Ellis E. Cousens | 100 | % | | Steven J. Miron | 95 | % | | Gary Rinck | 75 | % | | Mark J. Allin | 95 | % | |
| | The target annual incentive percentage for Mr. Smith was raised from 120% in fiscal year 2013 to 130% in fiscal year 2014, to bring his targeted cash compensation more in line with the median of the competitive market, using performance-based annual incentives. | | | | | | The Company uses a Performance Management Program that measures performance against financial goals, consistent with the operating plan, and approved by the Committee, as well as other quantitative and qualitative strategic objectives established at the beginning of the fiscal year. The Committee approves the strategic objectives of the President and CEO, evaluates his performance in light of those strategic objectives, and discusses its recommendation with the Board of Directors in executive session. The President and CEO evaluates the performance of the members of the senior executives, including the NEOs,executive officers against assigned quantitative and qualitative strategic objectives, and presents his ratings to the Committee for its review and approval. | | | | | | For the 75% of the annual incentive that is based on financial measures, corporate financial performance metrics are used for corporate NEOs, and a combination of corporate (weighted at 25%) and relevant business performance metrics (weighted at 75%) are used for business NEOs.NEOs (Messrs. Miron and Allin). For fiscal year 2013,2014, the corporate performance measures used were revenue, EPS and normalized FCF weighted at 30%, 40% and 30%, respectively. Performance goalsmeasures for individual businesses were based on revenue and EBITA,CTP, weighted at 40% and 60%, respectively. These performance measures are relevant measures of our corporate and business unit success and align shareholder and executive interests. The relative weight on the profit measure(s) ensures an appropriate distribution of incentives paid vis-a-vis what is retained by the Company in pretax income. | | | | | | Fiscal year 2014 was a transitional year as we continued progress in expanding Wiley’s depth and breadth as a provider of knowledge-enabled solutions, while undertaking the largest |
| | restructuring and reinvestment initiative in the Company’s history. Fiscal year 2014 financial targets were lower than the prior year primarily due to the divestiture of the consumer publishing programs during fiscal year 2013 and ongoing investments in enabling technology and investments to capitalize on Deltak market opportunities. The benefits of restructuring savings implemented during fiscal year 2014 will result in a significant increase in earnings in fiscal year 2015 and incentive targets have been set correspondingly higher to reflect expected improvements in fiscal year 2015 performance. Recent investments in new business growth (test prep and certification, online training and assessment, workflow tools and digital research), along with the impact of recent acquisitions, are expected to fuel sustainable revenue and earnings growth from fiscal year 2015 and beyond. | | | | | | In fiscal year 2013,2014, in comparison to the corporate target goals set by the Committee for annual incentive purposes (see table immediately following)below) revenue achievement was 93.9%98.6% of target, EPS achievement was 86.9%106.2% of target, and normalized FCF achievement was 108.0%111.6% of target, resulting in a payout of 62.9%123.2% of target for the corporate performance measures. |
| | | | | 2014 | | | | 2014 | | | | | | | | | Threshold | | 2014 | | Outstanding | | | | | | | | | Performance | | Target | | Performance | | 2014 | | | Financial Objective | | Weight | | Level | | Amount | | Level | | Results | | | | | | | | | | | | | | | | Revenue ($000s) | | 30% | | 95% | | $1,799,000 | | 105% | | $1,772,995 | | | EPS | | 40% | | 90% | | $2.90 | | 110% | | $3.08 | | | Normalized FCF ($000s) | | 30% | | 90% | | $250,000 | | 110% | | $279,100 | |
Financial Objective | | 2013 Threshold Performance Level | | 2013 Target Amount | | 2013 Outstanding Performance Level | | 2013 Results | | Revenue ($000s) | | 90% | | $1,882,100 | | 110% | | $1,768,216 | | EPS | | 90% | | $3.58 | | 110% | | $3.11 | | Normalized FCF ($000s) | | 90% | | $270,400 | | 110% | | $291,976 | |
Note: | Financial results used for incentive payment purposes are adjusted to budgeted foreign exchange rates. Certain items and events may be excluded as permitted by the shareholder-approved 2009 Executive Annual Incentive Plan. For fiscal year 2013, the |
| principal exclusions were the impact of the acquisitions and divestitures made during the fiscal year, a disputed income tax deposit paid to the German tax authorities in fiscal year 2013, and an excess payment made to the UK pension plan. | | Note: | Financial results used for incentive payment purposes are adjusted to budgeted foreign exchange rates. Certain items and events may be excluded as permitted by the shareholder-approved 2009 Executive Annual Incentive Plan. For fiscal year 2014, the principal exclusions were the impact of acquisitions made during the fiscal year; a disputed income tax deposit paid to the German tax authorities; deferred tax benefits due to a reduction in the UK income tax rate; and restructuring and reorganization charges. Free cash flow is defined by the Company as cash from operating activities less cash used for investing activities excluding acquisitions. | | | | | | | Quantitative and qualitative strategic objectives for fiscal year 2014 were set based on the following goals: |
| | ● | Execute fiscal year 2014 operating plan | | | | | | | ● | Restructure Wiley’s cost base to enhance core business performance and provide resources for reinvestment in new business growth | | | | | | | ● | Execute strategic plan and contribute to important strategic initiatives | | | | | | | ● | Develop and implement strategies to enhance the core business | | | | | | | ● | Identify, evaluate and implement strategies to accelerate growth from new revenue streams | | | | | | | ● | Engage colleagues and other stakeholders around shared values and a common vision |
| | An evaluation of each NEOsexecutive officer’s achievement of fiscal year 20132014 strategic objectives in the context of the over-arching goals set forth above, was made by the CEO and approved by the Committee. In the case of the CEO, this evaluation was made by the Committee. There were no specific weightings for each of the preceding goals, and achievement of the strategic objectives was based on the Committee’s qualitative assessment. The key strategic accomplishments for the NEOs during fiscal year 20132014 include: the integrationrestructuring of Wiley’s cost base to enhance core business performance and strong performanceprovide resources for reinvestment in new business growth; growth of our4% in adjusted EPS; a 10% increase in free cash flow over prior year; a 4% improvement in adjusted revenue primarily from journals subscriptions, author-funded open access, digital books, and Professional and Education solutions, including Online Training and Assessment, Online Program Management (Deltak), and WileyPLUS; the recent acquisitions — Inscape, Deltakof Profiles International and Efficient Learning Systems —CrossKnowledge, which move us well along the path towards digital content and services; signing the largest society contract in the Company’s history, with the American Geophysical Union; calendar year 2013 journal billings that are up about 3% as of the end of May; outstanding growth in China; and initiation of the largest restructuring and reinvestment program in the Company’s history, which is on trackwill help to realize its goal of $80 million in run rate savings by the end of fiscal 2014.create an end-to-end talent management solution from assessment through development, a significant value proposition for customers. | | | | | | Payout of the financial and strategic objectives portions of the annual incentives as a percentage of target, and total fiscal year 20132014 annual incentives paid to the NEOs as a percentage of target, are noted in the table below. |
| | | Payout of | | Payout of | | | | | | | Financial-Based | | Strategic Objectives | | Total Annual | | | | | Incentive as a % | | Incentive as a % | | Incentive Payout | | | Named Executive Officer | | of Target | | of Target | | as a % of Target | | | | | | | | | | | | Stephen M. Smith | | 123.2% | | | 135% | | | 126.2% | | | | Ellis E. Cousens | | 123.2% | | | 135% | | | 126.2% | | | | John A. Kritzmacher | | 123.2% | | | 125% | | | 123.7% | | | | Steven J. Miron | | 105.7% | | | 115% | | | 108.0% | | | | Gary Rinck | | 123.2% | | | 125% | | | 123.7% | | | | Mark J. Allin | | 81.7% | | | 140% | | | 96.3% | | |
Named Executive Officer | | Payout of Financial-Based Incentive as a % of Target | | Payout of Strategic Objectives Incentive as a % of Target | | Total Annual Incentive Payout as a % of Target | | Stephen M. Smith | | 62.9% | | 110% | | 74.7% | | Ellis E. Cousens | | 62.9% | | 105% | | 73.4% | | Steven J. Miron | | 65.5% | | 100% | | 74.1% | | Gary Rinck | | 62.9% | | 110% | | 74.7% | | Mark J. Allin | | 68.5% | | 120% | | 81.4% | |
Long-Term Stock-Based Incentives. | | Long-term incentives are intended to motivate and reward senior executivesexecutive officers for achieving long-term (three-year) business objectives that drive Company performance. The long-term incentive compensation program for senior executives, including the NEOs,executive officers consists of annual grants of restricted performance sharesshare units, stock options and stock options,restricted share units, weighted at approximately 40%50%, 30% and 60%20% of long-term target value, respectively. Beginning in fiscal year 2014, with the June 2013 grants, the Company changed the mix of equity to include a higher percentage of target long-term value (50%, up from 40%) on restricted performance shares,share units, a reduction from 60% to 30% of the long-term value delivered in stock options, and the inclusion of a time-based restricted share unit component, representing 20% of the target long-term value. The restricted share unit portion was added to increase stock holding,holdings, reduce share usage and for retention of executive talent. | | | | | | The Committee believes the mix of equity provides an appropriate balance between risk and potential reward by tying realizable compensation directly to pre-established performance goals and future increases in stock price, provides alignment with shareholder interests, and serves as an effective retention tool for superior performers. In administering the long-term incentive program, the Committee considers data from the executive compensation survey previously discussed (which utilizeutilizes FASB Accounting Standards Codification (“ASC”) Topic 718 valuevalues for equity), and the recommendations of the President and CEO (with respect to the other executive officers), to establish the targeted equity awards (value and number of shares) for each executive. | · | Performance sharesare used to encourage ownership and retention, and are payable for the achievement of three-year corporate financial performance goals established by the Committee. The use of corporate performance measures focuses the senior executives on the overall success of the Company, which is where shareholder value is reflected. Financial goals are based upon a strategic plan presented to and approved by the Board of Directors annually. At the end of the performance cycle a payout factor is calculated based on actual results against the threshold, target and outstanding performance levels, resulting in a payout from 0 to 200% of the targeted number of performance shares for cycles up to and including the fiscal year 2012–14 cycle. Beginning with the fiscal year 2013–15 performance cycle, the payout range was reduced to 0% to 150% of the targeted number of performance shares, and threshold payout moved from 25% to 50% of target. This is more typical long-term incentive plan design, and appropriate during periods of economicexecutive officer. |
uncertainty
| | ● | Restricted performance share unitsare used to focus executive officers on the achievement of three-year corporate financial performance goals established by the Committee. The use of corporate performance measures aligns executive officers with the overall success of the Company, which is where shareholder value is reflected. Financial goals are based upon a strategic plan approved by the Board of Directors annually. At the end of the performance cycle, a payout factor is calculated based on actual results against threshold, target and market volatility.outstanding performance levels, resulting in a payout from 0% to 200% of the targeted number of performance shares for cycles up to and including the fiscal year 2012-14 cycle. Beginning with the fiscal year 2013-15 performance cycle, the maximum payout was reduced to 150% from 200% of target, and threshold payout was increased from 25% to 50% of target; performance below threshold continues to result in a 0% payout. This payout range is more typical long-term incentive plan design. Additionally, the stretch level of financial performance at outstanding is higher than in the past. For the fiscal year 2011–132012-14 performance cycle, EPS and cumulative normalized free cash flow (FCF)FCF were the performance measures, used, weighted at 60% and 40%, respectively. These are the same performance measures and weights being used for the FY2013–15FY2014-16 performance cycle that began this year. These performance measures are meaningful measures of our financial health, drivers of shareholder value, and the focus of the long-term investors the Company wishes to attract. | | | | | | | | For the fiscal year 2011–132012-14 performance cycle, in comparison to the target goals set by the Committee for long-term incentive purposes (see table immediately following), EPS achievement was 97.7%below threshold at 84.8% of target, and FCF achievement was 125.7%102.9% of target, resulting in a payout of 129.8%47.7% of the targeted number of shares for this performance cycle.Financial Objective | | FY2011-13 Threshold Performance Level | | FY2011-13 Target Amount | | FY2011-13 Outstanding Performance Level | | FY2011-13 Results | | EPS | | 90% | | $3.10 | | 105% | | $3.03 | | Normalized FCF ($000s) | | 90% | | $615,000 | | 110% | | $772,900 | |
| Note: | Financial results used for long-term incentive payment purposes may be adjusted to budgeted foreign exchange rates and for certain items and events as permitted by the shareholder-approved 2009 Key Employee Stock Plan. For the 2011–13 cycle, the principal exclusions were the impact of the acquisitions and divestitures made during the fiscal year, a disputed income tax deposit paid to the German tax authorities in fiscal year 2013, and an excess payment made to the UK pension plan. Dividend equivalents are paid on earned shares following the performance cycle and before vesting. |
| | | Financial Objective | | FY2012-14 Threshold Performance Level | | FY2012-14 Target Amount | | FY2012-14 Outstanding PerformanceLevel | | FY2012-14 Results | | | | | | | | | | | | | | | | | | | | EPS | | 90% | | | $3.81 | | 110% | | | $3.23 | | | | | Normalized FCF ($000s) | | 85% | | | $810,000 | | 115% | | | $833,500 | |
| | | | | | Note: | Financial results used for long-term incentive payment purposes may be adjusted to budgeted foreign exchange rates and for certain items and events as permitted by the shareholder-approved 2009 Key Employee Stock Plan. For the 2012-14 cycle, the principal exclusions were the impact of acquisitions and divestments not contemplated in the 2012-2014 plan; a disputed income tax deposit paid to the German tax authorities; deferred tax benefits due to a reduction in the UK income tax rate; and restructuring and reorganization charges. Free cash flow is defined by the Company as cash from operating activities less cash used for investing activities excluding acquisitions. | | | | |
| | Following are the fiscal year 2011–132012-14 performance shares earned for the NEOs as a percentage of target:Named Executive Officer | | Target Performance Shares for the FY2011–13 Cycle | | Earned Performance Shares for the FY2011–13 Cycle | | Total Payout as a % of Target | | Stephen M. Smith | | 13,000 | | | 16,874 | | | 129.8 | % | | Ellis E. Cousens | | 10,000 | | | 12,980 | | | 129.8 | % | | Steven J. Miron | | 5,000 | | | 6,490 | | | 129.8 | % | | Gary Rinck | | 6,000 | | | 7,788 | | | 129.8 | % | | Mark J. Allin | | 5,000 | | | 6,490 | | | 129.8 | % | |
| | | |
| | Named Executive Officer | | Target Performance Shares for the FY2011–13 Cycle | | Earned Performance Shares for the FY2011–13 Cycle | | Total Payout as a % of Target | | | | | | | | | | | | | Stephen M. Smith | | 20,000 | | | 9,540 | | 47.7% | | | Ellis E. Cousens | | 10,000 | | | 4,770 | | 47.7% | | | Steven J. Miron | | 5,000 | | | 2,385 | | 47.7% | | | Gary Rinck | | 6,000 | | | 2,862 | | 47.7% | | | Mark J. Allin | | 4,500 | | | 2,147 | | 47.7% |
| | | | | Mr. Kritzmacher is not included in the table above since he was not a participant for this performance cycle given his recent hire date. The NEOsNEOs’ target performance shares for the fiscal year 2013–152014-16 performance cycle are included in the Grants of Plan-Based Awards Table on page 38. | | | | | | | | ● | Stock optionsare used to align the interests of management with those of the Company’s shareholders. The Committee believes that because value is realized only if the Company’s stock price rises, that stock options are performance-based compensation. |
| · | Restricted stock(a regular part of the equity mix beginning with the June 2013 (fiscal year 2014–16 | | | | | | | | | ● | Restricted share units,a regular part of the equity mix beginning with the June 2013 (fiscal year 2014-16 cycle) grants, will facilitate stock ownership, expediting achievement of the stock ownership multiple, and will provide an additional retention mechanism. Dividend equivalents are paid on restricted share units until the shares vest. |
| | | | | Equity award grants are made five business days after the release of the Company’s year-end earnings. Target Equity awards vest 50% after years four and five, except in limited circumstances involving performance shares for completed performance cycles upon executive retirement, death or permanent disability.
| | | |
Stock Ownership Guidelines | | The Committee believes that the ultimate goal of the long-term incentive program is to align the interests of Company stockholders and management. To reinforce this principle, the Committee established stock ownership guidelines for all executive officers participating in the long-term incentive program. The ownership guideline for the President and CEO is six times base salary. The ownership guideline for the other executive officers is two and one-half times base salary. Shares counted toward the ownership guidelines consist of: |
| | | | | | | | ● | Shares owned outright | | | | | | | | | ● | Half of the performance share units earned (i.e.where the performance cycle has been completed) but not yet vested. (Assumes half will be surrendered to pay taxes.) | | | | | | | | | ● | Half of any time-based restricted shares / restricted share units granted. (Assumes half will be surrendered to pay taxes.) | | | | | |
| | Mr. Cousens and Mr. Rinck have exceeded their targeted shareholdings. Messrs. Smith, Kritzmacher, Miron and Allin are all relatively new to their roles and are making progress toward meeting their ownership targets. |
| | For all equity grants awarded during and after June 2011, there is a stock retention requirement for our executive officers, including the NEOs, forthat requires retention of 50% of the fiscal year 2013–15net shares acquired upon the exercise of stock options or the vesting of performance cycle are detailedshare units and restricted shares/share units until the executive satisfies the stock ownership salary multiple. | | | | Clawback Provision | | To ensure that our compensation program does not encourage excessive risk taking, in July 2010 the Company introduced a clawback provision in both the annual and long-term incentive plans covering the top 350 colleagues in the Summary Compensation and GrantsCompany. The clawback provision allows the Company to recoup incentive payments to covered incentive participants in the event that the Company needs to restate its financial results because of Plan-Based Awards tables.
fraud, gross negligence or intentional misconduct on the part of one or more employees and/or because of material non-compliance with securities laws. | | | | Retirement and Post-
EmploymentPost-Employment Benefits | | All NEOs are eligible to participate in the Company’s qualified savings and retirement plans, as described further starting on page 42.53. However, because US and UK tax rules governing qualified retirement plans place significant limitations on the benefits that can be paid to executives, the Company has adopted four non-qualified deferred compensation plans to supplement their qualified retirement benefits.
| · | Nonqualified Supplemental Benefit Plan (the “Excess Plan”).The Excess Plan was adopted by the Board of Directors to restore benefits that cannot be provided under the Employees’ Retirement Plan of John Wiley & Sons, Inc. (“US Retirement Plan”) due to limitations imposed by the Internal Revenue Code. | | | |
| | | ● | Nonqualified Supplemental Benefit Plan (the “Excess Plan”).The Excess Plan was adopted by the Board of Directors to restore benefits that cannot be provided under the Employees’ Retirement Plan of John Wiley & Sons, Inc. (“US Retirement Plan”) due to limitations imposed by the Internal Revenue Code. Participation in and accruals under the Excess Plan were frozen as of June 30, 2013. | | | | | | | | | ● | Supplemental Executive Retirement Plan (the “SERP”).To provide executives with enhanced retirement income, and to attract and retain executive talent, the Company implemented the SERP. Participation in and accruals under the SERP were frozen as of June 30, 2013. The SERP is more fully described on page 54. | | | | | | | | | ● | Deferred Compensation Plan (the “DCP”).The Deferred Compensation Plan was adopted by the Board of Directors to provide the opportunity to defer compensation for those executives who are not able to take full advantage of the Company’s qualified Savings Plan because of tax rules limiting contributions. In conjunction with the freeze of the U.S. defined benefit plans, the Board approved amending the DCP to provide for Company contributions mirroring those made under the Savings Plan. | | | | | | | | | ● | UK Unapproved Supplemental Plan (the “UK Non-Qualified Plan”).The UK Non-Qualified Plan was adopted by the Board of Directors to restore benefits for selected individuals that cannot be provided under the UK Qualified Plan due to limitations imposed by Her Majesty’s Revenue & Customs. | | | · | Supplemental Executive Retirement Plan (the “SERP”).To assure that executives were provided with an adequate retirement income, and to attract and retain executive talent, the Company implemented the SERP which was later amended. The SERPs are more fully described on pages 42–43. | | | | | · | Deferred Compensation Plan.The Deferred Compensation Plan was adopted by the Board of Directors to address the opportunity to defer compensation for those executives who are not able to take full advantage of the Company’s qualified Savings Plan because of tax rules limiting contributions. |
| | | | · | UK Unapproved Supplemental Plan (the “UK Non-Qualified Plan”).The UK Non-Qualified Plan was adopted by the Board of Directors to restore benefits for selected individuals that cannot be provided under the UK Qualified Plan due to limitations imposed by Her Majesty’s Revenue & Customs. |
As noted above, in fiscal year 2013, the Company announced a cessation ofceased accruals and freeze offroze participation in the US defined benefit retirement plans, including the US Retirement Plan, the Excess Plan, and the SERP, effective June 30, 2013.2014. At the same time, the Company announced enhancements toenhanced its Defined Contribution Savings Plan (401(k)).
| | | |
Health and Welfare Benefits | | The Company provides or makes available a number of health and welfare benefits, such as medical, dental, vision, life, accident and long-term disability insurance to all US-based colleagues, including the NEOs. These benefits are competitive with those provided by other companies in the publishing / media and general industries and are provided primarily for the well-being of Wiley colleagues, and at the same time enhance Wiley’s attractiveness as an employer of choice.
| | | | Perquisites and Other Benefits | | The Company provides limited perquisites and other personal benefits to the NEOs, of which the incremental cost to the Company in the aggregate is generally in the range of $10,000 to $18,000 annually. These benefits are provided primarily for the financial security and productivity of the executives, which allows greater focus on Wiley business activities. These limited perquisites primarily consist of financial planning and tax preparation, an allowance for business and health club memberships, parking in the headquarters building (where appropriate), and an annual physical examination. In fiscal year 2012, we eliminated tax “gross-ups”“gross- |
| | ups” for perquisites provided to our executive officers. Any taxes on perquisites are now paid by the executives. Mr. Allin, whose position has required spending a significant amount of time in the US, has been allowed the use of a Company-leased apartment in the US. This accommodation is provided in lieu of hotel expenses while conducting Company business. The apartment is available to other Company employees throughout the year.
| | | | Post-Employment Benefits | | Depending on the circumstances of their termination, the NEOs are eligible to receive severance benefits in the form of base salary as a lump-sum payment, annual incentive, healthcare benefits and accelerated vesting of equity as determined by the provisions in their employment agreements, which are discussed in detail starting on page 44.60. Under a dismissal without cause or constructive discharge following a change of control, the Company provides these severance benefits because it serves the best interest of the Company and its shareholders to have executives focus on the business merits of mergers and acquisitions without undue concern for their personal financial outcome. In the case of a without cause termination or constructive discharge absent a change in control, the Company believes it is appropriate to provide severance at these levels to provide continued compensation for a reasonablelimited period to bridge executives to new employment, particularly in view of our non-compete agreements which staterequire that for twelve months following termination the executive will not compete with the Company or solicit customers or employees of the Company.
Tax Deductibility of Compensation | | Ordinarily it is in the best interest of the Company to retain flexibility in its compensation programs to enable it to appropriately reward, retain and attract executive talent necessary to further the Company’s success. To the extent such goals can be met with compensation that is designed to be deductible under Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), such as the 2009 Key Employee Stock Plan and the Executive Annual Incentive Plan, each approved by the shareholders in September 2009, such compensation plans will be used. However, the Committee recognizes that in appropriate circumstances, compensation that is not deductible under the Code may be paid at the Committee’s discretion. | | | | | | Closing Statement | | | | | | The executive compensation program discussed herein is based on our beliefs that: | · | The quality of our leadership is among the most important determinants of the Company’s success; | | | | | · | Our ability to attract and retain industry leaders who will ensure our success requires a competitive, performance-based compensation program; | | | | | · | Our shareholders are best served by providing our senior executives |
| | | ● | The quality of our leadership is among the most important determinants of the Company’s success; | | | | | | | | | ● | Our ability to attract and retain industry leaders who will ensure our success requires a competitive, performance-based compensation program; | | | | | | | | | ● | Our shareholders are best served by providing our executive officers with appropriate financial rewards directly linked to the long-term success of the Company; and | | | | | | | | | ● | Our executive officers must share in the risks as well as the rewards of the Company; and | | | | | · | Our senior executives must share in the risks as well as the rewards in achieving the Company’s challenging performance goals. |
| | | | | | | | We believe that the Company’s executive compensation program meets the goals and objectives discussed above. |
Summary Compensation Table: | Name [a] | | Year [b] | | Salary ($) [c] | | Bonus ($) [d] | | Stock Awards ($) [e] | | Option Awards ($) [f] | | Non- Equity Incentive Plan Compen- sation ($) [g] | | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) [h] | All Other Compen- sation ($) [i] | | Total ($) [j] | | | | | | | | | | | | | | | | | | | | | | Stephen M. Smith | | 2014 | | 869,167 | | | | 1,403,315 | | 607,800 | | 1,434,956 | | 714,201 | | 138,721 | | 5,168,159 | | | | 2013 | | 833,333 | | | | 961,200 | | 1,229,000 | | 752,724 | | 1,441,655 | | 132,083 | | 5,349,996 | | | | 2012 | | 800,000 | | | | 1,982,000 | | 1,428,000 | | 929,940 | | 3,771,050 | | 126,598 | | 9,037,588 | | Ellis E. Cousens | | 2014 | | 676,667 | | | | | | | | 857,820 | | 117,069 | | 44,210 | | 1,695,766 | | | | 2013 | | 656,667 | | | | 983,782 | | | | 484,605 | | 617,389 | | 33,223 | | 2,775,666 | | | | 2012 | | 636,667 | | | | 495,500 | | 928,200 | | 628,320 | | 993,032 | | 40,589 | | 3,722,308 | | John A. Kritzmacher | | 2014 | | 525,000 | | | | 913,425 | | 607,800 | | 667,710 | | 100 | | 36,150 | | 2,750,185 | | Steven J. Miron | | 2014 | | 512,500 | | | | 383,441 | | 160,054 | | 528,329 | | (194,949 | ) | 32,535 | | 1,421,910 | | | | 2013 | | 495,833 | | | | 264,330 | | 337,975 | | 352,183 | | 778,754 | | 25,376 | | 2,254,451 | | | | 2012 | | 469,167 | | | | 247,750 | | 357,000 | | 381,811 | | 1,263,740 | | 26,770 | | 2,746,238 | | Gary Rinck | | 2014 | | 512,500 | | | | 347,864 | | 144,859 | | 477,598 | | 320,715 | | 38,149 | | 1,841,685 | | | | 2013 | | 497,500 | | | | 288,360 | | 307,250 | | 280,031 | | 358,896 | | 18,327 | | 1,750,364 | | | | 2012 | | 482,500 | | | | 297,300 | | 357,000 | | 357,112 | | 560,472 | | 43,885 | | 2,098,269 | | Mark J. Allin | | 2014 | | 421,623 | | | | 320,193 | | 132,703 | | 388,137 | | (106,894 | ) | 95,232 | | 1,250,994 | | | | 2013 | | 399,253 | | | | 216,270 | | 320,769 | | 310,748 | | 651,647 | | 226,671 | | 2,125,359 | | | | 2012 | | 385,266 | | | | 222,975 | | 372,708 | | 344,798 | | 600,746 | | 41,698 | | 1,968,191 |
36 | | (c): | The 2014 base salary reported in this column for Mr. Kritzmacher reflects his period of employment during this fiscal year. The 2012 base salary reported in this column for Mr. Allin has been converted to U.S. dollars using the fiscal year 2012 average exchange rate of £1 = US$1.5942. The 2013 base salary reported in this column for Mr. Allin has been converted to U.S. dollars using the fiscal year 2013 average exchange rate of £1 = US$1.5760. The 2014 base salary reported in this column for Mr. Allin has been converted to U.S. dollars using the fiscal year 2014 average exchange rate of £1 = US$1.6011. | | | | | | | (e): | The amounts reported in this column consist of restricted performance shares/units and, for 2014, restricted share units granted under the Company’s 2009 Key Employee Stock Plan. The amounts noted for the restricted performance shares/units represent the value at the grant date based on the probable outcome of the performance conditions under the awards. Maximum value payouts of the restricted performance shares/units are 150% of target for 2014 and 2013, and 200% for 2012, and will only occur if the Company reaches preset “outstanding” performance benchmarks. To calculate the fair value of the awards, the market price on the date of grant is used in accordance with the FASB ASC Topic 718, Stock Compensation. Refer to Notes 2 and 18 in the Notes to the Consolidated Financial Statements in the Company’s 2014 Annual Report for the assumptions used in determining FAS ASC Topic 718, Stock Compensation values. The 2013 amount reported in this column for Mr. Cousens includes the $636,693 cash incentive in lieu of equity that was previously included in the Bonus column, and has been properly reclassified as a Stock Award. | | | | | | | (f): | The amounts reported in this column consist of stock options granted under the Company’s 2009 Key Employee Stock Plan. The assumptions used to calculate the stock option award values are in accordance with FASB ASC Topic 718, Stock Compensation. Refer to Notes 2 and 18 in the Notes to the Consolidated Financial Statements in the Company’s 2014 Annual Report for the assumptions used in determining FASB ASC Topic 718, Stock Compensation values. The amounts listed do not necessarily reflect the level of compensation that may be realized by our named executive officers. | | | | | | | (g): | The total annual incentive for 2014 was earned based on the achievement of pre-established corporate and, in the case of Mr. Miron and Mr. Allin, business financial measures—including revenue, profit and cash flow—approved by the Committee, as well as the achievement of strategic milestones that are designed to drive improved performance for the Company in the current and future fiscal years. | | | | | | | (h): | Messrs. Smith and Allin’s Present Value of Accumulated Benefits from the UK Qualified and UK Non-Qualified Plans were calculated using a British £ to US $ conversion factor |
Summary
| | of 1.5375 and 1.6811, for benefits as of 4/30/2013 and 4/30/2014, respectively. Messrs. Smith and Allin’s Present Value of Accumulated Benefits from the UK Qualified and UK Non-Qualified Plans were calculated using UK disclosure assumptions as of 4/30/2013 and 4/30/2014, as applicable. The change in pension value reflects the US Qualified, Excess and SERP benefits frozen as of June 30, 2013. Note the following: |
| | ● | Mr. Allin continues to accrue UK pension benefits. | | | | | | | ● | Additional US pension accruals ceased as of the US plans’ freeze. | | | | | | | ● | The change in pension value is mostly attributable to the net effects of changing the discount rates, decrease in the discount period, revising the mortality table, updating the UK exchange rates for UK pension benefits, the growth in included earnings (note the exception for Mr. Allin, as described below), and two months of US pension accruals since the 2013 proxy. |
| | Mr. Allin’s and Mr. Miron’s pension values have decreased from the 2013 proxy. The main reason for the decrease in Mr. Allin’s pension value is that the his FY 2013 bonus was assumed to be includable in the determination of his accumulated plan benefit for the 2013 proxy, but was actually paid in July 2013 and therefore was not included in his frozen final average compensation as of June 30, 2013 used for the determination of his accumulated plan benefit for the 2014 proxy. The main reason for the decrease in Mr. Miron’s pension value is due to the increase in the discount rates used to determine present value for the 2014 proxy. The discount rates for the 2013 proxy were 3.65%, 4.05% and 4.25% for the qualified, Excess and SERP, respectively. The discount rates for the 2014 proxy are 4.1%, 4.5% and 4.8%, respectively. |
| | (i): | All Other Compensation Table:consists of the following in 2014: |
| | ● | Employer contributions to the Company 401(k) plan and Deferred Compensation Plan for Messrs. Smith, Cousens, Kritzmacher, Miron and Rinck, are valued at $41,580, $32,886, $18,750, $25,111 and $25,298 respectively. | | | | | | | ● | Perquisites (financial planning, club membership fees, parking benefits) for Messrs. Smith, Cousens, Kritzmacher, Miron, Rinck and Allin, valued at $6,467, $11,324, $17,400, $7,424, $12,851 and $7,466.67, respectively. | | | | | | | ● | The Committee agreed to provide Mr. Smith with an allowance to be reviewed annually and used to cover personal travel for himself and his family between the UK and the US, since part of his family resides in the UK. In fiscal year 2014, these travel expenses amounted to $65,000. | | | | | | | ● | Mr. Smith continues to have tax obligations in the UK, and the Company has agreed to cover personal tax preparation and filing, and completion of other filing obligations in the UK and the US, amounting to $25,674 in fiscal year 2014, and included as “other compensation.” | | | | | | | ● | Mr. Allin is a UK-based executive who travels extensively to the US, and has tax obligations in both the UK and the US. The Company has agreed to cover tax preparation and filing assistance in the UK and the US, and completion of other filing obligations in the UK and the US for Mr. Allin through PricewaterhouseCoopers (PwC), amounting to $74,556 in fiscal year 2014, and included as “other compensation.” | | | | | | | ● | Mr. Allin, like other UK executives, receives an annual car allowance equal to £8250 per annum. That amount has been converted to $13,209 using the fiscal year 2013 average exchange rate of £1 = US$1.6011. |
Name [a] | | Year [b] | | | Salary ($) [c] | | | Bonus ($) [d] | | | Stock Awards ($) [e] | | | Option Awards ($) [f] | | | Non- Equity Incentive Plan Compen- sation ($) [g] | | | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) [h] | | | All Other Compen- sation ($) [i] | | | Total ($) [j] | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Stephen M. Smith | | | 2013 | | | | 833,333 | | | | | | | | 961,200 | | | | 1,229,000 | | | | 752,724 | | | | 1,441,655 | | | | 132,083 | | | | 5,349,996 | | | | | 2012 | | | | 800,000 | | | | | | | | 1,982,000 | | | | 1,428,000 | | | | 929,940 | | | | 3,771,050 | | | | 126,598 | | | | 9,037,588 | | | | | 2011 | | | | 620,833 | | | | | | | | 520,260 | | | | 857,500 | | | | 965,938 | | | | 1,029,276 | | | | 317,894 | | | | 4,311,701 | | Ellis E. Cousens | | | 2013 | | | | 656,667 | | | | 636,693 | | | | 347,089 | | | | | | | | 484,605 | | | | 617,389 | | | | 33,223 | | | | 2,775,666 | | | | | 2012 | | | | 636,667 | | | | | | | | 495,500 | | | | 928,200 | | | | 628,320 | | | | 993,032 | | | | 40,589 | | | | 3,722,308 | | | | | 2011 | | | | 616,667 | | | | | | | | 400,200 | | | | 796,250 | | | | 849,710 | | | | 640,475 | | | | 38,878 | | | | 3,342,180 | | Steven J. Miron | | | 2013 | | | | 495,833 | | | | | | | | 264,330 | | | | 337,975 | | | | 352,183 | | | | 778,754 | | | | 25,376 | | | | 2,254,451 | | | | | 2012 | | | | 469,167 | | | | | | | | 247,750 | | | | 357,000 | | | | 381,811 | | | | 1,263,740 | | | | 26,770 | | | | 2,746,238 | | | | | 2011 | | | | 440,000 | | | | | | | | 200,100 | | | | 306,250 | | | | 480,893 | | | | 433,735 | | | | 26,735 | | | | 1,887,713 | | Gary Rinck | | | 2013 | | | | 497,500 | | | | | | | | 288,360 | | | | 307,250 | | | | 280,031 | | | | 358,896 | | | | 18,327 | | | | 1,750,364 | | | | | 2012 | | | | 482,500 | | | | | | | | 297,300 | | | | 357,000 | | | | 357,112 | | | | 560,472 | | | | 43,885 | | | | 2,098,269 | | | | | 2011 | | | | 467,500 | | | | | | | | 240,120 | | | | 306,250 | | | | 465,476 | | | | 264,967 | | | | 22,836 | | | | 1,767,149 | | Mark J. Allin | | | 2013 | | | | 399,253 | | | | | | | | 216,270 | | | | 320,769 | | | | 310,748 | | | | 651,647 | | | | 226,671 | | | | 2,125,359 | | | | | 2012 | | | | 385,266 | | | | | | | | 222,975 | | | | 372,708 | | | | 344,798 | | | | 600,746 | | | | 41,698 | | | | 1,968,191 | |
(c): | The 2012 base salary reported in this column for Mr. Allin has been converted to U.S. dollars using the fiscal year 2012 average exchange rate of £1=US$1.5942. The 2013 base salary reported in this column for Mr. Allin has been converted to U.S. dollars using the fiscal year 2013 average exchange rate of £1=US$1.5760.Grants of Plan-Based Awards Table: | | | | | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards | | Estimated Future Payouts Under Equity Incentive Plan Awards | | All Other Stock Awards: Number of Shares of Stock or | | All Other Option Awards: Number ofSecurities Underlying | | Exercise or Base Price of Option | | Grant Date Fair Value of Stock and Option | | Name [a] | | Grant Date [b] | | Threshold ($) [c] | | Target ($) [d] | | Maximum ($) [e] | | Threshold (#) [f] | | Target (#) [g] | | Maximum (#) [h] | | Units (#) [i] | | Options (#) [j] | | Awards ($/Sh) [k] | | Awards ($) [l] | | | | | | | | | | | | | | | | | | | | | | | | | | Stephen M. Smith | | 6/19/2013 | | 568,750 | | 1,137,500 | | 1,706,250 | | | | | | | | | | | | | | | | | | 6/25/2013 | | | | | | | | 12,750 | | 25,500 | | 38,250 | | | | | | 39.53 | | 1,008,015 | | | | 6/25/2013 | | | | | | | | | | | | | | 10,000 | | | | 39.53 | | 395,300 | | | | 6/25/2013 | | | | | | | | | | | | | | | | 60,000 | | 39.53 | | 607,800 | | Ellis E. Cousens | | 6/19/2013 | | 340,000 | | 680,000 | | 1,020,000 | | | | | | | | | | | | | | | | John A. Kritzmacher | | 6/17/2013 | | | | | | | | | | | | | | 12,500 | | | | 41.45 | | 518,125 | | | | 6/19/2013 | | 270,000 | | 540,000 | | 810,000 | | | | | | | | | | | | | | | | | | 6/25/2013 | | | | | | | | 5,000 | | 10,000 | | 15,000 | | | | | | 39.53 | | 395,300 | | | | 6/25/2013 | | | | | | | | | | | | | | | | 60,000 | | 39.53 | | 607,800 | | Steven J. Miron | | 6/19/2013 | | 244,625 | | 489,250 | | 733,875 | | | | | | | | | | | | | | | | | | 6/25/2013 | | | | | | | | 3,450 | | 6,900 | | 10,350 | | | | | | 39.53 | | 272,757 | | | | 6/25/2013 | | | | | | | | | | | | | | 2,800 | | | | 39.53 | | 110,684 | | | | 6/25/2013 | | | | | | | | | | | | | | | | 15,800 | | 39.53 | | 160,054 | | Gary Rinck | | 6/19/2013 | | 193,125 | | 386,250 | | 579,375 | | | | | | | | | | | | | | | | | | 6/25/2013 | | | | | | | | 3,150 | | 6,300 | | 9,450 | | | | | | 39.53 | | 249,039 | | | | 6/25/2013 | | | | | | | | | | | | | | 2,500 | | | | 39.53 | | 98,825 | | | | 6/25/2013 | | | | | | | | | | | | | | | | 14,300 | | 39.53 | | 144,859 | | Mark J. Allin | | 6/19/2013 | | 201,476 | | 402,951 | | 604,427 | | | | | | | | | | | | | | | | | | 6/25/2013 | | | | | | | | 2,900 | | 5,800 | | 8,700 | | | | | | 39.53 | | 229,274 | | | | 6/25/2013 | | | | | | | | | | | | | | 2,300 | | | | 39.53 | | 90,919 | | | | 6/25/2013 | | | | | | | | | | | | | | | | 15,196 | | 39.53 | | 153,935 |
| | (c) to (e): | Represents the annual incentives for fiscal year 2014 that are based on achievement of financial goals and strategic milestones. Financial performance measures and relative weighting of each performance measure, as well as the threshold, target and outstanding levels of performance, are set at the beginning of the fiscal year. Revenue, profit and cash flow were the performance measures used for fiscal year 2014. Strategic milestones are designed to drive improved performance for the Company in the current and future fiscal years. Actual annual incentive payouts for fiscal year 2014 are indicated in column (g) of the Summary Compensation Table. | | | | | | | (f) to (h): | Represents the restricted performance share unit awards granted for the 2014 through 2016 performance period pursuant to the 2009 Key Employee Stock Plan. In fiscal 2014 executives received approximately 50% of their targeted long-term incentive in the form of restricted performance share units. Financial performance measures and relative weighting of each performance measure, as well as the threshold, target and outstanding levels of performance, are set at the beginning of the three-year plan cycle. Earnings per share and cumulative free cash flow are the performance measures used for the FY2014-16 performance cycle, weighted at 60% and 40%, respectively. No long-term incentive is payable unless the threshold performance level is reached for one of the performance measures. The restricted performance shares, if earned, vest 50% on April 30, 2017 and the remaining 50% on April 30, 2018. Dividends are not paid during the performance period, but dividend equivalents are paid on earned shares following the performance cycle and before vesting. Once the shares vest, dividends are paid on the retained shares. | | | | | | | (i): | Restricted share unit awards are granted on an annual basis, pursuant to the 2009 Key Employee Stock Plan. Shares vest 50% on April 30 the fourth year after grant and 50% on April 30 the fifth year after grant. In fiscal 2014 executives received approximately 20% of their targeted long-term incentive in the form of restricted share units. Dividend equivalents are paid on restricted share units until the shares vest. Once the shares vest, dividends are paid on the retained shares. | (e): | The amounts reported in this column consist of restricted performance shares granted under the Company’s 2009 Key Employee Stock Plan. These amounts represent the value at the grant date based on the probable outcome of the performance conditions under the awards. Maximum value payouts are 150% of target for 2013 and 200% for 2012 and 2011, and will only occur if the Company reaches preset “outstanding” performance benchmarks. To calculate the fair value of the awards, the market price on the date of grant is used in accordance with |
| | (j): | Option grants are awarded on an annual basis, pursuant to the 2009 Key Employee Stock Plan. Options have terms of ten years and vest 50% on April 30 the fourth year after grant and 50% on April 30 the fifth year after grant. All employees’ stock options have exercise prices that are equal to the grant date closing market price of Class A Stock. In fiscal 2014 executives received approximately 30% of their targeted long-term incentive in the form of stock options. | | | | | | | (k): | The closing stock price on June 25, 2013. The exercise price of all stock options may not be less than 100% of the fair market value of the stock on the date of grant. | | | | | | | (l): | The grant date fair value of the restricted performance shares and stock options is computed in accordance with FASB ASC Topic 718, Stock Compensation. The grant date fair value of the restricted performance share unit and restricted share unit awards is based on a $39.53 stock price. The fair value disclosed in this column for the restricted performance share units represents the total fair value of those awards at the target level. Maximum value payouts are 150% of target, and will only occur if the Company reaches preset “outstanding” performance benchmarks. The grant date fair value of stock option awards is based on a $10.13 Black-Scholes value. Refer to Notes 2 and 18 in the Notes to the Consolidated Financial Statements in the Company’s 2014 Annual Report for the assumptions made in determining FASB ASC Topic 718, Stock Compensation. Refer to Notes 2 and 18 in the Notes to the Consolidated Financial Statements in the Company’s 2013 Annual Report for the assumptions used in determining FAS ASC Topic 718, Stock Compensation values. | | | (f): | The amounts reported in this column consist of stock options granted under the Company’s 2009 Key Employee Stock Plan. The assumptions used to calculate the stock option award values are in accordance with FASB ASC Topic 718, Stock Compensation. Refer to Notes 2 and 18 in the Notes to the Consolidated Financial Statements in the Company’s 2013 Annual Report for the assumptions used in determining FASB ASC Topic 718, Stock Compensation values. The amounts listed do not necessarily reflect the level of compensation that may be realized by our named executive officers. | | | (g): | The total annual incentive for 2013 was earned based on the achievement of pre-established corporate and, in the case of Mr. Miron and Mr. Allin, business financial measures—including revenue, profit and cash flow—approved by the Committee, as well as the achievement of strategic milestones that are designed to drive improved performance for the Company in the current and future fiscal years. | | | (h): | Represents the aggregate change in actuarial present value of the executive’s accumulated benefit under all defined benefit and actuarial pension plans (including supplemental plans) from April 30, 2012 to April 30, 2013. | | | (i): | All Other Compensation consists of the following in 2013: |
| · | Employer contributions to the Company 401(k) plan and Deferred Compensation Plan for Messrs. Smith, Cousens, Miron and Rinck, are valued at $22,832, $18,518, $14,330 and $14,427 respectively. | | | | | · | Perquisites (financial planning, club membership fees, parking benefits) for Messrs. Smith, Cousens, Miron, Rinck and Allin, valued at $9,412, $14,705, $11,046, $3,900 and $8,640, respectively. |
37 | | | | Option Awards | | Stock Awards | | Outstanding Equity Awards at Fiscal Year End: | | Name [a] | | Number of Securities Under- lying Unexer- cised Options (#) Exercisable [b] | | | Number of Securities Underlying Unexer- cised Options (#) Unexer- cisable [c] | | | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) [d] | | Option Exercise Price ($) [e] | | | Option Expiration Date [f] | | Number of Shares or Units of Stock That Have Not Vested (#) [g] | | | Market Value of Shares or Units of Stock That Have Not Vested ($) [h] | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) [i] | | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) [j] | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Stephen M. Smith | | | 17,205 | | | | | | | | | $ | 38.55 | | | 6/21/2015 | | | 8,437 | (1) | | | 484,790 | | | | 20,000 | | | | 1,149,200 | | | | | | | 22,940 | | | | | | | | | $ | 33.05 | | | 6/21/2016 | | | 20,000 | (5) | | | 1,149,200 | | | | 25,500 | | | | 1,465,230 | | | | | | | 28,675 | | | | | | | | | $ | 48.46 | | | 6/27/2017 | | | 9,540 | (2) | | | 548,168 | | | | | | | | | | | | | | | 28,675 | | | | | | | | | $ | 47.55 | | | 6/25/2018 | | | 10,000 | (4) | | | 574,600 | | | | | | | | | | | | | | | 70,000 | | | | | | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | 35,000 | | | | | | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | 35,000 | (1) | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | 100,000 | (2) | | | | $ | 49.55 | | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | 100,000 | (3) | | | | $ | 48.06 | | | 6/25/2022 | | | | | | | | | | | | | | | | | | | | | | | | | | 60,000 | (4) | | | | $ | 39.53 | | | 6/24/2023 | | | | | | | | | | | | | | | | | | | Ellis E. Cousens | | | 36,432 | | | | | | | | | $ | 47.55 | | | 6/25/2018 | | | 6,490 | (1) | | | 372,915 | | | | 7,222 | | | | 414,976 | | | | | | | 130,000 | | | | | | | | | $ | 35.04 | | | 6/24/2019 | | | 4,770 | (2) | | | 274,084 | | | | | | | | | | | | | | | 32,500 | | | | | | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | 32,500 | (1) | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | 65,000 | (2) | | | | $ | 49.55 | | | 6/22/2021 | | | | | | | | | | | | | | | | | | | John A. Kritzmacher | | | | | | | 60,000 | (4) | | | | $ | 39.53 | | | 6/24/2023 | | | 12,500 | (6) | | | 718,250 | | | | 10,000 | | | | 574,600 | | | | Steven J. Miron | | | 4,900 | | | | | | | | | $ | 33.05 | | | 6/21/2016 | | | 3,245 | (1) | | | 186,458 | | | | 5,500 | | | | 316,030 | | | | | | | 4,400 | | | | | | | | | $ | 48.46 | | | 6/27/2017 | | | 2,385 | (2) | | | 137,042 | | | | 6,900 | | | | 396,474 | | | | | | | 4,600 | | | | | | | | | $ | 47.55 | | | 6/25/2018 | | | 2,800 | (4) | | | 160,888 | | | | | | | | | | | | | | | 7,000 | | | | | | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | 12,500 | | | | | | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | 12,500 | (1) | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | 25,000 | (2) | | | | $ | 49.55 | | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | 27,500 | (3) | | | | $ | 48.06 | | | 6/25/2022 | | | | | | | | | | | | | | | | | | | | | | | | | | 15,800 | (4) | | | | $ | 39.53 | | | 6/24/2023 | | | | | | | | | | | | | | | | | | | Gary Rinck | | | 30,000 | | | | | | | | | $ | 48.46 | | | 6/27/2017 | | | 3,894 | (1) | | | 223,749 | | | | 6,000 | | | | 344,760 | | | | | | | 30,000 | | | | | | | | | $ | 47.55 | | | 6/25/2018 | | | 2,862 | (2) | | | 164,451 | | | | 6,300 | | | | 361,998 | | | | | | | 30,000 | | | | | | | | | $ | 35.04 | | | 6/24/2019 | | | 2,500 | (4) | | | 143,650 | | | | | | | | | | | | | | | 12,500 | | | | | | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | 12,500 | (1) | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | 25,000 | (2) | | | | $ | 49.55 | | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | 25,000 | (3) | | | | $ | 48.06 | | | 6/25/2022 | | | | | | | | | | | | | | | | | | | | | | | | | | 14,300 | (4) | | | | $ | 39.53 | | | 6/24/2023 | | | | | | | | | | | | | | | | | | | Mark Allin | | | 5,000 | | | | | | | | | $ | 38.55 | | | 6/21/2015 | | | 3,245 | (1) | | | 186,458 | | | | 4,500 | | | | 258,570 | | | | | | | 4,100 | | | | | | | | | $ | 33.05 | | | 6/21/2016 | | | 2,147 | (2) | | | 123,367 | | | | 5,800 | | | | 333,268 | | | | | | | 3,500 | | | | | | | | | $ | 48.46 | | | 6/27/2017 | | | 2,300 | (4) | | | 132,158 | | | | | | | | | | | | | | | 4,500 | | | | | | | | | $ | 47.55 | | | 6/25/2018 | | | | | | | | | | | | | | | | | | | | | | 7,495 | | | | | | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | 14,338 | | | | | | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | 14,337 | (1) | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | | | 26,100 | (2) | | | | $ | 49.55 | | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | 26,100 | (3) | | | | $ | 48.06 | | | 6/25/2022 | | | | | | | | | | | | | | | | | | | | | | | | | | 15,196 | (4) | | | | $ | 39.53 | | | 6/24/2023 | | | | | | | | | | | | | | | | |
| · | The Committee agreed to provide Mr. Smith with an allowance to be reviewed annually and used to cover personal travel for himself and his family between the UK and the US, since part of his family resides in the UK. In fiscal year 2013, these travel expenses amounted to $65,000. | | | | | · | Mr. Smith continues to have tax obligations in the UK, and the Company has agreed to cover personal tax preparation and filing, and completion of other filing obligations in the UK and the US, amounting to $34,839 in fiscal year 2013, and included as “other compensation.” | | | | | · | Mr. Allin is a UK-based executive who travels extensively to the US, and has tax obligations in both the UK and the US. The Company has agreed to cover tax preparation and filing assistance in the UK and the US, and tax protection calculations for Mr. Allin through PricewaterhouseCoopers (PwC), amounting to $32,764 in fiscal year 2013, and included as “other compensation.” | | | | | · | Mr. Allin has been allowed the use of a Company-leased apartment in the US, which is available to other traveling executives. This accommodation is provided in lieu of hotel expenses while conducting Company business. The amount of that benefit is not included in “other compensation,” but the Company has agreed to cover the taxes incurred by Mr. Allin for his use of the corporate apartment. Since Mr. Allin has covered the taxes on this US apartment for the UK tax years 10/11, 11/12 and 12/13, PwC performed a tax protection calculation for Mr. Allin, which resulted in a reimbursement of $172,265, and included as “other compensation.” | | | | | · | Mr. Allin, like other UK executives, receives an annual car allowance equal to £8250 per annum. That amount has been converted to $13,002 using the fiscal year 2012 average exchange rate of £1=US$1.5760. | (1) | Remaining 50% of award vests on April 30, 2015. |
Grants of Plan-Based
Awards Table:
| | | | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards | | | Estimated Future Payouts Under Equity Incentive Plan Awards | | | All Other Stock Awards: Number of Shares of Stock or | | | All Other Option Awards: Number of Securities Underlying | | | Exercise or Base Price of Option | | | Grant Date Fair Value of Stock and Option | | Name [a] | | Grant Date [b] | | Threshold ($) [c] | | | Target ($) [d] | | | Maximum ($) [e] | | | Threshold (#) [f] | | | Target (#) [g] | | | Maximum (#) [h] | | | Units (#) [i] | | | Options (#) [j] | | | Awards ($/Sh) [k] | | | Awards ($) [l] | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Stephen M. Smith | | 6/20/2012 | | | 504,000 | | | | 1,008,000 | | | | 1,512,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 6/26/2012 | | | | | | | | | | | | | | | 10,000 | | | | 20,000 | | | | 30,000 | | | | | | | | | | | | 48.06 | | | | 961,200 | | | | 6/26/2012 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 100,000 | | | | 48.06 | | | | 1,229,000 | | Ellis E. Cousens | | 6/20/2012 | | | 330,000 | | | | 660,000 | | | | 990,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 6/20/2012 | | | | | | | 636,693 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 6/26/2012 | | | | | | | | | | | | | | | 3,611 | | | | 7,222 | | | | 10,833 | | | | | | | | | | | | 48.06 | | | | 347,089 | | Steven J. Miron | | 6/20/2012 | | | 237,500 | | | | 475,000 | | | | 712,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 6/26/2012 | | | | | | | | | | | | | | | 2,750 | | | | 5,500 | | | | 8,250 | | | | | | | | | | | | 48.06 | | | | 264,330 | | | | 6/26/2012 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 27,500 | | | | 48.06 | | | | 337,975 | | Gary Rinck | | 6/20/2012 | | | 187,500 | | | | 375,000 | | | | 562,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 6/26/2012 | | | | | | | | | | | | | | | 3,000 | | | | 6,000 | | | | 9,000 | | | | | | | | | | | | 48.06 | | | | 288,360 | | | | 6/26/2012 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 25,000 | | | | 48.06 | | | | 307,250 | | Mark J. Allin | | 6/20/2012 | | | 190,893 | | | | 381,786 | | | | 572,679 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 6/26/2012 | | | | | | | | | | | | | | | 2,250 | | | | 4,500 | | | | 6,750 | | | | | | | | | | | | 48.06 | | | | 216,270 | | | | 6/26/2012 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 26,100 | | | | 48.06 | | | | 320,769 | |
(c) to(e): | Represents the annual incentives for fiscal year 2013 that are based on achievement of financial goals and strategic milestones. Financial performance measures and relative weighting of each performance measure, as well as the threshold, target and outstanding levels of performance, are set at the beginning of the fiscal year. Revenue, profit and cash flow were the performance measures used for fiscal year 2013. Strategic milestones are designed to drive improved performance for the Company in the current and future fiscal years. Actual annual incentive payouts for fiscal year 2013 are indicated in column (g) of the Summary Compensation Table. Also included in Column D is the cash incentive in lieu of equity granted for Mr. Cousens, given his advance notice of his intention to retire. Payout of this incentive will be based on the closing stock price on April 30, 2014. | | | |
38 | | (2) | Award vests 50% on April 30, 2015 and 50% on April 30, 2016. |
(f) to (h): | Represents the restricted performance share awards granted for the 2013 through 2016 performance period pursuant to the 2009 Key Employee Stock Plan. Financial performance measures and relative weighting of each performance measure, as well as the threshold, target and outstanding levels of performance, are set at the beginning of the three-year plan cycle. Earnings per share and cumulative free cash flow are the performance measures used for the FY2013-15 performance cycle, weighted at 60% and 40%, respectively. No long-term incentive is payable unless the threshold performance level is reached for one of the performance measures. The restricted performance shares, if earned, vest 50% on April 30, 2016 and the remaining 50% on April 30, 2017. Dividends are not paid during the performance period, but are paid on earned shares following the performance cycle. | | | (j): | Option grants are awarded on an annual basis, have terms of ten years and vest 50% on April 30 the fourth year after grant and 50% on April 30 the fifth year after grant. All employees’ stock options have exercise prices that are equal to the grant date closing market price of Class A Stock. In fiscal 2013 executives received approximately 60% of their targeted long-term incentive in stock options, with the exception of Mr. Cousens who will receive a cash incentive in lieu of equity granted, as noted in (d) above. | | | (k): | The closing stock price on June 26, 2012. The exercise price of all stock options may not be less than 100% of the fair market value of the stock on the date of grant. | | | (l): | The grant date fair value of the restricted performance shares and stock options is computed in accordance with FASB ASC Topic 718, Stock Compensation. The grant date fair value of the restricted performance share awards is based on a $48.06 stock price. The fair value disclosed in this column for the restricted performance shares represents the total fair value of those awards at the target level. Maximum value payouts are 150% of target, and will only occur if the Company reaches preset “outstanding” performance benchmarks. The grant date fair value of stock option awards is based on a $12.29 Black-Scholes value. Refer to Notes 2 and 18 in the Notes to the Consolidated Financial Statements in the Company’s 2013 Annual Report for the assumptions made in determining FASB ASC Topic 718, Stock Compensation values. |
Outstanding Equity
Awards at Fiscal Year
End:
| | | | | | Option Awards | | | | | | | | | Stock Awards | Name [a] | | Number of Securities Under- lying Unexer- cised Options (#) Exercisable [b] | | | Number of Securities Underlying Unexer- cised Options (#) Unexer- cisable [c] | | | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) [d] | | | Option Exercise Price ($) [e] | | | Option Expiration Date [f] | | Number of Shares or Units of Stock That Have Not Vested (#) [g] | | | Market Value of Shares or Units of Stock That Have Not Vested ($) [h] | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) [i] | | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) [j] | | Stephen M. Smith | | | 17,205 | | | | | | | | | | | $ | 31.89 | | | 6/22/2014 | | | 9,100 | (1) | | | 347,347 | | | | 20,000 | | | | 763,400 | | | | | 17,205 | | | | | | | | | | | $ | 38.55 | | | 6/21/2015 | | | 20,000 | (5) | | | 763,400 | | | | 20,000 | | | | 763,400 | | | | | 22,940 | | | | | | | | | | | $ | 33.05 | | | 6/21/2016 | | | 16,874 | (2) | | | 644,081 | | | | | | | | | | | | | 28,675 | | | | | | | | | | | $ | 48.46 | | | 6/27/2017 | | | | | | | | | | | | | | | | | | | | 28,675 | | | | | | | | | | | $ | 47.55 | | | 6/25/2018 | | | | | | | | | | | | | | | | | | | | 35,000 | | | | | | | | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | | | 35,000 | (1) | | | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | | | 70,000 | (2) | | | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | 100,000 | (3) | | | | | | $ | 49.55 | | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | 100,000 | (4) | | | | | | $ | 48.06 | | | 6/25/2022 | | | | | | | | | | | | | | | | | Ellis E. Cousens | | | 65,000 | | | | | | | | | | | $ | 48.46 | | | 6/27/2017 | | | 22,400 | (1) | | | 855,008 | | | | 10,000 | | | | 381,700 | | | | | 65,000 | | | | | | | | | | | $ | 47.55 | | | 6/25/2018 | | | 12,980 | (2) | | | 495,447 | | | | 7,222 | | | | 275,664 | | | | | 65,000 | | | | | | | | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | | | 65,000 | (1) | | | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | | | 65,000 | (2) | | | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | 65,000 | (3) | | | | | | $ | 49.55 | | | 6/22/2021 | | | | | | | | | | | | | | | | |
| | | | | | Option Awards | | | | | | | | Stock Awards | | | Name [a] | | Number of Securities Under- lying Unexer- cised Options (#) Exercisable [b] | | | Number of Securities Underlying Unexer- cised Options (#) Unexer- cisable [c] | | | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) [d] | | Option Exercise Price ($) [e] | | | Option Expiration Date [f] | | Number of Shares or Units of Stock That Have Not Vested (#) [g] | | | Market Value of Shares or Units of Stock That Have Not Vested ($) [h] | | | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) [i] | | | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested($) [j] | | Steven J. Miron | | | 6,000 | | | | | | | | | $ | 38.55 | | | 6/21/2015 | | | 1,380 | (1) | | | 52,675 | | | | 5,000 | | | | 190,850 | | | | | 4,900 | | | | | | | | | $ | 33.05 | | | 6/21/2016 | | | 6,490 | (2) | | | 247,723 | | | | 5,500 | | | | 209,935 | | | | | 4,400 | | | | | | | | | $ | 48.46 | | | 6/27/2017 | | | | | | | | | | | | | | | | | | | | 4,600 | | | | | | | | | $ | 47.55 | | | 6/25/2018 | | | | | | | | | | | | | | | | | | | | 3,500 | | | | | | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | | | 3,500 | (1) | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | | | 25,000 | (2) | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | 25,000 | (3) | | | | $ | 49.55 | | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | 27,500 | (4) | | | | $ | 48.06 | | | 6/25/2022 | | | | | | | | | | | | | | | | | Gary Rinck | | | 25,000 | | | | | | | | | $ | 33.05 | | | 6/21/2016 | | | 4,200 | (1) | | | 160,314 | | | | 6,000 | | | | 229,020 | | | | | 30,000 | | | | | | | | | $ | 48.46 | | | 6/27/2017 | | | 7,788 | (2) | | | 297,268 | | | | 6,000 | | | | 229,020 | | | | | 30,000 | | | | | | | | | $ | 47.55 | | | 6/25/2018 | | | | | | | | | | | | | | | | | | | | 15,000 | | | | | | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | | | 15,000 | (1) | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | | | 25,000 | (2) | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | 25,000 | (3) | | | | $ | 49.55 | | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | 25,000 | (4) | | | | $ | 48.06 | | | 6/25/2022 | | | | | | | | | | | | | | | | | Mark Allin | | | 5,000 | | | | | | | | | $ | 38.55 | | | 6/21/2015 | | | 1,260 | (1) | | | 48,094 | | | | 4,500 | | | | 171,765 | | | | | 4,100 | | | | | | | | | $ | 33.05 | | | 6/21/2016 | | | 6,490 | (2) | | | 247,723 | | | | 4,500 | | | | 171,765 | | | | | 3,500 | | | | | | | | | $ | 48.46 | | | 6/27/2017 | | | | | | | | | | | | | | | | | | | | 4,500 | | | | | | | | | $ | 47.55 | | | 6/25/2018 | | | | | | | | | | | | | | | | | | | | 3,747 | | | | | | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | | | 3,748 | (1) | | | | $ | 35.04 | | | 6/24/2019 | | | | | | | | | | | | | | | | | | | | | | | | 28,675 | (2) | | | | $ | 40.02 | | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | | | | | 26,100 | (3) | | | | $ | 49.55 | | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | 26,100 | (4) | | | | $ | 48.06 | | | 6/25/2022 | | | | | | | | | | | | | | | | |
(1) | Remaining 50% of award vests on April 30, 2014. | | | (2) | Award vests 50% on April 30, 2014 and 50% on April 30, 2015. | | | (3) | Award vests 50% on April 30, 2015 and 50% on April 30, 2016. | | | (4) | Award vests 50% on April 30, 2016 and 50% on April 30, 2017. | | | (5) | Award vests 50% on June 23, 2015 and 50% on June 23, 2016. | | | (e): | The exercise price of all stock options may not be less than 100% of the fair market value of the stock on the date of grant. | | | (f): | Stock options have a term of 10 years. Stock options continue to vest and can be exercised for three years following retirement, but no later than the expiration of the option. | | | (g): | Represents the second half of the restricted performance shares earned for the 2010 to 2012 long-term incentive cycle, and all restricted performance shares earned for the 2011 to 2013 long-term incentive cycle, which will vest as noted above. | | | (h) and (j): | Based on the April 30, 2013 closing market price of Class A stock of $38.17. | | | (i): | Represents the target number of restricted performance shares granted but yet-to-be earned for the 2012-2014 and 2013-2015 long-term incentive cycles. The 2012-2014 shares, if earned, will vest half on April 30, 2015 and half on April 30, 2016. The 2013-2015 shares, if earned, will vest half on April 30, 2016 and half on April 30, 2017. |
| | (4) | Award vests 50% on April 30, 2017 and 50% on April 30, 2018. |
Option Exercises | | | | (5) | Award vests 50% on June 23, 2015 and 50% on June 23, 2016. | | | | | (6) | Award vests 50% on June 17, 2015 and 50% on June 17, 2016. | | | | | (e): | The exercise price of all stock options may not be less than 100% of the fair market value of the stock on the date of grant. | | | | | (f): | Stock Vested Table: | | Option Awards | | | Stock Awards | | Name [a] | | Number of Shares Acquired on Exercise (#) [b] | | Value Realized on Exercise ($) [c] | | Number of Shares Acquired on Vesting (#) [d] | | Value Realized on Vesting ($) [e] | | | | | | | | | | | | | | Stephen M. Smith | | — | | | — | | | 9,100 | | | $347,347 | | Ellis E. Cousens | | 164,660 | | | $2,371,739 | | | 22,400 | | | $855,008 | | Steven J. Miron | | — | | | — | | | 1,380 | | | $52,674 | | Gary Rinck | | 12,500 | | | $143,125 | | | 4,200 | | | $160,314 | | Mark J. Allin | | — | | | — | | | 1,260 | | | $48,094 | |
(c): | The value realized on exercise represents the excessoptions have a term of 10 years. Stock options continue to vest and can be exercised for three years following retirement, but no later than the expiration of the fair market value of the underlying securities purchased on the date of exercise over the exercise price contained in the option. | | | (d): | Vesting of half of the restricted performance shares earned from the 2010-12 Executive Long-Term Incentive Plan (Messrs. Smith, Cousens and Rinck) and the Business Officer Long-Term Incentive Plan (Messrs. Miron and Allin) on April 30, 2013, granted pursuant to the 2009 Key Employee Stock Plan. | | | (e): | The value realized on the vesting of restricted stock awards represents the value of stock no longer subject to a risk of forfeiture or other restrictions, obtained by multiplying the number of shares of stock released from such restrictions by the closing market price of Class A stock on April 30, 2013, of $38.17. |
Name [a] | | Plan [b] | | Number of Years Credited Service (#) [c] | | | Present Value of Accumulated Benefit ($) [d] | | Payments During Last Fiscal Year ($) [e] | | Stephen M. Smith | | Qualified Plan | | 11 | | | 352,071 | | | 0 | | | | Excess Plan | | 11 | | | 839,973 | | | 0 | | | | SERP | | 21 | | | 4,478,917 | | | 0 | | | | UK Qualified Plan(1)(2) | | 10 | | | 2,262,124 | | | 0 | | | | UK Non-Qualified Benefit(1)(2) | | 10 | | | 1,783,039 | | | 0 | | Ellis E. Cousens | | Qualified Plan | | 12 | | | 483,761 | | | 0 | | | | Excess Plan | | 12 | | | 1,708,709 | | | 0 | | | | SERP | | 12 | | | 5,039,210 | | | 0 | | Steven J. Miron | | Qualified Plan | | 20 | | | 328,149 | | | 0 | | | | Excess Plan | | 20 | | | 427,744 | | | 0 | | | | SERP | | 20 | | | 2,666,352 | | | 0 | | Gary Rinck | | Qualified Plan | | 9 | | | 272,071 | | | 0 | | | | Excess Plan | | 9 | | | 755,332 | | | 0 | | | | SERP | | 9 | | | 2,706,470 | | | 0 | | Mark Allin | | Qualified Plan | | N/A | | | N/A | | | 0 | | | | Excess Plan | | N/A | | | N/A | | | 0 | | | | SERP | | 13 | | | 1,285,456 | | | 0 | | | | UK Qualified Plan(1)(2) | | 13 | | | 809,801 | | | 0 | |
(1) | Mark Allin and Stephen Smith’s Present Value of Accumulated Benefits from the UK Qualified and UK Non-Qualified Plans were calculated using a British £ to US $conversion factor of 1.5375. | | | (2) | Mark Allin and Stephen Smith’s Present Value of Accumulated Benefits from the UK Qualified and UK Non-Qualified Plans were calculated using UK disclosure assumptions of 4.30% discount rate. | | | (c): | Credited service is limited to 35 years for all purposes under the Qualified and Excess Plans and the SERP. | | | | The named executives are entitled to retirement benefits under three defined benefit plans of the Company: The Employees Retirement Plan of John Wiley & Sons, Inc. (the “Qualified Plan”), the Nonqualified Supplemental Retirement Plan (the “Excess Plan”), and the Supplemental Executive Retirement Plan (the “SERP”). | | | (d): | The amounts shown in the table above for all plans represent the actuarial present values of the executive’s accumulated benefits accrued as of April 30, 2013, calculated using the same assumptions in footnote 17 of the Company’s financial statements, except that the SERP benefit for Messrs. Cousens and Rinck calculated under the 1989 SERP has no mortality assumption and under the 1989 and 2005 SERP, no recognition of future salary increases or pre-retirement mortality. | | | | | (g): | Represents the second half of the restricted performance shares earned for the 2011 to 2013 long-term incentive cycle, and all restricted performance shares earned for the 2012 to 2014 long-term incentive cycle, which will vest as noted above. | | | | | (h) and (j): | Based on the April 30, 2014 closing market price of Class A stock of $57.46. | | | | | (i): | Represents the target number of restricted performance shares granted but yet-to-be earned for the 2013-2015 and 2014-2016 long-term incentive cycles. The 2013-2015 shares, if earned, will vest half on April 30, 2016 and half on April 30, 2017. The 2014-2016 shares, if earned, will vest half on April 30, 2017 and half on April 30, 2018. |
Option Exercises and Stock Vested Table: | | | | Option Awards | | Stock Awards | | | | Number of Shares | | | | Number of | | | | | | Acquired on | | Value Realized | | Shares Acquired | | Value Realized | | Name [a] | | Exercise (#) [b] | | on Exercise ($) [c] | | on Vesting (#) [d] | | on Vesting ($) [e] | | | | | | | | | | | | | | | | | | | | | | Stephen M. Smith | | | 17,205 | | | $ | 299,400 | | | | 17,537 | | | $ | 1,007,676 | | | | Ellis E. Cousens | | | 93,568 | | | $ | 832,204 | | | | 28,890 | | | $ | 1,660,019 | | | | John A. Kritzmacher | | | — | | | | — | | | | — | | | | — | | | | Steven J. Miron | | | 6,000 | | | $ | 109,891 | | | | 4,625 | | | $ | 265,753 | | | | Gary Rinck | | | 25,000 | | | $ | 461,250 | | | | 8,094 | | | $ | 465,081 | | | | Mark J. Allin | | | — | | | | — | | | | 4,505 | | | $ | 258,857 | |
| (c): | The value realized on exercise represents the excess of the fair market value of the underlying securities purchased on the date of exercise over the exercise price contained in the option. | | | | | (d): | Vesting of the second half of the restricted performance shares earned from the fiscal year 2010-12 Executive Long-Term Incentive Plan (Messrs. Smith, Cousens and Rinck) and Business Officer Long-Term Incentive Plan (Messrs. Miron and Allin), and the first half of the restricted performance shares earned from the fiscal year 2011-13 Executive Long-Term Incentive Plan, for fiscal year 2011-13) on April 30, 2014, granted pursuant to the 2009 Key Employee Stock Plan. | | | | | (e): | The value realized on the vesting of restricted stock awards represents the value of stock no longer subject to a risk of forfeiture or other restrictions, obtained by multiplying the number of shares of stock released from such restrictions by the closing market price of Class A stock on April 30, 2014, of $57.46. |
Pension Benefits Table: | | | | | | | | Present Value of | | | | | | | | Number of Years | | Accumulated | | Payments During | | | | | | Credited Service | | Benefit(3) | | Last Fiscal Year | | Name | | Plan | | (#) | | ($) | | ($) | | [a] | | [b] | | [c] | | [d] | | [e] | | | | | | | | | | | | | | | | | | | | Stephen M. Smith | | Qualified Plan | | | 11 | | | | 350,971 | | | | 0 | | | | | | Excess Plan | | | 11 | | | | 845,789 | | | | 0 | | | | | | SERP | | | 21 | | | | 4,590,012 | | | | 0 | | | | | | UK Qualified Plan(1)(2) | | | 10 | | | | 2,583,851 | | | | 0 | | | | | | UK Non-Qualified Benefit(1)(2) | | | 10 | | | | 2,038,334 | | | | 0 | | | | Ellis E. Cousens | | Qualified Plan | | | 12 | | | | 426,744 | | | | 0 | | | | | | Excess Plan | | | 12 | | | | 1,508,140 | | | | 0 | | | | | | SERP | | | 12 | | | | 5,394,136 | | | | 0 | | | | Steven J. Miron | | Qualified Plan | | | 20 | | | | 314,808 | | | | 0 | | | | | | Excess Plan | | | 20 | | | | 415,637 | | | | 0 | | | | | | SERP | | | 20 | | | | 2,492,616 | | | | 0 | | | | Gary Rinck | | Qualified Plan | | | 9 | | | | 272,918 | | | | 0 | | | | | | Excess Plan | | | 9 | | | | 754,628 | | | | 0 | | | | | | SERP | | | 9 | | | | 2,740,979 | | | | 0 | | | | Mark J. Allin | | Qualified Plan | | | N/A | | | | N/A | | | | 0 | | | | | | Excess Plan | | | N/A | | | | N/A | | | | 0 | | | | | | SERP | | | 13 | | | | 981,216 | | | | 0 | | | | | | UK Qualified Plan(1)(2) | | | 13 | | | | 1,007,147 | | | | 0 | |
| (1) | Mark Allin and Stephen Smith’s Present Value of Accumulated Benefits from the UKQualified and UK Non-Qualified Plans were calculated using a British £ to US $ conversionfactor of 1.6811. | | | | | (2) | Mark Allin and Stephen Smith’s Present Value of Accumulated Benefits from the UKQualified and UK Non-Qualified Plans were calculated using UK disclosure assumptionsincluding a 4.30% discount rate. | | | | | (3) | The credited service and the accumulated benefits used to determine the present value ofthe US Qualified, Excess and SERP benefits are as of the US plans’ freeze on June 30,2013. Stephen Smith’s UK accumulated plan benefits used to determine present value arebased on his UK plan credited service as shown. Mr. Allin’s UK plan credited service andaccumulated benefit used to determine present value are as of April 30, 2014. | | | | | (d): | The amounts shown in the table above for all plans represent the actuarial present valuesof the executive’s accumulated benefits accrued as of April 30, 2014, calculated using thesame assumptions in footnote 17 of the Company’s financial statements, except that theSERP benefit for Messrs. Cousens and Rinck calculated under the 1989 SERP has nomortality assumption and under the 1989 and 2005 SERP, no recognition of pre-retirementmortality. |
The Employees Retirement Plan of John Wiley & Sons, Inc. (the Qualified Plan) | | A description of each plan follows.
The Employees
Retirement Plan of
John Wiley & Sons, Inc.
(the Qualified Plan)
The Company sponsors a qualified defined benefit pension plan to provide retirement benefits to U.S. based employees of the Company. The Plan pays benefits at retirement to participants who terminate or retire from the Company after meeting certain eligibility requirements. Prior to January 1, 2005, benefits under the Qualified Plan provided for annual normal benefits payable at normal retirement age of 65 based on certain factors times average final compensation times years of service not to exceed 35 (the “Previous Benefit Formula”). Effective January 1, 2005 the Qualified Plan formula was revised to provide covered participants with enhanced future benefits. After January 1, 2005, benefits are calculated as the sum of: | · | A frozen benefit as of December 31, 2004, calculated under the Previous Benefit Formula, plus | | | | | · |
| | ● | A frozen benefit as of December 31, 2004, calculated under the Previous Benefit Formula, plus | | | | | | | ● | An annual benefit earned for benefit service after January 1, 2005. The amount of each year’s accrual is the sum of: |
| | | ● | total annual compensation (annual base salary, plus 100% of bonus) for the year up to and including 80% of that year’s Social Security Wage Base times 1.0%, plus | | | | | |
| o | total annual compensation (annual base salary, plus 100% of bonus) for the year up to and including 80% of that year’s Social Security Wage Base times 1.0%, plus | | | | | o | | | | ● | total annual compensation for the year in excess of 80% of that year’s Social Security Wage Base times 1.3%. |
In fiscal year 2013, the Company announced a cessation of accruals and freeze of participation in the US Qualified Retirement Plan, effective June 30, 2013. |
| | The plan recognizes a maximum of 35 years of benefit service, accruing through June 30, 2013. If the total benefit service is greater than 35 years at age 65, the benefit will be equal to the 35 consecutive years of benefit accruals that produce the highest combined amount. The plan provides for retirement as early as age 55 with ten years of service. The age 65 benefit is reduced by 4% per year for each year less than 65, unless a participant has 20 years of service, in which case the participant can retire as early as age 62 without an early retirement reduction. The frozen benefit calculated under the Previous Benefit Formula for the combined Qualified Plan and the Excess Plan described below for Messrs. Smith, Cousens, Miron, and Rinck is $17,804, $30,168, $13,407, and $3,399, respectively. Messrs. Smith, Cousens and CousensRinck are eligible for early retirement under this plan.
| The Nonqualified Supplemental Benefit Plan (the Excess Plan) | | The Excess Plan provides benefits that would otherwise be denied participants by reason of certain Code limitations on the tax-qualified benefit. In addition, the Excess Plan provides benefits to certain individuals which arise from additional service credit granted for previous employment with acquired companies. Average final compensation and total annual compensation are determined under the Excess Plan in the same manner as under the Qualified Plan, except that a participant’s compensation is not subject to the limitations under the Code. Years of service under the Qualified Plan and the Excess Plan are the number of years and months through the plans’ freeze date, June 30, 2013, limited to 35 years, worked for the Company and its subsidiaries after attaining age 21. In fiscal year 2013, the Company announced a cessation of accruals and freeze of participation in the US Supplemental Benefit (“Excess”) Plan, effective June 30, 2013. Messrs. Smith, Cousens and CousensRinck are eligible for early retirement under this plan.
| Supplemental Executive Retirement Plan
(the (the SERP) | | In March 2005, the Board froze participation in the existing 1989 SERP and adopted the 2005 SERP. All active participants in the 1989 SERP, except those who were directors, 5% owners or who were within two years of the normal retirement age of 65, were given the option, prior to December 31, 2005, to waive their right to all benefits under the 1989 SERP and receive benefits under the 2005 SERP in consideration of that waiver. Four participants elected to do so. Messrs. Cousens and Rinck remain in the 1989 SERP.
The benefit under the 1989 SERP is the higher of the “primary” or the “additional” benefit. | · | The primary benefit consists of ten annual payments commencing at retirement (at or after age 65) determined by multiplying the participant’s base salary rate at retirement by 2.5, reducing the result by $50,000 and dividing the remainder by five. The plan also provides for an alternative early retirement benefit for participants who retire after age 55 with five years of service, a reduced payment for participants whose employment is terminated prior to age 65 other than on account of death (and who do not qualify for early retirement) and a survivor benefit for the beneficiaries of a participant who dies prior to age 65 while employed by the Company or an affiliate. | | | | | · |
| | ● | The primary benefit consists of ten annual payments commencing at retirement (at or after age 65) determined by multiplying the participant’s base salary rate at retirement by 2.5, reducing the result by $50,000 and dividing the remainder by five. The plan also provides for an alternative early retirement benefit for participants who retire after age 55 with five years of service, a reduced payment for participants whose employment is terminated prior to age 65 other than on account of death (and who do not qualify for early retirement) and a survivor benefit for the beneficiaries of a participant who dies prior to age 65 while employed by the Company or an affiliate. | | | | | | | ● | The additional benefit provides participants with a guaranteed total annual retirement benefit beginning at age 65 for ten years of 50%, 55%, or 65% (the “Applicable Percentage”) of average compensation, defined as base salary and annual incentive, over the executive’s highest three consecutive years. This amount is reduced by the retirement benefits under the Qualified Plan, the Excess Plan and the primary benefit above. The Applicable Percentage for Messrs. Cousens and Rinck are 55%, and 50%, respectively. |
| | The 2005 SERP provides a lifetime annual benefit determined by multiplying the executive’s average compensation over the highest three consecutive years times a service factor, which is the sum of years of service up to 20 years times 2%, plus years of service in excess of 20 times 1%, to a maximum of 35 years total. The 2005 SERP provides a reduced early retirement benefit for participants calculated in the same manner as the 1989 plan. The participant may elect to receive his or her benefit in the form of a joint and survivor benefit on an actuarial equivalent basis. All other terms of the 2005 SERP are substantially the same as the 1989 SERP. |
| | In fiscal year 2013, the Company announced a cessation of accruals and freeze of participation in the US Supplemental Executive Retirement Plan (“SERP”), effective June 30, 2013. | | | | | | Messrs. Smith, Cousens and CousensRinck are eligible for early retirement under this plan.
| | | | TheJohn Wiley & Sons Limited Retirement Benefits Scheme (UK Qualified Plan) | | The Company sponsors an approved defined benefit scheme to provide benefits to UK based employees of the Company. The Scheme provides benefits at retirement to participants who terminate or retire from the Company after meeting certain eligibility requirements. Members have a right to take benefits at Normal Retirement Date (age 65), or earlier subject to conditions as have been notified to them. | | | | | | The basic rate of accrual under the Scheme is 1/60th of Final Pensionable Salary for each year and complete month of Pensionable Service. Different rates of accrual are provided for certain members as advised separately to them. | | | | | | Early retirement is possible, subject to Company/Scheme Trustees consent, from age 55. A reduction factor, unless otherwise agreed with the Scheme member concerned under separate notification, is applied for each year (and complete month) benefits are taken prior to Normal Retirement Date. Reduction factors are determined by the Scheme Trustees in conjunction with advice from the Scheme Actuary, and are subject to regular review.
| | | | The Unapproved Supplemental UK Plan
(the (the UK Non-Qualified Plan) | | This arrangement provides benefits, for individuals nominated by the Company, that otherwise be denied by Her Majesty’s Revenue & Customs due to benefit limitations under approved benefit schemes. For Mr. Smith the Plan originally provided benefits in the same manner as under the UK Qualified Plan for benefits in excess of the limits under the latter. However, for Mr. Smith this was changed by mutual consent in a letter dated November 12, 2009 and signed by Mr. Smith on November 13, 2009. Under this revised structure, Mr. Smith agrees to defer his benefit until age 65 (or until termination of employment if sooner).
Nonqualified Deferred Compensation
(NQDC) Table: Name (a) | | Executive Contributions in Last FY ($) (b) | | Registrant Contributions in Last FY ($) (c) | | Aggregate Earnings in Last FY ($) (d) | | Aggregate Withdrawals/ Distributions ($) (e) | | Aggregate Balance at Last FYE ($) (f) | | | | | | | | | | | | | | | | | Stephen M. Smith | | 105,796 | | | 15,624 | | | 16,705 | | | N/A | | | 326,271 | | Ellis E. Cousens | | 77,099 | | | 10,830 | | | 15,684 | | | N/A | | | 326,392 | | Steven J. Miron | | 42,742 | | | 6,540 | | | 1,993 | | | N/A | | | 57,662 | | Gary Rinck | | 157,770 | | | 6,832 | | | 233,569 | | | N/A | | | 2,047,842 | | Mark Allin | | N/A | | | N/A | | | N/A | | | N/A | | | N/A | |
| | |
Compensation (NQDC) Table: | | Name (a) | | Executive Contributions in Last FY ($) (b) | | Registrant Contributions in Last FY ($) (c) | | Aggregate Earnings in Last FY ($) (d) | | Aggregate Withdrawals/ Distributions ($) (e) | | Aggregate Balance at Last FYE ($) (f) | | | | | | | | | | | | | | | | | | Stephen M. Smith | | | 97,313 | | | | 26,357 | | | | 21,368 | | | | 0 | | | | 471,309 | | | | | Ellis E. Cousens | | | 69,676 | | | | 18,027 | | | | 19,729 | | | | 0 | | | | 433,825 | | | | | John A. Kritzmacher | | | 0 | | | | 2,100 | | | | 100 | | | | 0 | | | | 2,200 | | | | | Steven J. Miron | | | 45,064 | | | | 11,175 | | | | 4,235 | | | | 0 | | | | 118,136 | | | | | Gary Rinck | | | 85,382 | | | | 11,173 | | | | 286,063 | | | | 285,691 | | | | 2,144,770 | | | | | Mark J. Allin | | | N/A | | | | N/A | | | | N/A | | | | N/A | | | | N/A | | |
| | Participants in the company’s Nonqualified Deferred Compensation Plan (the “NQDC Plan”) may elect to defer up to 25% of their base salary, or up to 100% of their annual cash incentive compensation. If the participant’s Company matching contributions under the Employees’ Savings Plan are restricted due to code contribution or compensation limitations, he/she is eligible to receive a Company matching contribution of up to 3%1.5% of base salary deferredpay in excess of qualified plan limits under the NQDC Plan. Mirroring Company contributions under the Savings Plan, the Company also makes Basic Retirement Contributions, and may make Discretionary Contributions, recognizing pay in excess of qualified plan limits, under the NQDC Plan. Since Mr. Allin is a UK-based executive, he is not eligible to participate in the Nonqualified Deferred CompensationNQDC Plan. |
| | Participants designate one or more investment funds which are used to measure the income credited to their account. Although not required to do so, the Company has elected to invest the funds deferred under the plan substantially as directed by the participants. The funds currently available under the NQDC Plan and their returns for the last fiscal year are shown below:Deferred Compensation Funds | | Rate of Return for 1 year
ending 04/30/2013 | | | | | Vanguard VIF Money Market | | 0.14 | % | PIMCO VIT Total Return | | 7.12 | % | PIMCO VIT Real Return | | 6.22 | % | MFS VIT Value | | 19.03 | % | Fidelity VIP Index 500 | | 16.78 | % | American Funds IS Growth | | 12.59 | % | Invesco Van Kampen VI Mid Cap Value I | | 16.37 | % | Fidelity VIP Mid Cap | | 12.93 | % | Royce Capital Small Cap | | 11.65 | % | Vanguard VIF Small Company Growth | | 14.34 | % | MFS VIT II International Value | | 22.68 | % | MFS VIT II International Growth | | 12.90 | % | Northwestern Mutual Life Insurance | | 5.76 | % |
| | Deferred Compensation Funds | | Rate of Return for 1 year ending 04/30/2014 | | | | | | | | | | Vanguard VIF Money Market | | 0.10 | % | | | | PIMCO VIT Total Return | | –1.84 | % | | | | PIMCO VIT Real Return | | –6.89 | % | | | | MFS VIT Value | | 19.63 | % | | | | Fidelity VIP Index 500 | | 20.32 | % | | | | American Funds IS Growth | | 17.83 | % | | | | Invesco Van Kampen VI Mid Cap Value I | | 20.97 | % | | | | Fidelity VIP Mid Cap | | 22.22 | % | | | | Royce Capital Small Cap | | 22.45 | % | | | | Vanguard VIF Small Company Growth | | 23.82 | % | | | | MFS VIT II International Value | | 13.00 | % | | | | MFS VIT II International Growth | | 7.28 | % | | | | Northwestern Mutual Life Insurance | | 5.50 | % | |
| | Account balances under the NQDC Plan are distributed to participants in accordance with their individual elections made at the time of the deferral election. Participants may elect to receive their contributions on a designated date or upon separation of service, subject to the restrictions of Section 409A of the Code. Distributions on account of termination or retirement are paid in 15 equal annual installments and distributions occurring as of a designated date prior to termination are paidavailable in a lump sum.sum or annual installments over up to 15 years. |
| | Amounts in column (b) are included in columns (c), and (d) on the Summary Compensation Table.
Payments Upon
Termination and
Change of Control
Tables:
Stephen M. Smith | | | | | | | | | | | | | Executive Benefits and Payments Upon Termination | | Retirement | | Resignation without Good Reason | | Dismissal without Cause or Resignation for Good Reason (absent CoC) | | Dismissal without Cause or Resignation for Good Reason (following CoC) | | | | | | | | | | Compensation: | | | | | | | | | | | | | | | | | Severance — Base Salary | | $ | 0 | | | $ | 0 | | | $ | 1,680,000 | | | $ | 1,680,000 | | Severance — Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 2,016,000 | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 1,008,000 | | ELTIP — Restricted Performance Shares | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 1,526,800 | | Restricted Stock (Performance Shares Earned but Not Vested)(1) | | $ | 1,754,828 | | | $ | 1,754,828 | | | $ | 1,754,828 | | | $ | 1,754,828 | | Stock Options(2) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 109,550 | | Benefits(3) | | $ | 0 | | | $ | 0 | | | $ | 47,077 | | | $ | 47,077 | | SERP(4) | | $ | 2,920,340 | | | $ | 2,920,340 | | | $ | 2,920,340 | | | $ | 6,769,533 | | Excess Plan(4) | | $ | 2,031,889 | | | $ | 2,031,889 | | | $ | 2,031,889 | | | $ | 2,031,889 | | Qualified Plan(4) | | $ | 2,099,922 | | | $ | 2,099,922 | | | $ | 2,099,922 | | | $ | 2,099,922 | | NQDC(5) | | $ | 326,271 | | | $ | 326,271 | | | $ | 326,271 | | | $ | 326,271 | | Total | | $ | 9,133,250 | | | $ | 9,133,250 | | | $ | 10,860,327 | | | $ | 19,369,870 | |
(1) | Vesting accelerates in all 4 termination scenarios since the executive has achieved age 55 and 10 years of service criteria. | | | (2) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the 4/30/2013 closing stock price ($38.17). | | | (3) | Presumes benefits are similar to those available to salaried employees and therefore only need to be disclosed in the dismissal columns. | | | (4) | Amounts shown are lump sum values (based on the PPA mortality table and the Section 417(e)(3) segment rates in effect for April 2013), even though plan documents only permit annuity payments, except on termination following a change of control. Annual benefits are: |
Qualified: | | $133,905 / year as a life annuityPayments upon | | Stephen M. Smith | | | | Excess: | | $129,567 / year as a life annuity | | | | SERP: | | $186,221 / year as a life annuity |
Termination and Change of Control Tables: | | Executive Benefits and Payments Upon Termination | | Retirement | | | Resignation without Good Reason | | | Dismissal without Cause or Resignation for Good Reason (absent CoC) | | | Dismissal without Cause or Resignation for Good Reason (following CoC) | | | | | | | | | | | | | | | | | | | | | | | Compensation: | | | | | | | | | | | | | | | | | | | Severance — Base Salary | | $ | 0 | | | $ | 0 | | | $ | 1,750,000 | | | $ | 1,750,000 | | | | Severance — Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 2,100,000 | | | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 1,050,000 | | | | ELTIP — Restricted Performance Share Units | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 2,614,430 | | | | Restricted Stock (PerformanceShares Earned but Not Vested)(1) | | $ | 2,783,190 | | | $ | 2,783,190 | | | $ | 2,783,190 | | | $ | 2,783,190 | | | | Restricted Stock (Time based) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 574,600 | | | | Stock Options(2) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 2,341,400 | | | | Benefits(3) | | $ | 0 | | | $ | 0 | | | $ | 49,693 | | | $ | 49,693 | | | | SERP(4) | | $ | 3,748,879 | | | $ | 3,748,879 | | | $ | 3,748,879 | | | $ | 6,360,283 | | | | Excess Plan(4) | | $ | 2,303,001 | | | $ | 2,303,001 | | | $ | 2,303,001 | | | $ | 2,303,001 | | | | Qualified Plan(4) | | $ | 1,774,425 | | | $ | 1,774,425 | | | $ | 1,774,425 | | | $ | 1,774,425 | | | | NQDC(5) | | $ | 471,309 | | | $ | 471,309 | | | $ | 471,309 | | | $ | 471,309 | | | | Total: | | $ | 11,080,804 | | | $ | 11,080,804 | | | $ | 12,880,497 | | | $ | 24,172,331 | |
| | (1) | Vesting accelerates in all 4 termination scenarios since the executive has achieved age 55 and 10 years of service criteria. |
(5) | Balance is paid as a lump sum on termination following a change of control; otherwise balance is paid per the executive’s election. |
Ellis E. Cousens | | | | | | | | | | | | | | | | | Executive Benefits and Payments Upon Termination | | | Retirement | | | Resignation without Good Reason | | | Dismissal without Cause or Resignation for Good Reason (absent CoC) | | | Dismissal without Cause or Resignation for Good Reason (following CoC) | | | | | | | | | | | | | | | | | | Compensation: | | | | | | | | | | | | | | | | | Severance — Base Salary | | $ | 0 | | | $ | 0 | | | $ | 990,000 | | | $ | 1,320,000 | | Severance — Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 1,320,000 | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 660,000 | | ELTIP — Restricted Performance Shares | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 657,364 | | Restricted Stock (Performance Shares Earned but Not Vested)(1) | | $ | 1,350,455 | | | $ | 1,350,455 | | | $ | 1,350,455 | | | $ | 1,350,455 | | Stock Options(2) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 203,450 | | Benefits(3) | | $ | 0 | | | $ | 0 | | | $ | 31,348 | | | $ | 41,797 | | SERP(4) | | $ | 4,525,987 | | | $ | 4,525,987 | | | $ | 4,525,987 | | | $ | 5,512,722 | | Excess Plan(4) | | $ | 1,602,151 | | | $ | 1,602,151 | | | $ | 1,602,151 | | | $ | 1,602,151 | | Qualified Plan(4) | | $ | 463,051 | | | $ | 463,051 | | | $ | 463,051 | | | $ | 463,051 | | NQDC(5) | | $ | 326,392 | | | $ | 326,392 | | | $ | 326,392 | | | $ | 326,392 | | Total: | | $ | 8,268,036 | | | $ | 8,268,036 | | | $ | 9,289,384 | | | $ | 13,457,382 | |
(1) | Vesting accelerates in all 4 termination scenarios since the executive has achieved age 55 and 10 years of service criteria. | | | (2) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the 4/30/2013 closing stock price ($38.17). | | | (3) | Presumes benefits are similar to those available to salaried employees and therefore only need to be disclosed in the dismissal columns. | | | (4) | Amounts shown are lump sum values (based on the PPA mortality table and the Section 417(e)(3) segment rates in effect for April 2013), even though plan documents only permit annuity payments, except on termination following a change of control. Annual benefits are: |
Qualified: | | $31,105 / year as a life annuity | | | | Excess: | | $107,623 / year as a life annuity | | | | SERP: | | $513,473 / year as a 10 year certain |
(5) | Balance is paid as a lump sum on termination following a change of control; otherwise balance is paid per the executive’s election. |
Steven J. Miron | | | | | | | | | | | | | Executive Benefits and Payments Upon Termination | | Retirement | | | Resignation without Good Reason | | | Dismissal without Cause or Resignation for Good Reason (absent CoC) | | | Dismissal without Cause or Resignation for Good Reason (following CoC) | | | Compensation: | | | | | | | | | | | | | Severance — Base Salary | | $ | 0 | | | $ | 0 | | | $ | 750,000 | | | $ | 1,000,000 | | Severance — Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 950,000 | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 475,000 | | ELTIP — Restricted Performance Shares | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 400,785 | | Restricted Stock (Performance Shares Earned but Not Vested) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 300,398 | | Stock Options(1) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 10,955 | | Benefits(2) | | $ | 0 | | | $ | 0 | | | $ | 28,760 | | | $ | 38,347 | | SERP(3) | | $ | 1,819,590 | | | $ | 1,819,590 | | | $ | 1,819,590 | | | $ | 5,705,161 | | Excess Plan(3) | | $ | 315,471 | | | $ | 315,471 | | | $ | 315,471 | | | $ | 315,471 | | Qualified Plan(3) | | $ | 251,489 | | | $ | 251,489 | | | $ | 251,489 | | | $ | 251,489 | | NQDC(4) | | $ | 57,662 | | | $ | 57,662 | | | $ | 57,662 | | | $ | 57,662 | | Total: | | $ | 2,444,212 | | | $ | 2,444,212 | | | $ | 3,222,972 | | | $ | 9,505,268 | |
(1) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the 4/30/2013 closing stock price ($38.17) | | | (2) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the 4/30/2014 closing stock price ($57.46). |
(2) | | | (3) | Presumes benefits are similar to those available to salaried employees and therefore only need to be disclosed in the dismissal columns. |
(3) | Amounts shown are lump sum values (based on the PPA mortality table and the Section 417(e)(3) segment rates in effect for April 2013) | | | (4) | Amounts shown are lump sum values (based on the PPA mortality table and the Section 417(e)(3) segment rates in effect for April 2014), even though plan documents only permit annuity payments, except on termination following a change of control. Annual benefits are: |
| | | Qualified: | | $36,613Qualified: $181,547 / year as a life annuityExcess: $221,900 / year as a life annuity SERP: $263,647 / year as a life annuity | | | (5) | Balance is paid as a lump sum on termination following a change of control; otherwise distribution is available in a lump sum or annual installments over up to 15 years. | | | |
56 | Excess: | | $45,928 / year as a life annuity |
| | | | SERP: | | $264,906 / year as a life annuity |
| | | | | | | | | | | | | | | | | | | | | | Ellis E. Cousens | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Executive Benefits and Payments Upon Termination | | Retirement | | Resignation without Good Reason | | Dismissal without Cause or Resignation for Good Reason (absent CoC) | | Dismissal without Cause or Resignation for Good Reason (following CoC) | | | | | | | | | | | | | | | | Compensation: | | | | | | | | | | | | | | | | | | | | Severance — Base Salary | | $ | 0 | | | $ | 0 | | | $ | 1,020,000 | | | $ | 1,360,000 | | | | | Severance — Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 1,360,000 | | | | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 680,000 | | | | | ELTIP — Restricted Performance Share Units | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 414,976 | | | | | Restricted Stock (Performance Shares Earned but Not Vested) (1) | | $ | 947,515 | | | $ | 947,515 | | | $ | 947,515 | | | $ | 947,515 | | | | | Restricted Stock (Time based) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | | | | Stock Options (2) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 1,080,950 | | | | | Benefits (3) | | $ | 0 | | | $ | 0 | | | $ | 32,372 | | | $ | 43,163 | | | | | Transition Award (4) | | $ | 783,198 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | | | | SERP (5) | | $ | 5,494,408 | | | $ | 5,494,408 | | | $ | 5,494,408 | | | $ | 5,499,566 | | | | | Excess Plan (5) | | $ | 1,535,554 | | | $ | 1,535,554 | | | $ | 1,535,554 | | | $ | 1,535,554 | | | | | Qualified Plan (5) | | $ | 446,679 | | | $ | 446,679 | | | $ | 446,679 | | | $ | 446,679 | | | | | NQDC (6) | | $ | 433,825 | | | $ | 433,825 | | | $ | 433,825 | | | $ | 433,825 | | | | | Total: | | $ | 9,641,179 | | | $ | 8,857,981 | | | $ | 9,910,353 | | | $ | 13,802,228 | | |
| | (1) | Vesting accelerates in all 4 termination scenarios since the executive has achieved age 55 and 10 years of service criteria. |
(4) | Balance is paid as a lump sum on termination following a change of control; otherwise balance is paid per the executive’s election. |
Gary Rinck | | | | | | | | | | | | | Executive Benefits and Payments Upon Termination | | Retirement | | | Resignation without Good Reason | | | Dismissal without Cause or Resignation for Good Reason (absent CoC) | | | Dismissal without Cause or Resignation for Good Reason (following CoC) | | | Compensation: | | | | | | | | | | | | | Severance — Base Salary | | $ | 0 | | | $ | 0 | | | $ | 500,000 | | | $ | 1,000,000 | | Severance — Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 750,000 | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 375,000 | | ELTIP — Restricted Performance Shares | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 458,040 | | Restricted Stock (Performance Shares Earned but Not Vested) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 457,582 | | Stock Options(1) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 46,950 | | Benefits(2) | | $ | 0 | | | $ | 0 | | | $ | 9,171 | | | $ | 18,342 | | SERP(3) | | $ | 2,708,430 | | | $ | 2,708,430 | | | $ | 2,708,430 | | | $ | 3,293,603 | | Excess Plan(3) | | $ | 767,781 | | | $ | 767,781 | | | $ | 767,781 | | | $ | 767,781 | | Qualified Plan(3) | | $ | 283,516 | | | $ | 283,516 | | | $ | 283,516 | | | $ | 283,516 | | NQDC(4) | | $ | 2,047,842 | | | $ | 2,047,842 | | | $ | 2,047,842 | | | $ | 2,047,842 | | Total: | | $ | 5,807,569 | | | $ | 5,807,569 | | | $ | 6,316,740 | | | $ | 9,498,656 | |
(1) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the 4/30/2013 closing stock price ($38.17) | | | (2) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the 4/30/2014 closing stock price ($57.46). |
(2) | | | (3) | Presumes benefits are similar to those available to salaried employees and therefore only need to be disclosed in the dismissal columns. |
(3) | Amounts shown are lump sum values (based on the PPA mortality table and the Section 417(e)(3) segment rates in effect for April 2013) | | | (4) | Represents cash payment approved by the Executive Compensation & Development Committee in March 2012 and was paid in July 2014. Payout was based on successful transition of responsibilities, completion of agreed projects and the stock price on April 30, 2014. | | | (5) | Amounts shown are lump sum values (based on the PPA mortality table and the Section 417(e)(3) segment rates in effect for April 2014), even though plan documents only permit annuity payments, except on termination following a change of control. Annual benefits are: |
46 | | | | Qualified: $33,024 / year as a life annuity |
| | | | Excess: $113,527 / year as a life annuity |
Qualified: | | $25,374 / year as a life annuity | | | | Excess: | | $68,715 / year as a life annuity | | | | SERP: | | $307,272 | | | | SERP: $642,039 / year as a 10 year certain |
(4) | Balance is paid as a lump sum on termination following a change of control; otherwise balance is paid per the executive’s election. |
Mark J. Allin | | | | | | | | | | | | | Executive Benefits and Payments Upon Termination | | Retirement | | | Resignation without Good Reason | | | Dismissal without Cause or Resignation for Good Reason (absent CoC) | | | Dismissal without Cause or Resignation for Good Reason (following CoC) | | | Compensation: | | | | | | | | | | | | | Severance — Base Salary | | $ | 0 | | | $ | 0 | | | $ | 602,288 | | | $ | 803,050 | | Severance — Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 762,898 | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 381,449 | | ELTIP — Restricted Performance Shares | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 343,530 | | Restricted Stock (Performance Shares Earned but Not Vested)(5) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 295,818 | | Stock Options(1) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 11,730 | | Benefits(2) | | $ | 0 | | | $ | 0 | | | $ | 9,631 | | | $ | 12,841 | | SERP(3) | | $ | 834,622 | | | $ | 834,622 | | | $ | 834,622 | | | $ | 2,643,369 | | Excess Plan(3) | | | N/A | | | | N/A | | | | N/A | | | | N/A | | Qualified Plan(3) | | $ | 303,737 | | | $ | 303,737 | | | $ | 303,737 | | | $ | 303,737 | | NQDC | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | Total: | | $ | 1,138,359 | | | $ | 1,138,359 | | | $ | 1,750,278 | | | $ | 5,558,422 | |
(1) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the 4/30/2013 closing stock price ($38.17). | | | (6) | Balance is paid as a lump sum on termination following a change of control; otherwise distribution is available in a lump sum or annual installments over up to 15 years. |
| | | | | | | | | | | | | | | | | | | | | | John A. Kritzmacher | | | | | | | | | | | | | | | | | | | | Executive Benefits and Payments Upon Termination | | Retirement | | Resignation without Good Reason | | Dismissal without Cause or Resignation for Good Reason (absent CoC) | | Dismissal without Cause or Resignation for Good Reason (following CoC) | | | | | | | | | | | | | | | | Compensation: | | | | | | | | | | | | | | | | | | | | Severance — Base Salary | | $ | 0 | | | $ | 0 | | | $ | 600,000 | | | $ | 1,200,000 | | | | | Severance — Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 1,080,000 | | | | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 468,986 | | | | | ELTIP — Restricted Performance Share Units | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 574,600 | | | | | Restricted Stock (Performance Shares Earned but Not Vested) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 718,250 | | | | | Restricted Stock (Time based) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | | | | Stock Options (1) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | | | | Benefits (2) | | $ | 0 | | | $ | 0 | | | $ | 29,151 | | | $ | 58,302 | | | | | SERP (3) | | | N/A | | | | N/A | | | | N/A | | | | N/A | | | | | Excess Plan (3) | | | N/A | | | | N/A | | | | N/A | | | | N/A | | | | | Qualified Plan (3) | | | N/A | | | | N/A | | | | N/A | | | | N/A | | | | | NQDC (4) | | $ | 2,200 | | | $ | 2,200 | | | $ | 2,200 | | | $ | 2,200 | | | | | Total: | | $ | 2,200 | | | $ | 2,200 | | | $ | 631,351 | | | $ | 4,102,338 | | |
| | (1) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the 4/30/2014 closing stock price ($57.46). | | | (2) | Presumes benefits are similar to those available to salaried employees and therefore only need to be disclosed in the dismissal columns. | | | (3) | Mr. Kritzmacher is not eligible for any DB benefits (Qualified, Excess and SERP) because he was hired in June 2013. The pension plans closed to new participants as of 07/01/2013. | | | (4) | Balance is paid as a lump sum on termination following a change of control; otherwise distribution is available in a lump sum or annual installments over up to 15 years. |
(3) | Amounts shown are lump sum values (based on the PPA mortality table and the Section 417(e)(3) segment rates in effect for April 2013) | | | | | | | | | | | | | | | | | | | | | | Steven J. Miron | | | | | | | | | | | | | | | | | | | | Executive Benefits and Payments Upon Termination | | Retirement | | Resignation without Good Reason | | Dismissal without Cause or Resignation for Good Reason (absent CoC) | | Dismissal without Cause or Resignation for Good Reason (following CoC) | | | | | | | | | | | | | | | | Compensation: | | | | | | | | | | | | | | | | | | | | Severance — Base Salary | | $ | 0 | | | $ | 0 | | | $ | 1,030,000 | | | $ | 1,030,000 | | | | | Severance — Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 978,500 | | | | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 489,250 | | | | | ELTIP — Restricted Performance Share Units | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 712,504 | | | | | Restricted Stock (Performance Shares Earned but Not Vested) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 473,758 | | | | | Restricted Stock (Time based) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 160,888 | | | | | Stock Options (1) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 674,250 | | | | | Benefits (2) | | $ | 0 | | | $ | 0 | | | $ | 39,613 | | | $ | 39,613 | | | | | SERP (3) | | $ | 1,597,311 | | | $ | 1,597,311 | | | $ | 1,597,311 | | | $ | 5,187,667 | | | | | Excess Plan (3) | | $ | 286,431 | | | $ | 286,431 | | | $ | 286,431 | | | $ | 286,431 | | | | | Qualified Plan (3) | | $ | 228,941 | | | $ | 228,941 | | | $ | 228,941 | | | $ | 228,941 | | | | | NQDC (4) | | $ | 118,136 | | | $ | 118,136 | | | $ | 118,136 | | | $ | 118,136 | | | | | Total: | | $ | 2,230,819 | | | $ | 2,230,819 | | | $ | 3,300,432 | | | $ | 10,379,938 | | |
| | (1) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the 4/30/2014 closing stock price ($57.46). | | | (2) | Presumes benefits are similar to those available to salaried employees and therefore only need to be disclosed in the dismissal columns. | | | (3) | Amounts shown are lump sum values (based on the PPA mortality table and the Section 417(e)(3) segment rates in effect for April 2014), even though plan documents only permit annuity payments, except on termination following a change of control. Annual benefits are: |
Qualified: | | $44,280 / year as a life annuity | | | | Excess: | | N/A / year as a life annuity | | | | SERP: | | $121,675 | | | | Qualified: $37,148 / year as a life annuity | | | | Excess: $46,476 / year as a life annuity | | | | SERP: $259,178 / year as a life annuity | | | (4) | Balance is paid as a lump sum on termination following a change of control; otherwise distribution is available in a lump sum or annual installments over up to 15 years. |
| | | | | | | | | | | | | | | | | | | | | | Gary Rinck | | | | | | | | | | | | | | | | | | | | Executive Benefits and Payments Upon Termination | | Retirement | | Resignation without Good Reason | | Dismissal without Cause or Resignation for Good Reason (absent CoC) | | Dismissal without Cause or Resignation for Good Reason (following CoC) | | | | | | | | | | | | | | | | | | | | | | | | Compensation: | | | | | | | | | | | | | | | | | | | | Severance — Base Salary | | $ | 0 | | | $ | 0 | | | $ | 772,500 | | | $ | 1,030,000 | | | | | Severance — Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 772,500 | | | | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 386,250 | | | | | ELTIP — Restricted Performance Share Units | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 706,758 | | | | | Restricted Stock (Performance Shares Earned but Not Vested) (1) | | $ | 568,509 | | | $ | 568,509 | | | $ | 568,509 | | | $ | 568,509 | | | | | Restricted Stock (Time based) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 143,650 | | | | | Stock Options (2) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 650,750 | | | | | Benefits (3) | | $ | 0 | | | $ | 0 | | | $ | 14,122 | | | $ | 18,829 | | | | | SERP (4) | | $ | 2,774,015 | | | $ | 2,774,015 | | | $ | 2,774,015 | | | $ | 3,223,919 | | | | | Excess Plan (4) | | $ | 745,828 | | | $ | 745,828 | | | $ | 745,828 | | | $ | 745,828 | | | | | Qualified Plan (4) | | $ | 278,967 | | | $ | 278,967 | | | $ | 278,967 | | | $ | 278,967 | | | | | NQDC (5) | | $ | 2,144,770 | | | $ | 2,144,770 | | | $ | 2,144,770 | | | $ | 2,144,770 | | | | | Total: | | $ | 6,512,089 | | | $ | 6,512,089 | | | $ | 7,298,711 | | | $ | 10,670,730 | | |
| (1) | Vesting accelerates in all 4 termination scenarios since the executive has achieved age 55 and 10 years of service criteria. | | | | | (2) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the 4/30/2014 closing stock price ($57.46). | | | | | (3) | Presumes benefits are similar to those available to salaried employees and therefore only need to be disclosed in the dismissal columns. | | | | | (4) | Amounts shown are lump sum values (based on the PPA mortality table and the Section 417(e)(3) segment rates in effect for April 2014), even though plan documents only permit annuity payments, except on termination following a change of control. Annual benefits are: | | | | | | Qualified: $25,908 / year as a life annuity | | | Excess: $69,265 / year as a life annuity | | | SERP: $324,153 / year as a 10 year certain | | | | | (4) | Balance is paid as a lump sum on termination following a change of control; otherwise distribution is available in a lump sum or annual installments over up to 15 years |
| | | | | | | | | | | Mark J. Allin | | | | | | | | | | | | | | | | | | | | Executive Benefits and Payments Upon Termination | | Retirement | | Resignation without Good Reason | | Dismissal without Cause or Resignation for Good Reason (absent CoC) | | Dismissal without Cause or Resignation for Good Reason (following CoC) | | | | | | | | | | | | Compensation: | | | | | | | | | | | | | | | | | | Severance — Base Salary | | $ | 0 | | | $ | 0 | | | $ | 630,074 | | | $ | 840,099 | | | Severance — Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 798,094 | | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 399,047 | | | ELTIP — Restricted Performance | | | | | | | | | | | | | | | | | | Share Units | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 591,838 | | | Restricted Stock (Performance | | | | | | | | | | | | | | | | | | Shares Earned but Not Vested) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 445,028 | | | Restricted Stock (Time based) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 132,158 | | | Stock Options (1) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 701,837 | | | Benefits (2) | | $ | 0 | | | $ | 0 | | | $ | 10,010 | | | $ | 13,347 | | | SERP (3) | | $ | 581,794 | | | $ | 581,794 | | | $ | 581,794 | | | $ | 2,030,336 | | | Excess Plan (3) | | | N/A | | | | N/A | | | | N/A | | | | N/A | | | Qualified Plan (3) | | $ | 311,046 | | | $ | 311,046 | | | $ | 311,046 | | | $ | 311,046 | | | NQDC | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | | Total: | | $ | 892,840 | | | $ | 892,840 | | | $ | 1,532,924 | | | $ | 6,262,830 | |
| | | | (1) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the 4/30/2014 closing stock price ($57.46). | | | | | (2) | Presumes benefits are similar to those available to salaried employees and therefore only need to be disclosed in the dismissal columns. | | | | | (3) | Amounts shown are lump sum values (based on the PPA mortality table and the Section 417(e)(3) segment rates in effect for April 2014), even though plan documents only permit annuity payments, except on termination following a change of control. Annual benefits are: | | | | | Qualified: $50,470 / year as a life annuity | | Excess: N/A / year as a life annuity | | SERP: $94,401 / year as a life annuity | | | | | The preceding tables—Potential Payments upon Termination or Change of Control—show the payments and benefits our named executives would receive in connection with a variety of employment termination scenarios and upon a change of control. For the named executive officers, the information assumes the terminations and change of control occurred on April 30, 2013.2014. All of the payments and benefits described below would be provided by the Company or its affiliates. | | | | | The tables do not include amounts such as base salary, annual incentives and stock awards the named executive officers earned due to employment through April 30, 2013.2014. | | | | | Under the 2009 Key Employee Stock Plan, the Committee may elect to accelerate the vesting of performance stock which has been earned but not vested for a retiring executive. Payout for current cycles will be made in shares following the end of the performance cycle. |
| The named officers and certain other executives are covered by employment agreements which provide for the following in the event of a “without cause termination” or “constructive discharge” without a change of control: |
| · | Severance—base salary: Messrs. Smith and Miron—24 months; Messrs. Cousens and Allin—18 months; Mr. Rinck— | | ● | Severance—base salary: Messrs. Smith and Miron—24 months; Messrs. Cousens, Rinck and Allin—18 months; Mr. Kritzmacher—12 months. | | | | | | | ● | Restricted Performance Shares/Units-Mr. Smith-accelerated vesting of all earned Restricted Performance Shares/Units for completed cycles. | | | | | | | ● | Company—paid health and welfare benefits, for their respective severance periods: |
| Messrs. Smith and Miron—24 months; Messrs. Cousens, Rinck and Allin—18 months; Mr. Kritzmacher—12 months. | | | | | | | · | Restricted Performance Shares—Mr. Smith—accelerated vesting of all earned Restricted Performance Shares for completed cycles. |
| · | Company-paid health and welfare benefits, for their respective severance periods: Messrs. Smith and Miron—24 months; Messrs. Cousens and Allin—18 months; Mr. Rinck—12 months. |
The named officers and certain other executives are covered by employment agreements which provide for the following, in the event of a “without cause termination” or “constructive discharge” following a change of control, as defined: | · | Severance—base salary: Messrs. Smith, Cousens, Miron, Rinck and Allin—24 months. | | | | | · | Severance—annual target incentive—Messrs. Smith, Cousens, Miron, Rinck and Allin—2 years. | | | | | · | Company-paid health and welfare benefits—24 months. | | | | | · | A lump-sum payment under the 1989 or 2005 SERP, equal to the present value of the benefit to which the participant would have been entitled if he/she had attained age 65 and retired on the date of such termination of employment. | | | | | · | Messrs. Smith, Cousens, Miron and Rinck—a lump-sum payment of the accrued benefit under the Excess Plan. | | | | | · |
| | ● | Severance—base salary: Messrs. Smith, Cousens, Kritzmacher, Miron, Rinck and Allin—24 months. | | | | | | | ● | Severance—annual target incentive-Messrs. Smith, Cousens, Kritzmacher, Miron, Rinck and Allin—2 years. | | | | | | | ● | Company—paid health and welfare benefits—Messrs. Smith, Cousens, Kritzmacher, Miron, Rinck and Allin—24 months. | | | | | | | ● | Messrs. Smith, Cousens, Miron, Rinck and Allin—a lump-sum payment under the 1989 or 2005 SERP, equal to the present value of the benefit to which the participant would have been entitled if he/she had attained age 65 and retired on the date of such termination of employment. | | | | | | | ● | Messrs. Smith, Cousens, Miron and Rinck—a lump-sum payment of the accrued benefit under the Excess Plan. | | | | | | | ● | Messrs. Smith, Cousens, Kritzmacher, Miron and Rinck—immediate payment of the current balance of the NQDC Plan. |
| Upon a “change of control”, as defined, under the 2004 and 2009 Key Employee Stock Plan, for grants made prior to June 2011, | · | All outstanding options shall become immediately exercisable up to the full number of shares covered by the option. | | | | | · | All outstanding target restricted performance shares shall become immediately vested. | | | | | · | All shares of restricted stock that would otherwise remain subject to restrictions shall be free of such restrictions. | | | | | · |
| | ● | All outstanding options shall become immediately exercisable up to the full number of shares covered by the option. | | | | | | | ● | All outstanding target restricted performance shares shall become immediately vested. | | | | | | | ● | All shares of restricted stock that would otherwise remain subject to restrictions shall be free of such restrictions. | | | | | | | ● | Beginning with the June 2011 equity awards, double-trigger vesting of equity upon a change of control will apply in cases where the acquiring company is a publicly traded company, and that company assumes or replaces the outstanding equity. | | | | | | | ● | In fiscal year 2012, the Company modified the executive employment agreements to eliminate excise tax “gross-ups” upon a change of control. |
| “Change of Control” shall mean an event which shall occur if there is: |
| | (i) | a change in the ownership of the Company; | | | | | | | (ii) | a change in the effective control of the Company; or | | | | | | (ii) | a change in the effective control of the Company; or | | | | | (iii) | a change in the ownership of a substantial portion of the assets of the Company. |
| For purposes of this definition, a change in the ownership occurs on the date on which any one person, or more than one person acting as a group (as defined in Treasury regulations 1.409A-2(i)(5)(v)(B)), acquires ownership of stock that, together with stock held by such person or group constitutes more than 50% of the total fair market value or total voting power of the stock of the Company. |
| | A change in the effective control occurs on the date on which either: | · | a person, or more than one person acting as a group (as defined in Treasury regulations 1.409A-2(i)(5)(v)(B)), acquires ownership of stock possessing 30% or more of the total voting power of the stock of the Company, taking into account all such stock acquired during the 12-month period ending on the date of the most recent acquisition, or | | | | | · | a majority of the members of the Board of Directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of such Board of Directors prior to the date of the appointment or election, but only if no other corporation is a majority shareholder. |
| (i) | a person, or more than one person acting as a group (as defined in Treasury regulations 1.409A-2(i)(5)(v)(B)), acquires ownership of stock possessing 30% or more of the total voting power of the stock of the Company, taking into account all such stock acquired during the 12-month period ending on the date of the most recent acquisition, or | | | | | (ii) | a majority of the members of the Board of Directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of such Board of Directors prior to the date of the appointment or election, but only if no other corporation is a majority shareholder. |
| | A change in the ownership of a substantial portion of assets occurs on the date on which any one person, or more than one person acting as a group (as defined in Treasury regulations 1.409A-2(i)(5)(v)(B)), other than a person or group of persons that is related to the Company, acquires assets that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions, taking into account all such assets acquired during the 12-month period ending on the date of the most recent acquisition. The determination as to the occurrence of a Change of Control shall be based on objective facts and in accordance with the requirements of Code Section 409A and the regulations promulgated thereunder. | | | | | | DIRECTORS’ COMPENSATION | | | | | | Directors’ Compensation 20132014 | | | | | | Our non-employee directors received an annual retainer of $72,500$75,000 and committee chairmen, except the chairman of the Executive Committee, received an additional annual retainer of $15,000. No fees are paid for attendance at meetings. No non-employee director receives any other compensation from the Company, except for reimbursement of expenses incurred for attendance at Board meetings. Directors who are employees do not receive an annual retainer for Board or committee service.Effective September 19, 2013,18, 2014, the annual retainer for non-employee directors will be increased to $75,000$80,000 in cash and in stock. cash. | | | | | | Pursuant to the Director Stock Plan, our non-employee directors receive an annual award of Class A shares equal in value to 100 percent of their annual total cash compensation, excluding the additional fees paid to committee chairmen and any expense reimbursements. In$72,500. On September 2012,19, 2013, a total of 13,43712,408 Class A shares were awarded to directors. Effective September 18, 2014, our non-employee directors will receive an annual stock grant equal to $100,000. In addition, in order to enhance alignment between the Board and the shareholders, the Board has increased the Director Stock Ownership Guideline from the current ownership requirement of an amount equal to three times current cash retainer value to five times current cash retainer value. This change will take effect on September 18, 2014. | | | | | | The Company has established a Deferred Compensation Plan for Directors (the “Deferred Plan”) Amended and Restated as of January 1, 2009. Non-employee directors are eligible to participate, and may defer all or a portion of their annual retainer fees in the form of cash and/or Class A Common Stock. They may also defer their annual stock award. EightSeven of our twelveeleven directors currently participate in the Deferred Plan. Retainers deferred in cash accrue interest annually based on the prime rate. Retainers deferred in the form of Class A Common Stock receive dividend equivalent units based on the closing price of the Class A Common Stock on the record date. Deferred cash and/or stock is payable to the directors upon their retirement from the Board, either in a lump sum or in the form of annual installments.instalments. | | | | | | Our active directors and their spouses are eligible to participate in the Company’s Matching Gift Program. The Company will match the first $1,000 given by the donor as follows: three-to-one on the first $500, and one-to-one on the second $500, up to a maximum contribution of $2,000 per institution, per donor, per calendar year. |
| | The table below indicates the total cash compensation received by each non-employee director during fiscal 2013.Name | | Fees Earned or Paid in Cash | | Stock Awards | | All Other Compensation | | Total | | | Mari Jean Baker(2)(3) | | $72,500.00 | | | $70,000.00 | | | $2,192.90 | | | $144,692.90 | | Jean-Lou Chameau(2)(3) | | $72,500.00 | | | $70,000.00 | | | $2,305.20 | | | $144,805.20 | | Linda P.B. Katehi(2)(3) | | $72,500.00 | | | $70,000.00 | | | $2,192.90 | | | $144,692.90 | | Matthew S. Kissner*(2)(3) | | $87,500.00 | | | $70,000.00 | | | $17,293.21 | | | $174,793.21 | | Raymond W. McDaniel, Jr.*(2)(3)(5) | | $87,500.00 | | | $70,000.00 | | | $19,044.21 | | | $176,544.21 | | Eduardo Menasce*(2)(3) | | $87,500.00 | | | $70,000.00 | | | $7,062.96 | | | $164,562.96 | | William B. Plummer(1)(2)(3) | | $72,500.00 | | | $70,000.00 | | | $24,226.62 | | | $166,726.62 | | William J. Pesce(2)(3)(6) | | $72,500.00 | | | $70,000.00 | | | $0.00 | | | $142,500.00 | | Kalpana Raina(2)(3) | | $72,500.00 | | | $70,000.00 | | | $5,162.96 | | | $147,662.96 | | Peter Booth Wiley(3)(4) | | $0.00 | | | $0.00 | | | $494,950.00 | | | $494,950.00 | | Jesse Wiley(6) | | | | | | | | $122,530.00 | | | $122,530.00 | |
2014. |
| | Name | | Fees Earned or Paid in Cash | | Stock Awards | | All Other Compensation | | Total | | | | | | | | | | | | | | | | | Mari Jean Baker(2)(3) | | $ | 75,000.00 | | | $ | 72,500.00 | | | | $3,887.03 | | | $ | 151,387.03 | | | Linda P.B. Katehi(2)(3) | | $ | 75,000.00 | | | $ | 72,500.00 | | | | $3,887.03 | | | $ | 151,387.03 | | | Matthew S. Kissner*(2)(3) | | $ | 90,000.00 | | | $ | 72,500.00 | | | | $19,983.39 | | | $ | 182,483.39 | | | Raymond W. McDaniel, Jr.*(2)(3)(5) | | $ | 90,000.00 | | | $ | 72,500.00 | | | | $25,545.00 | | | $ | 188,045.00 | | | Eduardo Menasce*(2)(3) | | $ | 90,000.00 | | | $ | 72,500.00 | | | | $9,078.45 | | | $ | 171,578.45 | | | William B. Plummer(1)(2)(3) | | $ | 75,000.00 | | | $ | 72,500.00 | | | | $29,049.09 | | | $ | 176,549.09 | | | William J. Pesce(2)(3)(6) | | $ | 75,000.00 | | | $ | 72,500.00 | | | | $4,000.00 | | | $ | 151,500.00 | | | Kalpana Raina(2)(3) | | $ | 75,000.00 | | | $ | 72,500.00 | | | | $7,053.64 | | | $ | 154,553.64 | | | Peter Booth Wiley(3)(4) | | | $0.00 | | | | $0.00 | | | | $537,500 | | | | $0 | | | Jesse Wiley(6) | | | | | | | | | | | $126,575 | | | | $0 |
| | | (1) | Effective January 1, 2009, Mr. Plummer has deferred receipt of his annual cash retainer fees in the form of stock. |
(1) | Effective January 1, 2009, Mr. Plummer has deferred receipt of his annual cash retainer fees in the form of stock. | | | (2) | On September 20, 2012, each of our non-employee Directors received an annual stock award of 1,493 Class A Shares based on the closing price of $46.87. | | | | | | | (2) | On September 19, 2013, each of our non-employee Directors received an annual stock award of 1,551 Class A Shares based on the closing price of $46.73. All of our non-employee directors, except for Mr. William J. Pesce deferred receipt of shares pursuant to the Deferred Compensation Plan, as described above. | | | | | | | (3) | The amounts in All Other Compensation include the cash value of dividends accrued under the Deferred Compensation Plan and, in the case of Mr. McDaniel, $7,300 in interest credited to his Deferred Cash Compensation Plan in FY2014. Also included are contributions made under the Company’s Matching Gift Program, as described above, as follows: Mr. P Wiley — $95,000 and Mr. Pesce — $4,000. | | | | | | | (4) | Peter Booth Wiley, Chairman of the Board, does not receive a retainer for his service on the board but receives an annual salary as an employee of the Company. Mr. Wiley’s current annual salary is $450,000. | | | | | | | (5) | Effective January 1, 2009, Mr. McDaniel deferred receipt of annual cash retainer fees in the form of stock until January 1, 2010. Effective January 1, 2011, Mr. McDaniel deferred receipt of his annual cash retainer in a cash deferral account. | | | | | | | (6) | Mr. J. Wiley, Editor and Board Member, does not receive a retainer for his service on the board but receives, as an employee of the Company, an annual base salary of $112,725 and a target annual incentive of $13,850, with payout on the incentive based solely on his role as Editor. |
| | Name | | Number of Shares Underlying Outstanding Deferred Stock Equivalents | | Number of Securities Underlying Outstanding Stock Options | | | | | | | | | | | | | Mari Jean Baker | | | 4,344 | | | | — | | | | Linda P.B. Katehi | | | 4,344 | | | | — | | | | Matthew S. Kissner | | | 20,711 | | | | — | | | | Raymond W. McDaniel, Jr. | | | 18,943 | | | | — | | | | Eduardo Menascé | | | 9,623 | | | | — | | | | William J. Pesce deferred receipt of shares pursuant to the Deferred Compensation Plan, as described above. | | | (3) | The amounts in All Other Compensation include the cash value of dividends accrued under the Deferred Compensation Plan and, in the case of Mr. McDaniel, $3,381.61 in interest credited to his Deferred Cash Compensation Plan in FY2013. Also included are contributions made under the Company’s Matching Gift Program, as described above, as follows: Mr. P Wiley — $59,590 and Mr. Pesce — $4,000. | | | (4) | Peter Booth Wiley, Chairman of the Board, does not receive a retainer for his service on the board but receives an annual salary of $435,000 as an employee of the Company | | | (5) | Effective January 1, 2009, Mr. McDaniel deferred receipt of annual cash retainer fees in the form of stock until January 1, 2010. Effective January 1, 2011, Mr. McDaniel deferred receipt of his annual cash retainer in a cash deferral account. | | | (6) | Mr. J. Wiley, Editor and Board Member, does not receive a retainer for his service on the board but receives, as an employee of the Company, an annual base salary of $111,445 and a target annual incentive of $11,085, with payout on the incentive based solely on his role as Editor. |
Name | | | Number of Shares
Underlying
Outstanding Deferred
Stock Equivalents | | | Number of Securities
Underlying
Outstanding
Stock Options | | | | | | | | | | | Mari Jean Baker | | | 2,695.31 | | | | — | | Jean-Lou Chameau | | | 3,166.51 | | | | — | | Linda P.B. Katehi | | | 2,695.31 | | | | — | | Matthew S. Kissner | | | 18,658,97 | | | | — | | Raymond W. McDaniel, Jr. | | | 16,935.37 | | | | — | | Eduardo Menascé | | | 7,843.91 | | | | — | | William B. Plummer | | | 26,889.11 | | | | — | | Kalpana Raina | | | 5,835.25 | | | | — | | Jesse Caleb Wiley | | | — | | | | — | | | | William B. Plummer | | | 30,621 | | | | — | | | | Kalpana Raina | | | 7,564 | | | | — | |
| | Insurance with Respect to Indemnification of Directors and Officers | | | | | | The By-Laws of the Company provide for indemnification of directors and officers in connection with claims arising from service to the Company to the extent permitted under the New York State Business Corporation Law. The Company carries insurance in the amount of $30,000,000$40,000,000 with FederalChubb Insurance Company of New Jersey, National Union Fire Insurance Company of Pittsburgh, PA, and Allied World National Assurance Company and Federal Insurance Company at a premium of $363,500.$468,500. The current policy expires on November 14, 2013.2014. |
| | Transactions with Directors’ Companies | | | | | | In the ordinary course of business, the Company and its subsidiaries may have transactions with companies and organizations whose executive officers are also Company directors. None of these transactions in fiscal 20132014 exceeded the threshold for disclosure under our Corporate Governance Guidelines, which is 2% of the gross revenues of either the Company or the other organization.
| | | | | | OTHER MATTERS | | | | | | Manner and Expenses of Solicitation | | | | | | Since many of our shareholders are unable to attend the Annual Meeting, the Board solicits proxies so that each shareholder has the opportunity to vote on the proposals to be considered at the Annual Meeting.
| | Shareholders of record can vote, and save the Company expense, by using the Internet or by calling the toll-free telephone number printed on the proxy card. Voting instructions (including instructions for both telephonic and Internet voting) are provided on the proxy card. The Internet and telephone voting procedures are designed to authenticate shareholder identities, to allow shareholders to give voting instructions and to confirm that shareholders’ instructions have been recorded properly. Shareholders voting via the Internet should understand that there may be costs associated with electronic access, such as usage charges from Internet access providers and telephone companies, that must be borne by the shareholder. | | | | | | If your shares are held in the name of a bank or broker, follow the voting instructions on the form you receive from such record holder. The availability of Internet and telephone voting will depend on their voting procedures. | | | | | | If you do vote by Internet or telephone, it will not be necessary to return your proxy card. If you do not choose to vote using these two options, you may return your proxy card, properly signed, and the shares will be voted in accordance with your directions. Shareholders are urged to mark the boxes on the proxy card to indicate how their shares are to be voted. If no choices are specified, the shares represented by that proxy card will be voted as recommended by the Board. | | | | | | If a shareholder does not return a signed proxy card, vote by the Internet, by telephone or attend the Annual Meeting and vote in person, his or her shares will not be voted. Any shareholder giving a proxy (including one given by the Internet or telephone) has the right to revoke it at any time before it is exercised by giving notice in writing to the Secretary of the Company, by delivering a duly executed proxy bearing a later date to the Secretary (or by subsequently completing a telephonic or Internet proxy) prior to the Annual Meeting of Shareholders, or by attending the Annual Meeting and voting in person. Attendance at the Annual Meeting will not in and of itself constitute revocation of a proxy. | | | | | | The Company will bear the costs of soliciting proxies. In addition to the solicitation of proxies by use of the mail, some of the officers, directors and other employees of the Company may also solicit proxies personally or by mail, telephone or facsimile, but they will not receive additional compensation for such services. Brokerage firms, custodians, banks, trustees, nominees or other fiduciaries holding shares of common stock in their names will be reimbursed for their reasonable out-of-pocket expenses in forwarding proxy material to their principals.
| | | | | | Electronic Delivery of Materials | | | | | | The 20132014 Notice of Annual Meeting, Proxy Statement and Annual Report on Form 10-K are available on our website athttps://materials.proxyvote.com/968223. Instead of receiving future copies of our Proxy Statement and Annual Report materials by mail, shareholders can elect to receive an e-mail that will provide electronic links to them. Selecting this option will save us the cost of producing and mailing documents to your home or business and will also give you an electronic link to the proxy voting site. Shareholders of record and beneficial owners may enroll in the electronic proxy delivery service at any time in the future by going to our enrollment site athttp://enroll.icsdelivery.com/jwa and following the enrollment instructions.
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| | Deadline for Submission of Shareholder Proposals | | | | | | If a shareholder intends to present a proposal for action at the 20142015 Annual Meeting and wishes to have such proposal considered for inclusion in our proxy materials in reliance on Rule 14a-8 under the Securities Exchange Act of 1934, the proposal must be submitted in writing and received by the Secretary of the Company by April 11, 2014.10, 2015. Such proposal must also meet the other requirements of the rules of the Securities and Exchange Commission relating to shareholder proposals. | | | | | | If a shareholder submits a proposal outside of Rule 14a-8 for the 20142015 Annual Meeting and the proposal fails to comply with the advance notice procedure prescribed by our By-Laws, then the Company’s proxy may confer discretionary authority on the persons being appointed as proxies on behalf of the Company’s Board to vote on the proposal. | | | | | | Our By-Laws establish an advance notice procedure with regard to certain matters, including shareholder proposals and nominations of individuals for election to the Board. In general, written notice of a shareholder proposal or a director nomination for an annual meeting
must be received by the Secretary of the Company no later than May 21, 2014,20, 2015, and must contain specified information and conform to certain requirements, as set forth in greater detail in the By-Laws. If the Company’s presiding officer at any shareholders’ meeting determines that a shareholder proposal or director nomination was not made in accordance with the By-Laws, the Company may disregard such proposal or nomination. | | | | | | Proposals and nominations should be addressed to Corporate Secretary, John Wiley & Sons, Inc., 111 River Street, Mail Stop 9-01, Hoboken, New Jersey 07030-5774. | | | | | | The Company has not received notice from any shareholder of its intention to bring a matter before the 20132014 Annual Meeting. At the date of this Proxy Statement, the Board of Directors does not know of any other matter to come before the meeting other than the matters set forth in the Notice of Meeting. However, if any other matter, not now known, properly comes before the meeting, the persons named on the enclosed proxy will vote said proxy in accordance with their best judgment on such matter. Shares represented by any proxy will be voted with respect to the proposals outlined above in accordance with the choices specified therein or in favor of any proposal as to which no choice is specified. | | | | | | The Company will provide, without charge, a copy of its Annual Report on Form 10-K filed with the Securities and Exchange Commission for fiscal year 2013,2014, including the financial statements and the schedules thereto. All such requests should be directed to Corporate Secretary, John Wiley & Sons, Inc., 111 River Street, Mail Stop 9-01, Hoboken, New Jersey 07030-5774. | | | | | | It is important that your proxy be returned promptly, whether by mail, by the Internet or by telephone. You may revoke the proxy at any time before it is exercised. If you attend the meeting in person, you may withdraw any proxy (including an Internet or telephonic proxy) and vote your own shares. | By Order of the Board of Directors | | | Michael L. Preston | | | Corporate Secretary |
Hoboken, New Jersey | | August 9, 2013 | | | | | By Order of the Board of Directors | | | | Edward J. May Corporate Secretary | | | | | | | Hoboken, New Jersey | | | August 8, 2014 |
Exhibit A 2014 DIRECTOR STOCK PLAN
521. | | Purposes.The purposes of the 2014 Director Stock Plan (the “Director Plan”) are to (a) attract and retain highly qualified individuals to serve as directors of John Wiley & Sons, Inc. (the “Company”) and (b) to increase the Non-Employee Directors’ (as defined below) stock ownership in the Company. | | | | 2. | | Effective Date.Provided that it is approved by the shareholders, the Director Plan shall be effective as of September 18, 2014. Following such approval, no further grants shall be made pursuant to the 2009 Director Stock Plan. | | | | 3. | | Participation.Only Non-Employee Directors shall be eligible to participate in the Director Plan. A “Non-Employee Director” is a person who is serving as a director of the Company and who is not an employee of the Company or any subsidiary or affiliate of the Company. | | | | 4. | | Shares Subject to the Plan.Subject to adjustment as provided in Section 8 below, no more than an aggregate of 100,000 shares of Class A Common Stock (the “Common Stock”) shall be delivered to Non-Employee Directors or their beneficiaries under the Director Plan, which shall be treasury shares. All shares awarded under the Director Plan will be charged against the total available for grant. | | | | 5. | | Restricted Stock Grant.Beginning with the Annual Meeting held in September 2014, and as soon as practicable after every subsequent Annual Meeting, each Non-Employee Director shall receive shares of the Company’s Common Stock, rounded upward or downward to the nearest whole share, equal in value to $100,000. If a Non-Employee Director becomes a director between Annual Meetings, the value of the shares shall be proportionately reduced to reflect the Non-Employee Director’s actual days of service during this period. If a Non-Employee Director has elected to defer receipt of the shares under the Deferred Compensation Plan for Directors (or any successor plan), the grant will be in the form of deferred stock rather than shares of the Company’s Common Stock. The value of the Common Stock or deferred stock for purposes of this paragraph shall be determined as of the date of the just concluded Annual Meeting and shall be equal to the closing price for the Common Stock as reported by any primary exchange on which the Common Stock may be listed on such date or, if no shares of the Common Stock were traded on such date, on the next preceding date on which the Common Stock was traded. The grant shares may not be sold or transferred during the time the Non-Employee Director remains a Director, but may be sold or transferred in the case of death or disability of the Non-Employee Director. Notwithstanding the first sentence of this Section 5, prior to the grant date at Annual Meetings following the 2014 Annual Meeting, the Governance Committee shall have the right to make adjustments to the amount of the grant share value, so long as the aggregate value of such shares granted with respect to any Annual Meeting does not exceed $300,000 (excluding for this purpose the value of any dividend equivalents credited on deferred stock and the value of any grants pursuant to an election to receive shares in lieu of cash as described in Section 6 below). | | | | 6. | | Election to Receive Stock in Lieu of Eligible Cash Fees.Subject to the terms and conditions of the Director Plan, each Non-Employee Director may elect to receive shares of Common Stock or deferred stock (rounded upward or downward to the nearest whole share) in lieu of all or a portion of the cash compensation otherwise payable for services to be rendered by such Non-Employee Director during each calendar year that begins after the date on which such election is made. This election may be made in increments of 25%, 50%, 75% or 100% of such compensation, as determined in accordance with Section 7 below. An election under this Section 6 to have cash compensation paid in shares of Stock shall be valid only if it is in writing, signed by the Non-Employee Director, and filed with the Corporate Secretary of the Company. The election must be irrevocable with respect to the calendar year to which it applies and must be made no later than the last day of the previous calendar year and, to the extent Sections 409A of the Internal Revenue Code applies, in accordance with the requirements thereof. Common Stock to be received by a Non-Employee Director pursuant to his or her election shall be distributed to such Non-Employee Director on each cash payment date. For purposes of this paragraph, cash compensation shall mean the Non-Employee Director’s annual retainer fee and the additional retainer fee received by committee chairmen. | | | | | | 7. | | Equivalent Amount of Stock.The number of whole shares of Common Stock to be distributed or allocated (if deferred stock) to a Non-Employee Director in accordance with the Non-Employee Director’s election made under Section 6 above shall be equal to: | | | | | | (a) | | the amount of the cash compensation which the Non-Employee Director has elected to forego in exchange for shares of Stock, divided by |
JOHN WILEY & SONS, INC. - ANNUAL MEETING, SEPTEMBER 19, 2013
YOUR VOTE IS IMPORTANT!
PLEASE SEE REVERSE SIDE FOR VOTING INSTRUCTIONS
CLASS A
Important Notice Regarding | | (b) | | the Availability of Proxy Materialsclosing price for the Annual Meeting:
The Notice & Proxy Statement and Annual ReportCommon Stock as reported by any exchange on Form 10-K are available at www.proxyvote.com.M61113-P41860
PROXY/VOTING INSTRUCTION CARD
JOHN WILEY & SONS, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Peter Booth Wiley, Stephen M. Smith and Gary M. Rinck aswhich the proxiesCommon Stock may be listed on the date of the undersigned, with full powerregularly scheduled quarterly meeting of substitution to eachthe Board of them, to vote the Class ADirectors or, if no shares of Common Stock were traded on such date, on the next preceding date on which the signee is entitled to vote at the Annual Meeting of Shareholders of John Wiley & Sons, Inc. and any and all adjournments thereof, to be held at the Company’s headquarters, 111 River Street, Hoboken, New Jersey, on September 19, 2013, at 9:30 AM, Eastern Daylight Saving Time.
The proxies are directed to vote as specified, and in their discretion on all other matters which may comebefore the meeting or any adjournments thereof. If no direction is given, this proxy will be voted “FOR” theElection of Directors and “FOR” Proposals 2 and 3.
| | | | | Address Changes/Comments: | | Common Stock was traded. | | | | | | 8. | | Change in Capital Stock.The total number of shares of Common Stock that may be issued under the Director Plan shall be appropriately adjusted for any change in the outstanding shares of Common Stock through recapitalization, stock split, stock dividend, extraordinary cash dividend or other change in the corporate structure, or through merger or consolidation in which the Company is the surviving corporation. The Board in its discretion will determine such adjustments and the manner of application. | | | |
(
9. | | Nonassignability.No rights under the Director Plan shall be assignable or transferable by a Non-Employee Director other than by will or the laws of descent and distribution | | | | 10. | | Legal Requirements.The issuance of shares pursuant to the Director Plan and the subsequent transfer of such shares shall be conditioned upon compliance with the listing requirements of any securities exchange upon which the Stock may be listed, the requirements of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and the requirements of applicable state laws relating to authorization, issuance or sale of securities. The Board may take such measures as it deems desirable to secure compliance with the foregoing. | | | | | | 11. | | Administration.The Board shall administer and interpret the Director Plan in its sole discretion. | | | | 12. | | Construction; Amendment; Termination.The Director Plan shall be construed in accordance with the laws of the State of New York, and may be amended by action of the Board and approval of the shareholders (to the extent such approval is required by applicable law or the rules of the stock market or exchange, if any, on which the shares of Common Stock are principally quoted or traded), or terminated at any time by action of the Board. | |
Approved by the Board of Directors—June 18, 2014 Exhibit B John Wiley & Sons, Inc. 2014 Executive Annual Incentive Plan 1. | | PURPOSE. The principal purposes of the John Wiley & Sons, Inc. 2014 Executive Annual Incentive Plan (the “Plan”) are to enable John Wiley & Sons, Inc. (the “Company”) to reinforce and sustain a culture devoted to excellent performance, reward significant contributions to the success of the Company, and attract and retain highly qualified executives. | | | | 2. | | ADMINISTRATION OF THE PLAN. The Plan will be administered by a committee (the “Committee”) appointed by the Board of Directors of the Company from among its members (which may be the Executive Compensation and Development Committee or a subcommittee thereof) and shall be comprised solely of no fewer than two members, all of whom shall be “outside directors” within the meaning of Treasury Regulation Section 1.162-27(e)(3) under Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”). | | | | | | The Committee shall have all the powers vested in it by the terms of this Plan, including the authority (within the limitations described herein) to select participants in the Plan and determine the terms and conditions for the cash target awards, including without limitation, to determine the time when cash target awards will be granted, to determine whether objectives and conditions for achieving cash target awards have been met, to determine whether awards will be paid out at the time set forth in Section 4(c) below or deferred, and to determine whether a cash target award or payout of an award should be reduced or eliminated. Unless otherwise determined by the Committee, it is intended that any cash target awards under the Plan satisfy all requirements for “performance-based compensation” within the meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended, where applicable. | | | | | | The Committee shall have full power and authority to administer and interpret the Plan and to adopt such rules, regulations, agreements, guidelines and instruments for the administration of the Plan and for the conduct of its business as the Committee deems necessary or advisable. The Committee’s interpretations of the Plan, and all actions taken and determinations made by the Committee pursuant to the powers vested in it hereunder, shall be conclusive and binding on all parties concerned, including the Company, its shareholders and any person granted a cash target award under the Plan. | | | | | | Unless otherwise determined by the Committee, the provisions of this Plan shall be administered and interpreted in accordance with Section 162(m) of the Code to ensure the deductibility by the Company of the payment of awards. The failure of any aspect of the Plan to satisfy Section 162(m) shall not void any action taken by the Committee under the Plan. | | | | | | The Committee may delegate all or a portion of its administrative duties under the Plan to such officers or other employees of the Company as it shall determine; provided, however, that no delegation shall be made regarding the selection of participants in the Plan, the amount and timing of cash target awards or payouts of awards, or the objectives and conditions pertaining to cash target awards or payouts of awards. | | | | 3. | | ELIGIBILITY. The Committee, in its discretion, may grant cash target awards to executive officers for each fiscal year of the Company as it shall determine. Those executive officers who are selected by the Committee and granted cash target awards for a fiscal year of the Company are referred to as “participants” for such fiscal year. | | | | 4. | | AWARDS. | | | | | | | | | | a. | | Granting of Cash Target Awards.For each fiscal year of the Company, each participant shall be granted a cash target award under the Plan as soon as practicable and no later than 90 days after the commencement of such fiscal years, provided, however, that if an individual first becomes eligible to participate after such 90 day period, that individual may be granted a cash target award after no more than 25% of the period of service to which the cash target award relates has elapsed. | | | | | | | | | | b. | | Performance Targets. | | | | | | | | | | i. | | For each fiscal year of the Company, the performance targets for each cash target award shall be determined by the Committee in writing, by resolution of the Committee or other appropriate action, not later than 90 days after the commencement of such fiscal year. The performance targets shall state, in terms of an objective formula or standard, the method for computing the amount of compensation payable to the applicable participant if such performance targets are attained. If you notedan individual first becomes eligible to participate after such 90 day period, that individual’s performance targets may be determined by the |
| | | | | | Committee in writing, by resolution of the Committee or other appropriate action, after no more than 25% of the period of service to which the performance targets relate has elapsed. | | | | | | | | | | | | ii. | | The annual performance targets for each cash target award shall be based on achievement of hurdle rates and/or growth in one or more business criteria that apply to the individual participant, including one or more business units, subsidiaries or the Company as a whole. The business criteria shall be as follows, individually or in combination: (A) net income; (B) earnings per share; (C) revenue; (D) net revenue growth; (E) market share; (F) operating income; (G) expenses; (H) working capital; (I) operating margin; (J) return on equity; (K) return on assets; (L) market price per share; (M) total return to stockholders; (N) cash flow; (0) free cash flow; (P) return on investment; (Q) earnings before interest, taxes, depreciation and amortization; (R) earnings before interest, taxes and amortization; (S) contribution to profit; (T) economic value added; and (U) objectively quantifiable customer or constituency satisfaction. In addition, the performance targets may include comparisons to performance of other companies or indices, using one or more of the foregoing business criteria. The Committee may provide in any Address Changes/Comments above, please mark corresponding boxcash target award that any evaluation of performance exclude the impact of any or all of the following: (1) asset write-downs; (2) litigation or claim judgments or settlements; (3) the effect of changes in tax law, accounting principles or methodology, or other laws or provisions affecting reported results; (4) accruals for reorganization and restructuring programs; (5) any non-recurring items as described in management’s discussion and analysis of financial condition and results of operations appearing in the Company’s annual report to shareholders or other filings for the applicable year; (6) acquisitions or divestitures; (7) any non-required contributions to the Company pension plan; (8) foreign exchange gains and losses; and (9) cash capital expenditures for facilities acquisition or construction. | | | | | | | | | | c. | | Payout of Awards.Payout of an award granted under the Plan may either be in cash or in the form of an equity award under the Company’s 2014 Key Employee Stock Plan (as amended from time to time, and any successor or replacement thereof). As a condition to the right of a participant to receive a payout of an award granted under this Plan, the Committee shall first be required to certify in writing, by resolution of the Committee or other appropriate action, that achievement of the award has been determined in accordance with the provisions of this Plan. Awards for a fiscal year shall be payable following the certification thereof by the Committee for such fiscal year and, subject to Section 4(e) below, by not later than the 15th day of the third month following the later of (i) the end of such fiscal year or (ii) the end of the participant’s taxable year in which occurs the end of the fiscal year. | | | | | | | | | | d. | | Discretion.After a cash target award has been granted, the Committee shall not increase such cash target award, and after a performance target has been determined, the Committee shall not revise such performance target in a manner that would increase the amount of compensation otherwise payable in respect of the award. Notwithstanding the attainment by the Company and a participant of the applicable targets, the Committee has the discretion, by participant, to reduce, prior to the confirmation of the award, some or all of an award that otherwise would be paid. | | | | | | | | | | e. | | Deferral.The Committee may determine to mandatorily defer or authorize participants to voluntarily defer the payout of an award or a portion of an award, in such manner as is consistent with the intent to comply with the rules under Code Section 409A. The Committee may determine the periods of such deferrals and any interest, not to exceed a reasonable rate, to be paid in respect of deferred payments. The Committee may also define such other conditions of payouts of awards as it may deem desirable in carrying out the purposes of the Plan, in such manner as is consistent with the intent to comply with the rules under Code Section 409A. | | | | | | | | | | f. | | Maximum Payout per Fiscal Year.No individual participant may receive a cash target award or a payout of an award under the Plan which is more than $6 million with respect to any fiscal year, excluding deferred amounts from prior years. | | | | | | | | 5. | | MISCELLANEOUS PROVISIONS. | | | | | | a. | | Withholding Taxes.The Company (or the relevant subsidiary or affiliate) shall have the right to deduct from all payouts of awards hereunder any federal, state, local or foreign taxes required by law to be withheld with respect to such payouts. | | | | | | | | | | b. | | No Rights to Cash Target Awards.Except as set forth herein, no person shall have any claim or right to be granted a cash target award under the Plan. Neither the Plan nor any action taken hereunder shall be construed as giving any person any right to be retained in the employ of the Company or any of its subsidiaries, divisions or affiliates. |
| | c. | | Funding of Plan.The Plan shall be unfunded. The Company shall not be required to establish any special or separate fund or to make any other segregation of assets to assure the payout of any award under the Plan. | | | | | | | | | | d. | | Awards are Subject to Clawback.All awards under the Plan are subject to the Company’s clawback policy as in effect from time to time. Without limiting the generality of the foregoing, in the event that the Company is required to file a restatement of its financial results due to fraud, gross negligence or intentional misconduct by one or more employees, and/or material non-compliance with securities laws, the Company may require reimbursement of any Award in the amount by which the payment under the Award exceeded any lower payment that would have been made based on the reverse side.restated financial results, for the fiscal year in which the restatement was required, to the full extent required or permitted by law. If a participant is directly responsible for or involved in fraud, gross negligence or intentional misconduct that causes the Company to file a restatement of its financial results, the Company may require reimbursement of all annual incentive compensation awarded to such participant, for the fiscal year in which the restatement was required, to the full extent required or permitted by law. | | | | | | | | | | e. | | Non-Transferability of Awards.No award under the Plan shall be transferable other than by will or the laws of descent and distribution. Upon any attempt to sell, transfer, assign, pledge, hypothecate, encumber or otherwise dispose of any such award, such award and all rights thereunder shall immediately become null and void. | | | | | | | | | | f. | | Effect on Other Plans.Payments pursuant to the Plan shall not be treated as compensation for purposes of any other compensation or benefit plan, program or arrangement of the Company or any of its subsidiaries, unless either (a) such other plan provides that compensation such as payments made pursuant to the Plan are to be considered as compensation thereunder or (b) the Board or the Committee so determines in writing. Neither the adoption of the Plan nor the submission of the Plan to the Company’s shareholders for their approval shall be construed as limiting the power of the Board or the Committee to adopt such other incentive arrangements as it may otherwise deem appropriate. | | | | | | | | | | g. | | Binding Effect.The Plan shall be binding upon the Company and its successors and assigns and the Participants and their beneficiaries, personal representatives and heirs. If the Company becomes a party to any merger, consolidation or reorganization, then the Plan shall remain in full force and effect as an obligation of the Company or its successors in interest, unless the Plan is amended or terminated pursuant to Section 6. | | | | | | | | 6. | | EFFECTIVE DATE, AMENDMENTS AND TERMINATION. | | | | | | a. | | Effective Date.The Plan shall be effective as of July 30, 2014, the date on which it was adopted by the Committee and ratified by the Board (the “Effective Date”), provided that the Plan is approved by the shareholders of the Company at an annual meeting or any special meeting of shareholders of the Company within 12 months of the Effective Date, and such approval of shareholders shall be a condition to the right of each participant to receive any awards or payouts hereunder. Any awards granted under the Plan prior to such approval of shareholders shall be effective as of the date of grant (unless, with respect to any award, the Committee specifies otherwise at the time of grant), but no such award may be paid out prior to such shareholder approval, and if shareholders fail to approve the Plan as specified hereunder, any such award shall be cancelled. | | | | | | | | | | b. | | Amendments.The Committee may at any time terminate or from time to time amend the Plan in whole or in part, but no such action shall materially adversely affect any rights or obligations with respect to any cash target awards theretofore granted under the Plan without the participant’s consent. | | | | | | | | | | | | Unless the shareholders of the Company shall have first approved thereof, no amendment of the Plan shall be effective which would: (i) increase the maximum amount which can be paid to any participant under the Plan; (ii) change the types of business criteria on which performance targets are to be based under the Plan; or (iii) modify the requirements as to eligibility for participation in the Plan. | | | | | | | | | | c. | | Termination.No cash target awards shall be granted under the Plan after the Annual Meeting of Shareholders in September 2019 (but any awards granted prior thereto may be paid out in accordance with their terms). |
Exhibit C JOHN WILEY & SONS, INC. 2014 KEY EMPLOYEE STOCK PLAN John Wiley & Sons, Inc. (the “Company”), a New York corporation, hereby establishes and adopts the following 2014 Key Employee Stock Plan (the “Plan”). (Continued, and to be marked, dated and signed, on the other side)
The Plan is intended to provide the officers and other key employees of the Company and of its Subsidiaries and Affiliates, upon whose judgment, initiative and efforts the Company depends for its growth and for the profitable conduct of its business, with additional incentive to promote the success of the Company, and to that end to encourage such employees to acquire or increase their proprietary interest in the Company. 2.1.“Affiliate”shall mean (i) any Person that directly, or through one or more intermediaries, controls, or is controlled by, or is under common control with, the Company or (ii) any entity in which the Company has a significant equity interest, as determined by the Committee. 2.2.“Award”shall mean any Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award, Other Share-Based Award, Performance Award or any other right, interest or option relating to Shares or other property (including cash) granted pursuant to the provisions of the Plan. 2.3.“Award Agreement”shall mean any agreement, contract or other instrument or document evidencing any Award hereunder, whether in writing or through an electronic medium. 2.4.“Board”shall mean the board of directors of the Company. 2.5.“Code”shall mean the Internal Revenue Code of 1986, as amended from time to time. 2.6.“Committee”shall mean, unless otherwise determined by the Board, the Executive Compensation and Development Committee (ECDC) of the Board or a subcommittee thereof formed by the ECDC to act as the Committee hereunder. The Committee shall consist of no fewer than two Directors, each of whom is (i) a “non-employee director” within the meaning of Rule 16b-3 under the Exchange Act, (ii) an “outside director” within the meaning of Section 162(m) of the Code, and (iii) an “independent director” for purpose of the rules of the principal U.S. national securities exchange on which the Shares are traded, to the extent required by such rules. 2.7.“Covered Employee”shall mean an employee of the Company or its Subsidiaries who is a “covered employee” within the meaning of Section 162(m) of the Code. 2.8.“Director”shall mean a member of the Board who is not an employee. 2.9.“Dividend Equivalents”shall have the meaning set forth in Section 12.6. 2.10.“Effective Date”shall mean the date as of which the Plan is approved by the Company’s shareholders at a duly constituted meeting. 2.11.“Employee” shall mean any employee of the Company or any Subsidiary or Affiliate and any prospective employee conditioned upon, and effective not earlier than, such person becoming an employee of the Company or any Subsidiary. 2.12.“Exchange Act”shall mean the Securities Exchange Act of 1934, as amended. 2.13.“Fair Market Value”shall mean, with respect to Shares as of any date, (i) the closing price of the Shares as reported on the principal U.S. national securities exchange on which the Shares are listed and traded on such date, or, if there is no closing price on that date, then on the last preceding date on which such a closing price was reported; (ii) if the Shares are not listed on any U.S. national securities exchange but are quoted in an inter-dealer quotation system on a last sale basis, the final ask price of the Shares reported on the inter-dealer quotation system for such date, or, if there is no such sale on such date, then on the last preceding date on which a sale was reported; or (iii) if the Shares are neither listed on a U.S. national securities exchange nor quoted on an inter-dealer quotation system on a last sale basis, the amount determined by the Committee to be the fair market value of the Shares as determined by the Committee in its sole discretion. The Fair Market Value of any property other than Shares shall mean the market value of such property determined by such methods or procedures as shall be established from time to time by the Committee. 2.14.“Incentive Stock Option”shall mean an Option which when granted is intended to qualify as an incentive stock option for purposes of Section 422 of the Code. 2.15.“Option”shall mean any right granted to a Participant under the Plan allowing such Participant to purchase Shares at such price or prices and during such period or periods as the Committee shall determine. 2.16.“Other Share-Based Award”shall have the meaning set forth in Section 8.1. 2.17.“Participant”shall mean an Employee who is selected by the Committee to receive an Award under the Plan. 2.18.“Performance Award”shall mean any Award of Performance Cash, Performance Shares or Performance Units granted pursuant to Article 9. 2.19.“Performance Cash”shall mean any cash incentives granted pursuant to Article 9 payable to the Participant upon the achievement of such performance goals as the Committee shall establish. 2.20.“Performance Period”shall mean the period established by the Committee during which any performance goals specified by the Committee with respect to a Performance Award are to be measured. 2.21.“Performance Share”shall mean any grant pursuant to Article 9 of a unit valued by reference to a designated number of Shares, which value may be paid to the Participant in Shares or cash as determined by the Committee in its sole discretion, upon achievement of such performance goals as the Committee shall establish. 2.22.“Performance Unit”shall mean any grant pursuant to Article 9 of a unit valued by reference to a designated amount of cash or property other than Shares, which value may be paid to the Participant in cash or Shares as determined by the Committee in its sole discretion, upon achievement of such performance goals during the Performance Period as the Committee shall establish. 2.23.“Permitted Assignee”shall have the meaning set forth in Section 12.3. 2.24.“Person”shall mean any individual, corporation, partnership, association, limited liability company, joint-stock company, trust or unincorporated organization. 2.25.“Prior Plans”shall mean, collectively, the Company’s 2009 Key Employee Stock Plan and 2004 Key Employee Stock Plan. 2.26.“Restricted Stock”shall mean any Share issued with the restriction that the holder may not sell, transfer, pledge or assign such Share and with such other restrictions as the Committee, in its sole discretion, may impose, which restrictions may lapse separately or in combination at such time or times, in installments or otherwise, as the Committee may deem appropriate. 2.27.“Restricted Stock Award”shall have the meaning set forth in Section 7.1. 2.28.“Restricted Stock Unit”means an Award that is valued by reference to a Share, which value may be paid to the Participant in Shares or cash as determined by the Committee in its sole discretion upon the satisfaction of vesting restrictions as the Committee may establish, which restrictions may lapse separately or in combination at such time or times, in installments or otherwise, as the Committee may deem appropriate. 2.29.“Restricted Stock Unit Award”shall have the meaning set forth in Section 7.1 2.30.“Retirement”shall mean a Participant’s retirement after attaining a minimum of age 55 with 10 or more years of continuous employment with the Company, or any Subsidiary or Affiliate. 2.31.“SEC”means the Securities and Exchange Commission. 2.32.“Shares”shall mean the shares of Class A Common Stock of the Company, par value $1.00 per share (and not the Class B Common Stock). 2.33.“Stock Appreciation Right”shall mean the right granted to a Participant pursuant to Article 6. 2.34.“Subsidiary”shall mean any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company if, at the relevant time each of the corporations other than the last corporation in the unbroken chain owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in the chain. 2.35.“Substitute Awards”shall mean Awards granted or Shares issued by the Company in assumption of, or insubstitution or exchange for, awards previously granted, or the right or obligation to make future awards, in each case by a company acquired by the Company or any Subsidiary or with which the Company or any Subsidiary combines. 2.36.“Vesting Period”shall mean the period of time specified by the Committee during which vesting restrictions for an Award are applicable. 3. | SHARES SUBJECT TO THE PLAN |
3.1.Number of Shares.(a) Subject to adjustment as provided in Section 12.2, a total of 6,500,000 Shares shall be authorized for Awards granted under the Plan, less one (1) Share for every one (1) Share that was subject to an option or stock appreciation right granted after April 30, 2014 under the 2009 Key Employee Stock Plan and 1.76 Shares for every one (1) Share that was subject to an award other than an option or stock appreciation right granted after April 30, 2014 under the 2009 Key Employee Stock Plan. Any Shares that are subject to Options or Stock Appreciation Rights shall be counted against this limit as one (1) Share for every one (1) Share granted, and any Shares that are subject to Awards other than Options or Stock Appreciation Rights shall be counted against this limit as 1.76 Shares for every one (1) Share granted. After the Effective Date of the Plan, no awards may be granted under the 2009 Key Employee Stock Plan. (b) If (i) any Shares subject to an Award are forfeited or an Award expires or is settled for cash (in whole or in part), or (ii) after April 30, 2014 any Shares subject to an award under any Prior Plan are forfeited or an award under any Prior Plan expires or is settled for cash (in whole or in part), then in each such case the Shares subject to such Award or award under any Prior Plan shall, to the extent of such forfeiture, expiration or cash settlement, be added to the Shares available for Awards under the Plan, in accordance with Section 3.1(d) below. In the event that withholding tax liabilities arising from an Award other than an Option or Stock Appreciation Right or, after April 30, 2014, an award other than an option or stock appreciation right under any Prior Plan are satisfied by the tendering of Shares (either actually or by attestation) or by the withholding of Shares by the Company, the Shares so tendered or withheld shall be added to the Shares available for Awards under the Plan in accordance with Section 3.1(d) below. Notwithstanding anything to the contrary contained herein, the following Shares shall not be added to the Shares authorized for grant under paragraph (a) of this Section: (i) Shares tendered by the Participant or withheld by the Company in payment of the purchase price of an Option or, after April 30, 2014, an option under any Prior Plan, (ii) Shares tendered by the Participant or withheld by the Company to satisfy any tax withholding obligation with respect to Options or Stock Appreciation Rights or, after April 30, 2014, options or stock appreciation rights under any Prior Plan, (iii) Shares subject to a Stock Appreciation Right or, after April 30, 2014, a stock appreciation right under any Prior Plan that are not issued in connection with its stock settlement on exercise thereof, and (iv) Shares reacquired by the Company on the open market or otherwise using cash proceeds from the exercise of Options or, after April 30, 2014, options under any Prior Plan. (c) Substitute Awards shall not reduce the Shares authorized for grant under the Plan or the limitations on grants to a Participant under Section 10.5, nor shall Shares subject to a Substitute Award be added to the Shares available for Awards under the Plan as provided in paragraph (b) above. Additionally, in the event that a company acquired by the Company or any Subsidiary or with which the Company or any Subsidiary combines has shares available under a pre-existing plan approved by shareholders and not adopted in contemplation of such acquisition or combination, the shares available for grant pursuant to the terms of such pre-existing plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or formula used in such acquisition or combination to determine the consideration payable to the holders of common stock of the entities party to such acquisition or combination) may be used for Awards under the Plan and shall not reduce the Shares authorized for grant under the Plan (and Shares subject to such Awards shall not be added to the Shares available for Awards under the Plan as provided in paragraphs (b) above); provided that Awards using such available shares shall not be made after the date awards or grants could have been made under the terms of the pre-existing plan, absent the acquisition or combination, and shall only be made to individuals who were not Employees prior to such acquisition or combination. (d) Any Shares that again become available for Awards under the Plan pursuant to this Section shall be added as (i) one (1) Share for every one (1) Share subject to Options or Stock Appreciation Rights granted under the Plan or options or stock appreciation rights granted under any Prior Plan, and (ii) as 1.76 Shares for every one (1) Share subject to Awards other than Options or Stock Appreciation Rights granted under the Plan or awards other than options or stock appreciation rights granted under any Prior Plan. 3.2.Character of Shares.Any Shares issued hereunder may consist, in whole or in part, of authorized and unissued shares, treasury shares or shares purchased in the open market or otherwise. 4. | ELIGIBILITY AND ADMINISTRATION |
4.1.Eligibility.Any Employee shall be eligible to be selected as a Participant. 4.2.Administration.
(a) The Plan shall be administered by the Committee. The Committee shall have full power and authority, subject to the provisions of the Plan and subject to such orders or resolutions not inconsistent with the provisions of the Plan as may from time to time be adopted by the Board, to: (i) select the Employees to whom Awards may from time to time be granted hereunder; (ii) determine the type or types of Awards to be granted to each Participant hereunder; (iii) determine the number of Shares (or dollar value) to be covered by each Award granted hereunder; (iv) determine the terms and conditions, not inconsistent with the provisions of the Plan, of any Award granted hereunder; (v) determine whether, to what extent and under what circumstances Awards may be settled in cash, Shares or other property; (vi) determine whether, to what extent, and under what circumstances cash, Shares, other property and other amounts payable with respect to an Award made under the Plan shall be deferred either automatically or at the election of the Participant; (vii) determine whether, to what extent and under what circumstances any Award shall be canceled or suspended; (viii) interpret and administer the Plan and any instrument or agreement entered into under or in connection with the Plan, including any Award Agreement; (ix) correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Award in the manner and to the extent that the Committee shall deem desirable to carry it into effect; (x) establish such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan; (xi) determine whether any Award, other than an Option or Stock Appreciation Right, will have Dividend Equivalents; and (xii) make any other determination and take any other action that the Committee deems necessary or desirable for the administration of the Plan. (b) Decisions of the Committee shall be final, conclusive and binding on all persons or entities, including the Company, any Participant, and any Subsidiary. (c) To the extent not inconsistent with applicable law, including Section 162(m) of the Code with respect to Awards intended to comply with the performance-based compensation exception under Section 162(m), or the rules and regulations of the principal U.S. national securities exchange on which the Shares are traded, the Committee may (i) delegate to a committee of one or more directors of the Company any of the authority of the Committee under the Plan, including the right to grant, cancel or suspend Awards and (ii) authorize one or more executive officers to do one or more of the following with respect to Employees who are not directors or executive officers of the Company (A) designate Employees to be recipients of Awards, (B) determine the number of Shares subject to such Awards to be received by such Employees and (C) cancel or suspend Awards to such Employees; provided that (x) any resolution of the Committee authorizing such officer(s) must specify the total number of Shares subject to Awards that such officer(s) may so award and (y) the Committee may not authorize any officer to designate himself or herself as the recipient of an Award. 5.1.Grant.Options may be granted hereunder to Participants either alone or in addition to other Awards granted under the Plan. Any Option shall be subject to the terms and conditions of this Article and to such additional terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall deem desirable. 5.2.Award Agreements.All Options shall be evidenced by an Award Agreement in such form and containing such terms and conditions as the Committee shall determine which are not inconsistent with the provisions of the Plan. The terms and conditions of Options need not be the same with respect to each Participant. Granting an Option pursuant to the Plan shall impose no obligation on the recipient to exercise such Option. Any individual who is granted an Option pursuant to this Article may hold more than one Option granted pursuant to the Plan at the same time. 5.3.Option Price.Other than in connection with Substitute Awards, the option price per each Share purchasable under any Option granted pursuant to this Article shall not be less than 100% of the Fair Market Value of one Share on the date of grant of such Option; provided, however, that in the case of an Incentive Stock Option granted to a Participant who, at the time of the grant, owns stock representing more than 10% of the voting power of all classes of stock of the Company or any Subsidiary, the option price per share shall be no less than 110% of the Fair Market Value of one Share on the date of grant. Other than pursuant to Section 12.2, the Committee shall not without the approval of the Company’s shareholders (a) lower the option price per Share of an Option after it is granted, (b) cancel an Option when the option price per Share exceeds the Fair Market Value of one Share in exchange for cash, an Option with a lower option price per Share or another Award (other than in connection with a Change in Control as defined in Section 11.3), or (c) take any other action with respect to an Option that would be treated as a repricing under the rules and regulations of the principal U.S. national securities exchange on which the Shares are listed. 5.4.Option Term.The term of each Option shall be fixed by the Committee in its sole discretion; provided that no Option shall be exercisable after the expiration of ten (10) years from the date the Option is granted, except in the event of death; provided, however, that the term of the Option shall not exceed five (5) years from the date the Option is granted in the case of an Incentive Stock Option granted to a Participant who, at the time of the grant, owns stock representing more than 10% of the voting power of all classes of stock of the Company or any Subsidiary. Notwithstanding the foregoing and unless otherwise determined by the Committee, in the event that on the last business day of the term of an Option (other than an Incentive Stock Option) (i) the exercise of the Option is prohibited by applicable law or (ii) Shares may not be purchased or sold by certain employees or directors of the Company due to the “black-out period” of a Company policy or a “lock-up” agreement undertaken in connection with an issuance of securities by the Company, the term of the Option shall be extended for a period of thirty (30) days following the end of the legal prohibition, black-out period or lock-up agreement. 5.5.Vesting of Options.Unless otherwise provided in an Award Agreement, any Option granted under the Plan shall have a minimum vesting period of four years and the Shares subject thereto shall vest and become exercisable in two equal installments as of each fiscal year end of the Company that immediately precedes the fourth and fifth anniversaries of the date the Option is granted, in each case so long as the Participant continues to be employed by or provide services to the Company or any of its Subsidiaries or Affiliates on the relevant vesting date. 5.6.Exercise of Options. (a) Vested Options granted under the Plan shall be exercised by the Participant (or by a Permitted Assignee thereof or the Participant’s executors, administrators, guardian or legal representative, to the extent provided in an Award Agreement) as to all or part of the Shares covered thereby, by giving notice of exercise to the Company or its designated agent, specifying the number of Shares to be purchased. The notice of exercise shall be in such form, made in such manner, and shall comply with such other requirements consistent with the provisions of the Plan as the Committee may prescribe from time to time. (b) Unless otherwise provided in an Award Agreement, full payment of such purchase price shall be made at the time of exercise and shall be made (i) in cash or cash equivalents (including certified check or bank check or wire transfer of immediately available funds), (ii) by tendering previously acquired Shares (either actually or by attestation) valued at their then Fair Market Value, (iii) with the consent of the Committee, by delivery of other consideration having a Fair Market Value on the exercise date equal to the total purchase price, (iv) with the consent of the Committee, by withholding Shares otherwise issuable in connection with the exercise of the Option, (v) through any other method specified in an Award Agreement (including same-day sale through a broker), or (vi) any combination of any of the foregoing; provided, however, to the extent required by applicable law, that the Participant must pay in cash an amount not less than the aggregate par value (if any) of the Shares being acquired. The notice of exercise, accompanied by such payment, shall be delivered to the Company at its principal business office or such other office as the Committee may from time to time direct, and shall be in such form, containing such further provisions consistent with the provisions of the Plan, as the Committee may from time to time prescribe. In no event may any Option granted hereunder be exercised for a fraction of a Share. 5.7.Termination of Employment. (a)Other Than by Death or Retirement.Unless otherwise provided in an Award Agreement, each vested Option may be exercised only while the Participant is regularly employed by the Company, a Subsidiary or an Affiliate, as the case may be, or within three months after the Participant’s employment has been terminated (but no later than the expiration of the Option term), whether such termination was by the Company (unless such termination was for cause as determined by the Committee) or by the Participant for any reason. If the Participant’s employment is terminated for cause (as determined by the Committee), the Option may not be exercised after the Participant’s employment has been terminated. A Participant’s employment shall not be deemed to have terminated for purposes of this Section 5.7 as long as the Participant is employed by the Company, or any Subsidiary or Affiliate. For purposes of this Section 5.7, “employment” shall mean continuous employment (either full or part time), except that leaves of absence for such periods and purposes as may be approved by the Company or the Subsidiary or Affiliate, shall not be deemed to terminate employment. If a Participant is permanently disabled (as described in Section 22(e)(3) of the Code) as of the date of termination of employment, the Option may be exercised within three years after such date. The Committee may require evidence of permanent disability, including medical examinations by physicians selected by it. Notwithstanding the foregoing, the Committee, in its discretion, may permit the exercise of an Option for such period after such termination of employment as the Committee may specify and may also increase the number of Shares subject to exercise up to the full number of Shares covered by the Option. In no event (except as hereinafter provided in the case of the death of a Participant) may an Option be exercised after the expiration date of the Option. (b)Retirement.In the event of a Participant’s Retirement, the Option shall terminate on the earlier of (i) the expiration of the 10-year Option term, or (ii) the later of (1) the date that is three years after the individual’s retirement, or (2) ninety days after the option’s vesting date that occurs during such three-year period. If the Participant shall die within such three year (or shorter) period, the Participant’s estate or any person who acquires the right to exercise such Option by bequest, inheritance or by reason of the death of the Participant shall have the right to exercise the Option during such period, or during the period ending one year after the Participant’s death, if longer, to the same extent as the Participant would have had if he or she had survived. (c)Death.If a Participant shall die while in the employ of the Company or a Subsidiary or Affiliate, the Participant’s estate or any person who acquires the right to exercise such Option by bequest, inheritance or by reason of the death of the Participant shall have the right to exercise the Option within three years from the date of the Participant’s death (but not later than the expiration of the Option term or one year after the Participant’s death, whichever is later), without regard to whether the right to exercise such Option shall have otherwise accrued. (d) Notwithstanding the foregoing, the Committee may in its sole discretion specify alternative terms and conditions relating to the vesting and exercise of Options in the applicable Award Agreement (including specific terms relating to Incentive Stock Options that are intended to comply with Section 422 of the Code), in which case the Award Agreement terms relating thereto shall govern. 5.8.Form of Settlement.In its sole discretion, the Committee may provide that the Shares to be issued upon an Option’s exercise shall be in the form of Restricted Stock or other similar securities. 5.9.Incentive Stock Options.The Committee may grant Incentive Stock Options to any employee of the Company or any Subsidiary, subject to the requirements of Section 422 of the Code. Solely for purposes of determining whether Shares are available for the grant of Incentive Stock Options under the Plan, the maximum aggregate number of Shares that may be issued pursuant to Incentive Stock Options granted under the Plan shall be 6,500,000 Shares, subject to adjustment as provided in Section 12.2. 6. | STOCK APPRECIATION RIGHTS |
6.1.Grant and Vesting.The Committee may grant Stock Appreciation Rights (a) in tandem with all or part of any Option granted under the Plan or at any subsequent time during the term of such Option, (b) in tandem with all or part of any Award (other than an Option) granted under the Plan or at any subsequent time during the term of such Award, or (c) without regard to any Option or other Award in each case upon such terms and conditions as the Committee may establish in its sole discretion. Unless otherwise provided in an Award Agreement, any Share Appreciation Rights granted under the Plan shall have a minimum vesting period of four years and shall vest and become exercisable in two equal installments as of each fiscal year end of the Company that immediately precedes the fourth and fifth anniversaries of the date the Share Appreciation Rights are granted, in each case so long as the Participant continues to be employed by or provide services to the Company or any of its Subsidiaries on the relevant vesting date. 6.2.Terms and Conditions.Stock Appreciation Rights shall be subject to such terms and conditions, not inconsistent with the provisions of the Plan, as shall be determined from time to time by the Committee, including the following: (a) Upon the exercise of a Stock Appreciation Right, the holder shall have the right to receive the excess of (i) the Fair Market Value of one Share on the date of exercise (or such amount less than such Fair Market Value as the Committee shall so determine at any time during a specified period before the date of exercise) over (ii) the grant price of the Stock Appreciation Right. (b) The Committee shall determine in its sole discretion whether payment on exercise of a Stock Appreciation Right shall be made in whole Shares, in cash or other property, or any combination thereof. (c) The terms and conditions of Stock Appreciation Rights need not be the same with respect to each recipient. (d) The Committee may impose such other terms and conditions on the exercise of any Stock Appreciation Right, as it shall deem appropriate. A Stock Appreciation Right shall (i) have a grant price per Share of not less than the Fair Market Value of one Share on the date of grant or, if applicable, on the date of grant of an Option with respect to a Stock Appreciation Right granted in exchange for or in tandem with, but subsequent to, the Option (subject to the requirements of Section 409A of the Code) except in the case of Substitute Awards or in connection with an adjustment provided in Section 12.2, and (ii) have a term not greater than ten (10) years. Notwithstanding clause (ii) of the preceding sentence, in the event that on the last business day of the term of a Stock Appreciation Right (x) the exercise of the Stock Appreciation Right is prohibited by applicable law or (y) Shares may not be purchased or sold by certain employees or directors of the Company due to the “black-out period” of a Company policy or a “lock-up” agreement undertaken in connection with an issuance of securities by the Company, the term shall be extended for a period of thirty (30) days following the end of the legal prohibition, black-out period or lock-up agreement. (e) Without the approval of the Company’s shareholders, other than pursuant to Section 12.2, the Committee shall not (i) reduce the grant price of any Stock Appreciation Right after the date of grant (ii) cancel any Stock Appreciation Right when the grant price per Share exceeds the Fair Market Value of one Share in exchange for cash, a Stock Appreciation Right with a lower grant price per Share or another Award (other than in connection with a Change in Control as defined in Section 11.3), or (iii) take any other action with respect to a Stock Appreciation Right that would be treated as a repricing under the rules and regulations of the principal U.S. national securities exchange on which the Shares are listed. 7. | RESTRICTED STOCK AND RESTRICTED STOCK UNITS |
7.1.Grants.Awards of Restricted Stock and of Restricted Stock Units may be granted hereunder to Participants either alone or in addition to other Awards granted under the Plan (a “Restricted Stock Award” or “Restricted Stock Unit Award,” respectively), and such Restricted Stock Awards and Restricted Stock Unit Awards shall also be available as a form of payment of Performance Awards and other earned cash-based incentive compensation. The Committee has absolute discretion to determine whether any consideration (other than services) is to be received by the Company or any Subsidiary as a condition precedent to the grant of Restricted Stock or Restricted Stock Units, subject to such minimum consideration as may be required by applicable law. 7.2.Award Agreements.The terms of any Restricted Stock Award or Restricted Stock Unit Award granted under the Plan shall be set forth in an Award Agreement which shall contain provisions determined by the Committee and not inconsistent with the Plan. The terms of Restricted Stock Awards and Restricted Stock Unit Awards need not be the same with respect to each Participant 7.3.Rights of Holders of Restricted Stock and Restricted Stock Units.Unless otherwise provided in the Award Agreement, beginning on the date of grant of the Restricted Stock Award and subject to execution of the Award Agreement, the Participant shall become a shareholder of the Company with respect to all Shares subject to the Award Agreement and shall have all of the rights of a shareholder, including the right to vote such Shares and the right to receive distributions made with respect to such Shares, except as otherwise provided in this Section. A Participant who holds a Restricted Stock Unit Award shall only have those rights specifically provided for in the Award Agreement; provided, however, in no event shall the Participant have voting rights with respect to such Award. Except as otherwise provided in an Award Agreement, any Shares or any other property distributed as a dividend or otherwise with respect to any Restricted Stock Award or Restricted Stock Unit Award as to which the restrictions have not yet lapsed shall be subject to the same restrictions as such Restricted Stock Award or Restricted Stock Unit Award, and the Committee shall have the sole discretion to determine whether, if at all, any cash amount that is subject to such restrictions shall earn interest and at what rate. Notwithstanding the provisions of this Section, cash dividends, stock and any other property (other than cash) distributed as a dividend or otherwise with respect to any Restricted Stock Award or Restricted Stock Unit Award that vests based on achievement of performance goals shall either (i) not be paid or credited or (ii) be accumulated, or deemed reinvested in additional Shares or otherwise reinvested, and shall be subject to restrictions and risk of forfeiture to the same extent as the Restricted Stock or Restricted Stock Units with respect to which such cash, stock or other property has been distributed and shall be paid at the time such restrictions and risk of forfeiture lapse. 7.4.Vesting Period.The Award Agreement shall specify the Vesting Period for the Restricted Stock or Restricted Stock Units. Except for Substitute Awards, the death, disability or retirement of the Participant, or special circumstances determined by the Committee or unless otherwise provided in an Award Agreement, Restricted Stock Awards and Restricted Stock Unit Awards shall have a Vesting Period of not less than (i) three (3) years from date of grant (but permitting pro rata vesting over such time) if subject only to continued service with the Company or a Subsidiary and (ii) one (1) year from the date of grant if subject to the achievement of performance objectives, subject in either case to accelerated vesting in the Committee’s discretion in the event of a Change in Control (as defined in Section 11.3) or the termination of the Participant’s service with the Company and its Subsidiaries. The Committee may, in its sole discretion waive the vesting restrictions and any other conditions set forth in any Award Agreement under such terms and conditions as the Committee shall deem appropriate, subject to the limitations imposed under Section 162(m) of the Code and the regulations thereunder in the case of a Restricted Stock Award or Restricted Stock Unit Award intended to comply with the performance-based exception under Code Section 162(m) except as otherwise determined by the Committee to be appropriate under the circumstances. 7.5.Issuance of Shares.Any Restricted Stock granted under the Plan may be evidenced in such manner as the Board may deem appropriate, including book-entry registration or issuance of a stock certificate or certificates, which certificate or certificates shall be held by the Company. Any such certificate or certificates shall be registered in the name of the Participant and shall bear an appropriate legend referring to the restrictions applicable to such Restricted Stock. 7.6.Termination of Employment. (a)Other than Death or Disability.Restricted Stock and Restricted Stock Units shall be forfeited and revert to the Company upon the termination of employment during the Vesting Period for any reason other than death or permanent disability (as described in Section 22(e)(3) of the Code), except to the extent the Committee, in its discretion, determines that a lesser number of Restricted Stock or Restricted Stock Units or no Restricted Stock and Restricted Stock Units shall be forfeited pursuant to the foregoing provisions of this Section 7. (b)Death or Permanent Disability.Restricted Stock and Restricted Stock Units shall not be forfeited as a result of the Participant’s death or his or her termination of employment by reason of permanent disability (as described in Section 22(e)(3) of the Code), as determined by the Committee. The Committee may require medical evidence of permanent disability, including medical examinations by physicians selected by it. Such shares shall remain subject to forfeiture if any performance objectives specified in the award are not met. (c) Notwithstanding the foregoing, the Committee may in its sole discretion specify alternative terms and conditions relating to the vesting and forfeiture of Restricted Stock and Restricted Stock Units in the applicable Award Agreement, in which case the Award Agreement terms relating thereto shall govern. 8. | OTHER SHARE-BASED AWARDS |
8.1.Grants.Other Awards of Shares and other Awards that are valued in whole or in part by reference to, or are otherwise based on, Shares or other property (“Other Share-Based Awards”), including deferred stock units, may be granted hereunder to Participants either alone or in addition to other Awards granted under the Plan. Other Share-Based Awards shall also be available as a form of payment of other Awards granted under the Plan and other earned cash-based compensation. 8.2.Award Agreements.The terms of Other Share-Based Awards granted under the Plan shall be set forth in an Award Agreement which shall contain provisions determined by the Committee and not inconsistent with the Plan. The terms of such Awards need not be the same with respect to each Participant. Notwithstanding the provisions of this Section, Dividend Equivalents with respect to the Shares covered by an Other Share-Based Award that vests based on achievement of performance goals shall be subject to restrictions and risk of forfeiture to the same extent as the Shares covered by an Other Share-Based Award with respect to which such Dividend Equivalents have been credited. Other Share-Based Awards may be subject to vesting restrictions during the Vesting Period as specified by the Committee. 8.3.Vesting Period.Except for Substitute Awards, the death, disability or retirement of the Participant, or special circumstances determined by the Committee or unless otherwise provided in an Award Agreement, Other Share-Based Awards shall have a Vesting Period of not less than (i) three (3) years from date of grant (but permitting pro rata vesting over such time) if subject only to continued service with the Company or a Subsidiary and (ii) one (1) year) from the date of grant if subject to the achievement of performance objectives, subject in either case to accelerated vesting in the Committee’s discretion in the event of a Change in Control (as defined in Section 11.3) or the termination of the Participant’s service with the Company and its Subsidiaries. The Committee may, in its sole discretion waive the vesting restrictions and any other conditions set forth in any Award Agreement under such terms and conditions as the Committee shall deem appropriate, subject to the limitations imposed under Section 162(m) of the Code and the regulations thereunder in the case of an Other Share-Based Award intended to comply with the performance-based exception under Code Section 162(m) except as otherwise determined by the Committee to be appropriate under the circumstances. 8.4.Payment.Except as may be provided in an Award Agreement, Other Share-Based Awards may be paid in Shares, cash or other property, or any combination thereof, in the sole discretion of the Committee. Other Share-Based Awards may be paid in a lump sum or in installments or, in accordance with procedures established by the Committee, on a deferred basis subject to the requirements of Section 409A of the Code. 9.1.Grants.Performance Awards in the form of Performance Cash, Performance Shares or Performance Units, as determined by the Committee in its sole discretion, may be granted hereunder to Participants, for no consideration or for such minimum consideration as may be required by applicable law, either alone or in addition to other Awards granted under the Plan. The performance goals to be achieved for each Performance Period shall be conclusively determined by the Committee and may be based upon the criteria set forth in Section 10.2 or such other criteria as determined by the Committee in its discretion. 9.2.Award Agreements.The terms of any Performance Award granted under the Plan shall be set forth in an Award Agreement (or, if applicable, in a resolution duly adopted by the Committee) which shall contain provisions determined by the Committee and not inconsistent with the Plan, including whether such Awards shall have Dividend Equivalents. The terms of Performance Awards need not be the same with respect to each Participant. 9.3.Terms and Conditions.The performance criteria to be achieved during any Performance Period and the length of the Performance Period shall be determined by the Committee upon the grant of each Performance Award. The amount of the Award to be distributed shall be conclusively determined by the Committee. 9.4.Payment.Except as provided in Article 11, as provided by the Committee or as may be provided in an Award Agreement, Performance Awards will be distributed only after the end of the relevant Performance Period. Performance Awards may be paid in Shares, cash or other property, or any combination thereof, in the sole discretion of the Committee. Performance Awards may be paid in a lump sum or in installments following the close of the Performance Period or, in accordance with procedures established by the Committee, on a deferred basis subject to the requirements of Section 409A of the Code. 10. CODE SECTION 162(m) PROVISIONS 10.1.Covered Employees.Notwithstanding any other provision of the Plan, if the Committee determines at the time a Restricted Stock Award, a Restricted Stock Unit Award, a Performance Award or an Other Share-Based Award is granted to a Participant who is or may be, as of the end of the tax year in which the Company would claim a tax deduction in connection with such Award, a Covered Employee, then the Committee may provide that this Article 10 is applicable to such Award. 10.2.Performance Goals.If the Committee determines that a Restricted Stock Award, a Restricted Stock Unit, a Performance Award or an Other Share-Based Award is intended to be subject to this Article 10, the lapsing of restrictions thereon and the distribution of cash, Shares or other property pursuant thereto, as applicable, shall be subject to the achievement of one or more objective performance goals established by the Committee, which shall be based on the attainment of specified levels of one or any combination of the following: (a) net income; (b) earnings per share; (c) revenue; (d) net revenue growth; (e) market share; (f) operating income; (g) expenses; (h) working capital; (i) operating margin; (j) return on equity; (k) return on assets; (l) market price per share; (m) total return to stockholders; (n) cash flow; (o) free cash flow; (p) return on investment; (q) earnings before interest, taxes, depreciation and amortization; (r) earnings before interest, taxes and amortization; (s) contribution to profit; (t) economic value added; and (u) objectively quantifiable customer or constituency satisfaction. Such performance goals also may be based solely by reference to the Company’s performance or the performance of a Subsidiary, division, business segment or business unit of the Company or a Subsidiary, or based upon performance relative to performance of other companies or upon comparisons of any of the indicators of performance relative to performance of other companies. If the Committee determines that a Restricted Stock Award, a Restricted Stock Unit, a Performance Award or an Other Share-Based Award is intended to be subject to this Article 10, the Committee may provide that any evaluation of performance exclude the impact of any or all of the following: (1) asset write-downs; (2) litigation or claim judgments or settlements; (3) the effect of changes in tax law, accounting principles or methodology, or other laws or provisions affecting reported results; (4) accruals for reorganization and restructuring programs; (5) any non-recurring items as described in management’s discussion and analysis of financial condition and results of operations appearing in the Company’s annual report to shareholders or other filings for the applicable year; (6) acquisitions or divestitures; (7) any non-required contributions to the Company pension plan; (8) foreign exchange gains and losses; and (9) cash capital expenditures for facilities acquisition or construction. Such performance goals (and any exclusions) shall (i) be set by the Committee prior to the earlier of 90 days after the commencement of the applicable Performance Period and the expiration of 25% of the Performance Period, and (ii) otherwise comply with the requirements of, Section 162(m) of the Code and the regulations thereunder. 10.3.Adjustments; Certification.Notwithstanding any provision of the Plan (other than Article 11), with respect to any Restricted Stock Award, Restricted Stock Unit Award, Performance Award or Other Share-Based Award that is subject to this Section 10, the Committee may adjust downwards, but not upwards, the amount payable pursuant to such Award, and the Committee may not waive the achievement of the applicable performance goals except in the case of the death or disability of the Participant or as otherwise determined by the Committee in special circumstances. The Committee must certify, in writing the amount of the Award for each Participant for such Performance Period before payment of the Award is made. 10.4.Restrictions.The Committee shall have the power to impose such other restrictions on Awards subject to this Article as it may deem necessary or appropriate to ensure that such Awards satisfy all requirements for “performance-based compensation” within the meaning of Section 162(m) of the Code. 10.5.Limitations on Grants to Individual Participants.Subject to adjustment as provided in Section 12.2, no Participant may be granted (i) Options or Stock Appreciation Rights during any calendar year period with respect to more than 600,000 Shares and (ii) Restricted Stock Awards, Restricted Stock Unit Awards, Performance Awards and/or Other Share-Based Awards during any calendar year that are intended to comply with the performance-based exception under Code Section 162(m) and are denominated in Shares with respect to more than 600,000 Shares. During any calendar year no Participant may be granted Performance Awards that are intended to comply with the performance-based exception under Code Section 162(m) and are denominated in cash under which more than may $6,000,000 may be earned for each twelve (12) months in the Performance Period. If an Award is cancelled, the cancelled Award shall continue to be counted toward the applicable limitation in this Section. 11. CHANGE IN CONTROL PROVISIONS 11.1.Impact on Certain Awards.Unless otherwise specifically provided in an Award Agreement, the Committee shall have the right to provide that in the event of a Change in Control of the Company (as defined in Section 11.3): (i) Options and Stock Appreciation Rights outstanding as of the date of the Change in Control shall be cancelled and terminated without payment if the Fair Market Value of one Share as of the date of the Change in Control is less than the per Share Option exercise price or Stock Appreciation Right grant price, and (ii) all Performance Awards shall be (x) considered to be earned and payable based on achievement of performance goals or based on target performance (either in full or pro rata based on the portion of Performance Period completed as of the date of the Change in Control), and any limitations or other restrictions shall lapse and such Performance Awards shall be immediately settled or distributed or (y) converted into Restricted Stock or Restricted Stock Unit Awards based on achievement of performance goals or based on target performance (either in full or pro rata based on the portion of Performance Period completed as of the date of the Change in Control) that are subject to Section 11.2. 11.2.Assumption or Substitution of Certain Awards. (a) Unless otherwise provided in an Award Agreement, in the event of a Change in Control in connection with which the successor company assumes or substitutes for an Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award or Other Share-Based Award (or in which the Company is the ultimate parent corporation and continues the Award), if a Participant’s employment with such successor company (or the Company) or a subsidiary thereof terminates within 24 months following such Change in Control (or such other period set forth in the Award Agreement, including prior thereto if applicable) under the circumstances specified in the Award Agreement (e.g., a termination without “cause”): (i) Options and Stock Appreciation Rights outstanding as of the date of such termination of employment will immediately vest, become fully exercisable, and may thereafter be exercised for 24 months (or the period of time set forth in the Award Agreement), (ii) the restrictions, limitations and other conditions applicable to Restricted Stock and Restricted Stock Units outstanding as of the date of such termination of employment shall lapse and the Restricted Stock and Restricted Stock Units shall become free of all restrictions, limitations and conditions and become fully vested, and (iii) the restrictions, limitations and other conditions applicable to any Other Share-Based Awards shall lapse, and such Other Share-Based Awards shall become free of all restrictions, limitations and conditions and become fully vested and transferable to the full extent of the original grant. For the purposes of this Section 11.2, an Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award or Other Share-Based Award shall be considered assumed or substituted for if following the Change in Control the Award confers the right to purchase or receive, for each Share subject to the Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award or Other Share-Based Award immediately prior to the Change in Control, the consideration (whether stock, cash or other securities or property) received in the transaction constituting the Change in Control by holders of Shares for each Share held on the effective date of such transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the transaction constituting a Business Combination is not solely common stock of the successor company, the Committee may, with the consent of the successor company, provide that the consideration to be received upon the exercise or vesting of an Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award or Other Share-Based Award, for each Share subject thereto, will be solely common stock of the successor company with a fair market value substantially equal to the per Share consideration received by holders of Shares in the Change in Control. The determination of whether fair market value is substantially equal shall be made by the Committee in its sole discretion and its determination shall be conclusive and binding. (b) Unless otherwise provided in an Award Agreement, in the event of a Change in Control to the extent (i) the successor company does not assume or substitute for an Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award or Other Share-Based Award (or in which the Company is the ultimate parent corporation and does not continue the Award), or (ii) common stock of the successor company is not publicly traded, then immediately prior to the Change in Control: (1) those Options and Stock Appreciation Rights outstanding as of the date of the Business Combination that are not assumed or substituted for (or continued) shall immediately vest and become fully exercisable, (2) restrictions, limitations and other conditions applicable to Restricted Stock and Restricted Stock Units that are not assumed or substituted for (or continued) shall lapse and the Restricted Stock and Restricted Stock Units shall become free of all restrictions, limitations and conditions and become fully vested, (3) the restrictions, other limitations and other conditions applicable to any Other Share-Based Awards or any other Awards that are not assumed or substituted for (or continued) shall lapse, and such Other Share-Based Awards or such other Awards shall become free of all restrictions, limitations and conditions and become fully vested and transferable to the full extent of the original grant, and (4) any performance based Award shall be deemed fully earned at the target amount as of the date on which the Change of Control occurs. (c) The Committee, in its discretion, may determine that, upon the occurrence of a Change in Control, each Option and Stock Appreciation Right outstanding shall terminate within a specified number of days after notice to the Participant, and/or that each Participant shall receive, with respect to each Share subject to such Option or Stock Appreciation Right, an amount equal to the excess of the Fair Market Value of such Share immediately prior to the occurrence of such Business Combination over the exercise price per Share of such Option and/or Stock Appreciation Right; such amount to be payable in cash, in one or more kinds of stock or property (including the stock or property, if any, payable in the transaction) or in a combination thereof, as the Committee, in its discretion, shall determine. 11.3.Definitions (a) “Change of Control” shall mean an event which shall occur if there is: (i) a change in the ownership of the Company; (ii) a change in the effective control of the Company; (iii) a change in the ownership of a substantial portion of the assets of the Company; or (iv) a liquidation or dissolution of the Company. (b) For purposes of this Section 11.3, a change in the ownership occurs on the date on which any one person, or more than one person acting as a group (as defined in Treasury regulations 1.409A-2(i)(5)(v)(B)), acquires ownership of stock that, together with stock held by such person or group constitutes more than 50% of the total fair market value or total voting power of the stock of the Company. (c) For purposes of this Section 11.3, a change in the effective control occurs on the date on which either (i) a person, or more than one person acting as a group (as defined in Treasury regulations 1.409A-2(i)(5)(v)(B)), acquires ownership of stock possessing 30% or more of the total voting power of the stock of the Company, taking into account all such stock acquired during the 12-month period ending on the date of the most recent acquisition, or (ii) a majority of the members of the Board of Directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of such Board of Directors prior to the date of the appointment or election, but only if no other corporation is a majority shareholder. (d) For purposes of this Section 11.3, a change in the ownership of a substantial portion of assets occurs on the date on which any one person, or more than one person acting as a group (as defined in Treasury regulations 1.409A-2(i)(5)(v)(B)), other than a person or group of persons that is related to the Company, acquires assets that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions, taking into account all such assets acquired during the 12-month period ending on the date of the most recent acquisition. (e) For purposes of this Section 11.3, a liquidation or dissolution of the Company occurs on the date of shareholder approval of a resolution or plan of complete liquidation or dissolution of the Company. (f) The determination as to the occurrence of a Change of Control for purposes of Sections 11.3 (b), (c) and (d) shall be based on objective facts and in accordance with the requirements of Code Section 409A and the regulations promulgated thereunder. 12. GENERALLY APPLICABLE PROVISIONS 12.1.Amendment and Termination of the Plan.The Board may, from time to time, alter, amend, suspend or terminate the Plan as it shall deem advisable, subject to any requirement for shareholder approval imposed by applicable law, including the rules and regulations of the principal U.S. national securities exchange on which the Shares are traded; provided that the Board may not amend the Plan in any manner that would result in noncompliance with Rule 16b-3 under the Exchange Act; and further provided that the Board may not, without the approval of the Company’s shareholders to the extent required by such applicable law, amend the Plan to (a) increase the number of Shares that may be the subject of Awards under the Plan (except for adjustments pursuant to Section 12.2), (b) expand the types of awards available under the Plan, (c) materially expand the class of persons eligible to participate in the Plan, (d) amend Section 5.3 or Section 6.2(e) to eliminate the requirements relating to minimum exercise price, minimum grant price and shareholder approval, (e) increase the maximum permissible term of any Option specified by Section 5.4 or the maximum permissible term of a Stock Appreciation Right specified by Section 6.2(d), (f) add performance goals to Section 10.2 or (g) increase any of the limitations in Section 10.5. The Board may not (except pursuant to Section 12.2 or in connection with a Change in Control), without the approval of the Company’s shareholders, cancel an Option or Stock Appreciation Right in exchange for cash when the exercise or grant price per share exceeds the Fair Market Value of one Share or take any action with respect to an Option or Stock Appreciation Right that would be treated as a repricing under the rules and regulations of the principal securities exchange on which the Shares are traded, including a reduction of the exercise price of an Option or the grant price of a Stock Appreciation Right or the exchange of an Option or Stock Appreciation Right for another Award. In addition, no amendments to, or termination of, the Plan shall impair the rights of a Participant in any material respect under any Award previously granted without such Participant’s consent. 12.2.Adjustments.In the event of any merger, reorganization, consolidation, recapitalization, dividend or distribution (whether in cash, shares or other property, other than a regular cash dividend), stock split, reverse stock split, spin-off or similar transaction or other change in corporate structure affecting the Shares or the value thereof, such adjustments and other substitutions shall be made to the Plan and to Awards in a manner the Committee deems equitable or appropriate taking into consideration the accounting and tax consequences, including such adjustments in the aggregate number, class and kind of securities that may be delivered under the Plan, the limitations in Section 10.5 (other than to Awards denominated in cash), the maximum number of Shares that may be issued pursuant to Incentive Stock Options and, in the aggregate or to any Participant, in the number, class, kind and option or exercise price of securities subject to outstanding Awards granted under the Plan (including, if the Committee deems appropriate, the substitution of similar options to purchase the shares of, or other awards denominated in the shares of, another company); provided, however, that the number of Shares subject to any Award shall always be a whole number. 12.3.Transferability of Awards.Except as provided below, no Award and no Shares that have not been issued or as to which any applicable restriction, performance or deferral period has not lapsed, may be sold, assigned, transferred, pledged or otherwise encumbered, other than by will or the laws of descent and distribution, and such Award may be exercised during the life of the Participant only by the Participant or the Participant’s guardian or legal representative except that shares of Restricted Stock may be used, if the Award Agreement permits, to pay the exercise price of an Option granted under the Plan (or an option granted under any Prior Plan), provided an equal number of Shares delivered to the Participant shall carry the same restrictions and be subject to the same provisions regarding forfeiture as the shares of Restricted Stock so used. To the extent and under such terms and conditions as determined by the Committee, a Participant may assign or transfer an Award without consideration (each transferee thereof, a “Permitted Assignee”) (i) to the Participant’s spouse, children or grandchildren (including any adopted and step children or grandchildren), parents, grandparents or siblings, (ii) to a trust for the benefit of one or more of the Participant or the persons referred to in clause (i), (iii) to a partnership, limited liability company or corporation in which the Participant or the persons referred to in clause (i) are the only partners, members or shareholders or (iv) for charitable donations; provided that such Permitted Assignee shall be bound by and subject to all of the terms and conditions of the Plan and the Award Agreement relating to the transferred Award and shall execute an agreement satisfactory to the Company evidencing such obligations; and provided further that such Participant shall remain bound by the terms and conditions of the Plan. The Company shall cooperate with any Permitted Assignee and the Company’s transfer agent in effectuating any transfer permitted under this Section. 12.4.Termination of Employment or Services.The Committee shall determine and set forth in each Award Agreement whether any Awards granted in such Award Agreement will continue to be exercisable, continue to vest or be earned and the terms of such exercise, vesting or earning, on and after the date that a Participant ceases to be employed by or to provide services to the Company or any Subsidiary (including as a Director), whether by reason of death, disability, voluntary or involuntary termination of employment or services, or otherwise. The date of termination of a Participant’s employment or services will be determined by the Committee, which determination will be final. 12.5. Deferral.The Committee shall be authorized to establish procedures pursuant to which the payment of any Award may be deferred. 12.6.Dividend Equivalents.Subject to the provisions of the Plan and any Award Agreement, the recipient of an Award other than an Option or Stock Appreciation Right may, if so determined by the Committee, be entitled to receive, currently or on a deferred basis, amounts equivalent to cash, stock or other property dividends on Shares (“Dividend Equivalents”) with respect to the number of Shares covered by the Award, as determined by the Committee, in its sole discretion. The Committee may provide that the Dividend Equivalents (if any) shall be deemed to have been reinvested in additional Shares or otherwise reinvested and may provide that the Dividend Equivalents are subject to the same vesting or performance conditions as the underlying Award. Notwithstanding the foregoing, Dividend Equivalents credited in connection with an Award that vests based on the achievement of performance goals shall be subject to restrictions and risk of forfeiture to the same extent as the Award with respect to which such Dividend Equivalents have been credited. 13. MISCELLANEOUS 13.1.Award Agreements.Each Award Agreement shall either be (a) in writing in a form approved by the Committee and executed by the Company by an officer duly authorized to act on its behalf, or (b) an electronic notice in a form approved by the Committee and recorded by the Company (or its designee) in an electronic recordkeeping system used for the purpose of tracking one or more types of Awards as the Committee may provide; in each case and if required by the Committee, the Award Agreement shall be executed or otherwise electronically accepted by the recipient of the Award in such form and manner as the Committee may require. The Committee may authorize any officer of the Company to execute any or all Award Agreements on behalf of the Company. The Award Agreement shall set forth the material terms and conditions of the Award as established by the Committee consistent with the provisions of the Plan. 13.2.Tax Withholding.The Company shall have the right to make all payments or distributions pursuant to the Plan to a Participant (or a Permitted Assignee thereof) net of any applicable federal, state and local taxes required to be paid or withheld as a result of (a) the grant of any Award, (b) the exercise of an Option or Stock Appreciation Right, (c) the delivery of Shares or cash, (d) the lapse of any restrictions in connection with any Award or (e) any other event occurring pursuant to the Plan. The Company or any Subsidiary shall have the right to withhold from wages or other amounts otherwise payable to a Participant (or Permitted Assignee) such withholding taxes as may be required by law, or to otherwise require the Participant (or Permitted Assignee) to pay such withholding taxes. If the Participant (or Permitted Assignee) shall fail to make such tax payments as are required, the Company or its Subsidiaries shall, to the extent permitted by law, have the right to deduct any such taxes from any payment of any kind otherwise due to such Participant (or Permitted Assignee) or to take such other action as may be necessary to satisfy such withholding obligations. The Committee shall be authorized to establish procedures for election by Participants (or Permitted Assignee) to satisfy such obligation for the payment of such taxes by tendering previously acquired Shares (either actually or by attestation, valued at their then Fair Market Value), or by directing the Company to retain Shares (up to the minimum required tax withholding rate for the Participant (or Permitted Assignee) or such other rate that will not cause an adverse accounting consequence or cost) otherwise deliverable in connection with the Award. 13.3.Right of Discharge Reserved; Claims to Awards.Nothing in the Plan nor the grant of an Award hereunder shall confer upon any Employee the right to continue in the employment or service of the Company or any Subsidiary or affect any right that the Company or any Subsidiary may have to terminate the employment or service of (or to demote or to exclude from future Awards under the Plan) any such Employee at any time for any reason. The Company shall not be liable for the loss of existing or potential profit from an Award granted in the event of termination of an employment or other relationship. No Employee shall have any claim to be granted any Award under the Plan, and there is no obligation for uniformity of treatment of Employees under the Plan. 13.4.Substitute Awards.Notwithstanding any other provision of the Plan, the terms of Substitute Awards may vary from the terms set forth in the Plan to the extent the Committee deems appropriate to conform, in whole or in part, to the provisions of the awards in substitution for which they are granted. 13.5.Awards are Subject to Clawback.All awards under the Plan are subject to the Company’s clawback policy as in effect from time to time. Without limiting the generality of the foregoing, in the event that the Company is required to file a restatement of its financial results due to fraud, gross negligence or intentional misconduct by one or more employees, and/or material non-compliance with securities laws, the Company may require reimbursement of any Award in the amount by which the payment under the Award exceeded any lower payment that would have been made based on the restated financial results, for the fiscal year in which the restatement was required, to the full extent required or permitted by law. If a Participant is directly responsible for or involved in fraud, gross negligence or intentional misconduct that causes the Company to file a restatement of its financial results, the Company may require reimbursement of all annual incentive compensation awarded to such Participant, for the fiscal year in which the restatement was required, to the full extent required or permitted by law. 13.6.Competition with the Company. (a) If the Participant, without the consent of the Company, while employed by or providing services to the Company or any Subsidiary or Affiliate or after termination of such employment or service, violates a non-competition, non-solicitation or non-disclosure covenant or agreement or otherwise engages in a competitive activity that is in conflict with or adverse to the interest of the Company, or any Subsidiary or Affiliate, as determined by the Committee in its sole discretion, then (i) any outstanding, vested or unvested, earned or unearned portion of the Award may, at the Committee’s discretion, be canceled and (ii) the Committee, in its discretion, may require the Participant or other person to whom any payment has been made or Shares or other property have been transferred in connection with the Award to forfeit and pay over to the Company, on demand, all or any portion of the gain (whether or not taxable) realized upon the exercise of any Option or Stock Appreciation Right and the value realized (whether or not taxable) on the vesting or payment of any other Award during the time period specified in the Award Agreement. (c) Any remittance to the Company required by Section 13.6(a) shall be payable in cash or by delivery of Shares duly assigned to the Company or by a combination of the foregoing. Any such Shares so delivered shall be deemed to have a value per Share equal to the Fair Market Value of the Shares on such date of issuance (or, if such date is not determinable, the date of vesting). (d) The foregoing provisions of this Section 13.6 shall not apply in the event of a Change of Control of the Company. (e) Unless otherwise provided in the Award Agreement, for purposes of this Section 13.6 a Participant is deemed to be “engaged in a competing activity” if he or she owns, manages, controls, is employed by, or otherwise engages in or assists another to engage in any activity or which competes with any business or activity of the Company in which the employee was engaged or involved, at the time of the employee’s termination. 13.7.Stop Transfer Orders.All certificates for Shares delivered under the Plan pursuant to any Award shall be subject to such stop-transfer orders and other restrictions as the Committee may deem advisable under the rules, regulations and other requirements of the SEC, any stock exchange upon which the Shares are then listed, and any applicable federal or state securities law, and the Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions. 13.8.Nature of Payments.All Awards made pursuant to the Plan are in consideration of services performed or to be performed for the Company or any Subsidiary, division or business unit of the Company or a Subsidiary. Any income or gain realized pursuant to Awards under the Plan constitutes a special incentive payment to the Participant and shall not be taken into account, to the extent permissible under applicable law, as compensation for purposes of any of the employee benefit plans of the Company or any Subsidiary except as may be determined by the Committee or by the Board or board of directors of the applicable Subsidiary (or as may be required by the terms of such plan). 13.9.Other Plans.Nothing contained in the Plan shall prevent the Board from adopting other or additional compensation arrangements, subject to shareholder approval if such approval is required; and such arrangements may be either generally applicable or applicable only in specific cases. 13.10.Severability.The provisions of the Plan shall be deemed severable. If any provision of the Plan shall be held unlawful or otherwise invalid or unenforceable in whole or in part by a court of competent jurisdiction or by reason of change in a law or regulation, such provision shall (a) be deemed limited to the extent that such court of competent jurisdiction deems it lawful, valid and/or enforceable and as so limited shall remain in full force and effect, and (b) not affect any other provision of the Plan or part thereof, each of which shall remain in full force and effect. If the making of any payment or the provision of any other benefit required under the Plan shall be held unlawful or otherwise invalid or unenforceable by a court of competent jurisdiction or any governmental regulatory agency, or impermissible under the rules of any securities exchange on which the Shares are listed, such unlawfulness, invalidity, unenforceability or impermissibility shall not prevent any other payment or benefit from being made or provided under the Plan, and if the making of any payment in full or the provision of any other benefit required under the Plan in full would be unlawful or otherwise invalid or impermissible, then such unlawfulness, invalidity or impermissibility shall not prevent such payment or benefit from being made or provided in part, to the extent that it would not be unlawful, invalid or impermissible and the maximum payment or benefit that would not be unlawful, invalid or impermissible shall be made or provided under the Plan. 13.11.Construction.As used in the Plan, the words “include” and “including,” and variations thereof, shall not be deemed to be terms of limitation, but rather shall be deemed to be followed by the words “without limitation.” 13.12.Unfunded Status of the Plan.The Plan is intended to constitute an “unfunded” plan for incentive compensation. With respect to any payments not yet made to a Participant by the Company, nothing contained herein shall give any such Participant any rights that are greater than those of a general creditor of the Company. In its sole discretion, the Committee may authorize the creation of trusts or other arrangements to meet the obligations created under the Plan to deliver the Shares or payments in lieu of or with respect to Awards hereunder; provided, however, that the existence of such trusts or other arrangements is consistent with the unfunded status of the Plan. 13.13.Governing Law.The Plan and all determinations made and actions taken thereunder, to the extent not otherwise governed by the Code or the laws of the United States, shall be governed by the laws of the State of New York, without reference to principles of conflict of laws, and construed accordingly. 13.14.Effective Date of Plan; Termination of Plan.The Plan shall be effective on the date of the approval of the Plan by the holders of the shares entitled to vote at a duly constituted meeting of the shareholders of the Company. The Plan shall be null and void and of no effect if the foregoing condition is not fulfilled and in such event each Award shall, notwithstanding any of the preceding provisions of the Plan, be null and void and of no effect. Awards may be granted under the Plan at any time and from time to time on or prior to the tenth anniversary of the Effective Date of the Plan, on which date the Plan will expire except as to Awards then outstanding under the Plan; provided, however, in no event may an Incentive Stock Option be granted more than ten (10) years after the earlier of (i) the date of the adoption of the Plan by the Board or (ii) the Effective Date of the Plan as provided in the first sentence of this Section. Such outstanding Awards shall remain in effect until they have been exercised or terminated, or have expired. 13.15.Foreign Employees.Awards may be granted to Participants who are foreign nationals or employed or providing services outside the United States, or both, on such terms and conditions different from those applicable to Awards to Employees providing services in the United States as may, in the judgment of the Committee, be necessary or desirable in order to recognize differences in local law or tax policy. The Committee also may impose conditions on the exercise or vesting of Awards in order to minimize the Company’s obligation with respect to tax equalization for Employees on assignments outside their home country. 13.16.Compliance with Section 409A of the Code.This Plan is intended to comply and shall be administered in a manner that is intended to comply with Section 409A of the Code and shall be construed and interpreted in accordance with such intent. To the extent that an Award or the payment, settlement or deferral thereof is subject to Section 409A of the Code, the Award shall be granted, paid, settled or deferred in a manner that will comply with Section 409A of the Code, including regulations or other guidance issued with respect thereto, except as otherwise determined by the Committee. Any provision of this Plan that would cause the grant of an Award or the payment, settlement or deferral thereof to fail to satisfy Section 409A of the Code shall be amended to comply with Section 409A of the Code on a timely basis, which may be made on a retroactive basis, in accordance with regulations and other guidance issued under Section 409A of the Code. 13.17.No Registration Rights; No Right to Settle in Cash.The Company has no obligation to register with any governmental body or organization (including, without limitation, the SEC) any of (a) the offer or issuance of any Award, (b) any Shares issuable upon the exercise of any Award, or (c) the sale of any Shares issued upon exercise of any Award, regardless of whether the Company in fact undertakes to register any of the foregoing. In particular, in the event that any of (x) any offer or issuance of any Award, (y) any Shares issuable upon exercise of any Award, or (z) the sale of any Shares issued upon exercise of any Award are not registered with any governmental body or organization (including, without limitation, the SEC), the Company will not under any circumstance be required to settle its obligations, if any, under this Plan in cash. 13.18.Data Privacy.As a condition of acceptance of an Award, the Participant explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of personal data as described in this Section by and among, as applicable, the Company and its Subsidiaries for the exclusive purpose of implementing, administering and managing the Participant’s participation in the Plan. The Participant understands that the Company and its Subsidiaries hold certain personal information about the Participant, including the Participant’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company or any Subsidiary, details of all Awards or any other entitlement to Shares awarded, canceled, exercised, vested, unvested or outstanding in the Participant’s favor, for the purpose of implementing, managing and administering the Plan (the “Data”). The Participant further understands that the Company and its Subsidiaries may transfer the Data amongst themselves as necessary for the purpose of implementation, management and administration of the Participant’s participation in the Plan, and that the Company and its Subsidiaries may each further transfer the Data to any third parties assisting the Company in the implementation, management, and administration of the Plan. The Participant understands that these recipients may be located in the Participant’s country, or elsewhere, and that the recipient’s country may have different data privacy laws and protections than the Participant’s country. The Participant understands that he or she may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative. The Participant, through participation in the Plan and acceptance of an Award under the Plan, authorizes such recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Participant’s participation in the Plan, including any requisite transfer of such Data as may be required to a broker or other third party with whom the Participant may elect to deposit any Shares. The Participant understands that the Data will be held only as long as is necessary to implement, manage, and administer the Participant’s participation in the Plan. The Participant understands that he or she may, at any time, view the Data, request additional information about the storage and processing of the Data, require any necessary amendments to the Data, or refuse or withdraw the consents herein in writing, in any case without cost, by contacting his or her local human resources representative. The Participant understands that refusal or withdrawal of consent may affect the Participant’s ability to participate in the Plan. For more information on the consequences of refusal to consent or withdrawal of consent, the Participant understands that he or she may contact his or her local human resources representative. 13.19.Indemnity.To the extent allowable pursuant to applicable law, each member of the Committee or of the Board and any person to whom the Committee has delegated any of its authority under the Plan shall be indemnified and held harmless by the Company from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by such person in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action or failure to act pursuant to the Plan and against and from any and all amounts paid by him or her in satisfaction of judgment in such action, suit, or proceeding against him or her; provided he or she gives the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled pursuant to the Company’s Certificate of Incorporation or By-laws, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless. 13.20.Captions.The captions in the Plan are for convenience of reference only, and are not intended to narrow, limit or affect the substance or interpretation of the provisions contained herein. [THIS PAGE INTENTIONALLY LEFT BLANK] JOHN WILEY & SONS, INC. 111 RIVER STREET HOBOKEN, NJ 07030 VOTE BY INTERNET -www.proxyvote.com Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time on September 17, 2014 or the cut-off date for the 401K Plan participants noted below. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time on September 17, 2014 or the cut-off date for the 401K Plan participants noted below. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. JOHN WILEY & SONS, INC.
111 RIVER STREET
HOBOKEN, NJ 07030
VOTE BY INTERNET -www.proxyvote.com
Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time on September 18, 2013 or the cut-off date for the 401K Plan participants noted below. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form.
ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS
If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.
VOTE BY PHONE - 1-800-690-6903
Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time on September 18, 2013 or the cut-off date for the 401K Plan participants noted below. Have your proxy card in hand when you call and then follow the instructions.
VOTE BY MAIL
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
TOVOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: M61112-P41860
| | M77378-P54804 | KEEP THIS PORTION FOR YOUR RECORDS | | DETACH AND RETURN THIS PORTION ONLY THIS PROXY/VOTING INSTRUCTION CARD IS VALID ONLY WHEN SIGNED AND DATED.
| | | | | | | | | JOHN WILEY & SONS, INC. | | For | | Withhold | | For All | | | | | All | | All | | Except | | The Board of Directors recommends a vote “FOR” all nominees and “FOR” proposals 2 and 3.
Vote on Directors | | o | | o | | o |
| | | | | 1. | | | | | The election as directors of all nominees listed below,
except as marked to the contrary. | | | | | | | | | | | | | | | | Nominees: | | | | | | | | | | | | | | | | | | 01) Mari J. Baker | | 03) William B. Plummer | | | | | | | 02) Raymond W. McDaniel, Jr. | | 04) Kalpana Raina | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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THIS PROXY/VOTING INSTRUCTION CARD IS VALID ONLY WHEN SIGNED AND DATED. | | | | | | | | | | JOHN WILEY & SONS, INC. | For All | Withhold All | For All Except | To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. | | | | | | The Board of Directors recommends a vote “FOR” all nominees and “FOR” proposals 2, 3, 4, 5 and 6. | | | | | | | | | | | | | | | | | | | | | | | | | Vote on Directors | £ | £ | £ | | | | | | | | | | | | | | | | | | | 1. | The election as directors of all nominees listed below, except as marked to the contrary. | | | | | | | | | | | | | | | | | | | | | | | | Nominees: | | | | | | | | | | | | | | 01) | Mari J. Baker | 03) | Raymond W. McDaniel, Jr. | | | | | | | | | | | | 02) | George Bell | 04) | Kalpana Raina | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Vote on Proposals: | For | Against | Abstain | | | | | | | | | | | | Notice to participants in the John Wiley & Sons, Inc. Employee Savings Plan (“401K”) and the Payroll Deduction Employee Stock Purchase Plan (“ESPP”): | | | | | 2. | Ratification of the appointment of KPMG LLP as independent accountants. | £ | £ | £ | | | | | | | | | | | | | | | | | 3. | Approval, on an advisory basis, of the compensation of the named executive officers. | £ | £ | £ | If you participate in the 401K or the ESPP, this proxy card includes shares that the relevant plans have credited to this account.
To allow for sufficient time for the 401K Trustee to vote, the Trustee must receive your voting instructions by 11:59 p.m. Eastern Daylight Time on Monday, September 15, 2014. If the 401K Trustee does not receive your instructions by that date, the Trustee will vote the shares held in the same proportion as votes from other participants in the 401K. | | | | | | | | | | | | | | 4. | Approval of the 2014 Directors Stock Plan. | £ | £ | £ | | | | | | | | | | | | | | 5. | Approval of the 2014 Executive Annual Incentive Plan. | £ | £ | £ | | | | | | | | | | | | | | 6. | Approval of the 2014 Key Employee Stock Plan. | £ | £ | £ | | | | | | | | PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR(S) ON THIS CARD. When signing as an attorney, executor, administrator, trustee or guardian, please give your full title. If shares are held jointly, each holder should sign. Please sign exactly as your name(s) appear(s) hereon. | | | | | For address changes and/or comments, please check this box and write them on the back where indicated. | | | £ | | | | | | | | | | | Please indicate if you plan to attend this meeting. | £ | £ | | | | | | | | | | | | | | Yes | No | | | | | | | | | | | | | | | | | | | | | | | | PLEASE COMPLETE, DATE, SIGN, AND MAIL THIS INSTRUCTION CARD PROMPTLY IN THE ENCLOSED POSTAGE-PAID ENVELOPE OR PROVIDE YOUR INSTRUCTIONS TO VOTE VIA THE INTERNET OR BY TELEPHONE. | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | Vote on Proposals:
| | For | | Against | | Abstain | | | | | | | | | | | | | | | | | | 2. | | Ratification of the appointment of KPMG LLP as independent accountants. | | o | | o | | o | | | | | | | | | | | | | | | | | | 3. | | Approval, on an advisory basis, of the compensation of the named executive officers. | | o | | o | | o | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | For address changes and/or comments, please check this box and write them on the back where indicated. | | | | | | o | | | | | | | | | | | | | | | | | | Please indicate if you plan to attend this meeting. | | o | | o | | | | | | | | | Yes | | No | | |
| | | | | To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. | | | | | | | | | | | | | | | | | |
Notice to participants in the John Wiley & Sons, Inc. Employee Savings Plan (“401K”) and the Payroll Deduction Employee Stock Purchase Plan (“ESPP”):
If you participate in the 401K or the ESPP, this proxy card includes shares that the relevant plans have credited to this account.
To allow for sufficient time for the 401K Trustee to vote, the Trustee must receive your voting instructions by 11:59 p.m. Eastern Daylight Time on Monday, September 16, 2013. If the 401K Trustee does not receive your instructions by that date, the Trustee will vote the shares held in the same proportion as votes from other participants in the 401K.
PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR(S) ON THIS CARD. When signing as an attorney, executor, administrator, trustee or guardian, please give your full title. If shares are held jointly, each holder should sign. Please sign exactly as your name(s) appear(s) hereon.
PLEASE COMPLETE, DATE, SIGN, AND MAIL THIS INSTRUCTION CARD PROMPTLY IN THE ENCLOSED POSTAGE-PAID ENVELOPE OR PROVIDE YOUR INSTRUCTIONS TO VOTE VIA THE INTERNET OR BY TELEPHONE.
| | | | | | | | | | | | | | | | | | | | | | | | Signature [PLEASE SIGN WITHIN BOX] | Date | | | | | | Signature (Joint Owners) | Date | | |
JOHN WILEY & SONS, INC. - ANNUAL MEETING, SEPTEMBER 19, 2013
YOUR VOTE IS IMPORTANT!
PLEASE SEE REVERSE SIDE FOR VOTING INSTRUCTIONS
CLASS B
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Notice & Proxy Statement and Annual Report on Form 10-K are available at www.proxyvote.com.
M61115-P41860
PROXY/VOTING INSTRUCTION CARD
JOHN WILEY & SONS, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Peter Booth Wiley, Stephen M. Smith and Gary M. Rinck as the proxies of the undersigned, with full power of substitution to each of them, to vote the Class B Common Stock, which the signee is entitled to vote at the Annual Meeting of Shareholders of John Wiley & Sons, Inc. and any and all adjournments thereof, to be held at the Company’s headquarters, 111 River Street, Hoboken, New Jersey, on September 19, 2013, at 9:30 AM, Eastern Daylight Saving Time.
The proxies are directed to vote as specified, and in their discretion on all other matters which may comebefore the meeting or any adjournments thereof. If no direction is given, this proxy will be voted “FOR” theElection of Directors and “FOR” Proposals 2 and 3.
| | | | | Address Changes/Comments: | | | | | | | | |
(If you noted any Address Changes/Comments above, please mark corresponding box on the reverse side.)
(Continued, and to be marked, dated and signed, on the other side)
JOHN WILEY & SONS, INC.
111 RIVER STREET
HOBOKEN, NJ 07030
VOTE BY INTERNET -www.proxyvote.com
Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time on September 18, 2013. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form.
ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS
If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.
VOTE BY PHONE - 1-800-690-6903
Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time on September 18, 2013. Have your proxy card in hand when you call and then follow the instructions.
VOTE BY MAIL
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
M61114-P41860 KEEP THIS PORTION FOR YOUR RECORDS
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY/VOTING INSTRUCTION CARD IS VALID ONLY WHEN SIGNED AND DATED.
| | | | | | | | | JOHN WILEY & SONS, INC. | | For | | Withhold | | For All | | | | | All | | All | | Except | | The Board of Directors recommends a vote “FOR” all nominees and “FOR” proposals 2 and 3.
Vote on Directors | | o | | o | | o |
| | | | | 1. | | | | | The election as directors of all nominees listed below, except as marked to the contrary. | | | | | | | Nominees: | | | | | | | | | 01) Linda Katehi | | 05) Stephen M. Smith | | | | | | | 02) Matthew S. Kissner | | 06) Jesse Wiley | | | | | | | 03) Eduardo Menascé | | 07) Peter Booth Wiley | | | | | | | 04) William J. Pesce | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | Vote on Proposals:
| | For | | Against | | Abstain | | | | | | | | | | | | | | | | | | 2. | | Ratification of the appointment of KPMG LLP as independent accountants. | | o | | o | | o | | | | | | | | | | | | | | | | | | 3. | | Approval, on an advisory basis, of the compensation of the named executive officers. | | o | | o | | o | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | PLEASE COMPLETE, DATE, SIGN, AND MAIL THIS INSTRUCTION CARD PROMPTLY IN THE
ENCLOSED POSTAGE-PAID ENVELOPE OR PROVIDE YOUR INSTRUCTIONS TO VOTE VIA THE
INTERNET OR BY TELEPHONE. |
| | | | | | | | Signature [PLEASE SIGN WITHIN BOX] | Date | | | | | Signature (Joint Owners) | Date | | | | | | | | | | | | | | | | | | |
JOHN WILEY & SONS, INC. - ANNUAL MEETING, SEPTEMBER 18, 2014 YOUR VOTE IS IMPORTANT! PLEASE SEE REVERSE SIDE FOR VOTING INSTRUCTIONS CLASS A Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice & Proxy Statement and Annual Report on Form 10-K are available at www.proxyvote.com. M77379-P54804 PROXY/VOTING INSTRUCTION CARD JOHN WILEY & SONS, INC. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned hereby appoints Peter Booth Wiley, Stephen M. Smith and Gary M. Rinck as the proxies of the undersigned, with full power of substitution to each of them, to vote the Class A Common Stock, which the signee is entitled to vote at the Annual Meeting of Shareholders of John Wiley & Sons, Inc. and any and all adjournments thereof, to be held at the Company’s headquarters, 111 River Street, Hoboken, New Jersey, on September 18, 2014, at 9:30 AM, Eastern Daylight Saving Time. The proxies are directed to vote as specified, and in their discretion on all other matters which may come before the meeting or any adjournments thereof. If no direction is given, this proxy will be voted “FOR” the Election of Directors and “FOR” Proposals 2, 3, 4, 5 and 6. | Address Changes/Comments: | | | | | | | | |
(If you noted any Address Changes/Comments above, please mark corresponding box on the reverse side.) (Continued, and to be marked, dated and signed, on the other side) JOHN WILEY & SONS, INC. 111 RIVER STREET HOBOKEN, NJ 07030 VOTE BY INTERNET -www.proxyvote.com Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time on September 17, 2014. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time on September 17, 2014. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. TOVOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: | | M77380-P54804 | KEEP THIS PORTION FOR YOUR RECORDS | | DETACH AND RETURN THIS PORTION ONLY |
THIS PROXY/VOTING INSTRUCTION CARD IS VALID ONLY WHEN SIGNED AND DATED. | | | | | | | | | | JOHN WILEY & SONS, INC. | For All | Withhold All | For All Except | To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. | | | | | | The Board of Directors recommends a vote “FOR” all nominees and “FOR” proposals 2, 3, 4, 5 and 6. | | | | | | | | | | | | | | | | | | | | | | | | Vote on Directors | £ | £ | £ | | | | | | | | | | | | | | | | | | | 1. | The election as directors of all nominees listed below, except as marked to the contrary. | | | | | | | | | | | | Nominees: | | | | | | | | | | | | | | 01) | Matthew S. Kissner | 05) | Stephen M. Smith | | | | | | | | | | | | 02) | Eduardo Menascé | 06) | Jesse Wiley | | | | | | | | | | | | 03) | William J. Pesce | 07) | Peter Booth Wiley | | | | | | | | | | | | 04) | William B. Plummer | | | | | | | | | | | | | | | | | | | | | | | | Vote on Proposals: | For | Against | Abstain | | For | Against | Abstain | | | | | | | | | | | | | | | 2. | Ratification of the appointment of KPMG LLP as independent accountants. | £ | £ | £ | 5. | Approval of the 2014 Executive Annual Incentive Plan. | £ | £ | £ | | | | | | | | | | | | | | | | | 3. | Approval, on an advisory basis, of the compensation of the named executive officers. | £ | £ | £ | 6. | Approval of the 2014 Key Employee Stock Plan. | £ | £ | £ | | | | | | | | | | | | | | | 4. | Approval of the 2014 Directors Stock Plan. | £ | £ | £ | | | | | | | | | | | | | | | | | | | | PLEASE COMPLETE, DATE, SIGN, AND MAIL THIS INSTRUCTION CARD PROMPTLY IN THE ENCLOSED POSTAGE-PAID ENVELOPE OR PROVIDE YOUR INSTRUCTIONS TO VOTE VIA THE INTERNET OR BY TELEPHONE. | | | | | | | | | | | | For address changes and/or comments, please check this box and write them on the back where indicated. | | | £ | | | | | | | | | | | | | | | Please indicate if you plan to attend this meeting. | £ | £ | | | | | | | | | | | | | | Yes | No | | | | | | | | | | | | | | | | | | | | | | | | PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR(S) ON THIS CARD. When signing as an attorney, executor, administrator, trustee or guardian, please give your full title. If shares are held jointly, each holder should sign. Please sign exactly as your name(s) appear(s) hereon. | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Signature [PLEASE SIGN WITHIN BOX] | Date | | | | | Signature (Joint Owners) | Date | | | | | | | | | | | | | | | | | For address changes and/or comments, please check this box and write them on the back where indicated. | | | | | | | o | | | | | | | | | | | | | | | |
| | Please indicate if you plan to attend this meeting. | | | o | | o | | | | | | | | | Yes | | No |
JOHN WILEY & SONS, INC. - ANNUAL MEETING, SEPTEMBER 18, 2014 YOUR VOTE IS IMPORTANT! PLEASE SEE REVERSE SIDE FOR VOTING INSTRUCTIONS CLASS B Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice & Proxy Statement and Annual Report on Form 10-K are available at www.proxyvote.com. M77381-P54804 PROXY/VOTING INSTRUCTION CARD JOHN WILEY & SONS, INC. THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned hereby appoints Peter Booth Wiley, Stephen M. Smith and Gary M. Rinck as the proxies of the undersigned, with full power of substitution to each of them, to vote the Class B Common Stock, which the signee is entitled to vote at the Annual Meeting of Shareholders of John Wiley & Sons, Inc. and any and all adjournments thereof, to be held at the Company’s headquarters, 111 River Street, Hoboken, New Jersey, on September 18, 2014, at 9:30 AM, Eastern Daylight Saving Time. The proxies are directed to vote as specified, and in their discretion on all other matters which may come before the meeting or any adjournments thereof. If no direction is given, this proxy will be voted “FOR” the Election of Directors and “FOR” Proposals 2, 3, 4, 5 and 6. | Address Changes/Comments: | | |
PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR(S) ON THIS CARD. When signing as an attorney, executor, administrator, trustee or guardian, please give your full title. If shares are held jointly, each holder should sign. Please sign exactly as your name(s) appear(s) hereon.
| | | | | | | | | | | | | | | | | | | | | | | | Signature [PLEASE SIGN WITHIN BOX] | Date | | | | | | Signature (Joint Owners) | Date | | |
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(If you noted any Address Changes/Comments above, please mark corresponding box on the reverse side.) (Continued, and to be marked, dated and signed, on the other side) |
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