Roles of the CompensationCommittee 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 other executive officers to the Compensation Committee for its review and approval. The Compensation 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 executive officers consists of base salary, targeted cash incentives expressed as a percent of base salary and targeted long-term equity awards. Each executive 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, thereby aligning executive compensation with shareholder interests. Third quartile levels of total direct compensation can be realized when challenging, long-term financial goals are achieved and accompanied by future share price appreciation. An executive’s position against the market may be below or above 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 Committee’s independent compensation consultant prepares an annual review of executive compensation competitiveness, using a combination of third-party surveys and a custom proxy peer group (the latter implemented for fiscal 2016). For fiscal 2015, data from the Towers Watson US Media Industry Survey and the Towers Watson US General Industry Survey were used. The Towers Watson survey data included a special cut of 43 publishing and information services companies in the 2013 Towers Watson US Media Industry Survey, and over 442 companies in the 2013 Towers Watson US General Industry Survey, adjusted to be appropriate for the Company’s revenue size. 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 executives is broader than the publishing / media industry. The independent compensation consultant presents its report to the Compensation Committee at its March meeting. In benchmarking compensation levels against the Towers Watson survey data, the Compensation Committee considers only the aggregated survey data. Therefore, the Compensation Committee members do not consider the identity of the companies comprising the survey data to be material for this purpose. As noted previously, the Radford Technology Survey will replace the Towers Watson Media Industry Survey beginning in fiscal 2016, recognizing the evolution of our business. 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 CEO is established using the same process and philosophy previously discussed for the other executive officers. The Compensation Committee establishes the CEO’s base salary, target annual incentive and stock-based awards using the executive compensation competitive review report prepared annually by the independent compensation consultant, as indicated above. In addition, the CEO’s compensation relative to the next two highest-compensated executives is evaluated. Weighting of Pay Elements – Fixed Versus “At Risk” Compensation 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 executive officers in Fiscal 2015 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 2015. Approximately 80% of our CEO’s target total direct compensation, and on average 66% of our other NEOs’ target total direct compensation, was at risk in the form of performance share units, stock options, restricted share units and annual incentives. 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 executive officers for performing their day-to-day responsibilities. Competitive base salaries allow the Company to attract and retain executive talent. For Fiscal 2015, 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 executive officers are based on a review of the competitive median marketplace for equivalent executive positions as previously discussed, assessment of the executive officer’s individual performance by the CEO (or in the case of the CEO, by the Compensation Committee), the performance of the Company and / or relevant business unit, internal pay relationships among executive officers based on relative duties and responsibilities, the tenure of the executive officer in his / her role, and the Company’s annual salary increase budget. After taking into consideration the foregoing, the Compensation Committee determined to increase the NEOs’ salaries ranging from 2.9% to 5.4%. Annual incentives 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 Compensation 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. 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. There is no payout of the financial portion of the annual incentives if achievement of financial performance is below the threshold 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. Following are the Fiscal 2015 target annual incentives for the NEOs: Named Executive Officer | | Target Annual Incentive as a % of Base Salary | | | | Stephen M. Smith | | Determination of Target Compensation Levels | | | 140 | % | Compensation PhilosophyMark J. Allin | | The Company’s executive compensation program for the executive officers consists of base salary, targeted cash incentive expressed as a percent of base salary and targeted long-term equity awards. Each executive 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, thereby aligning executive compensation with shareholder interests. Third quartile levels of total direct compensation can be realized when challenging, long-term financial goals are achieved and accompanied by future share price appreciation. An executive’s position against the market may be below or above 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. | | | 95 | % | Compensation BenchmarkingJohn A. Kritzmacher | | The compensation for each executive officer 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 included a cut of 67 publishing and information services companies in the 2013 Towers Watson U.S. Media Industry Survey, and over 332 companies in the 2013 Towers Watson U.S. General Industry Survey, adjusted to be appropriate for the Company’s revenue size. For the executive 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 report 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. | 95 | % | Gary Rinck | | | 75 | % | Joseph S. Heider | | | 95 | % | John W. Semel | | | 75 | % | Steven J. Miron | | | 95 | % |
The target annual incentive percentage for Mr. Smith was raised from 130% in Fiscal 2014 to 140% in Fiscal 2015, to bring his targeted cash compensation more in line with our executive compensation philosophy, 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 Compensation Committee, as well as other quantitative and qualitative strategic objectives established at the beginning of the fiscal year. The Compensation Committee approves the strategic objectives of the CEO, evaluates his performance in light of those strategic objectives, and discusses its recommendation with the Board of Directors in executive session. The CEO evaluates the performance of the executive officers against assigned quantitative and qualitative strategic objectives, and presents his ratings to the Compensation Committee for its review and approval. | | 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 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, prepared annually by the independent compensation 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 – Fixed Versus “At Risk” Compensation.
| | 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 executive officers in fiscal year 2014 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 2014. Between 63% and 78% of our NEOs target compensation for fiscal year 2014 is “at risk” in the form of restricted performance share units, stock options, restricted share units and annual incentives. The pay mix for Mr. Cousens is not included in the chart below since he did not receive equity awards in fiscal year 2014 given his intention to retire in June 2014. The pay mix for Mr. Kritzmacher includes the annualized value of his new hire restricted share grant. | | | | | | |
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. For Fiscal 2015, the corporate performance metrics were revenue, EPS and normalized FCF weighted at 30%, 40% and 30%, respectively. Performance metrics for individual businesses were revenue and CTP, weighted at 40% and 60%, respectively. These performance metrics are relevant measures of our corporate and business unit success and align shareholder and executive interests. The higher weight on the profit metric(s) ensures an appropriate distribution of incentives paid vis-a-vis what is retained by the Company in pretax income. | | 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 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 executive officers are based on a review of the competitive median marketplace for equivalent executive positions as previously discussed, assessment of the executive 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 / or relevant business unit, internal pay relationships among executive 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. After taking into consideration the foregoing, the Committee determined to increase the NEOs’ salaries ranging from 3.0% to 4.2%. | | | | Annual incentives. | | 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 maximum payout was reduced to 150% from 200% of target, and threshold payout was increased from 25% to 50% of target, to be more aligned with market practice. There is no payout of the financial portion of the annual incentives if achievement of financial performance is below the threshold 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. | | | | | | Following are the fiscal year 2014 target annual incentives for the NEOs: |
In Fiscal 2015, in comparison to the corporate target goals set by the Compensation Committee for annual incentive purposes (see table below) revenue achievement was 96.7% of target, EPS achievement was 100.3% of target, and normalized FCF achievement was 95.8% of target, resulting in a payout of 84.4% of target for the corporate performance measures. | | 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% | | |
| | 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 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 (Messrs. Miron and Allin). For fiscal year 2014, the corporate performance measures were revenue, EPS and normalized FCF weighted at 30%, 40% and 30%, respectively. Performance measures for individual businesses were revenue and 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 2014, in comparison to the corporate target goals set by the Committee for annual incentive purposes (see table below) revenue achievement was 98.6% of target, EPS achievement was 106.2% of target, and normalized FCF achievement was 111.6% of target, resulting in a payout of 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 | Weight | 2015 Threshold Performance Level | 2015 Target Amount | 2015 Outstanding Performance Level | 2015 Results | Revenue ($000s) | 30% | 95% | $1,916,000 | 105% | $1,852,500 | EPS | 40% | 90% | $3.35 | 110% | $3.36 | Normalized FCF ($000s) | 30% | 90% | $292,000 | 110% | $279,698 |
| | Note: | Financial results used for incentive payment purposes arewere adjusted to be on a constant currency basis using budgeted foreign exchange rates. Certain items and events may be excluded as permitted by the shareholder-approved 2009 Executive Annual Incentive Plan. These exclusions ensure that executives will not be unduly influenced in their decision-making because they would neither benefit nor be penalized as a result of certain unexpected and uncontrollable or strategic events that may positively or negatively affect the performance metrics in the short-term. For fiscal year 2014,Fiscal 2015, 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;authorities 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 |
Quantitative and qualitative strategic objectives for Fiscal 2015 were set based on the following goals: | · | Execute Fiscal 2015 Financial Plan to achieve targeted performance |
| · | Integrate recent acquisitions to create a high-growth Talent Management Solutions business |
| · | Invest in adding more value digitally to Wiley’s book and journal content |
| · | Increase efficiency and simplify business processes to enable better decision-making, reduce long-term technology investment and foster innovation |
| · | Accelerate growth in emerging markets |
| · | Drive double-digit growth in Wiley’s content-enabled solutions business |
| · | Clearly and succinctly articulate a vision for Wiley’s future success as a business built on the following goals:integration of high quality curated content, innovative technology and valued services |
| | ● | Execute fiscal year 2014 operating plan | | | | | | | ● | Restructure Wiley’s cost baseAn evaluation of each executive officer’s achievement of Fiscal 2015 strategic objectives in the context of the goals set forth above, was made by the CEO and approved by the Compensation Committee. In the case of the CEO, this evaluation was made by the Compensation Committee. There were no specific weightings for each of the preceding goals, and achievement of the strategic objectives was based on the Compensation Committee’s qualitative assessment. The key strategic accomplishments of the NEOs during Fiscal 2015 include: continuing to reorganize and restructure Wiley’s businesses and shared service functions 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 business growth and technology initiatives; growth of 10% in adjusted EPS; a 4% improvement in revenue primarily from journals subscriptions, funded access and other journal revenue, streams | | | | | | | ● | Engage colleagues and other stakeholders around shared values and a common vision |
| | An evaluation of each executive officer’s achievement of fiscal year 2014 strategic objectives in the context of the 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 2014 include: the restructuring of Wiley’s cost base to enhance core business performance and provide resources for reinvestment in new business growth; growth of 4% 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 and Test Preparation, Online Program Management (Deltak), and WileyPLUS; the recent acquisitions of Profiles International and CrossKnowledge, which will help to 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 2014 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% | | |
WileyPLUS, and the recent acquisition and integration of Profiles International and CrossKnowledge into our Talent Solutions business. Payout of the financial and strategic objectives portions of the annual incentives as a percentage of target, and total Fiscal 2015 annual incentives paid to the NEOs as a percentage of target, are noted in the table below. 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 | | | 84.4 | % | | | 100 | % | | | 88.3 | % | Mark J. Allin | | | 63.8 | % | | | 105 | % | | | 74.1 | % | John A. Kritzmacher | | | 84.4 | % | | | 150 | % | | | 100.8 | % | Gary Rinck | | | 84.4 | % | | | 105 | % | | | 89.5 | % | Joseph S. Heider | | | 62.1 | % | | | 100 | % | | | 71.6 | % | John W. Semel | | | 84.4 | % | | | 125 | % | | | 94.6 | % |
Long-Term Stock-Based Incentives Long-term incentives are intended to motivate and reward executive officers for achieving long-term (three-year) business objectives that drive Company performance. The long-term incentive compensation program for executive officers consists of annual grants of performance share units, stock options and restricted share units, weighted at approximately 50%, 30% and 20% of long-term target value, respectively. The Compensation 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 Compensation Committee considers data from the executive compensation survey previously discussed (which utilizes FASB Accounting Standards Codification (“ASC”) Topic 718 values for equity), and the recommendations of the CEO (with respect to the other executive officers), to establish the targeted equity awards (value and number of shares) for each executive officer. Long-Term Stock-Based Incentives. | | Long-term incentives are intended to motivate and reward executive officers for achieving long-term (three-year) business objectives that drive Company performance. The long-term incentive compensation program for executive officers consists of annual grants of restricted performance share units, stock options and restricted share units, weighted at approximately 50%, 30% and 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 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 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 utilizes FASB Accounting Standards Codification (“ASC”) Topic 718 values 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 officer. |
| | ●· | Restricted performancePerformance share unitsare used to focus executive officers on the achievement of three-year corporate financial performance goals established by the Compensation 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 aand the strategic plan approved by the Board of Directors annually.Directors. At the end of the performance cycle, a payout factor is calculated based on actual results against threshold, target and outstanding performance levels, resulting in a payout from 0% to 200%150% of the targeted number of performance shares for cycles up to and includingcycle. There is no payout in shares if performance is below the fiscal year 2012-14 cycle. Beginning withthreshold level. For the fiscal yearFiscal 2013-15 performance cycle, the maximum payout was reduced to 150% from 200% of target,stake-in-the-ground fiscal 2015 EPS 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 2012-14 performance cycle, EPS andthree-year cumulative FCF were the performance measures, weighted at 60% and 40%, respectively. These are the same performance measures and weights being used for the FY2014-16Fiscal 2015-17 performance cycle that began this year.cycle. 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 2012-14 performance cycle, in comparison to the target goals set by the Committee for long-term incentive purposes (see table immediately following), EPS achievement was below threshold at 84.8% of target, and FCF achievement was 102.9% of target, resulting in a payout of 47.7% of the targeted number of shares for this performance cycle. Dividend equivalents are paid on earned shares following the performance cycle and before vesting. |
For the Fiscal 2013-15 performance cycle, EPS achievement was below threshold at 81.4% of target, and FCF achievement was 100.8% of target, resulting in a payout of 41.7% of the targeted number of shares for this performance cycle. For participants of the Executive Long-Term Incentive Plan, dividend equivalents are paid on earned shares over the additional vesting period following the end of the performance cycle. | | | 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 | |
Financial Objective | FY2013-15 Threshold Performance Level | FY2013-15 Target Amount | FY2013-15 Outstanding Performance Level | FY2013-15 Results | | | | | | EPS | 90% | $4.20 | 110% | $3.42 | Normalized FCF ($000s) | 90% | $845,000 | 110% | $851,998 |
| | | | | | Note: | Financial results used for long-term incentive payment purposes maywere adjusted to be adjusted toon a constant currency basis using budgeted foreign exchange rates and for certain items and events as permitted by the shareholder-approved 2009 Key Employee Stock Plan. These exclusions ensure that executives will not be unduly influenced in their decision-making because they would neither benefit nor be penalized as a result of certain unexpected and uncontrollable or strategic events that may positively or negatively affect the performance metrics in the short-term. For the 2012-14Fiscal 2013-15 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;authorities 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 2013-15 performance shares earned for the NEOs as a percentage of target: Named Executive Officer | | Target Performance Shares for the FY2013-15 Cycle | | Earned Performance Shares for the FY2013-15 Cycle | | Total Payout as a % of Target | | | | | | | | Stephen M. Smith | | | 20,000 | | | | 8,340 | | | | 41.7 | % | Mark J. Allin | | | 4,500 | | | | 1,877 | | | | 41.7 | % | Gary Rinck | | | 6,000 | | | | 2,502 | | | | 41.7 | % | Joseph S. Heider | | | 4,000 | | | | 1,668 | | | | 41.7 | % | John W. Semel | | | 2,100 | | | | 876 | | | | 41.7 | % | Steven J. Miron | | | 4,736 | | | | 1,975 | | | | 41.7 | % |
Mr. Kritzmacher is not included in the table above since he was not a participant for this performance cycle given his hire date. The NEOs’ target performance shares for the Fiscal 2015-17 performance cycle are included in the Grants of Plan-Based Awards Table on page 40. Mr. Miron’s target and earned shares for this performance cycle are prorated, reflecting his separation from service on November 30, 2014. | · | Following are the fiscal year 2012-14 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 | | 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 NEOs’ target performance shares for the fiscal year 2014-16 performance cycle are included in the Grants of Plan-Based Awards Table on page 50. |
| | | | | | | | ● | Stock optionsare used to align the interests of management with those of the Company’s shareholders. The Compensation Committee believes that because value is realized only if the Company’s stock price rises, that stock options are performance-based compensation. |
| · | | | | | | | ● | Restricted share units,a regular part of the equity mix beginning with the June 2013 (fiscal year 2014-16 cycle)Fiscal 2014 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 using a ten-day trailing average stock price from the date five business days after the release of the Company’s year-end earnings. 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 Compensation 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 Compensation Committee established stock ownership guidelines for all executive officers participating in the long-term incentive program. The ownership guideline for the 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: | | | | | Equity award grants are made five business days after the release of the Company’s year-end earnings. 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: |
| · | | | | | | | ● | 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. |
Messrs. Smith, Rinck and Heider have exceeded their targeted shareholdings. Messrs. Kritzmacher and Allin are 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, that requires retention of 50% of the net shares acquired upon the exercise of stock options or the vesting of performance share 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 the Company has a clawback provision in both the annual and long-term incentive plans covering the top 450 employees in the Company. The clawback provision allows the Company to recoup incentive payments to covered incentive participants in the event that the Company restates 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. Hedging Prohibited As part of an Insider Trading Policy, the Company strictly prohibits any type of hedging activity, including the use of financial instruments such as prepaid variable forwards, equity swaps, collars and/or exchange funds. Retirement and Post-Employment Benefits All NEOs are eligible to participate in the Company’s qualified savings and retirement plans, as described further starting on page 44. 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 qualified retirement benefits. | · | For all equity grants awarded during and after June 2011, 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 vesting of performance share 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 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. | | | | Retirement and
Post-Employment Benefits | | All NEOs are eligible to participate in the Company’s qualified savings and retirement plans, as described further starting on page 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. 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 54.45. |
| · | | | | | | | ● | Deferred Compensation Plan (the(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.US 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. | | | | | Participation in and service-related accruals under the UK Non-Qualified Plan were frozen as of April 30, 2015. |
| | As noted above, the Company ceased accruals and froze participation in the US defined benefit retirement plans, including the US Retirement Plan, the Excess Plan, and the SERP, effective June 30, 2014. At the same time, the Company enhanced its Defined Contribution Savings Plan (401(k)) and the DCP. | | | |
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 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- |
As noted above, the Company ceased accruals and froze participation in the US defined benefit retirement plans, including the US Retirement Plan, the Excess Plan, and the SERP, effective June 30, 2013. At the same time, the Company enhanced its Defined Contribution Savings Plan (401(k)) and the DCP. Service-related accruals under the UK Qualified Plan and the UK Non-Qualified Plan were frozen as of April 30, 2015, and colleagues previously accruing benefits under the UK Qualified Plan became covered by the UK Group Personal Pension Plan (GPPP), a UK tax-qualified defined contribution arrangement. 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 employees, 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 employees, 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 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). In Fiscal 2012, we eliminated tax “gross-ups” for perquisites provided to our executive officers. Any taxes on perquisites are now paid by the executives. Mr. Allin, whose previous position had required spending a significant amount of time in the US, had been allowed the use of a Company-leased apartment in the US. This accommodation was provided in lieu of hotel expenses while conducting Company business. The apartment was 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 51. 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 for a limited period to bridge executives to new employment, particularly in view of our non-compete agreements which require that for twelve months following termination the executive will not compete with the Company or solicit customers or employees. As part of his separation from service, Mr. Miron received severance equal to twenty-four months’ base salary, payable in a lump-sum; benefits coverage for a two-year period; prorated incentive payment under the Fiscal 2015 annual incentive plan, based on actual financial performance; vesting of all earned but unvested performance shares; continued vesting of stock options and restricted share units for three years following his separation date; continued prorated participation in all active long-term performance cycles, with payment in shares following the end of the cycles; and financial planning and tax preparation services for six months. 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, and the successor Plans, approved by shareholders in September 2014, such compensation plans will be used. However, the Compensation Committee recognizes that in appropriate circumstances, compensation that is not deductible under the Code may be paid at the Compensation Committee’s discretion. | | 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 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 for a limited period to bridge executives to new employment, particularly in view of our non-compete agreements which require that for twelve months following termination the executive will not compete with the Company or solicit customers or employees. | | | | 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: | | | |
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 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 achieving the Company’s challenging performance goals. | | | | | | | | We believe that the Company’s executive compensation program meets the goals and objectives discussed above. |
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] | SEC Total ($) [j] | Stephen M. Smith | 2015 | 912,500 | | 1,492,500 | 640,900 | 1,137,304 | 498,877 | 164,882 | 4,846,963 | | 2014 | 869,167 | | 1,403,315 | 607,800 | 1,434,956 | 714,201 | 138,721 | 5,168,159 | | 2013 | 833,333 | | 961,200 | 1,229,000 | 752,724 | 1,441,655 | 132,083 | 5,349,996 | Mark J. Allin | 2015 | 472,870 | | 334,320 | 167,620 | 309,836 | 332,866 | 140,450 | 1,757,962 | | 2014 | 421,623 | | 320,193 | 132,703 | 388,137 | (106,894) | 95,232 | 1,250,994 | | 2013 | 399,253 | | 216,270 | 320,769 | 310,748 | 651,647 | 226,671 | 2,125,359 | John A. Kritzmacher | 2015 | 616,667 | | 728,340 | 311,100 | 593,712 | 1,312 | 78,447 | 2,329,577 | | 2014 | 525,000 | | 913,425 | 607,800 | 667,710 | 100 | 36,150 | 2,750,185 | Gary Rinck | 2015 | 531,667 | | 352,230 | 149,600 | 359,319 | 503,614 | 51,300 | 1,947,730 | | 2014 | 512,500 | | 347,864 | 144,859 | 477,598 | 320,715 | 38,149 | 1,841,685 | | 2013 | 497,500 | | 288,360 | 307,250 | 280,031 | 358,896 | 18,327 | 1,750,364 | Joseph S. Heider | 2015 | 386,667 | | 286,560 | 122,400 | 265,255 | 393,203 | 56,090 | 1,510,174 | John W. Semel | 2015 | 394,625 | | 167,160 | 71,400 | 281,204 | 38,682 | 36,040 | 989,111 | Steven J. Miron | 2015 | 306,667 | | 417,900 | 178,500 | 236,380 | 544,129 | 1,114,297 | 2,797,873 | | 2014 | 512,500 | | 383,441 | 160,054 | 528,329 | (194,949) | 32,535 | 1,421,910 | | 2013 | 495,833 | | 264,330 | 337,975 | 352,183 | 778,754 | 25,376 | 2,254,451 |
Summary Compensation Table: | Name [a] | | Year [b] | | Salary ($) [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 |
| | (c): | The 2013 base salary reported in this column for Mr. Allin has been converted to US dollars using the Fiscal 2013 average exchange rate of £1=US$1.5760. The 2014 base salary reported in this column for Mr. Allin has been converted to US dollars using the Fiscal 2014 average exchange rate of £1=US$1.6011. The 2015 base salary reported in this column for Mr. Allin has been converted to US dollars using the Fiscal 2015 average exchange rate of £1=US$1.5997. 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/share units and, for fiscal years 2014 and 2015, restricted share units granted under the Company’s 2009 and 2014 Key Employee Stock Plan.Plans. The amounts noted for the restricted performance shares/share 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/share 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 20142015 Annual Report on Form 10-K 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 and 2014 Key Employee Stock Plan.Plans. 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 20142015 Annual Report on Form 10-K 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 2014Fiscal 2015 was earned based on the achievement of pre-established corporate and, in the case of Mr.Messrs. Allin, Heider and Miron, and Mr. Allin, business financial measures—including revenue, profit and cash flow—approved by the Compensation Committee, as well as the achievement of strategic milestonesobjectives that are designed to drive improved performance for the Company in the current and future fiscal years.Mr. Miron’s total annual incentive for Fiscal 2015 is prorated, reflecting his separation from service on November 30, 2014. |
| | | | | | (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 |
| | of 1.53751.6811 and 1.6811,1.5181, for benefits as of 4/30/2013April 30, 2014 and 4/30/2014,April 30, 2015, 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 4/30/2013April 30, 2014 and 4/30/2014,April 30, 2015, 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 continuescontinued to accrue UK pension benefits.benefits through April 30, 2015. |
| | | | | | ●· | Additional US pension accruals ceased as of the US plans’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 consists of the following in 2014:Fiscal 2015: |
| | ●· | Employer contributions to the Company 401(k) plan and Deferred Compensation Plan for Messrs. Smith, Cousens, Kritzmacher, MironRinck, Heider, Semel and Rinck,Miron, are valued at $41,580, $32,886, $18,750, $25,111$109,669, $61,047, $47,400, $38,690, $36,040 and $25,298$40,797 respectively. |
| | | | | | ●· | Perquisites (financial planning, health club membership fees, parking benefits) for Messrs. Smith, Cousens,Allin, Kritzmacher, Miron, Rinck, Heider and Allin,Miron, valued at $6,467, $11,324,$12,000, $12,000, $17,4000, $3,900, $17,400 $7,424, $12,851 and $7,466.67,$13,500, respectively. |
| | | | | | ●· | The Compensation 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,Fiscal 2015, 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$43,213 in fiscal year 2014,Fiscal 2015, and included as “other compensation.” |
| | | | | | ●· | Mr. Allin iswas a UK-based executive who travelstraveled 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$55,252 in fiscal year 2014,Fiscal 2015, and included as “other compensation.” |
| | | | | | ●· | Mr. Allin, like otherwhile based in the UK, executives, receiveshad received an annual car allowance equal to £8250£8,250 per annum. That amount has been converted to $13,209 using the fiscal year 2013Fiscal 2015 average exchange rate of £1 = £1=US$1.6011.1.5997. |
| · | The Compensation Committee agreed to provide Mr. Allin with an allowance of $20,000 per month to be reviewed annually and used to cover dual UK and US living expenses, and personal travel for himself and his family between the UK and the US, since part of his family continues to reside in the UK. |
| · | Severance for Mr. Miron of $1,060,000, equivalent to two years of his base salary at termination of $530,000, consistent with his employment agreement. |
Grants of Plan-Based Awards Table: Name [a] | Grant Date [b] | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards | Estimated Future Payouts Under Equity Incentive Plan Awards | All Other Stock Awards: Number of Shares of Stock or Units (#) [i] | All Other Option Awards: Number of Securities Underlying Options (#) [j] | Exercise or Base Price of Option Awards ($/Sh) [k] | Grant Date Fair Value of Stock and Option Awards ($) [l] | Threshold ($) [c] | Target ($) [d] | Maximum ($) [e] | Threshold (#) [f] | Target (#) [g] | Maximum (#) [h] | Stephen M. Smith | 6/18/14 | 644,000 | 1,288,000 | 1,932,000 | | | | | | | | | 6/24/14 | | | | 8,950 | 17,900 | 26,850 | | | 59.70 | 1,068,630 | | 6/24/14 | | | | | | | 7,100 | | 59.70 | 423,870 | | 6/24/14 | | | | | | | | 37,700 | 59.70 | 640,900 | Mark J. Allin | 6/18/14 | 208,961 | 417,922 | 626,882 | | | | | | | | | 6/24/14 | | | | 2,000 | 4,000 | 6,000 | | | 59.70 | 238,800 | | 6/24/14 | | | | | | | 1,600 | | 59.70 | 95,520 | | 6/24/14 | | | | | | | | 9,860 | 59.70 | 167,620 | John A. Kritzmacher | 6/18/14 | 294,500 | 589,000 | 883,500 | | | | | | | | | 6/24/14 | | | | 4,350 | 8,700 | 13,050 | | | 59.70 | 519,390 | | 6/24/14 | | | | | | | 3,500 | | 59.70 | 208,950 | | 6/24/14 | | | | | | | | 18,300 | 59.70 | 311,100 | | | | | | | | | | | | |
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 |
Name [a] | Grant Date [b] | 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 Units (#) [i] | All Other Option Awards: Number of Securities Underlying Options (#) [j] | Exercise or Base Price of Option Awards ($/Sh) [k] | Grant Date Fair Value of Stock and Option Awards ($) [l] | Threshold ($) [c] | Target ($) [d] | Maximum ($) [e] | Threshold (#) [f] | Target (#) [g] | Maximum (#) [h] | Gary Rinck | 6/18/14 | 200,625 | 401,250 | 601,875 | | | | | | | | | 6/24/14 | | | | 2,100 | 4,200 | 6,300 | | | 59.70 | 250,740 | | 6/24/14 | | | | | | | 1,700 | | 59.70 | 101,490 | | 6/24/14 | | | | | | | | 8,800 | 59.70 | 149,600 | Joseph S. Heider | 6/18/14 | 185,250 | 370,500 | 555,750 | | | | | | | | | 6/24/14 | | | | 1,700 | 3,400 | 5,100 | | | 59.70 | 202,980 | | 6/24/14 | | | | | | | 1,400 | | 59.70 | 83,580 | | 6/24/14 | | | | | | | | 7,200 | 59.70 | 122,400 | John W. Semel | 6/18/14 | 148,707 | 297,413 | 446,120 | | | | | | | | | 6/24/14 | | | | 1,000 | 2,000 | 3,000 | | | 59.70 | 119,400 | | 6/24/14 | | | | | | | 800 | | 59.70 | 47,760 | | 6/24/14 | | | | | | | | 4,200 | 59.70 | 71,400 | Steven J. Miron | 6/18/14 | 251,750 | 503,500 | 755,250 | | | | | | | | | 6/24/14 | | | | 2,500 | 5,000 | 7,500 | | | 59.70 | 298,500 | | 6/24/14 | | | | | | | 2,000 | | 59.70 | 119,400 | | 6/24/14 | | | | | | | | 10,500 | 59.70 | 178,500 |
(c) to (e):Represents the annual incentives for Fiscal 2015 that are based on achievement of financial goals and strategic objectives. 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 2015. Strategic objectives are designed to drive improved performance for the Company in the current and future fiscal years. Actual annual incentive payouts for Fiscal 2015 are indicated in column (g) of the Summary Compensation Table. Mr. Miron’s Fiscal 2015 target incentive was subsequently prorated to $293,708, reflecting his November 30, 2014 separation from service. (f) to (h):Represents the performance share unit awards granted for the Fiscal 2015-17 performance cycle pursuant to the 2009 Key Employee Stock Plan. In Fiscal 2015 executives received approximately 50% of their targeted long-term incentive in the form of 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 FY2015-17 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 performance share units, if earned, vest 50% on April 30, 2018 and the remaining 50% on April 30, 2019. Dividends are not paid during the performance period, but dividend equivalents are paid on earned shares following the performance cycle and before vesting. | | (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 2014Fiscal 2015 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. |
| | (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 2014Fiscal 2015 executives received approximately 30% of their targeted long-term incentive in the form of stock options. |
| | | | | | (k): | The closing stock price on June 25, 2013.24, 2014. 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 sharesshare units 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$59.70 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$17.00 Black-Scholes value. Refer to Notes 2 and 18 in the Notes to the Consolidated Financial Statements in the Company’s 20142015 Annual Report on Form 10-K for the assumptions made in determining FASB ASC Topic 718, Stock Compensation values. |
| | | | Option Awards | | Stock Awards | | Outstanding Equity Awards at Fiscal Year End: | | Name [a] | | Number of Securities Under- lying Unexer- cised Options (#) Exercisable [b] | | | Number of Securities Underlying Unexer- cised Options (#) Unexer- cisable [c] | | | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) [d] | | Option Exercise Price ($) [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 | | | | | | | | | | | | | | | | |
Outstanding Equity Awards at Fiscal 2015 Year End: | | Option Awards | | Stock Awards | Name [a] | | | Number of Securities Underlying Unexercised Options (#) Exercisable [b] | | | | Number of Securities Underlying Unexercised Options (#) Unexercisable [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 | | | 28,675 | | | | | | | | | $48.46 | | 6/27/2017 | | | 4,770 | (1) | | | 271,318 | | | | 25,500 | (3) | | | 1,450,440 | | | | | 28,675 | | | | | | | | | $47.55 | | 5/31/2018 | | | 20,000 | (5) | | | 1,137,600 | | | | 17,900 | (4) | | | 1,018,152 | | | | | 70,000 | | | | | | | | | $35.04 | | 5/31/2018 | | | 8,340 | (2) | | | 474,379 | | | | | | | | | | | | | 70,000 | | | | | | | | | $40.02 | | 5/31/2018 | | | 10,000 | (3) | | | 568,800 | | | | | | | | | | | | | 50,000 | | | | | | | | | $49.55 | | 5/31/2018 | | | 7,100 | (4) | | | 403,848 | | | | | | | | | | | | | | | | | 50,000 | (1) | | | | $49.55 | | 5/31/2018 | | | | | | | | | | | | | | | | | | | | | | | | 100,000 | (2) | | | | $48.06 | | 5/31/2018 | | | | | | | | | | | | | | | | | | | | | | | | 60,000 | (3) | | | | $39.53 | | 5/31/2018 | | | | | | | | | | | | | | | | | | | | | | | | 37,700 | (7) | | | | $59.70 | | 7/29/2018 | | | | | | | | | | | | | | | | | Mark Allin | | | 4,100 | | | | | | | | | $33.05 | | 6/21/2016 | | | 1,074 | (1) | | | 61,089 | | | | 5,800 | (3) | | | 329,904 | | | | | 3,500 | | | | | | | | | $48.46 | | 6/27/2017 | | | 1,877 | (2) | | | 106,764 | | | | 4,000 | (4) | | | 227,520 | | | | | 4,500 | | | | | | | | | $47.55 | | 6/25/2018 | | | 2,300 | (3) | | | 130,824 | | | | | | | | | | | | | 7,495 | | | | | | | | | $35.04 | | 6/24/2019 | | | 1,600 | (4) | | | 91,008 | | | | | | | | | | | | | 28,675 | | | | | | | | | $40.02 | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | 13,050 | | | | | | | | | $49.55 | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | 13,050 | (1) | | | | $49.55 | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | 26,100 | (2) | | | | $48.06 | | 6/26/2022 | | | | | | | | | | | | | | | | | | | | | | | | 15,196 | (3) | | | | $39.53 | | 6/24/2023 | | | | | | | | | | | | | | | | | | | | | | | | 9,860 | (4) | | | | $59.70 | | 6/23/2024 | | | | | | | | | | | | | | | | | John A. Kritzmacher | | | | | | | 60,000 | (3) | | | | $39.53 | | 6/24/2023 | | | 12,500 | (6) | | | 711,000 | | | | 10,000 | (3) | | | 568,800 | | | | | | | | | 18,300 | (4) | | | | $59.70 | | 6/23/2024 | | | 3,500 | (4) | | | 199,080 | | | | 8,700 | (4) | | | 494,856 | | Gary Rinck | | | 30,000 | | | | | | | | | $47.55 | | 6/25/2018 | | | 1,431 | (1) | | | 81,395 | | | | 6,300 | (3) | | | 358,344 | | | | | 30,000 | | | | | | | | | $35.04 | | 6/24/2019 | | | 2,502 | (2) | | | 142,314 | | | | 4,200 | (4) | | | 238,896 | | | | | 25,000 | | | | | | | | | $40.02 | | 6/23/2020 | | | 2,500 | (3) | | | 142,200 | | | | | | | | | | | | | 12,500 | | | | | | | | | $49.55 | | 6/22/2021 | | | 1,700 | (4) | | | 96,696 | | | | | | | | | | | | | | | | | 12,500 | (1) | | | | $49.55 | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | 25,000 | (2) | | | | $48.06 | | 6/26/2022 | | | | | | | | | | | | | | | | | | | | | | | | 14,300 | (3) | | | | $39.53 | | 6/24/2023 | | | | | | | | | | | | | | | | | | | | | | | | 8,800 | (4) | | | | $59.70 | | 6/23/2024 | | | | | | | | | | | | | | | | | Joseph S. Heider | | | 4,600 | | | | | | | | | $33.05 | | 6/21/2016 | | | 954 | (1) | | | 54,264 | | | | 4,800 | (3) | | | 273,024 | | | | | 3,700 | | | | | | | | | $48.46 | | 6/27/2017 | | | 1,668 | (2) | | | 94,876 | | | | 3,400 | (4) | | | 193,392 | | | | | 3,800 | | | | | | | | | $47.55 | | 6/25/2018 | | | 2,000 | (3) | | | 113,760 | | | | | | | | | | | | | 5,800 | | | | | | | | | $35.04 | | 6/24/2019 | | | 1,400 | (4) | | | 79,632 | | | | | | | | | | | | | 15,000 | | | | | | | | | $40.02 | | 6/23/2020 | | | | | | | | | | | | | | | | | | | | 8,750 | | | | | | | | | $49.55 | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | 8,750 | (1) | | | | $49.55 | | 6/22/2021 | | | | | | | | | | | | | | | | | | | | | | | | 17,500 | (2) | | | | $48.06 | | 6/26/2022 | | | | | | | | | | | | | | | | | | | | | | | | 11,100 | (3) | | | | $39.53 | | 6/24/2023 | | | | | | | | | | | | | | | | | | | | | | | | 7,200 | (4) | | | | $59.70 | | 6/23/2024 | | | | | | | | | | | | | | | | | John W. Semel | | | 3,400 | | | | | | | | | $40.02 | | 6/23/2020 | | | 5,000 | (7) | | | 284,400 | | | | 2,500 | (3) | | | 142,200 | | | | | 3,150 | | | | | | | | | $49.55 | | 6/22/2021 | | | 417 | (1) | | | 23,719 | | | | 2,000 | (4) | | | 113,760 | | | | | | | | | 3,150 | (1) | | | | $49.55 | | 6/22/2021 | | | 876 | (2) | | | 49,827 | | | | | | | | | | | | | | | | | 8,200 | (2) | | | | $48.06 | | 6/26/2022 | | | 1,000 | (3) | | | 56,880 | | | | | | | | | | | | | | | | | 5,700 | (3) | | | | $39.53 | | 6/24/2023 | | | 800 | (4) | | | 45,504 | | | | | | | | | | | | | | | | | 4,200 | (4) | | | | $59.70 | | 6/23/2024 | | | | | | | | | | | | | | | | | Steven J. Miron | | | 12,500 | | | | | | | | | $40.02 | | 11/30/2017 | | | 1,975 | (8\) | | | 112,338 | | | | 3,642 | (8) | | | 207,157 | | | | | 12,500 | | | | | | | | | $49.55 | | 11/30/2017 | | | 1,400 | (9) | | | 79,632 | | | | 972 | (11) | | | 55,287 | | | | | | | | | 12,500 | (1) | | | | $49.55 | | 11/30/2017 | | | | | | | | | | | | | | | | | | | | | | | | 27,500 | (2) | | | | $48.06 | | 11/30/2017 | | | | | | | | | | | | | | | | | | | | | | | | 7,900 | (9) | | | | $39.53 | | 11/30/2017 | | | | | | | | | | | | | | | | |
| (1) | Remaining 50% of award vests on April 30, 2015. | | | | | (2) | Award vests 50% on April 30, 2015 and 50% on April 30, 2016. |
| | | | (3)(2) | Award vests 50% on April 30, 2016 and 50% on April 30, 2017. |
| | | | (4)(3) | Award vests 50% on April 30, 2017 and 50% on April 30, 2018. |
| (4) | Award vests 50% on April 30, 2018 and 50% on April 30, 2019. |
| (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. |
| (7) | Award vests 100% on September 18, 2016. |
| (8) | Award vests 100% on June 30, 2015. |
| (9) | Award vests 100% on April 30, 2017. |
| (10) | Award vests 100% on June 30, 2016. |
(11) | Award vests 100% on June 30, 2017. | | |
| (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)(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): | | | (g): | RepresentsIncludes the second half of the restricted performance shares earned for the 2011 to 2013Fiscal 2012-14 long-term incentive cycle, andcycle; all restricted performance shares earned for the 2012 to 2014Fiscal 2013-15 long-term incentive cycle,cycle; the restricted share units granted in June 2013 and June 2014; and any new hire or promotion restricted stock, all of which will vest as noted above. |
(h) and
(j): Based on the April 30, 2015 closing market price of Class A stock of $56.88. | | | | (h) and (j): | Based on the April 30, 2014 closing market price of Class A stock of $57.46. | | | | | (i): | Represents the target number of restricted performance sharesshare units granted but yet-to-be earned for the 2013-2015Fiscal 2014-16 and 2014-2016Fiscal 2015-17 long-term incentive cycles. The 2013-2015 shares, if earned, will vest half on April 30, 2016 and half on April 30, 2017. The 2014-2016Fiscal 2014-16 shares, if earned, will vest half on April 30, 2017 and half on April 30, 2018. The Fiscal 2015-17 shares, if earned, will vest half on April 30, 2018 and half on April 30, 2019. |
Option Exercises and Stock Vested Table: Option Exercises and Stock Vested Table: | | | | Option Awards | | Stock Awards | | | | Number of Shares | | | | Number of | | | | | | Acquired on | | Value Realized | | Shares Acquired | | Value Realized | | Name [a] | | Exercise (#) [b] | | on Exercise ($) [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 | |
| 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 | 2,595 | $59,737 | 8,437 | $479,897 | | 14,610 | $314,846 | 4,770 | $271,318 | | 4,412 | $125,830 | | | | 18,528 | $504,888 | | | Mark J. Allin | 3,292 | $68,728 | 3,245 | $184,576 | | 1,708 | $35,697 | 1,073 | $61,032 | John A. Kritzmacher | — | — | — | — | Gary Rinck | 15,000 | $180,600 | 3,894 | $221,491 | | 15,000 | $188,100 | 1,431 | $81,395 | Joseph S. Heider | — | — | 2,596 | $147,660 | | | | 954 | $54,264 | John W. Semel | 1,870 | $36,241 | 1,263 | $71,839 | | 1,530 | $29,804 | 417 | $23,719 | | 2,849 | $69,687 | | | | 951 | $23,519 | | | Steven J. Miron | 3,608 | $97,959 | 3,245 | $186,198 | | 1,292 | $35,091 | 2,385 | $136,851 | | 10,566 | $228,014 | | | | 1,934 | $41,813 | | | | 4,053 | $56,945 | | | | 546 | $7,196 | | | | 3,854 | $50,642 | | | | 547 | $7,707 | | | | 1,334 | $35,484 | | | | 5,666 | $150,489 | | |
| (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 sharesshare units earned from the fiscal year 2010-12Fiscal 2011-13 Executive Long-Term Incentive Plan (Messrs. Smith, CousensAllin, Rinck, Heider, and Rinck)Miron ) and Business Officer Long-Term Incentive Plan (Messrs. Miron and Allin)(Mr. Semel), and the first half of the restricted performance sharesshare units earned from the fiscal year 2011-13Fiscal 2012-14 Executive Long-Term Incentive Plan for fiscal year 2011-13)(Messrs. Smith, Allin, Rinck, Heider, and Miron ) and Business Officer Long-Term Incentive Plan (Mr. Semel), on April 30, 2015 for Messrs. Smith, Allin, Rinck, Heider and Semel, and December 15, 2014 granted pursuant to the 2009 Key Employee Stock Plan.for Mr. Miron given his separation from service on November 30, 2014. |
| | | | (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 stockCommon Stock on April 30, 2014,the dates of $57.46.vesting. |
Pension Benefits Table: Name [a] | Plan [b] | Number of Years Credited Service (#) [c] | Present Value of Accumulated Benefit (3) ($) [d] | Payments During Last Fiscal Year ($) [e] | Stephen M. Smith | Qualified Plan | 11 | 405,061 | 0 | | Excess Plan | 11 | 970,716 | 0 | | SERP | 21 | 4,150,505 | 0 | | UK Qualified Plan (1) (2) | 10 | 2,697,056 | 0 | | UK Non-Qualified Benefit (1) (2) | 10 | 2,656,720 | 0 | Mark J. Allin | Qualified Plan | N/A | N/A | 0 | | Excess Plan | N/A | N/A | 0 | | SERP | 13 | 1,138,477 | 0 | | UK Qualified Plan (1) (2) | 15 | 1,182,752 | 0 | | | | | |
Pension Benefits Table: | | | | | | | | Present Value of | | | | | | | | Number of Years | | Accumulated | | Payments During | | | | | | Credited Service | | Benefit(3) | | Last Fiscal Year | | Name | | Plan | | (#) | | ($) | | ($) | | [a] | | [b] | | [c] | | [d] | | [e] | | | | | | | | | | | | | | | | | | | | Stephen M. Smith | | Qualified Plan | | | 11 | | | | 350,971 | | | | 0 | | | | | | Excess Plan | | | 11 | | | | 845,789 | | | | 0 | | | | | | SERP | | | 21 | | | | 4,590,012 | | | | 0 | | | | | | UK Qualified Plan(1)(2) | | | 10 | | | | 2,583,851 | | | | 0 | | | | | | UK Non-Qualified Benefit(1)(2) | | | 10 | | | | 2,038,334 | | | | 0 | | | | Ellis E. Cousens | | Qualified Plan | | | 12 | | | | 426,744 | | | | 0 | | | | | | Excess Plan | | | 12 | | | | 1,508,140 | | | | 0 | | | | | | SERP | | | 12 | | | | 5,394,136 | | | | 0 | | | | Steven J. Miron | | Qualified Plan | | | 20 | | | | 314,808 | | | | 0 | | | | | | Excess Plan | | | 20 | | | | 415,637 | | | | 0 | | | | | | SERP | | | 20 | | | | 2,492,616 | | | | 0 | | | | Gary Rinck | | Qualified Plan | | | 9 | | | | 272,918 | | | | 0 | | | | | | Excess Plan | | | 9 | | | | 754,628 | | | | 0 | | | | | | SERP | | | 9 | | | | 2,740,979 | | | | 0 | | | | Mark J. Allin | | Qualified Plan | | | N/A | | | | N/A | | | | 0 | | | | | | Excess Plan | | | N/A | | | | N/A | | | | 0 | | | | | | SERP | | | 13 | | | | 981,216 | | | | 0 | | | | | | UK Qualified Plan(1)(2) | | | 13 | | | | 1,007,147 | | | | 0 | |
Name [a] | Plan [b] | Number of Years Credited Service (#) [c] | Present Value of Accumulated Benefit (3) ($) [d] | Payments During Last Fiscal Year ($) [e] | Gary Rinck | Qualified Plan | 9 | 317,362 | 0 | | Excess Plan | 9 | 872,728 | 0 | | SERP | 9 | 2,911,765 | 0 | Joseph Heider | Qualified Plan | 20 | 460,289 | 0 | | Excess Plan | 20 | 314,072 | 0 | | SERP | 20 | 1,833,823 | 0 | John Semel | Qualified Plan | 4 | 88,740 | 0 | | Excess Plan | 4 | 112,227 | 0 | Steven J. Miron | Qualified Plan | 20 | 375,095 | 0 | | Excess Plan | 20 | 490,952 | 0 | | SERP | 20 | 2,892,113 | 0 |
| (1) | Mark Allin and Stephen Smith’s Present Value of Accumulated Benefits from the UKQualifiedUK Qualified and UK Non-Qualified Plans were calculated using a British £ to US $ conversionfactorconversion factor of 1.6811.1.5181. |
| | | | (2) | Mark Allin and Stephen Smith’s Present Value of Accumulated Benefits from the UKQualifiedUK Qualified and UK Non-Qualified Plans were calculated using UK disclosure assumptionsincludingassumptions including a 4.30%3.60% discount rate. |
| | | | (3) | The credited service and the accumulated benefits used to determine the present value oftheof the US Qualified, Excess and SERP benefits are as of the US plans’plans' freeze on June 30,2013.30, 2013. Stephen Smith’s UK accumulated plan benefits used to determine present value arebasedare based on his UK plan credited service as shown. Mr. Allin’sAllin's UK plan credited service andaccumulatedand accumulated benefit used to determine present value are as of April 30, 2014.2015. |
| | | | (d): | The amounts shown in the table above for all plans represent the actuarial present valuesofvalues of the executive’sexecutives’ accumulated benefits accrued as of April 30, 2014,2015, calculated using thesamethe same assumptions in footnote 17 of the Company’s financial statements, except that theSERPthe SERP benefit for Messrs. Cousens andMr. Rinck calculated under the 1989 SERP has nomortalityno mortality assumption and under the 1989 and 2005 SERP, no recognition of pre-retirementmortality.pre-retirement mortality. |
A description of each plan follows. The Employees Retirement Plan of John Wiley & Sons, Inc. (the Qualified Plan) The Employees Retirement Plan of John Wiley & Sons, Inc. (the Qualified Plan)
| | A description of each plan follows.
The Company sponsors a qualified defined benefit pension plan to provide retirement benefits to U.S.
The Company sponsors a qualified defined benefit pension plan to provide retirement benefits to US 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 |
| | | | | | ●· | 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 |
| | | | | | | | ●· | total annual compensation for the year in excess of 80% of that year’s Social Security Wage Base times 1.3%. |
In Fiscal 2013, the Company announced a cessation of accruals and freeze of participation in the US Qualified Retirement Plan, effective June 30, 2013. | | 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 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 Rinck 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 Rinck are eligible for early retirement under this plan.
| Supplemental Executive Retirement Plan (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
The frozen annual benefit calculated under the Previous Benefit Formula for the combined Qualified Plan and the Excess Plan described below for Messrs. Smith, Rinck, Heider and Miron is $17,804, $3,399, $17,579, and $13,407, respectively. Messrs. Smith, Rinck and Heider 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 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, Rinck and Heider are eligible for early retirement under this plan. Supplemental Executive Retirement Plan (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. Mr. Rinck remains 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 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 andMr. Rinck are 55%, andis 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 SERP. 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. | | 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
In Fiscal 2013, the Company announced a cessation of accruals and freeze of participation in the US Supplemental Executive Retirement Plan, effective June 30, 2013. Messrs. Smith, Rinck and Heider are eligible for early retirement under this 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. |
The John 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. In Fiscal 2015, the Company announced its desire to cease of accruals based on service under the UK Qualified Plan. Following a period of consultation with Plan participants, service-related accruals under the Plan were frozen, effective April 30, 2015. The Unapproved Supplemental UK Plan (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 agreed 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 | 140,718 | 96,384 | 27,778 | 0 | 736,188 | Mark J. Allin | N/A | N/A | N/A | N/A | N/A | John A. Kritzmacher | 0 | 46,497 | 1,312 | 0 | 50,008 | Gary Rinck | 150,703 | 35,900 | 170,284 | 358,612 | 2,143,045 | Joseph S. Heider | 81,888 | 25,445 | 37,226 | 0 | 786,043 | John W. Semel | 0 | 22,892 | 8 | 0 | 24,746 | Steven J. Miron | 50,100 | 35,083 | 9,030 | 0 | 212,349 |
Participants in the company’s Nonqualified Deferred Compensation Plan (the “NQDC Plan”) may elect to defer up to 25% of their base salary and 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 1.5% of pay 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. While Mr. Allin was a UK-based executive, he was not eligible to participate in the NQDC Plan. As elected in 2009, Mr. Rinck received an in-service distribution from the NQDC Plan on January 31, 2015, representing the value of deferrals of CY 2010 base and incentive pay. 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 | In fiscal | Rate of Return for 1 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. ending 04/30/2015 | | | | | | Messrs. Smith, Cousens and Rinck 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 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 | | | 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 1.5% of pay 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 NQDC 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 04/30/2014 | | | | | | | | | | Vanguard VIF Money Market | | | 0.10 | % | | | | PIMCO VIT Total Return | | –1.84 | 4.09 | % | | | | PIMCO VIT Real Return | | –6.89 | 1.62 | % | | | | MFS VIT Value | | 19.63 | 9.97 | % | | | | Fidelity VIP Index 500 | | 20.32 | 12.87 | % | | | | American Funds IS Growth | | 17.83 | 15.69 | % | | | | Invesco Van Kampen VI Mid CapAmerican Value I | | 20.97 | 11.70 | % | | | | Fidelity VIP Mid Cap | | 22.22 | 10.74 | % | | | | Royce Capital Small Cap | | 22.45 | 6.09 | % | | | | Vanguard VIF Small Company Growth | | 23.82 | 13.63 | % | | | | MFS VIT II International Value | | 13.00 | 8.37 | % | | | | MFS VIT II International Growth | | 7.28 | 2.31 | % | | | | Northwestern Mutual Life Insurance | | 5.50 | 5.30 | % | |
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 available in a lump sum or annual installments over up to 15 years. Amounts in column (b) are included in columns (c) and (g) 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 | | | $ | 1,840,000 | | | $ | 1,840,000 | | Severance – Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 2,576,000 | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 1,288,000 | | ELTIP – Restricted Performance Share Units | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 2,468,592 | | Restricted Stock (Performance Shares Earned but Not Vested) (1) | | $ | 1,883,297 | | | $ | 1,883,297 | | | $ | 1,883,297 | | | $ | 1,883,297 | | Restricted Stock (Time based) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 972,648 | | Stock Options (2) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 2,289,500 | | Benefits (3) | | $ | 0 | | | $ | 0 | | | $ | 24,866 | | | $ | 49,732 | | SERP (4) | | $ | 2,900,480 | | | $ | 2,900,480 | | | $ | 2,900,480 | | | $ | 5,314,497 | | Excess Plan (4) | | $ | 3,276,093 | | | $ | 3,276,093 | | | $ | 3,276,093 | | | $ | 3,276,093 | | Qualified Plan (4) | | $ | 2,028,506 | | | $ | 2,028,506 | | | $ | 2,028,506 | | | $ | 2,028,506 | | NQDC (5) | | $ | 736,187 | | | $ | 736,187 | | | $ | 736,187 | | | $ | 736,187 | | Total: | | $ | 10,824,563 | | | $ | 10,824,563 | | | $ | 12,689,429 | | | $ | 24,723,052 | |
| | 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 available in a lump 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 | | Stephen M. Smith |
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. | | | (2) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the 4/30/2014April 30, 2015 closing stock price ($57.46)56.88). | | | (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)2015), even though plan documents only permit annuity payments, except on termination following a change of control. Annual benefits are: | | Qualified: | | Qualified: $181,547$182,068 / year as a life annuity
| | Excess: $221,900 | $207,249 / year as a life annuity | | SERP: $263,647 | $196,109 / 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. |
| | | | | | | | | | | | | | | | | | | | | | 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 | | |
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 | | | $ | 907,353 | | | $ | 1,209,804 | | Severance – Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 1,149,314 | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 574,657 | | ELTIP – Restricted Performance Share Units | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 557,424 | | Restricted Stock (Performance Shares Earned but Not Vested) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 167,853 | | Restricted Stock (Time based) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 221,832 | | Stock Options (1) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 589,509 | | Benefits (2) | | $ | 0 | | | $ | 0 | | | $ | 7,557 | | | $ | 15,114 | | SERP (3) | | $ | 703,158 | | | $ | 703,158 | | | $ | 703,158 | | | $ | 2,258,382 | | Excess Plan (3) | | | N/A | | | | N/A | | | | N/A | | | | N/A | | Qualified Plan (3) | | $ | 465,327 | | | $ | 465,327 | | | $ | 465,327 | | | $ | 465,327 | | NQDC | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | Total: | | $ | 1,168,485 | | | $ | 1,168,485 | | | $ | 2,083,395 | | | $ | 7,209,216 | |
| | (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 4/30/2014April 30, 2015 closing stock price ($57.46)56.88). | | | (3)(2) | Presumes benefits are similar to those available to salaried employees and therefore only need to be disclosed in the dismissal columns. | | | (4)(3) | 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)2015), even though plan documents only permit annuity payments, except on termination following a change of control. Annual benefits are: | | Qualified: | | Qualified: $33,024$55,070 / year as a life annuity | | Excess: | | Excess: $113,527N/A / year as a life annuity | | SERP: | | SERP: $642,039$94,401 / year as a 10 year certainlife annuity |
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 | | | $ | 620,000 | | | $ | 1,240,000 | | Severance – Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 1,178,000 | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 589,000 | | ELTIP – Restricted Performance Share Units | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 1,063,656 | | Restricted Stock (Performance Shares Earned but Not Vested) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | Restricted Stock (Time based) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 910,080 | | Stock Options (1) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 1,041,000 | | Benefits (2) | | $ | 0 | | | $ | 0 | | | $ | 29,093 | | | $ | 58,186 | | 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) | | $ | 50,008 | | | $ | 50,008 | | | $ | 50,008 | | | $ | 50,008 | | Total: | | $ | 50,008 | | | $ | 50,008 | | | $ | 699,101 | | | $ | 6,129,930 | |
(1) | Reflects the intrinsic value of those stock options that become vested because of the change of control based on the April 30, 2015 closing stock price ($56.88). | (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 and had not completed one year of service as of the plans’ June 30, 2013 freeze date. | (6)(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. |
| | | | | | | | | | | | | | | | | | | | | | 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 | | |
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 | | | $ | 802,500 | | | $ | 1,070,000 | | Severance – Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 802,500 | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 401,250 | | ELTIP – Restricted Performance Share Units | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 597,240 | | Restricted Stock (Performance Shares Earned but Not Vested) (1) | | $ | 223,709 | | | $ | 223,709 | | | $ | 223,709 | | | $ | 223,709 | | Restricted Stock (Time based) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 238,896 | | Stock Options (2) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 560,230 | | Benefits (3) | | $ | 0 | | | $ | 0 | | | $ | 9,474 | | | $ | 18,948 | | SERP (4) | | $ | 2,947,284 | | | $ | 2,947,284 | | | $ | 2,947,284 | | | $ | 3,324,101 | | Excess Plan (4) | | $ | 897,342 | | | $ | 897,342 | | | $ | 897,342 | | | $ | 897,342 | | Qualified Plan (4) | | $ | 335,640 | | | $ | 335,640 | | | $ | 335,640 | | | $ | 335,640 | | NQDC (5) | | $ | 2,143,044 | | | $ | 2,143,044 | | | $ | 2,143,044 | | | $ | 2,143,044 | | Total: | | $ | 6,547,019 | | | $ | 6,547,019 | | | $ | 7,358,993 | | | $ | 10,612,900 | |
| | (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 4/30/2014April 30, 2015 closing stock price ($57.46)56.88). | | | (2)(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) | Mr. Kritzmacher is not eligible segment rates in effect for any DBApril 2015), even though plan documents only permit annuity payments, except on termination following a change of control. Annual benefits (Qualified, Excess and SERP) because he was hired in June 2013. The pension plans closed to new participants as of 07/01/2013.are: | | Qualified: | $24,008 / year as a life annuity | | Excess: | $64,186 / year as a life annuity | | SERP: | $338,776 / year as a 10 year certain | (4)(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. |
| | | | | | | | | | | | | | | | | | | | | | 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 | | |
Joseph S. Heider | 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 | | | $ | 780,000 | | | $ | 780,000 | | Severance – Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 741,000 | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 370,500 | | ELTIP – Restricted Performance Share Units | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 466,416 | | Restricted Stock (Performance Shares Earned but Not Vested) (1) | | $ | 150,277 | | | $ | 150,277 | | | $ | 150,277 | | | $ | 150,277 | | Restricted Stock (Time based) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 193,392 | | Stock Options (2) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 411,073 | | Benefits (3) | | $ | 0 | | | $ | 0 | | | $ | 18,151 | | | $ | 36,302 | | SERP (4) | | $ | 1,571,190 | | | $ | 1,571,190 | | | $ | 1,571,190 | | | $ | 3,265,016 | | Excess Plan (4) | | $ | 282,350 | | | $ | 282,350 | | | $ | 282,350 | | | $ | 282,350 | | Qualified Plan (4) | | $ | 430,481 | | | $ | 430,481 | | | $ | 430,481 | | | $ | 430,481 | | NQDC (5) | | $ | 786,043 | | | $ | 786,043 | | | $ | 786,043 | | | $ | 786,043 | | Total: | | $ | 3,220,341 | | | $ | 3,220,341 | | | $ | 4,018,492 | | | $ | 7,912,850 | |
(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 4/30/2014April 30, 2015 closing stock price ($57.46)56.88). | | | (2)(3) | Presumes benefits are similar to those available to salaried employees and therefore only need to be disclosed in the dismissal columns. | | |
(3)(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)2015), even though plan documents only permit annuity payments, except on termination following a change of control. Annual benefits are: | | Qualified: | | Qualified: $37,148$26,858 / year as a life annuity | | | Excess: | | Excess: $46,476$17,616 / year as a life annuity | | | SERP: | | SERP: $259,178$98,028 / year as a life annuity | | | | (4)(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. |
| | | | | | | | | | | | | | | | | | | | | | 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 | | |
John W. Semel | 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 | | | $ | 396,550 | | | $ | 396,550 | | Severance – Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | Prorated Annual Incentive | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | ELTIP – Restricted Performance Share Units | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 187,704 | | Restricted Stock (Performance Shares Earned but Not Vested) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 73,546 | | Restricted Stock (Time based) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 386,784 | | Stock Options (1) | | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 194,309 | | Benefits (2) | | $ | 0 | | | $ | 0 | | | $ | 11,492 | | | $ | 22,984 | | SERP (3) | | | N/A | | | | N/A | | | | N/A | | | | N/A | | Excess Plan (3) | | $ | 65,760 | | | $ | 65,760 | | | $ | 65,760 | | | $ | 65,760 | | Qualified Plan (3) | | $ | 55,638 | | | $ | 55,638 | | | $ | 55,638 | | | $ | 55,638 | | NQDC (4) | | $ | 24,746 | | | $ | 24,746 | | | $ | 24,746 | | | $ | 24,746 | | Total: | | $ | 146,144 | | | $ | 146,144 | | | $ | 554,186 | | | $ | 1,408,021 | |
| (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 4/30/2014April 30, 2015 closing stock price ($57.46)56.88). | | | | | (3)(2) | Presumes benefits are similar to those available to salaried employees and therefore only need to be disclosed in the dismissal columns. | | | | | (4)(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)2015), even though plan documents only permit annuity payments, except on termination following a change of control. Annual benefits are: | | | Qualified: | $13,156 / year as a life annuity | | | | Excess: | Qualified: $25,908$15,550 / year as a life annuity | | | | SERP: | Excess: $69,265N/A / 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 | |
years. | | | | (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, 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, 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, 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. | | | | |
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, 2015. 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, 2015. Under the 2009 and 2014 Key Employee Stock Plans, the Compensation 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. Some of the named officers and certain other executives are covered by employment agreements or severance agreements which provide for the following in the event of a “without cause termination” or “constructive discharge” without a change of control: | ●· | Company—paidSeverance—base salary: Messrs. Smith, Allin and Heider—24 months; Mr. Rinck—18 months; Messrs. Kritzmacher and Semel—12 months. |
| · | Performance Share Units—Mr. Smith—accelerated vesting of all earned Performance Share Units for completed cycles. |
| · | Company-paid health and welfare benefits, for their respective severance periods: |
| Messrs. Smith, Allin and Miron—Heider—24 months; Messrs. Cousens, Rinck and Allin—Mr., Rinck—18 months; Mr. Kritzmacher—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: |