UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(RULE
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
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Rockwell International Corporation
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(NameAutomation, Inc.
(Name of Registrant as Specified
in itsIn Its Charter)
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(Name (Name of Person(s) Filing Proxy Statement, if other than
the Registrant)
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[ROCKWELL AUTOMATION LOGO]
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December 17, 2001
14, 2006
Dear Shareowner:
You are cordially invited to attend our 2007 Annual Meeting of Shareowners.
We will hold the annual meeting of shareowners ofin the Corporation.
The meeting will be held in The GrandImperial Ballroom at The Pfister Hotel, 424 East Wisconsin Avenue, Milwaukee, Wisconsin, on Wednesday, February 6, 2002,7, 2007, at 10 a.m. (Central Standard Time). At the meeting thereI will be a current report on the Corporation’s activities ofand performance during the Corporation followed by discussionpast fiscal year, and actionwe will discuss and act on the matters described in the Proxy Statement. At this year’s meeting, you will have an opportunity to vote on the election of three directors and approve the selection of Deloitte & Touche LLP as our independent registered public accounting firm. Shareowners will then have an opportunity to comment on or to inquire about the affairs of the Corporation that may be of interest to shareowners generally.
Your vote is important to us. Whether or not you plan to attend the meeting, please return your proxy card as soon as possible. You also have the option of voting via the Internet or by telephone.
If you plan to attend the meeting, please request an admittance card in one of the ways described in the box on the last page of the Proxy Statement.
We sincerely hope that as many shareowners as can conveniently attend will do so.
We have enclosed the Proxy Statement for our 2007 Annual Meeting of Shareowners and our 2006 Annual Report. I hope you find them interesting and useful in understanding your company.
Sincerely yours,
/s/ Don H. Davis, Jr.
Don H. Davis, Jr.
Keith D. Nosbusch
Chairman of the Board and Chief Executive Officer
ROCKWELL INTERNATIONAL CORPORATION
_____________________________________________
777 East Wisconsin Avenue,
Rockwell Automation, Inc.
1201 South Second Street, Milwaukee, Wisconsin 53202
53204
Notice of 20022007 Annual Meeting of Shareowners
TO THE SHAREOWNERS OF
To the Shareowners of
ROCKWELL INTERNATIONAL CORPORATION:
NOTICE IS HEREBY GIVEN that the 2002AUTOMATION, INC.:
The 2007 Annual Meeting of Shareowners of Rockwell International CorporationAutomation, Inc. will be held in The Grandthe Imperial Ballroom at The Pfister Hotel, 424 East Wisconsin Avenue, Milwaukee, Wisconsin, on Wednesday, February 6, 2002,7, 2007, at 10 a.m. (Central Standard Time) for the following purposes:
(a) to elect three members of the Board of Directors of the Corporation
with terms expiring at the Annual Meeting in 2005;
(b) to consider and vote on a proposal to approve the selection by the
Board of Directors of the firm of Deloitte & Touche LLP as auditors of
the Corporation;
(c) to consider and vote on a proposal to amend the Corporation's Restated
Certificate of Incorporation to change the name of the Corporation from
Rockwell International Corporation to Rockwell Automation, Inc.; and
(d) to transact such other business as may properly come before the
meeting.
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| (a) | to elect three members of our Board of Directors with terms expiring at the Annual Meeting in 2010; |
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| (b) | to consider and vote on a proposal to approve the selection by the Audit Committee of our Board of Directors of Deloitte & Touche LLP as our independent registered public accounting firm for fiscal year 2007; and |
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| (c) | to transact such other business as may properly come before the meeting. |
Only shareowners of record at the close of business on December 10, 2001,11, 2006 will be entitled to notice of, and to vote at, the meeting.
By order of the Board of Directors.
/s/ William J. Calise, Jr.
William J. Calise, Jr.
Douglas M. Hagerman
Secretary
December
17, 2001
NOTE: THE BOARD OF DIRECTORS SOLICITS VOTES BY THE EXECUTION AND PROMPT RETURN
OF THE
ACCOMPANYING PROXY IN THE ENCLOSED RETURN ENVELOPE OR BY USE OF THE
CORPORATION'S TELEPHONE OR INTERNET VOTING PROCEDURES.
14, 2006Note: The Board of Directors solicits votes by the execution and prompt return of the
accompanying proxy in the enclosed return envelope or by use of the
Corporation’s telephone or Internet voting procedures.
Rockwell International CorporationAutomation, Inc.
2007 Proxy Statement
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Rockwell Automation, Inc.
Proxy Statement
The 20022007 Annual Meeting of Shareowners of Rockwell International
CorporationAutomation, Inc. will be held on February 6, 2002,7, 2007, for the purposes set forth in the accompanying Notice of 20022007 Annual Meeting of Shareowners. This proxy statement and the accompanying proxy, which are first being sent to shareowners on or about December 21, 2001,2006, are furnished in connection with the solicitation by the Board of Directors of proxies to be used at the meeting and at any adjournment thereof.of the meeting. We will refer to your company in this proxy statement as “we”, “us”, the “Corporation” or “Rockwell Automation”.
What am I Voting On?
You will be voting on the following:
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| • | the election of three members of our Board of Directors; and |
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| • | the approval of the appointment of Deloitte & Touche LLP (D&T) as our independent registered public accounting firm for fiscal year 2007. |
Who is Entitled to Vote at the Annual Meeting?
Only holders of record of the Corporation’s Common Stock at the close of business on December 11, 2006, the record date for the meeting, may vote at the Annual Meeting. Each shareowner is entitled to one vote for each share of our Common Stock held on the record date. On December 11, 2006, we had outstanding 167,179,172 shares of our Common Stock.
Who may Attend the Annual Meeting?
All shareowners as of the record date, or individuals holding their duly appointed proxies, may attend the Annual Meeting. Please note that if you hold your shares through a broker or other nominee (in street name), you will need to provide a copy of a brokerage statement reflecting your stock ownership as of the record date to be admitted to the Annual Meeting.
How Do I Vote My Shares?
All shareowners may vote in person at the Annual Meeting. If your shares are held in street name, you should contact your broker or other nominee to obtain a shareownerbroker’s proxy card and bring it, together with proper identification and your brokerage statement reflecting your stock ownership as of the record date, with you to the Annual Meeting, in order to vote your shares. In addition you may vote:
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| • | for shareowners of record and participants in our savings plans and Mellon Investor Services Program (dividend reinvestment and stock purchase plan), by completing, signing and returning in the postage-paid envelope provided the enclosed proxy and direction card, or via the Internet or by telephone; or |
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| • | for shares held in street name, by using the method directed by your broker or other nominee. You may vote over the Internet or by telephone if your broker or nominee makes those methods available, in which case they will provide instructions with your proxy materials. |
How Will My Proxy Be Voted?
If you duly executescomplete, sign and returnsreturn a proxy in the accompanying
form or uses the Corporation'suse our telephone or internetInternet voting procedures to authorize the named proxies to vote the shareowner'syour shares, thoseyour shares will be voted as specified, and if no specificationspecified. If your proxy card is made, thesigned but does not contain specific instructions, your shares will be voted as recommended by our Board of Directors.
For shareowners participating in our savings plans or in the Mellon Investor Services Program (dividend reinvestment and stock purchase plan), the trustee or administering bank will vote the shares that it holds for a
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participant’s account only in accordance with the recommendations of the Board of Directors. Theinstructions given in a duly signed, completed and returned proxy and any votes cast usingdirection card, or in accordance with instructions given pursuant to our Internet or telephone voting procedures. Where no instructions are received, the Corporation'sshares will not be voted.
May I Revoke My Proxy?
For shareowners of record, whether you vote by mail, by telephone or internet voting proceduresvia the Internet, you may revoke your proxy at any time before it is voted by:
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| • | delivering a written notice of revocation to the Secretary of the Corporation; |
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| • | submitting a properly signed proxy card with a later date; |
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| • | casting a later vote using the telephone or Internet voting procedures; or |
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| • | voting in person at the Annual Meeting (except for shares held in the savings plans). |
If your shares are held in street name, you must contact your broker or other nominee to revoke your proxy. Your proxy is not revoked simply because you attend the Annual Meeting.
Will My Vote be revoked prior to exercise by delivering written notice of revocation to
the Secretary of the Corporation, by executing a later dated proxy, by casting a
later vote using the telephone or internet voting procedures or by attending the
meeting and voting in person.
The Corporation, which was incorporated in 1996, is the successor to the
former Rockwell International Corporation, which was incorporated in 1928, as
the result of a tax-free reorganization completed December 6, 1996. References
in this Proxy Statement to the Corporation, Board of Directors and executive
officers of the Corporation with respect to periods on or prior to December 6,
1996 shall mean, unless otherwise stated, the predecessor corporation and its
Board of Directors and executive officers.
Confidential?
It is the Corporation'sour policy to keep confidential all proxy cards, ballots and voting tabulations that identify individual shareowners, except as may be necessary to meet any applicable legal requirements and, in the case of any contested proxy solicitation, as may be necessary to permit proper parties to verify the propriety of proxies presented by any person and the results of the voting. The inspectorsindependent inspector of election and any employees associated withinvolved in processing proxy cards or ballots and tabulating the vote are required to acknowledge their
responsibility to comply with this policy of confidentiality.
For shareowners participating in
How Many Votes are Needed to Elect Directors and Approve the Mellon Investor Services Program for
Rockwell Shareowners, the administering bank will vote the shares that it holds
for a participant's account only in accordance with the proxy returned by the
participant to the Corporation, or in accordance with instructions given
pursuant to the Corporation's telephone or internet voting procedures.
VOTING SECURITIES
On December 10, 2001, the record date for the meeting, the Corporation had
outstanding 183,976,715 sharesSelection of Common Stock. Each holderour Independent Registered Public Accounting Firm?
Election of Common Stock is
entitled to one vote for each share held. The following table shows, as of
December 10, 2001, information with respect to the persons known to the
Corporation, based on statements filed with the Securities and Exchange
Commission pursuant to Section 13(d) or 13(g) of the Securities Exchange Act or
otherwise furnished to the Corporation, to be the beneficial owner of more than
5% of any class of the Corporation's outstanding voting securities.
Percent
Title of Class Name and Address of Beneficial Owner Shares of Class(1)
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Common Stock Wells Fargo Bank, N.A., as Trustee(2) 21,845,870(2) 11.9%
707 Wilshire Boulevard
Los Angeles, CA 90017
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(1) The percentage of class owned has been computed in accordance with Rule
13d-3(d)(1) under the Securities Exchange Act.
(2) Shares are held as trustee under the Corporation's savings plans for
participating employees and former employees of the Corporation or its
predecessors. The trustee will vote the shares held on account of
participants in accordance with written instructions from the participants,
or instructions from the participants given pursuant to the Corporation's
telephone or internet voting procedures, and where no instructions are
received, as the trustee deems proper. The trustee has no investment power
with respect to the shares held on account of participants unless a tender
offer is made for the shares and the participant provides no instructions to
the trustee.
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ELECTION OF DIRECTORS
The Corporation's Restated Certificate of Incorporation provides that the
Board ofDirectors. Directors
shall consist of three classes of directors with overlapping
three-year terms. One class of directors is to be elected each year with terms
extending to the third succeeding Annual Meeting after election. The Restated
Certificate of Incorporation provides that the Board shall maintain the three
classes so as to be as nearly equal in number as the then total number of
directors permits but that no decrease in the number of directors shall shorten
the term of any director.
There are two directors whose terms expire at the 2002 Annual Meeting, both
of whom have been designated by the Board as nominees for election as directors
at the 2002 Annual Meeting. In addition, two directors whose terms would have
expired at the 2002 and 2004 Annual Meetings resigned during the year. Mr.
Robert B. Shapiro, a member of the Audit and Board Composition Committees of the
Board, resigned effective July 6, 2001, and George L. Argyros, a member of the
Board Composition and Technology, Environmental and Social Responsibility
Committees of the Board, resigned effective November 16, 2001. Accordingly, the
Board decreased the number of directors of the Corporation to eight, three of
whom will be directors in each of the classes with terms extending to the 2003
and 2004 Annual Meetings and two of whom will be directors in the class with
terms extending to the 2005 Annual Meeting and until their successors are elected
and qualify. The Board subsequently approved an increase in the number
of directors to nine effective immediately prior to the 2002 Annual Meeting,
with such additional director being in the class with terms extending to the
2005 Annual Meeting and until their successors are elected and qualify. The
Board has designated Kenneth F. Yontz as an additional nominee for election as a
director at the 2002 Annual Meeting.
It is intended that proxies in the accompanying form properly executed and
returned to the Corporation's proxy tabulator or shares properly authorized to
be voted in accordance with the Corporation's telephone or internet voting
procedures will be voted at the meeting, unless authority to do so is withheld,
for the election as directors of the three nominees specified in Nominees for
Directors with Terms Expiring in 2005 below. If for any reason any of those
nominees is not a candidate (which is not expected) when the election occurs, it
is expected that proxies in the accompanying form will be voted at the meeting
for the election of a substitute nominee or, in lieu thereof, the Board of
Directors may reduce the number of directors.
INFORMATION AS TO NOMINEES FOR DIRECTORS AND CONTINUING DIRECTORS
There is shown below for each nominee for director and each continuing
director, as reported to the Corporation, the name, age and principal
occupation; the position, if any, with the Corporation; the period of service as
a director of the Corporation (or a predecessor corporation); other
directorships held; and the committees of the Board of Directors on which the
nominee or continuing director serves.
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NOMINEES FOR DIRECTORS WITH TERMS EXPIRING IN 2005
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[ROCKWELL PHOTO]
BRUCE M. ROCKWELL DIRECTOR SINCE 1969 AGE 62
Vice Chairman, First of Michigan Division of Fahnestock & Co.
Inc., member New York Stock Exchange (Investment Banking). Mr.
Rockwell is Chairman of the Technology, Environmental and
Social Responsibility Committee and a member of the Audit and
Compensation and Management Development Committees of the
Board. He joined First of Michigan Corporation in 1961 and was
elected Senior Vice President in 1983, assuming his present
position in March 1998 prior to the acquisition of First of
Michigan by Fahnestock & Co. He is past chairman of the
Municipal Advisory Council of Michigan and past President of
the Bond Club of Detroit. He also serves as a board member of
a number of civic and community organizations.
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[TOOT PHOTO]
JOSEPH F. TOOT, JR. DIRECTOR SINCE 1977 AGE 66
Retired President and Chief Executive Officer, The Timken
Company (Tapered Roller Bearings and Specialty Steel). Mr.
Toot is a member of the Compensation and Management
Development and Board Composition Committees of the Board. He
joined The Timken Company in 1962 and served in various senior
executive positions until his election as President in 1979
and Chief Executive Officer in 1992. He retired as President
and Chief Executive Officer in December 1997 and then served
as Chairman of the Executive Committee -- Board of Directors
from January 1998 until April 2000. Mr. Toot has served as a
director of Timken since 1968. He is a director of Rockwell
Collins, Inc. and a member of the Supervisory Board of PSA
Peugeot Citroen. Mr. Toot has also served as a director,
officer, trustee or member of various community, charitable
and philanthropic organizations.
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[YONTZ PHOTO]
KENNETH F. YONTZ NEW NOMINEE AGE 57
Chairman of the Board, Apogent Technologies Inc. (Laboratory
and Life Sciences Company) and Sybron Dental Specialties Inc.
(Dental Supplies, Orthodontic Appliances and Related Products)
(successor companies to Sybron International Corporation).
Mr. Yontz served as Chairman, President and Chief Executive
Officer of Sybron International Corporation from October 1987
until December 2000. Mr. Yontz is a director of Viasystems
Group, Inc. and also serves as a director or member of a
number of civic and community organizations.
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CONTINUING DIRECTORS WITH TERMS EXPIRING IN 2003
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[ALEWINE PHOTO]
BETTY C. ALEWINE DIRECTOR SINCE 2000 AGE 53
Retired President and Chief Executive Officer, COMSAT
Corporation (Global Satellite Services and Digital Networking
Services and Technology). Ms. Alewine is a member of the
Audit and Technology, Environmental and Social Responsibility
Committees of the Board. She joined COMSAT in 1986 as Vice
President of Sales and Marketing, then as the Vice President
and General Manager and in 1994 as President of COMSAT
International, the Company's largest operating unit. Ms.
Alewine was named Chief Executive Officer of COMSAT in July
1996 and served in that position until the merger of COMSAT
and Lockheed Martin Corporation in August 2000. Ms. Alewine is
a director of the New York Life Insurance Company and The
Pittston Company. She also serves as a director or member of a
number of civic and educational organizations.
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[COOK PHOTO]
J. MICHAEL COOK DIRECTOR SINCE 2000 AGE 59
Retired Chairman and Chief Executive Officer, Deloitte &
Touche LLP (Professional Services). Mr. Cook is Chairman of
the Audit Committee and a member of the Board Composition
Committee of the Board. Mr. Cook served as Chairman and Chief
Executive Officer of Deloitte & Touche from 1989 until May
1999. He also served as Chairman of the Deloitte & Touche
Foundation and a member of the Board of Deloitte Touche
Tohmatsu. Mr. Cook serves as a member of the Board of
Overseers of the Columbia Business School. He is a director of
AT&T Corp., The Dow Chemical Company, HCA Inc. and
International Flavor & Fragrances, Inc. Mr. Cook is a Trustee
of the Fidelity Group of Mutual Funds. He also serves as a
director or member of a number of other civic and educational
organizations.
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[NICHOLS PHOTO]
JOHN D. NICHOLS DIRECTOR SINCE 1988 AGE 71
Retired Chairman of the Board and Chief Executive Officer,
Illinois Tool Works Inc. (Engineered Components and Industrial
Systems and Consumables). Mr. Nichols is Chairman of the
Compensation and Management Development Committee and a member
of the Audit Committee of the Board. He joined Illinois Tool
Works in 1980 as Executive Vice President and was named
President, Chief Operating Officer and a director in 1981 and
Chairman in 1986. He served as Chief Executive Officer from
1982 through August 1995. He is a director of Household
International, Inc. and Philip Morris Companies Inc. Mr.
Nichols also serves as a director or member of a number of
civic and community organizations.
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CONTINUING DIRECTORS WITH TERMS EXPIRING IN 2004
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[DAVIS PHOTO]
DON H. DAVIS, JR. DIRECTOR SINCE 1995 AGE 62
Chairman of the Board and Chief Executive Officer. Mr. Davis
has been Chairman of the Board since February 1998 and Chief
Executive Officer since October 1997. He was President from
July 1995 to October 1997. Mr. Davis is a director of Illinois
Tool Works Inc. and Apogent Technologies Inc. He is a member
of The Business Council, The Business Roundtable, former
Chairman of the Board of Governors of the National Electrical
Manufacturers Association and also a director, trustee or
member of a number of other business, educational and civic
organizations.
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[GRAY PHOTO]
WILLIAM H. GRAY, III DIRECTOR SINCE 1994 AGE 60
President and Chief Executive Officer, The College Fund/UNCF
(Educational Assistance). Mr. Gray is a member of the Board
Composition and Technology, Environmental and Social
Responsibility Committees of the Board. He has been President
of The College Fund/UNCF since September 1991 and senior
minister, Bright Hope Baptist Church in Philadelphia since
1972. He served in Congress from 1979 to 1991, as House
Majority Whip, Chair of the Democratic Caucus and the House
Budget Committee and on the House Appropriations Committee. In
addition, he has taught at St. Peter's College and Temple
University. Mr. Gray is a director of J. P. Morgan Chase &
Co., Dell Computer Corporation, Electronic Data Systems
Corporation, MBIA, Inc., Pfizer Inc., The Prudential Insurance
Company of America, Viacom Inc. and Visteon Corporation.
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[McCORMICK PHOTO]
WILLIAM T. MCCORMICK, JR. DIRECTOR SINCE 1989 AGE 57
Chairman of the Board and Chief Executive Officer, CMS Energy
Corporation (Diversified Energy Company). Mr. McCormick is
Chairman of the Board Composition Committee and a member of
the Compensation and Management Development Committee of the
Board. He has been Chairman of the Board and Chief Executive
Officer of CMS Energy Corporation since November 1985. Before
joining CMS, he had been Chairman and Chief Executive Officer
of American Natural Resources Company and Executive Vice
President and a director of its parent corporation, The
Coastal Corporation. Mr. McCormick is a director of Bank One
Corporation and Schlumberger Ltd. Among his other activities,
he serves as a director of the Edison Electric Institute and
the U.S. Chamber of Commerce.
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BOARD OF DIRECTORS AND COMMITTEES
The business of the Corporation is managed by or under the direction of the
Board of Directors. The Board has established several committees whose principal
functions are briefly described below. In the 2001 fiscal year, the Board held
eight meetings and acted on five occasions by unanimous written consent in lieu
of a meeting. Average attendance by incumbent directors at Board and Committee
meetings was 92%, and all of the directors attended 88% or more of the meetings
of the Board and the Committees on which they served except Mr. Gray. Mr. Gray,
whose attendance at Board and Committee meetings has been exemplary over his
seven years of Board service, did not attend two sessions of meetings during
fiscal 2001, once due to illness, and therefore attended 45% of the meetings of
the Board and Committees on which he served.
The Audit Committee is presently composed of four non-employee directors.
It assists the Board in overseeing the integrity of the Corporation's financial
statements, its compliance with legal and regulatory requirements and the
independence and performance of its internal and external auditors. The specific
functions and responsibilities of the Audit Committee are set forth in the Audit
Committee Charter, which is attached as Appendix A to this Proxy Statement. The
Committee met four times during the 2001 fiscal year.
The principal functions of the Board Composition Committee are to consider
and recommend to the Board qualified candidates for election as directors of the
Corporation and periodically to prepare and submit to the Board for adoption the
Committee's selection criteria for director nominees. The Committee also
annually assesses the performance of the Board of Directors as a whole and of
the individual directors and reports thereon to the Board. The Committee, which
is composed of four non-employee directors, met once during the 2001 fiscal
year. Shareowners wishing to recommend candidates for consideration by the
Committee can do so by writing to the Secretary of the Corporation at its World
Headquarters in Milwaukee, Wisconsin, giving the candidate's name, biographical
data and qualifications. Any such recommendation must be accompanied by a written statement from the individualplurality of his or her consent to be named as a
candidate and, if nominated and elected, to serve as a director.
The four members of the Compensation and Management Development Committee
are non-employee directors and are ineligible to participate in any of the plans
or programs which are administered by the Committee except the Directors Stock
Plan. The principal functions of the Compensation and Management Development
Committee are to evaluate the performance of the Corporation's senior executives
and plans for management succession and development, to consider the design and
competitiveness of the Corporation's compensation plans, to review and approve
senior executive compensation and to administer the Corporation's incentive,
deferred compensation, stock option and long-term incentives plans pursuant to
the terms of the respective plans. The Committee met four times and acted on one
occasion by unanimous written consent in lieu of a meeting during the 2001
fiscal year.
The Technology, Environmental and Social Responsibility Committee is
composed of three non-employee directors. The Committee reviews and assesses the
Corporation's technological activities as well as its policies and practices in
the following areas: employee relations, with emphasis on equal employment
opportunity and advancement; the protection and enhancement of the environment
and energy resources; product integrity and safety; employee health and safety;
and community and civic relations including
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programs for and contributions to health, educational, cultural and other social
institutions. The Committee met twice during the 2001 fiscal year.
The Executive Committee, which was composed of the Chairman of the Board
and three non-employee directors of the Corporation, was empowered to exercise,
when the Board of Directors was not in session, all the powers of the Board
except certain reserved powers. The Executive Committee was terminated before
the Annual Meeting held in February 2001. The Committee did not meet during
fiscal 2001.
In February 2001, the Board formed a special committee known as the Collins
Transaction Committee to take certain action with respect to the spin-off by the
Corporation of its Rockwell Collins avionics and communications business, which
was completed on June 29, 2001. The Committee was composed of four non-employee
directors. The Committee met three times and acted on one occasion by unanimous
written consent in lieu of a meeting during fiscal 2001.
During the 2001 fiscal year, non-employee directors of the Corporation
received an annual retainer of $60,000, of which $33,000 was paid in cash and
$27,000 was paid by delivery of restricted shares of Common Stock, for Board
service, together with a retainer for service on each Board committee at the
annual rate of $4,000 ($5,000 for Chairmen) for service on the Audit and
Compensation and Management Development Committees and $2,000 ($3,000 for
Chairmen) for service on each other Board committee. Members of the Collins
Transaction Committee received $1,000 for each meeting attended in person. Each
non-employee director also received a grant of 400 shares of Common Stock
immediately after the Annual Meeting of Shareowners in February 2001. On the
same date, each non-employee director received a grant of options under the
Directors Stock Plan to purchase 1,000 shares of Common Stock. In accordance
with the Directors Stock Plan, the options (i) were granted at an exercise price
of $46.89 per share, the closing market price on the date of grant, and (ii)
become exercisable in three substantially equal installments on the first,
second and third anniversaries of the grant date. The options were adjusted on
June 29, 2001 to preserve the intrinsic value of the options following the pro
rata distribution of shares of Rockwell Collins. On July 31, 2001, each
non-employee director received a grant of options pursuant to Board resolutions
to purchase 7,000 shares of Common Stock at an exercise price of $16.05 per
share, the closing market price on the date of grant. The options become
exercisable in three substantially equal installments on the first, second and
third anniversaries of the grant date. The average of retainer fees (including
the annual stock grants) paid or deferred by non-employee directors for the 2001
fiscal year was $87,080 (determined by valuing the February 2001 stock grant at
$46.89 per share, the closing price on the date the shares were issued before
adjustment for the Rockwell Collins spin-off). In addition, the stock options
granted under the Directors Stock Plan and pursuant to Board resolutions to each
director to whom a grant was made had a fair value of $16.55 and $3.76 per
option share, for the February and July 2001 option grants, respectively, based
on the Black-Scholes option pricing methodology using the following assumptions
and inputs: options exercised after 7 1/2 years, expected stock price volatility
of 0.33 and 0.28, dividend yield of 2.29% and 4.20% and an interest rate of
5.173% and 5.05% for the February and July 2001 grants, respectively. The
interest rates represent the zero coupon Treasury bond rates with maturity dates
7 1/2 years from the respective grant dates.
Under the terms of the directors' deferred compensation plan, a director
may elect to defer all or part of the cash payment of retainer fees until such
time as shall be specified, with interest on deferred amounts accruing quarterly
at 120% of the federal long-term rate set each month by the Secretary of the
Treasury. In addition, under the Directors Stock Plan, each director has the
opportunity each year to defer all the annual grant of shares and all or any
portion of the cash retainers by electing to receive restricted shares valued at
the closing price on the New York Stock Exchange--Composite Transactions on the
date of the annual grant and the date each retainer payment would otherwise be
made in cash.
6
AUDIT COMMITTEE REPORT
The Audit Committee of the Board of Directors, which consists entirely of
directors who meet the independence and experience requirements of the New York
Stock Exchange, has furnished the following report:
The Audit Committee assists the Board in overseeing and monitoring the
integrity of the Corporation's financial reporting process, its compliance with
legal and regulatory requirements and the quality of its internal and external
audit processes. The role and responsibilities of the Audit Committee are set
forth in a written Charter adopted by the Board, which is attached as Appendix A
to this Proxy Statement. The Audit Committee reviews and reassesses the Charter
annually and recommends any changes to the Board for approval.
The Audit Committee is responsible for overseeing the Corporation's overall
financial reporting process. In fulfilling its responsibilities for the
financial statements for fiscal year 2001, the Audit Committee:
- Reviewed and discussed the audited financial statements for the fiscal
year ended September 30, 2001 with management and Deloitte & Touche LLP
("D&T"), the Corporation's independent auditors;
- Discussed with D&T the matters required to be discussed by Statement on
Auditing Standards No. 61, as amended, relating to the conduct of the
audit; and
- Received written disclosures and the letter from D&T regarding its
independence as required by Independence Standards Board Standard No. 1.
The Audit Committee discussed with D&T their independence.
The Audit Committee also considered the status of pending litigation,
taxation matters and other areas of oversight relating to the financial
reporting and audit processvotes cast. This means that the Committee determined appropriate.
Based on the Audit Committee's review of the audited financial statements
and discussions with management and D&T, the Audit Committee recommended to the
Board that the audited financial statements be included in the Corporation's
Annual Report on Form 10-K for the fiscal year ended September 30, 2001 for
filing with the Securities and Exchange Commission.
AUDIT COMMITTEE
J. Michael Cook, Chairman
Betty C. Alewine
John D. Nichols
7
OWNERSHIP BY MANAGEMENT OF EQUITY SECURITIES
The following table shows the beneficial ownership, reported to the
Corporation as of November 1, 2001, of the Corporation's Common Stock, including
shares as to which a right to acquire ownership within 60 days exists (for
example, through the exercise of stock options, conversions of securities or
through various trust arrangements) within the meaning of Rule 13d-3(d)(1) under
the Securities Exchange Act, of each director, each nominee for director, each
executive officer listed in the table on page 9 and of such persons and other
executive officers as a group.
Beneficial Ownership on
November 1, 2001
-----------------------------------
Percent of
Name Shares(1) Class(2)
---- --------- --------
Betty C. Alewine............................................ 4,434(3,4) --
J. Michael Cook............................................. 6,207(3,4) --
Don H. Davis, Jr............................................ 1,464,108(4,5,6) --
William H. Gray, III........................................ 9,413(3,4) --
William T. McCormick, Jr.................................... 16,985(3,4) --
John D. Nichols............................................. 27,954(3,4) --
Bruce M. Rockwell........................................... 46,297(3,4) --
Joseph F. Toot, Jr.......................................... 25,846(3,4) --
Kenneth F. Yontz............................................ 20,000 --
William J. Calise, Jr....................................... 408,263(4,5) --
Keith D. Nosbusch........................................... 439,998(4,5) --
Joseph D. Swann............................................. 261,000(4,5) --
Michael A. Bless............................................ 101,057(4,5) --
W. Michael Barnes........................................... 802,579(4,5) --
All of the above and other executive officers as a group (23
persons).................................................. 4,005,211(4,5) 2.1%
- ---------
(1) Each person has sole voting and investment power with respect to the shares
listed unless otherwise indicated.
(2) The shares owned by each person, and by the group, and the shares included
in the number of shares outstanding have been adjusted, and the percentage
of shares owned (where such percentage exceeds 1%) has been computed, in
accordance with Rule 13d-3(d)(1) under the Securities Exchange Act.
(3) Includes 3,626; 5,024; 3,346; 4,633; 11,168; 4,233 and 5,433 shares granted
as restricted stock under the Directors Stock Plan or otherwise as
compensation for services as directors for Ms. Alewine and Messrs. Cook,
Gray, McCormick, Nichols, Rockwell, and Toot, respectively.
(4) Includes shares which may be acquired upon the exercise of outstanding stock
options within 60 days as follows: 333; 83; 1,384,683; 4,352; 4,352; 14,073;
4,352; 9,213; 386,596; 421,824; 253,839; 92,301; 710,214 and 3,624,425 for
Ms. Alewine and Messrs. Cook, Davis, Gray, McCormick, Nichols, Rockwell,
Toot, Calise, Nosbusch, Swann, Bless, Barnes and the group, respectively.
Does not include 55,450 and 90,000 shares which may be acquired on exercise
of outstanding options granted to Messrs. Davis and Barnes, respectively,
that have been assigned to or for the benefit of family members and are not
attributable to them pursuant to Rule 13d-3(d)(1) under the Securities
Exchange Act.
(5) Includes shares held under the Corporation's savings plan as of November 1,
2001. Does not include 16,990; 2,702; 1,467; 4,344; 994; 3,930 and 31,379
share equivalents for Messrs. Davis, Calise, Nosbusch, Swann, Bless, Barnes
and the group, respectively, held under the Corporation's supplemental
savings plan and for Mr. Barnes under the Rockwell Collins supplemental
savings plan, as of November 1, 2001.
(6) Includes 14,166 shares granted as restricted stock in partial payment of a
bonus for fiscal year 1995 and a long-term incentive payment earned for a
three-year performance period ended September 30, 1995 and 7,792 and 17,500
shares granted as restricted stock in partial payments of bonuses for fiscal
years 1997 and 1999, respectively.
8
EXECUTIVE COMPENSATION
There is shown below information concerning the annual and long-term
compensation for services in all capacities to the Corporation for the fiscal
years ended September 30, 2001, 2000, and 1999, of (i) the chief executive
officer of the Corporation, (ii) the other four most highly compensated
executive officers of the Corporation at September 30, 2001 and (iii) one other
person who was an executive officer during fiscal 2001 and would have been
included under clause (ii) if he had remained an executive officer at September
30, 2001 (the Named Officers):
SUMMARY COMPENSATION TABLE
All Other
Annual Compensation Long-Term Compensation Compensation(1)
------------------------------------------- ------------------------------------- ---------------
Awards Payouts
------------------------ -------
Restricted
Other Stock Stock Long-Term
Annual Awards Options Incentive
Name and Principal Position Year Salary Bonus(2) Compensation (Shares) (Shares)(3) Payouts(4)
- --------------------------- ---- ------ -------- ------------ -------- ----------- ----------
Don H. Davis, Jr. ......... 2001 $900,000 -0- $34,053 -- 330,000 -0- -0-
Chairman of the Board & 2000 900,000 $1,300,000 30,179 -- 330,000 -0- -0-
Chief Executive Officer 1999 775,000 1,750,000(5) 25,847 -- 330,000 -0- $398,210
William J. Calise, Jr. .... 2001 426,667 -0- 38,471 -- 82,500 -0- 19,564
Senior Vice President, 2000 407,917 325,000 42,260 -- 82,500 -0- -0-
General Counsel and 1999 385,000 400,000 42,467 5,000 82,500 -0- 65,224
Secretary
Keith D. Nosbusch.......... 2001 410,000 -0- 37,397 -- 120,000 -0- 11,670
Senior Vice President 2000 350,000 200,000 73,101 -- 90,000 107,901 20,342
and President, Rockwell 1999 290,722 275,000 25,274 -- 55,950 -0- 24,451
Automation Control Systems
Joseph D. Swann............ 2001 310,000 -0- 16,503 -- 60,000 -0- -0-
Senior Vice President 2000 282,500 125,000 27,028 -- 45,000 88,197 -0-
and President, Rockwell 1999 271,667 175,000 11,042 -- 37,500 -0- 142,046
Automation Power
Systems(6)
Michael A. Bless........... 2001 278,875 -0- 37,233 -- 24,750 -0- 32
Senior Vice President and 2000 254,500 100,000 3,628 -- 24,750 -0- 3,275
Chief Financial Officer(7) 1999 240,000 150,000 20,375 -- 24,750 -0- 15,259
W. Michael Barnes.......... 2001 428,333 -0- 38,339 -- 115,500 -0- 26,183
Senior Vice President, 2000 490,000 450,000 37,805 -- 115,500 -0- -0-
Finance & Planning 1999 462,500 550,000 46,498 5,000 115,500 -0- 154,150
& Chief Financial
Officer(8)
- ---------
(1) Amounts contributed or accrued for fiscal years 2001, 2000 and 1999 for
the Named Officers under the Corporation's Savings Plan and the related
supplemental savings plan; amounts contributed or accrued for Mr. Nosbusch
under Allen-Bradley's Employee Savings Plan for Salaried Employees and the
related supplemental savings plan for part of 1999; amounts contributed or
accrued for Mr. Swann under Reliance Electric's Employee Savings Plan and
the related supplemental savings plans for 1999 and amounts contributed or
accrued for Mr. Barnes under the Corporation's Deferred Compensation Plan
for fiscal year 2000. For fiscal year 1999, the amounts are principally
attributable to accruals under the supplemental plans in respect of
investment gains. For fiscal years 2001 and 2000, contributions or
accruals under the supplemental plans and Deferred Compensation Plan were
offset by investment losses.
(2) Amounts awarded, even if deferred, under the Annual Incentive Compensation
Plan for Senior Executive Officers for Messrs. Davis, Calise, Nosbusch and
Barnes for fiscal years 2000 and 1999 and under the Incentive Compensation
Plan for Messrs. Swann and Bless for fiscal years 2000 and 1999.
(3) Shares were adjusted on June 29, 2001 and December 31, 1998 as applicable
to preserve the intrinsic value of options for shares of Common Stock of
the Corporation following the pro-rata distributions of shares of Rockwell
Collins, Inc. and Conexant Systems, Inc. These adjustments are not
reflected in the table.
(4) Cash and market value of Common Stock paid in respect of performance units
granted under business unit long-term incentive plans for the three-year
performance period ended September 30, 2000 for Messrs. Nosbusch and
Swann.
(5) Mr. Davis' bonus for 1999 was paid in part by delivery of 17,500 shares of
restricted Common Stock, valued at the closing price on the New York Stock
Exchange--Composite Transactions on December 1, 1999, the date of the
bonus award ($50.00).
(6) Vice President of the Corporation prior to June 2001.
(7) Vice President from February 2001 through June 2001; Vice President,
Finance--Rockwell Automation Control Systems from June 1999 through June
2001; Vice President, Corporate Development and Planning prior thereto.
(8) Mr. Barnes resigned as an executive officer in June 2001 in connection
with the spin-off of Rockwell Collins and remained an active employee of
the Corporation through July 31, 2001.
9
OPTION GRANTS
Shown below is further information on grants to the Named Officers of stock
options pursuant to the 2000 Long-Term Incentives Plan during the fiscal year
ended September 30, 2001, which are reflected in the Summary Compensation Table
on page 9. No stock appreciation rights were granted during fiscal 2001.
Grant Date
Individual Grants Value
- ---------------------------------------------------------------------------------------------------- ----------------
Number of
Securities Percentage of
Underlying Total Options
Options Granted to Exercise or
Granted Employees in Base Price Expiration Grant Date
Name (Shares)(1) Fiscal 2001 (Per Share)(1) Date Present Value(2)
---- ----------- ----------- -------------- ---------- ----------------
Don H. Davis, Jr........................ 220,000(3) 5.10% $29.9375 10/2/10 $2,442,000
110,000(4) 2.55% 29.9375 10/2/10 1,221,000
William J. Calise, Jr................... 55,000(3) 1.28% 29.9375 10/2/10 610,500
27,500(4) 0.64% 29.9375 10/2/10 305,250
Keith D. Nosbusch....................... 80,000(3) 1.85% 29.9375 10/2/10 888,000
40,000(4) 0.93% 29.9375 10/2/10 444,000
Joseph D. Swann......................... 40,000(3) 0.93% 29.9375 10/2/10 444,000
20,000(4) 0.46% 29.9375 10/2/10 222,000
Michael A. Bless........................ 16,500(3) 0.38% 29.9375 10/2/10 183,150
8,250(4) 0.19% 29.9375 10/2/10 91,575
W. Michael Barnes....................... 77,000(3) 1.79% 29.9375 10/2/10 854,700
38,500(4) 0.89% 29.9375 10/2/10 427,350
- ---------
(1) Shares and exercise price were adjusted on June 29, 2001 to preserve the
intrinsic value of options following the pro rata distribution of shares of
Rockwell Collins. These adjustments are not reflected in the table.
(2) These values are based on the Black-Scholes option pricing model which
produces a per share option value of $11.10 for the October 2, 2000 grant,
computed using the following assumptions and inputs: options exercised 7 1/2
years from the grant date, expected stock price volatility of 0.33, dividend
yield of 2.29% and an interest rate of 6.038%. The interest rate represents
the zero coupon Treasury bond rate with a maturity date 7 1/2 years from the
date the options were granted. The actual value, if any, the executive
officers may realize from these options will depend solely on the gain in
stock price over the exercise price when the options are exercised.
(3) Granted on October 2, 2000 and exercisable in three substantially equal
installments beginning October 2, 2001.
(4) Granted on October 2, 2000 and became exercisable on October 2, 2001 after
closing market price reached at least 150% of the grant date closing market
price of the Corporation's Common Stock on 20 consecutive trading days.
The Black-Scholes option pricing methodology, on which the present value of
the stock options granted to the Named Officers is based, attempts to portray
the value of an option at the date of grant. While the options have no value if
the stock price does not increase, were the $11.10 present value of the possible
future gains on the options granted October 2, 2000 used to derive a future
stock price at the end of the 7 1/2 year period when it is assumed the options
would be exercised, the shareowners of the approximately 183 million shares
outstanding on the grant date of those options (assuming that number of shares
remains outstanding) would realize aggregate appreciation of approximately $3.2
billion compared to aggregate appreciation on the options for the Named Officers
of approximately $13 million (assuming that they hold their options or the
shares acquired on exercise thereof for the whole 7 1/2 year period).
10
AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END VALUES
Shown below is information with respect to (i) exercises by the Named
Officers during fiscal 2001 of options to purchase the Corporation's Common
Stock granted under the 2000 Long-Term Incentives Plan, the 1995 Long-Term
Incentives Plan or the 1988 Long-Term Incentives Plan and (ii) the unexercised
options to purchase the Corporation's Common Stock granted to the Named Officers
in fiscal 2001 and prior years under any of those plans and held by them at
September 30, 2001.
Number of Unexercised
Shares Options Held at
Acquired September 30, 2001(1)
on Value ---------------------
Name Exercise(1) Realized(1) Exercisable Unexercisable
---- ----------- ----------- ----------- -------------
Don H. Davis, Jr................. -- $-- 1,039,913(3) 674,770
William J. Calise, Jr............ -- -- 300,404 168,693
Keith D. Nosbusch................ -- -- 159,676 528,758
Joseph D. Swann.................. -- -- 116,205 360,938
Michael A. Bless................. -- -- 66,443 50,608
W. Michael Barnes................ 10,305 39,773 612,845(3) 172,870(4)
Value of Unexercised
In-the-Money Options Held at
September 30, 2001(1)(2)
----------------------------
Name Exercisable Unexercisable
---- ----------- -------------
Don H. Davis, Jr................. $2,556,890 $1,375,787
William J. Calise, Jr............ 630,626 343,948
Keith D. Nosbusch................ 194,453 1,039,343
Joseph D. Swann.................. 370,064 697,144
Michael A. Bless................. 94,660 103,185
W. Michael Barnes................ 2,084,698 286,802
- ---------
(1) Does not include options or shares acquired on exercise of options for
shares of Rockwell Collins and Conexant Systems, Inc. issued in connection
with the anti-dilution adjustment made June 29, 2001 and December 31, 1998,
respectively, to options for the Corporation's Common Stock following the
pro-rata distribution of shares of Rockwell Collins and Conexant Systems,
Inc.
(2) Based on the closing price on the New York Stock Exchange--Composite
Transactions of the Corporation's Common Stock on September 28, 2001
($14.68).
(3) Excludes 25,450 exercisable options with a value of $132,857 and 30,000
exercisable options with no value because the exercise price was greater
than the value of the shares underlying the options granted to Mr. Davis and
30,000 exercisable options with no value because the exercise price was
greater than the value of the shares underlying the options granted to Mr.
Barnes that have been assigned to or for the benefit of family members and
are not attributable to them pursuant to Rule 13d-3(d)(1) under the
Securities Exchange Act.
(4) Excludes 60,000 unexercisable options with a value of $184,572 granted to
Mr. Barnes that have been assigned to family members and that are not
attributable to him pursuant to Rule 13d-3(d)(1) under the Securities
Exchange Act.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation and Management Development Committee of the Board of
Directors, which consists entirely of non-employee directors, has furnished the
following report on executive compensation:
COMPENSATION PHILOSOPHY
Under the Committee's supervision, the Corporation has developed and
implemented compensation policies, plans and programs intended to "pay for
performance." The Committee sets base salaries generally somewhat below the
median of other major U.S. industrial companies, and provides opportunity for
above-median compensation through the Corporation's annual and long-term
incentive plans which depend heavily on corporate, business unit and individual
performance. The Committee considers the total compensation (earned or
potentially available) of each of the Named Officers and the other senior
executives in establishing each element of compensation. In its review the
Committee considers industry, peer group and national surveys of other major
U.S. industrial companies and performance judgments as to the past and expected
future contributions of the individual senior executives.
EMPLOYEE STOCK OWNERSHIP
The Committee believes the focus on "pay for performance" is sharpened by
aligning closely the financial interests of the Corporation's key executives
with those of the shareowners. Accordingly, it had set minimum Ownership
Guidelines.
As a result of the Rockwell Collins spin-off in June 2001, the value of
each officer's stock holdings was reduced by 61%. Accordingly, the Committee has
determined to suspend the guidelines for 2002 in order to reconsider what should
be the appropriate guidelines.
11
COMPONENTS OF COMPENSATION
- BASE SALARY--The Committee reviewed and approved the Chief Executive
Officer's base salary (which was not changed in fiscal 2001), and an annual
salary plan for the Corporation's other senior executives near the beginning of
the 2001 fiscal year and periodically during the fiscal year for new officers.
- ANNUAL INCENTIVES--In the early part of each fiscal year, the Committee
reviews with the Chief Executive Officer the Corporate Goals and Objectives.
These include measurable financial return and shareowner value creation
objectives as well as long-term leadership goals that in part require more
subjective assessments. After the end of the year, the Committee evaluates the
Corporation's performance and considers the results together with the
contributions made by and the levels of responsibility of the individual
executives in awarding annual incentive compensation. The incentive compensation
for executives responsible for the management of business units is largely
determined by the extent to which the respective business unit achieves goals
established at the beginning of each year tailored to the particular business
unit.
In fiscal 2001, the principal financial goals were not met. Although the
Committee believes this was largely due to the recessionary economic environment
in the markets the Corporation serves, the Committee has reduced annual
incentive payouts for fiscal 2001 by approximately 85% (on a comparable basis)
in line with its "pay for performance" philosophy. None of the Named Officers,
including the chief executive officer, received any incentive compensation in
fiscal 2001.
- LONG-TERM INCENTIVES--The Corporation's 2000 Long-Term Incentives Plan
provides the flexibility to grant long-term incentives in a variety of forms,
including performance units, stock options, stock appreciation rights and
restricted stock. Annually, the Committee evaluates the type of long-term
incentive it believes is most likely to achieve the Corporation's total
compensation objectives.
In fiscal 2001, long-term incentives for all senior and middle-management
executives were provided solely through stock option grants, and those grants
were made near the beginning of the fiscal year. The Committee believes that
stock option grants better meet the objectives of the long-term incentive plans,
including particularly the alignment of management's interests with those of the
shareowners.
- COMPENSATION DEDUCTIBILITY--It is anticipated that all 2001 compensation
to the Named Officers will be fully deductible under Internal Revenue Code
Section 162(m). Accordingly, the Committee determined that a policy with respect
to qualifying compensation paid to Named Officers for deductibility was not
necessary.
COMPENSATION OF THE CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER
Mr. Davis' base salary, which has been in effect since October 1999, is
$900,000. His total annual cash compensation continues to be substantially
dependent on annual incentive compensation tied to the Committee's assessment of
his and the Corporation's performance. As discussed previously, the Committee
determined that Mr. Davis would receive no incentive compensation award for
fiscal 2001.
At the beginning of fiscal 2001, the Committee granted Mr. Davis the same
number of options as it granted for fiscal 2000. The Committee considered
information on Mr. Davis' total compensation and historical information
regarding his long-term compensation opportunities, as well as Mr. Davis' past
and expected future contributions to the Corporation's achievement of its
long-term performance goals.
The Board in Executive Session (when Mr. Davis was not present), as
provided in the Corporation's Corporate Governance Guidelines, received and
discussed the Committee's evaluation of the Corporation's and Mr. Davis'
performance in the 2001 fiscal year.
COMPENSATION AND MANAGEMENT DEVELOPMENT COMMITTEE
John D. Nichols, Chairman Bruce M. Rockwell
William T. McCormick, Jr. Joseph F. Toot, Jr.
12
SHAREOWNER RETURN PERFORMANCE PRESENTATION
Set forth below is a line graph comparing the cumulative total shareowner
return on the Corporation's Common Stock against the cumulative total return of
the S&P Composite-500 Stock Index and the S&P Electrical Equipment Index for the
period of five fiscal years which commenced October 1, 1996 and ended September
30, 2001, assuming in each case a fixed investment of $100 at the respective
closing prices on September 30, 1996 and reinvestment of all dividends.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
ROCKWELL, S&P COMPOSITE-500 & S&P ELECTRICAL EQUIPMENT
ROCKWELL S&P COMPOSITE - 500 S&P ELECTRICAL EQUIPMENT
-------- ------------------- ------------------------
1996 100.00 100.00 100.00
1997 121.41 140.45 145.15
1998 80.95 153.15 163.15
1999 144.97 195.73 244.38
2000 85.66 221.73 341.58
2001 101.70 162.71 214.79
THE CUMULATIVE TOTAL RETURNS ON ROCKWELL COMMON STOCK AND EACH INDEX AS OF EACH
SEPTEMBER 30, 1996-2001 PLOTTED IN THE ABOVE GRAPH ARE AS FOLLOWS:
1996 1997 1998 1999 2000 2001
---- ---- ---- ---- ---- ----
Rockwell*.................................. $100.00 $121.41 $80.95 $144.97 $85.66 $101.70
S&P Composite -- 500....................... 100.00 140.45 153.15 195.73 221.73 162.71
S&P Electrical Equipment................... 100.00 145.15 163.15 244.38 341.58 214.79
Dividends per common share during fiscal
year ended September 30.................. 1.16 1.16 1.02 1.02 1.02 0.93
- ---------
* Includes the reinvestment of all dividends in Rockwell common stock,
including the value of the dividends related to the receipt of 0.042 share of
Boeing common stock on December 6, 1996; the receipt of 0.333 share of
Meritor (now ArvinMeritor) common stock on September 30, 1997; the receipt of
0.5 share of Conexant common stock on January 4, 1999; and the receipt of 1
share of Rockwell Collins common stock on June 29, 2001.
13
RETIREMENT PLANS
The following table shows the estimated annual retirement benefits payable
on a straight life annuity basis to participating employees, including officers,
in the earnings and years of service classifications indicated, under the
Corporation's retirement plans which cover most officers and other salaried
employees on a non-contributory basis, and under the Rockwell Collins'
retirement plans for Mr. Barnes. Such benefits reflect a reduction to recognize
in part the Corporation's cost of Social Security benefits related to service
for the Corporation. The Corporation's plans also provide for the payment of
benefits to an employee's surviving spouse or other beneficiary.
Average Estimated Annual Retirement Benefits for Years of Service Indicated
Annual -------------------------------------------------------------------------------------------------
Earnings 5 Years 10 Years 15 Years 20 Years 25 Years 30 Years 35 Years 40 Years
-------- ------- -------- -------- -------- -------- -------- -------- --------
$ 500,000 ......... $ 65,802 $131,657 $ 197,458 $ 209,493 $ 221,528 $ 233,563 $ 256,117 $ 287,956
1,000,000 ......... 132,452 265,007 397,458 421,993 446,528 471,063 518,617 581,706
1,500,000 ......... 199,102 398,357 597,458 634,493 671,528 708,563 781,117 875,456
2,000,000 ......... 265,752 531,707 797,458 846,993 896,528 946,063 1,043,617 1,169,206
2,500,000 ......... 332,402 665,057 997,458 1,059,493 1,121,528 1,183,563 1,306,117 1,462,956
3,000,000 ......... 399,052 798,407 1,197,458 1,271,993 1,346,528 1,421,063 1,568,617 1,756,706
Covered compensation includes salary and annual bonus. The calculation of
retirement benefits under the plans generally is based upon average earnings for
the highest five years of the ten years preceding retirement. The credited years
of service for Messrs. Davis, Calise, Nosbusch, Swann, Bless and Barnes are 38,
7, 27, 32, 4 and 33, respectively.
Sections 401(a)(17) and 415 of the Internal Revenue Code of 1986, as
amended, limit the annual benefits which may be paid from a tax-qualified
retirement plan. As permitted by the Employee Retirement Income Security Act of
1974, the Corporation has a nonqualified supplemental pension plan which
authorizes the payment out of general funds of the Corporation of any benefits
calculated under provisions of the applicable retirement plan which may be above
the limits under these sections.
OTHER ARRANGEMENTS
In June 2001, the Corporation entered into change of control agreements
with each of the Named Officers, except Mr. Barnes, and with certain other
executives. Each agreement has a term of three and one-half years and becomes
effective upon a "change of control" of the Corporation during that term. Each
agreement provides for the continuing employment of the executive for three
years after the change of control on conditions no less favorable than those in
effect before the change of control. If the executive's employment is terminated
by the Corporation without "cause" or if the executive terminates his employment
for "good reason" within that three year period, the executive is entitled to
severance benefits equal to a multiple of his annual compensation, including
bonus, and continuation of other benefits for a number of years equal to the
multiple. The multiple is 3 for each of the Named Officers and 3 or 2 for the
other executives. In addition, if the executive terminates his own employment
for any reason during a 30-day window period beginning one year after the change
of control, the executive is also entitled to these severance benefits. The
executives are entitled to an additional payment, if necessary, to make them
whole as a result of any excise tax imposed by the Internal Revenue Code on
these change of control payments, unless the safe harbor below which the excise
tax is imposed is not exceeded by more than 10%, in which event the payments
will be reduced to avoid the excise tax.
In connection with the spin-off of Rockwell Collins, all employees at the
Corporation's headquarters were given the opportunity to elect a separation
payment in lieu of continued employment with the Corporation, with the payment
amount based on length of service and position with the Corporation. Under that
program, which was assumed by Rockwell Collins as part of the spin-off on June
29, 2001, Mr. Barnes, a 33-year employee and Senior Vice President of the
Corporation, received from Rockwell Collins a twenty-four month payment of base
salary. In addition, he received the ownership of his existing country club
memberships.
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The Named Officers participate in the Corporation's non-qualified
supplemental pension plan, supplemental savings plan and deferred compensation
plan. The Corporation has established a master rabbi trust relating to these
non-qualified plans. The master rabbi trust requires that, upon a change of
control of the Corporation, the Corporation fund the trust in a cash amount
equal to the unfunded accrued liabilities as of such time of these non-qualified
plans.
SELECTION OF AUDITORS
The directors of the Corporation have selected the firm of Deloitte &
Touche LLP (D&T) as the auditors of the Corporation for the fiscal year ending
September 30, 2002, subject to the approval of the shareowners. D&T, and its
predecessors, have acted for the Corporation, and its predecessors, as auditors
since 1934.
Before the Audit Committee recommended to the full Board the appointment of
D&T, it carefully considered the qualifications of that firm, including their
performance in prior years and their reputation for integrity and for competence
in the fields of accounting and auditing. Representatives of D&T are expected to
be present at the meeting to respond to appropriate questions and to make a
statement if they desire to do so.
The following table sets forth the aggregate fees for services provided by
D&T for the fiscal year ended September 30, 2001 (in millions):
Audit Fees(1)............................................... $2.3
Financial Information Systems
Design and Implementation Fees(2)(3)................... $1.3
All Other Fees
Audit of Rockwell Collins financial statements in
connection with spin-off(3)........................... $3.2
Audit related services, including statutory audits and
employee benefit plan audits.......................... $1.4
Tax services, including tax return preparation......... $6.0
Other.................................................. $1.0
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(1) Audit of 2001 annual financial statements and review of financial statements
included in Forms 10-Q for fiscal 2001.
(2) Fees related to implementation of financial information systems at Rockwell
Collins.
(3) On June 29, 2001, the Corporation completed the spin-off of its Rockwell
Collins avionics and communications business into an independent, separately
traded, publicly held company.
The Audit Committee considered and determined that the provision of
non-audit services by D&T was compatible with maintaining the firm's
independence.
AMENDMENT TO CERTIFICATE OF INCORPORATION TO CHANGE NAME OF CORPORATION
The Board of Directors proposes and recommends that the shareowners approve
an amendment ("Amendment") to the Corporation's Restated Certificate of
Incorporation to change the name of the Corporation from "Rockwell International
Corporation" to "Rockwell Automation, Inc." The name change is intended to
better reflect the nature of the Corporation's business. With the spin-off of
the Rockwell Collins avionics and communications business on June 29, 2001, the
Corporation's focus has become automation. Since the spin-off, the Corporation
has been doing business under the name "Rockwell Automation" and now proposes to
change its legal name to that name. The name change will not alter any rights of
shareowners.
If this proposal is approved, Article FIRST of the Restated Certificate of
Incorporation will be amended to read as follows:
"FIRST: THE NAME OF THE CORPORATION IS ROCKWELL AUTOMATION, INC."
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE AMENDMENT.
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VOTE REQUIRED
The three nominees for election as directors to serve until the 2005 Annual
Meeting of Shareowners who receive the greatest number of votes cast for the
election of directors at the meeting by the holders of the Corporation'sour Common Stock entitled to vote at the meeting, a quorum being present, shallwill become directors atdirectors. Majority Vote Policy. Our Guidelines on Corporate Governance set forth our policy if a director is elected by a plurality of votes cast but receives a greater number of votes “withheld” from his or her election than votes “for” such election. In an uncontested election, any nominee for director who receives more votes “withheld” than votes “for” his or her election must promptly tender his or her resignation to the conclusionBoard. The Board Composition and Governance Committee will consider the resignation offer and make a recommendation to the Board of Directors. The Board will act on the tendered resignation within 90 days following certification of the tabulationelection results. The Board Composition and Governance Committee, in making its recommendation, and the Board of votes.Directors, in making its decision, may consider any factors or other information that it considers appropriate and relevant, including any stated reasons why the shareowners withheld votes from such director, the director’s tenure, the director’s qualifications, the director’s past and expected contributions to the Board, and the overall composition of the Board. Thereafter, we will promptly disclose the Board’s decision regarding whether to accept or reject the director’s resignation offer in aForm 8-K furnished to the Securities and Exchange Commission. If the Board rejects the tendered resignation or pursues any additional action, the disclosure will include the rationale behind the decision. Any director who tenders his or her resignation may not participate in the Board Composition and Governance Committee deliberations and recommendation or in the Board’s decision whether to accept or reject the resignation offer.
Selection of our Independent Registered Public Accounting Firm. An affirmative vote of the holders of a majority of the voting power of the Corporation'sour Common Stock present in person or represented by proxy and entitled to vote aton the meeting,matter, a quorum being present, is necessary to approve the action proposed in item (b) of
the accompanying Notice of 2002 Annual Meeting of Shareowners. An affirmative
vote of the holders of a majority of the outstanding voting power of the
Corporation's Common Stock is necessaryproposal to approve the action proposed in item
(c)selection of the accompanying Notice of 2002 Annual Meeting of Shareowners.
D&T as our independent registered public accounting firm.
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How are Votes Counted?
Under Delaware law and the Corporation'sour Restated Certificate of Incorporation and By-Laws, the aggregate number ofall votes entitled to be cast by
all shareowners present in person or represented by proxy at the meeting and entitled to vote on the subject matter, whether those shareowners vote "for"“for”, "against"“against” or abstain from voting,
(including broker non-votes), will be counted for purposes of determining the minimum number of affirmative votes required for approval of item (b) and the total numberproposal to approve the selection of votes cast "for" that matter will be counted for purposes of
determining whether sufficient affirmative votes have been cast.D&T as our independent registered public accounting firm. The shares of a shareowner who abstains from voting on a matter or whose shares are not voted by reason of a broker non-vote on a particular matter will be counted for purposes of determining whether a quorum is present at the meeting so long as the shareowner is present in person or represented by proxy. An abstention from voting or a broker non-vote on a matter by a shareowner present in person or represented by proxy at the meeting has no effect in the election of directors (assuming a quorum is present) andbut has the same legal effect as a vote "against"“against” the proposal to approve the selection of D&T as our independent registered public accounting firm. A broker non-vote on a matter has no effect in the election of directors or on the approval of the proposal to approve the selection of D&T as our independent registered public accounting firm.
Can I Receive Electronic Access to Shareowner Materials?
You can save the Corporation printing and mailing costs by electing to access proxy statements, annual reports and related materials electronically instead of receiving these documents in print. To enroll for these services, please go towww.icsdelivery.com/rockwellautoor visit our website atwww.rockwellautomation.com, click on the heading: “About Us”, then the heading: “Investor Relations”, then the heading “Shareowner Information, Transfer Agent & Dividends”. If you own your shares through a broker or other nominee, you may contact them directly to request electronic access.
You must have ane-mail account and access to a computer and the Internet and expect to have such access in the future to be eligible for electronic access to such materials. Selecting this option means that you will no longer receive a printed copy of our annual report and proxy statement unless you request one.
Your consent to electronic access will be effective until you revoke it. You may cancel your consent at no cost to you at any time by going towww.icsdelivery.com/rockwellautoand following the instructions or by contacting your broker or other nominee.
We are a leading global provider of industrial automation power, control and information products and services. We were incorporated in 1996 in connection with a tax-free reorganization completed December 6, 1996, pursuant to which we divested our former aerospace and defense business to The Boeing Company. In the reorganization, the former Rockwell International Corporation (RIC) contributed all of its businesses, other than the aerospace and defense business, to the Corporation and distributed all capital stock of the Corporation to RIC’s shareowners. Boeing then acquired RIC. RIC was incorporated in 1928. Our principal executive office is located at 1201 South Second Street, Milwaukee, Wisconsin 53204. Our telephone number is(414) 382-2000 and our website is located atwww.rockwellautomation.com. Our Common Stock trades on the New York Stock Exchange (NYSE) under the symbol ROK.
The following table shows, as of December 11, 2006, information with respect to the persons known to us, based on statements filed with the Securities and Exchange Commission (SEC) pursuant to Section 13(d) or 13(g) of the Securities Exchange Act of 1934 (Securities Exchange Act) or information otherwise furnished to us, to be the beneficial owners of more than 5% of our Common Stock.
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| | | | | | | Percent of
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Title of Class | | Name and Address of Beneficial Owner | | Shares | | | Class(1) | |
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Common Stock | | Fidelity Management Trust Company, as Trustee(2) 300 Puritan Way Marlborough, MA 01752 | | | 10,253,042 | (2) | | | 6.1 | % |
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(1) | | The percent of class owned has been computed in accordance withRule 13d-3(d)(1) under the Securities Exchange Act. |
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(2) | | Shares are held as trustee under our savings plans for approximately 20,900 participating employees and former employees of the Corporation or its predecessors. Our Common Stock represents only one of many investment alternatives under the plans that can be selected by plan participants. Participants can reallocate their investments within these plans at any time (to the extent vested) and in their sole discretion, subject to our insider trading policy. The trustee will vote the shares held on account of participants in the plans in accordance with written instructions from the participants, or instructions from the participants given pursuant to our telephone or Internet voting procedures. Where no instructions are received, the shares will not be voted. The trustee has no investment power with respect to the shares held on account of participants. |
ELECTION OF DIRECTORS
Our Restated Certificate of Incorporation provides that the Board of Directors will consist of three classes of directors serving staggered three-year terms that are as nearly equal in number as possible. One class of directors is elected each year with terms extending to the third succeeding Annual Meeting after election.
The terms of four directors expire at the 2007 Annual Meeting, including Don H. Davis, Jr., who will retire as a director immediately before the 2007 Annual Meeting. The Board has designated the other three directors, upon the recommendation of the Board Composition and Governance Committee, as nominees for election as directors at the 2007 Annual Meeting with terms expiring at the 2010 Annual Meeting. The Board also decreased the number of directors from ten to nine effective immediately before the 2007 Annual Meeting.
Proxies properly submitted will be voted at the meeting, unless authority to do so is withheld, for the election of the three nominees specified inNominees for Election as Directors with Terms Expiring in 2010below. If for any reason any of those nominees is not a candidate when the election occurs (which is not expected), proxies and shares properly authorized to be voted will be voted at the meeting for the election of a substitute nominee or, instead, the Board of Directors may reduce the number of directors.
INFORMATION AS TO NOMINEES FOR DIRECTORS AND CONTINUING DIRECTORS
For each director nominee and each continuing director, we have stated the nominee’s or continuing director’s name, age (as of December 14, 2006) and principal occupation; the position, if any, with the Corporation; the period of service as a director of the Corporation (or a predecessor corporation); and other directorships held.
NOMINEES FOR ELECTION AS DIRECTORS WITH TERMS EXPIRING IN 2010
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| | Barry C. Johnson, Ph.D. Director Since 2005 Age 63 Retired Dean, College of Engineering, Villanova University. Dr. Johnson served as Dean, College of Engineering, Villanova University from August 2002 until March 2006. He served as Chief Technology Officer of Honeywell International Inc. (diversified technology and manufacturing company) from July 2000 to April 2002. Prior to that, Dr. Johnson served as Corporate Vice President of Motorola, Inc. (global communications company) and Chief Technology Officer for that company’s Semiconductor Product Sector. Dr. Johnson also serves as a director of Cytec Industries Inc. and IDEXX Laboratories, Inc. |
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| | William T. McCormick, Jr. Director Since 1989 Age 62 Retired Chairman of the Board and Chief Executive Officer, CMS Energy Corporation (Diversified Energy). Mr. McCormick served as Chairman of the Board and Chief Executive Officer of CMS Energy Corporation from November 1985 until May 2002. Before joining CMS, he had been Chairman and Chief Executive Officer of American Natural Resources Company (natural gas company) and Executive Vice President and a director of its parent corporation, The Coastal Corporation (energy holding company). |
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| | Keith D. Nosbusch Director Since 2004 Age 55 Chairman of the Board, President and Chief Executive Officer. Mr. Nosbusch has been our Chairman of the Board since February 2005 and our President and Chief Executive Officer since February 2004. He served as Senior Vice President and President, Rockwell Automation Control Systems from November 1998 until February 2004. Mr. Nosbusch is a director of The Manitowoc Company, Inc. and serves as a director or member of a number of business, civic and community organizations. |
CONTINUING DIRECTORS WITH TERMS EXPIRING IN 2008 |
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| | Bruce M. Rockwell Director Since 1969 Age 67 Retired Executive Vice President, Fahnestock & Co. Inc. (now part of Oppenheimer & Co., Inc.) (Investment Banking), member New York Stock Exchange. Mr. Rockwell joined First of Michigan Corporation (investment banking) in 1961, was elected Senior Vice President in 1983, and was named Vice Chairman, First of Michigan Division of Fahnestock & Co. Inc. in March 1998 following the acquisition of First of Michigan by Fahnestock & Co. He is past chairman of the Municipal Advisory Council of Michigan and past President of the Bond Club of Detroit. |
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| | Joseph F. Toot, Jr. Director Since 1977 Age 71 Retired President and Chief Executive Officer, The Timken Company (Tapered Roller Bearings and Specialty Steel). Mr. Toot joined The Timken Company in 1962 and served in various senior executive positions until his election as President in 1979 and Chief Executive Officer in 1992. He retired as President and Chief Executive Officer of Timken in December 1997 and then served as Chairman of the Executive Committee from January 1998 until April 2000. Mr. Toot has served as a director of Timken since 1968. He is also a director of Rockwell Collins, Inc. and a member of the Supervisory Board of PSA Peugeot Citroën. |
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| | Kenneth F. Yontz Director Since 2002 Age 62 Retired Chairman of the Board, Sybron Dental Specialties Inc. (Dental Supplies, Orthodontic Appliances and Related Products). Mr. Yontz served as Chairman of the Board of Sybron Dental Specialties from October 2000 until May 2006. He served as Chairman of the Board of Apogent Technologies Inc. (laboratory and life sciences company) (successor company to Sybron International Corporation) from December 1987 until August 2004, and as President and Chief Executive Officer from October 1987 until December 2000. Mr. Yontz is a director of AMN Healthcare Services, Inc. He also serves as a director or member of a number of civic and co mmunity organizations. |
CONTINUING DIRECTORS WITH TERMS EXPIRING IN 2009 |
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| | Betty C. Alewine Director Since 2000 Age 58Retired President and Chief Executive Officer, COMSAT Corporation (Global Satellite Services and Digital Networking Services and Technology). Ms. Alewine joined COMSAT in 1986 as Vice President of Sales and Marketing, and then served as the Vice President and General Manager and in 1994 as President of COMSAT International, the company’s largest operating unit. Ms. Alewine was named Chief Executive Officer of COMSAT in July 1996 and served in that position until the merger of COMSAT and Lockheed Martin Corporation in August 2000. Ms. Alewine is a director of the New York Life Insurance Company and The Brink’s Company. She also serves as a director or member of a number of civic and charitable organizations. |
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| | Verne G. Istock Director Since 2003 Age 66 Retired Chairman and President, Bank One Corporation (now part of JPMorgan Chase & Co.) (Financial Holding Company). Mr. Istock served as Chairman of the Board of Bank One Corporation from October 1998, following completion of the merger of First Chicago NBD Corporation and Banc One Corporation, until October 1999, and as President of Bank One Corporation from October 1999 until September 2000. He served as Acting Chief Executive Officer of Bank One Corporation from December 1999 until March 2000. He served as Chairman of First Chicago NBD from 1996 to 1998 and as President and Chief Executive Officer of First Chicago N BD from 1995 to 1998. Mr. Istock is lead director of Kelly Services, Inc. and a director of Masco Corporation. He also serves as a director or member of a number of civic and community organizations. |
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| | David B. Speer Director Since 2003 Age 55 Chairman and Chief Executive Officer, Illinois Tool Works Inc. (Engineered Components and Industrial Systems and Consumables). Mr. Speer joined Illinois Tool Works in 1978. In October 1995, he was elected Executive Vice President of worldwide construction products businesses and in 2003 assumed similar responsibilities for the company’s Wilsonart businesses. He was elected President of Illinois Tool Works in August 2004, Chief Executive Officer in August 2005 and Chairman in May 2006. Mr. Speer is a member of the Chicago Economic Club and also a director or member of a number of other business and community organizations.
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The Board of Directors recommends that you vote “FOR” the election as directors of the three nominees described above, which is presented as item (a).
6
BOARD OF DIRECTORS AND COMMITTEES
Our business is managed under the direction of the Board of Directors. The Board has established the Audit Committee, the Board Composition and Governance Committee, the Compensation and Management Development Committee and the Technology, Environmental and Social Responsibility Committee, whose principal functions are briefly described below. The duties and responsibilities of each committee are set forth in committee charters that are available on our website atwww.rockwellautomation.com; click on the heading: “About Us”, then the heading: “Investor Relations”, then the heading: “Corporate Governance”. The committee charters are also available in print to any shareowner upon request. In the 2006 fiscal year, the Board held nine meetings and acted on two occasions by written consent in lieu of a meeting. Average attendance by incumbent directors at Board and committee meetings was 96%, and all of the directors attended 86% or more of the meetings of the Board and the committees on which they served. Directors are expected to attend the Annual Meeting of Shareowners. All directors attended the 2006 Annual Meeting.
The Board has reviewed the independence of its members considering categorical standards adopted by the Board to assist in determining independence, the independence criteria of the NYSE and any other matter even thoughcommercial, industrial, banking, consulting, legal, accounting, charitable and familial relationships between the directors and the Corporation. Based on this review, the Board has determined that none of the current directors, other than Mr. Nosbusch and Mr. Davis (who are current and former employees, respectively, of the Corporation), has a material relationship with the Corporation and each of our current directors (other than Mr. Nosbusch and Mr. Davis) meets the independence requirements of the NYSE.
The Board’s categorical standards provide that the following relationships are deemed to be immaterial and would not in and of themselves impair a director’s independence:
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| • | a director is an executive officer or current employee, or an immediate family member of such director is a current executive officer, of a company that has made payments to, or received payments from, the Corporation or any of its subsidiaries for property or services in an amount which in any of the last three fiscal years of the other company does not exceed the greater of $1 million or 2% of such other company’s consolidated gross revenues; |
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| • | a director is an executive officer or employee, or an immediate family member of such director is an executive officer, of another company that is indebted to the Corporation or to which the Corporation is indebted, and the total amount of either company’s indebtedness to the other is less than 2% of the total consolidated assets of each of the Corporation and such other company; or |
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| • | a director serves as an executive officer of a tax exempt organization and the Corporation’s discretionary charitable contributions (excluding the amount of any matching contributions under the Corporation’s Matching Gifts Program) to the tax exempt organization in any of the last three fiscal years of the tax exempt organization are not more than the greater of $1 million or 2% of the tax exempt organization’s consolidated gross revenues. |
The non-management directors meet in executive session without the presence of any corporate officer or member of management in conjunction with regular meetings of the Board. A director designated by the non-management directors chairs the session. The non-management directors’ practice is to designate the Chairman of one of the Board Committees as chair, in part depending upon whether the principal items to be considered at the session are within the scope of the applicable Committee. The independent directors meet in executive session in connection with most regular meetings.
Audit Committee. The members of the Audit Committee are Verne G. Istock (Chairman), Barry C. Johnson, David B. Speer and Kenneth F. Yontz. All members of the Audit Committee are non-employee directors who meet the independence and financial literacy standards and requirements of the NYSE and the SEC. The Audit Committee assists the Board in overseeing and monitoring the integrity of our financial reporting processes, our internal control and disclosure control systems, the integrity and audits of our financial statements, our compliance with legal and regulatory requirements, the qualifications and independence of our independent registered public accounting firm and the performance of our internal audit function and independent registered public accounting firm. The Committee’s duties and responsibilities are set forth in the Audit Committee Charter, and include: appointment of our independent registered public accounting firm, subject to shareowner approval; approval of all audit, audit-related and permitted non-audit fees and services of
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our independent registered public accounting firm; review with our independent registered public accounting firm and management the annual audited and quarterly financial statements; discussion periodically with management of quarterly earnings releases; and review with our independent registered public accounting firm and management of the quality and adequacy of internal controls. The Audit Committee met seven times during the 2006 fiscal year. The Board has determined that Messrs. Istock, Speer and Yontz qualify as “audit committee financial experts” as defined by the SEC.
Board Composition and Governance Committee. The members of the Board Composition and Governance Committee are William T. McCormick, Jr. (Chairman), Verne G. Istock, Joseph F. Toot, Jr. and Kenneth F. Yontz. The principal functions of the Board Composition and Governance Committee are to consider and recommend to the Board qualified candidates for election as directors of the Corporation and to consider matters of corporate governance. The Committee annually assesses and reports to the Board on the performance of the Board of Directors as a whole and of the individual directors. The Committee also recommends to the Board the members of the committees of the Board and the terms of our Guidelines on Corporate Governance. All members of the Committee are independent directors as defined by the NYSE. The Committee met twice during the 2006 fiscal year.
The Committee will consider candidates for director recommended by shareowners. Shareowners wishing to recommend director candidates can do so by writing to the Secretary of the Corporation at 1201 South Second Street, Milwaukee, Wisconsin 53204. The recommendation must include the candidate’s name, biographical data and qualifications and any other information required by the SEC to be included in a proxy statement with respect to a director nominee. Any such recommendation must be accompanied by a written statement from the candidate indicating his or her willingness to serve if nominated and elected. The recommending shareowner also must provide evidence of being a shareowner of record of our Common Stock at that time.
The Committee, the Chairman and Chief Executive Officer or other members of the Board may identify a need to add new members to the Board or fill a vacancy on the Board. In that case, the Committee will initiate a search for qualified director candidates, seeking input from senior management and Board members, and to the extent it deems it appropriate, outside search firms. The Committee will evaluate qualified candidates and then make its recommendation to the Board for its consideration and approval.
In making its recommendations to the Board with respect to director candidates, the Committee considers various criteria set forth in our Board Membership Criteria (see Exhibit A to the Committee’s Charter), including experience, professional background, specialized expertise and concern for the best interests of shareowners as a whole. In addition, directors must be of the highest character and integrity, be free of conflicts of interest with the Corporation, and have sufficient time available to devote to the affairs of the Corporation. The Committee from time to time reviews with the Board our Board Membership Criteria in the context of the current composition of the Board and our circumstances.
The Committee will evaluate properly submitted shareowner recommendations under substantially the same criteria and in substantially the same manner as other potential candidates.
In addition to recommending director candidates to the Committee, shareowners may also nominate candidates for election to the Board at annual shareowner meetings by following the procedures set forth in our By-Laws. See “Shareowner Proposals for Annual Meeting in 2008” set forth later in this proxy statement.
Compensation and Management Development Committee. The members of the Compensation and Management Development Committee are Joseph F. Toot, Jr. (Chairman), Betty C. Alewine, William T. McCormick, Jr. and Bruce M. Rockwell. All members of the Committee are independent directors as defined by the NYSE and are not eligible to participate in any of our plans or programs administered by the Committee, except our 2003 and 1995 Directors Stock Plans. The principal functions of the Compensation and Management Development Committee are to evaluate the performance of our senior executives and plans for management succession and development, review the design and competitiveness of our compensation plans, review and approve salaries of corporate officers and review the salary plan for other executives who are direct reports to the Chief Executive Officer, review and approve corporate goals and objectives and administer our incentive, deferred compensation and long-term incentives plans pursuant to the terms of the respective plans. The Committee determines salaries, incentive compensation and long-term incentive awards for all corporate
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officers. The Committee met five times and acted on one occasion by written consent in lieu of a meeting during the 2006 fiscal year.
Technology, Environmental and Social Responsibility Committee. The members of the Technology, Environmental and Social Responsibility Committee are Bruce M. Rockwell (Chairman), Betty C. Alewine, Barry C. Johnson and David B. Speer. All members of the Committee are independent directors as defined by the NYSE. The Committee reviews and assesses our technological activities as well as our policies and practices in the following areas: employee relations, with emphasis on diversity and inclusiveness; the protection and enhancement of the environment and energy resources; product integrity and safety; employee health and safety; and community and civic relations, including programs for and contributions to educational, cultural and other social institutions. The Committee met twice during the 2006 fiscal year.
Communications to the Board and Ombudsman. Shareowners and other interested parties analyzingmay send communications to the Board, an individual director, the non-management directors as a group, or a specified Board Committee at the following address:
Rockwell Automation, Inc.
c/o Corporate Secretary
1201 South Second Street
Milwaukee, WI 53204
Attn: Board of Directors
The Secretary will receive and process all communications before forwarding them to the addressee. The Secretary will forward all communications unless the Secretary determines that a communication is a business solicitation or advertisement, or requests general information about us.
In accordance with procedures approved by the Audit Committee, concerns about accounting, internal controls or auditing matters should be reported to the Ombudsman as outlined in our Standards of Business Conduct, which are available on our website atwww.rockwellautomation.com; please click on the heading: “About Us”, then the heading: “Who We Are”, then the heading: “Ethics”. The Ombudsman is required to report promptly to the Audit Committee all reports of questionable accounting or auditing matters that the Ombudsman receives. You may contact the Ombudsman by addressing a letter to:
Ombudsman
Rockwell Automation, Inc.
1201 South Second Street
Milwaukee, WI 53204
You may also contact the Ombudsman by telephone at(800) 552-3589,e-mail atombudsman@rockwell.comor fax at(414) 382-8485.
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DIRECTOR COMPENSATION(1)
The following table sets forth compensation paid to and deferred by our non-employee directors in connection with their service as directors during fiscal year 2006.
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| | | | | Retainer Fees
| | | | | | | | | Grant Date
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| | Retainer
| | | Paid in
| | | Retainer Fees
| | | | | | Present Value of
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| | Fees Paid
| | | Restricted Shares
| | | Paid in
| | | Value of Annual
| | | Stock Option
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Name | | in Cash(2) | | | in Lieu of Cash(2) | | | Restricted Shares | | | Share Award(3) | | | Awards(4) | |
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Betty C. Alewine | | $ | 69,000 | | | | — | | | $ | 27,000 | | | $ | 32,895 | | | $ | 30,870 | |
Don H. Davis, Jr. | | | 60,000 | | | | — | | | | 27,000 | | | | 32,895 | | | | 30,870 | |
Verne G. Istock | | | 76,500 | | | | — | | | | 27,000 | | | | 32,895 | | | | 30,870 | |
Barry C. Johnson | | | 68,000 | | | | — | | | | 27,000 | | | | 32,895 | | | | 30,870 | |
William T. McCormick, Jr | | | 72,000 | | | | — | | | | 27,000 | | | | 32,675 | | | | 30,870 | |
Bruce M. Rockwell | | | 74,750 | | | | — | | | | 27,000 | | | | 32,675 | | | | 30,870 | |
David B. Speer | | | 61,688 | | | $ | 8,813 | | | | 27,000 | | | | 32,895 | | | | 30,870 | |
Joseph F. Toot, Jr. | | | 73,000 | | | | — | | | | 27,000 | | | | 32,895 | | | | 30,870 | |
Kenneth F. Yontz | | | 71,500 | | | | — | | | | 27,000 | | | | 32,675 | | | | 30,870 | |
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(1) | | Does not include cash dividends paid on restricted shares and other benefits discussed below under the headings “Retainer Fees” and “Other Awards and Benefits”. |
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(2) | | Includes retainer fees for Board and Board Committee service. |
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(3) | | Based on the closing price of $65.35 of our Common Stock on the NYSE on the date of grant for awards made in restricted shares and the average of the high and low prices of $65.79 of our Common Stock on the NYSE on the date of grant for awards made in non-restricted shares. |
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(4) | | These values are based on the Black-Scholes option pricing model. The value reflects the annual option award for all directors. |
Retainer Fees. Non-employee directors receive an annual retainer of $87,000, of which $60,000 is paid in cash and $27,000 is paid by delivery of restricted shares of our Common Stock pursuant to the 2003 Directors Stock Plan. Non-employee directors who serve on Board Committees receive an additional retainer at the annual rate of $7,500 ($12,500 for the Chairman) for service on the Audit Committee; $6,000 ($9,000 for the Chairman) for service on the Compensation and Management Development Committee; $4,000 ($6,000 for the Chairman) for service on the Board Composition and Governance Committee; and $3,000 ($5,000 for the Chairman) for service on the Technology, Environmental and Social Responsibility Committee. The restricted shares paid as part of the annual retainer vest upon a director’s retirement from the Board under the Board’s retirement policy, a change of control of the Corporation or resignation by reason of the antitrust laws, compliance with our conflict of interest policies, death, disability or other circumstances the Board determines not to be adverse to the best interests of the Corporation. Non-employee directors are entitled to any cash dividends paid on the restricted shares, but are not entitled to any dividends paid in shares until the restricted shares vest. During fiscal year 2006, cash dividends of $7,396; $733; $2,695; $492; $9,180; $9,180; $5,016; $9,022 and $5,908 were paid on the restricted shares held by Ms. Alewine and Messrs. Davis, Istock, Johnson, McCormick, Rockwell, Speer, Toot and Yontz, respectively.
Equity Awards. Each non-employee director also receives an annual grant of 500 shares of Common Stock pursuant to the 2003 Directors Stock Plan immediately after our Annual Meeting of Shareowners (and for directors elected after the Annual Meeting, a pro-rated number of shares). On the same date, each non-employee director receives an annual grant of options to purchase 1,500 shares of Common Stock pursuant to the 2003 Directors Stock Plan (and for directors elected after the Annual Meeting, a pro-rated number of options). In accordance with the 2003 Directors Stock Plan, the options awarded on February 1, 2006 (i) were granted at an exercise price of $65.35 per share, the closing market price on the date of grant, and (ii) become exercisable in three substantially equal installments on the first, second and third anniversaries of the grant date.
The average of retainer fees and the annual stock grants (but not the annual option grants) paid to or deferred by non-employee directors for the 2006 fiscal year was $130,405 (determined by valuing the stock grants at the closing price on the date the shares were issued).
10
Deferral Election. Under the terms of the directors’ deferred compensation plan, a director may elect to defer all or part of the cash payment of retainer fees until such time as shall be specified, with interest on deferred amounts accruing quarterly at 120% of the federal long-term rate set each month by the Secretary of the Treasury. In addition, under the 2003 Directors Stock Plan, each director has the opportunity each year to defer all of the annual grant of shares and all or any portion of the cash retainers by electing to receive restricted shares valued, in the case of deferrals of cash retainers, at the closing price on the NYSE on the date each retainer payment would otherwise be made in cash.
Other Awards and Benefits. We provide each director with life insurance in the amount of $100,000. During fiscal year 2006, we imputed income for life insurance in the amount of: $516; $762; $1,524; $792; $792; $1,524; $276; $2,472 and $792 to Ms. Alewine and Messrs. Davis, Istock, Johnson, McCormick, Rockwell, Speer, Toot and Yontz, respectively.
Under the 2003 Directors Stock Plan, options to purchase 7,000 shares of our Common Stock are awarded to each director upon his or her initial election to the Board.
We reimburse directors for transportation and other expenses actually incurred in attending Board and committee meetings. At times, directors use our corporate aircraft for travel for Board meetings. During fiscal 2006, on two occasions Board meetings were held as retreats at which the Corporation provided leisure activities for the directors’ spouses (with the leisure activities provided for all director spouses valued at less than $4,400) .
Directors may participate in a matching gift program under which we will match donations made to eligible educational, arts or cultural institutions. Gifts will be matched in any calendar year up to a maximum of $10,000.
Related Party Transactions. In fiscal year 2006 we engaged in business transactions with organizations with which certain of our directors are affiliated, including Illinois Tool Works Inc., of which Mr. Speer is Chairman and Chief Executive Officer. However, none of these transactions was material to either us or any of those organizations.
Directors are subject to stock ownership guidelines. Our Guidelines on Corporate Governance provide that non-management directors are required to own shares of our Common Stock (including restricted shares) equal in value to three times the amount of the annual retainer that is paid in cash for Board service within five years after joining the Board to further the direct correlation of directors’ and shareowners’ economic interests. All directors, except Dr. Johnson who has been a director since September 2005, met the guidelines as of September 30, 2006.
Our Guidelines on Corporate Governance and codes of business conduct and ethics are available on our website atwww.rockwellautomation.com; click on the heading: “About Us”, then the heading: “Investor Relations”, then the heading “Corporate Governance”. They are also available in print to any shareowner upon request.
AUDIT COMMITTEE REPORT
The Audit Committee assists the Board in overseeing and monitoring the integrity of the Corporation’s financial reporting process, its internal control and disclosure control systems, the integrity and audits of its financial statements, the Corporation’s compliance with legal and regulatory requirements, the qualifications and independence of its independent registered public accounting firm and the performance of its internal audit function and independent registered public accounting firm.
Our Committee’s roles and responsibilities are set forth in a written Charter adopted by the Board, which is available on the Corporation’s website atwww.rockwellautomation.comunder the heading “Investor Relations”. We review and reassess the Charter annually, and more frequently as necessary to address any changes in NYSE corporate governance and SEC rules regarding audit committees, and recommend any changes to the Board for approval.
Management is responsible for the Corporation’s financial statements and the reporting process, including the system of internal control. Deloitte & Touche LLP (D&T), the Corporation’s independent registered public accounting firm, is responsible for expressing an opinion on the conformity of those audited financial statements
11
with U.S. generally accepted accounting principles, and attesting to and reporting on management’s assessment of the Corporation’s internal control over financial reporting.
We are responsible for overseeing the Corporation’s overall financial reporting process. In fulfilling our responsibilities for the financial statements for fiscal year 2006, we:
| | |
| • | Reviewed and discussed the audited financial statements for the fiscal year ended September 30, 2006 with management and D&T; |
|
| • | Reviewed management’s assessment of the Corporation’s internal control over financial reporting and D&T’s report and attestation on management’s assessment pursuant to Section 404 of the Sarbanes-Oxley Act; |
|
| • | Discussed with D&T the matters required to be discussed by Statement on Auditing Standards No. 61, as amended, relating to the conduct of the audit; and |
|
| • | Received written disclosures and the letter from D&T regarding its independence as required by Independence Standards Board Standard No. 1. We also discussed with D&T its independence. |
For information on fees paid to D&T for each of the last two years, see “Proposal to Approve the Selection of Independent Registered Public Accounting Firm” on page 23.
We considered the non-audit services provided by D&T in fiscal year 2006 and determined that engaging D&T to provide those services is compatible with and does not impair D&T’s independence.
In fulfilling our responsibilities, we met with the internal auditors and D&T, with and without management present, to discuss the results of their examinations, the evaluations of the Corporation’s internal control over financial reporting and the overall quality of the Corporation’s financial reporting. We considered the status of pending litigation, taxation matters and other areas of oversight relating to the financial reporting and audit process that we determined appropriate. We also met separately with the Corporation’s Chief Executive Officer, Chief Financial Officer, Controller, General Counsel and Ombudsman.
Based on our review of the audited financial statements and discussions with, and the reports of, management and D&T, we recommended to the Board that the audited financial statements be included in the Corporation’s Annual Report onForm 10-K for the fiscal year ended September 30, 2006 for filing with the SEC.
The Audit Committee has selected D&T as auditors of the Corporation for the fiscal year ending September 30, 2007, subject to the approval of shareowners.
Audit Committee
Verne G. Istock,Chairman
Barry C. Johnson
David B. Speer
Kenneth F. Yontz
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OWNERSHIP OF EQUITY SECURITIES BY DIRECTORS AND EXECUTIVE OFFICERS
The following table shows the beneficial ownership, reported to us as of October 31, 2006, of our Common Stock, including shares as to which a right to acquire ownership within 60 days exists (for example, through the exercise of stock options) of each director, each nominee for director, each executive officer listed in the table on page 14 and of such persons and other executive officers as a group.
| | | | | | | | | | | | | | | | |
| | Beneficial Ownership on October 31, 2006 | |
| | Shares of
| | | | | | Total
| | | Percent of
| |
Name | | Common Stock(1) | | | Options(2) | | | Shares(1) | | | Class(3) | |
|
Betty C. Alewine | | | 10,659 | (4) | | | 12,500 | | | | 23,159 | | | | — | |
Don H. Davis, Jr. | | | 82,479 | (4,5) | | | 117,167 | | | | 199,646 | | | | — | |
Verne G. Istock | | | 10,361 | (4) | | | 9,500 | | | | 19,861 | | | | — | |
Barry C. Johnson | | | 1,763 | (4) | | | 2,583 | | | | 4,346 | | | | — | |
William T. McCormick, Jr. | | | 19,191 | (4) | | | 3,500 | | | | 22,691 | | | | — | |
Keith D. Nosbusch | | | 109,080 | (5,6) | | | 1,213,484 | | | | 1,322,564 | | | | — | |
Bruce M. Rockwell | | | 42,791 | (4) | | | — | | | | 42,791 | | | | — | |
David B. Speer | | | 8,440 | (4) | | | 9,500 | | | | 17,940 | | | | — | |
Joseph F. Toot, Jr. | | | 23,191 | (4) | | | 10,834 | | | | 34,025 | | | | — | |
Kenneth F. Yontz | | | 17,556 | (4) | | | 1,500 | | | | 19,056 | | | | — | |
Theodore D. Crandall | | | 33,063 | (5,6) | | | 192,921 | | | | 225,984 | | | | — | |
Steven A. Eisenbrown | | | 21,250 | (5,6) | | | 189,056 | | | | 210,306 | | | | — | |
James V. Gelly | | | 20,064 | (5,6) | | | 84,532 | | | | 104,596 | | | | — | |
Douglas M. Hagerman | | | 14,050 | (5,6) | | | 75,568 | | | | 89,618 | | | | — | |
All of the above and other executive officers as a group (25 persons) | | | 622,147 | (4,5,6) | | | 2,749,394 | | | | 3,371,541 | | | | 1.95 | % |
| | |
(1) | | Each person has sole voting and investment power with respect to the shares listed (either individually or with spouse), unless otherwise indicated. |
|
(2) | | Represents shares that may be acquired upon the exercise of outstanding stock options within 60 days. |
|
(3) | | The shares owned by each person, and by the group, and the shares included in the number of shares outstanding have been adjusted, and the percentage of shares owned (where such percentage exceeds 1%) has been computed, in accordance withRule 13d-3(d)(1) under the Securities Exchange Act. |
|
(4) | | Includes 8,684; 1,281; 3,461; 1,013; 10,791; 10,791; 6,040; 10,491 and 7,156 shares granted as restricted stock under the 1995 and 2003 Directors Stock Plans or otherwise as compensation for services as directors for Ms. Alewine and Messrs. Davis, Istock, Johnson, McCormick, Rockwell, Speer, Toot and Yontz, respectively. |
|
(5) | | Includes shares held under our savings plan as of October 31, 2006. Does not include 589; 777; 1,716; 224; 1,477; and 11,728 share equivalents for Messrs. Nosbusch, Crandall, Eisenbrown, Gelly, Hagerman, and the group, respectively, held under our supplemental savings plan as of October 31, 2006. |
|
(6) | | Includes 10,000, 5,000 and 5,000 shares granted as restricted stock under the 2000 Long-Term Incentives Plan for Messrs. Nosbusch, Gelly and Hagerman, respectively, which vest on February 5, 2007, January 5, 2007 and May 1, 2007, respectively, and 11,200, 2,800, 3,400, 3,400, 2,800, and 58,800 shares granted as restricted stock under the 2000 Long-Term Incentives Plan for Messrs. Nosbusch, Crandall, Eisenbrown, Gelly, Hagerman, and the group, respectively, which vest on November 7, 2008. |
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EXECUTIVE COMPENSATION
The information below reflects the annual and long-term compensation for service in all capacities to us for the fiscal years ended September 30, 2006, 2005, and 2004, of our Chief Executive Officer and our other four most highly compensated executive officers at September 30, 2006 (the Named Officers):
Summary Compensation Table
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Annual Compensation | | | Long-Term Compensation | | | | |
| | | | | | | | | | | | | | Awards | | | Payouts | | | | |
| | | | | | | | | | | | | | | | | Securities
| | | | | | | |
| | | | | | | | | | | | | | | | | Underlying
| | | | | | | |
| | | | | | | | | | | | | | Restricted
| | | Stock
| | | Long-Term
| | | | |
| | | | | | | | | | | Other Annual
| | | Stock
| | | Options
| | | Incentive
| | | All Other
| |
Name and Principal Position | | Year | | | Salary | | | Bonus | | | Compensation(1) | | | Awards($)(2) | | | (Shares) | | | Payouts | | | Compensation(3) | |
|
Keith D. Nosbusch | | | 2006 | | | $ | 896,154 | | | $ | 1,450,000 | | | $ | 55,418 | | | $ | 631,232 | (5) | | | 145,500 | | | | — | | | $ | 23,746 | |
President and Chief | | | 2005 | | | | 750,385 | | | | 1,550,000 | | | | 55,350 | | | | — | | | | 300,000 | | | | — | | | | 23,262 | |
Executive | | | 2004 | | | | 599,231 | | | | 1,000,000 | | | | 52,873 | | | | 308,000 | (6) | | | 250,000 | | | | — | | | | 17,804 | |
Officer(4) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Theodore D. Crandall | | | 2006 | | | | 411,154 | | | | 452,000 | | | | 45,446 | | | | 157,808 | (5) | | | 36,300 | | | | — | | | | 11,844 | |
Senior Vice President, | | | 2005 | | | | 349,308 | | | | 440,000 | | | | 44,120 | | | | — | | | | 70,000 | | | | — | | | | 10,822 | |
Components and Packaged | | | 2004 | | | | 290,770 | | | | 320,000 | | | | 42,196 | | | | — | | | | 55,000 | | | | — | | | | 8,723 | |
Applications Group, Rockwell | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Automation Control Systems(7) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Steven A. Eisenbrown | | | 2006 | | | | 421,154 | | | | 325,000 | | | | 40,200 | | | | 191,624 | (5) | | | 43,600 | | | | — | | | | 11,428 | |
Senior Vice President, | | | 2005 | | | | 357,001 | | | | 450,000 | | | | 35,846 | | | | — | | | | 80,000 | | | | — | | | | 9,657 | |
Automation | | | 2004 | | | | 290,771 | | | | 340,000 | | | | 35,994 | | | | — | | | | 65,000 | | | | — | | | | 7,440 | |
Control and Information Group, | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Rockwell Automation Control Systems(7) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
James V. Gelly | | | 2006 | | | | 469,231 | | | | 451,300 | | | | 28,273 | | | | 191,624 | (5) | | | 43,600 | | | | — | | | | 13,217 | |
Senior Vice President and | | | 2005 | | | | 443,078 | | | | 500,000 | | | | 29,775 | | | | — | | | | 80,000 | | | | — | | | | 11,963 | |
Chief Financial Officer(8) | | | 2004 | | | | 315,000 | | | | 337,000 | (9) | | | 130,450 | (10) | | | 171,200 | (11) | | | 70,000 | | | | — | | | | 17,835 | |
Douglas M. Hagerman | | | 2006 | | | | 429,077 | | | | 411,400 | | | | 39,292 | | | | 157,808 | (5) | | | 36,300 | | | | — | | | | 11,873 | |
Senior Vice President, | | | 2005 | | | | 412,310 | | | | 460,000 | | | | 34,208 | | | | — | | | | 70,000 | | | | — | | | | 12,139 | |
General Counsel and Secretary(12) | | | 2004 | | | | 189,235 | | | | 180,000 | | | | 4,253 | | | | 163,450 | (13) | | | 40,000 | | | | — | | | | — | |
| | |
(1) | | Represents amounts paid for financial planning, automobile allowance, personal liability insurance, social club memberships, dental and vision care insurance, executive physical exams, leisure activities for spouses at Board retreats and taxgross-ups for social clubs, personal liability insurance and certain other items. The amount of such tax gross-ups for fiscal 2006, 2005 and 2004 were $6,895, $6,682 and $6,419 for Mr. Nosbusch; $8,020, $7,788 and $7,739 for Mr. Crandall; $5,860, $5,177 and $4,674 for Mr. Eisenbrown; $1,673, $1,551 and $40,185 for Mr. Gelly and $4,132, $4,047 and $1,757 for Mr. Hagerman, respectively. |
|
(2) | | As of September 30, 2006, Messrs. Nosbusch, Crandall, Eisenbrown, Gelly and Hagerman held an aggregate of 21,200, 2,800, 3,400, 8,400 and 7,800 shares of restricted stock, respectively, with an aggregate value of $1,231,720; $162,680; $197,540; $488,040 and $453,180, respectively (based on the closing price of our Common Stock on the NYSE on September 30, 2006 ($58.10)). The Named Officers also received grants of performance shares during fiscal 2006. Further information on the grants of performance shares is provided in the Long-Term Incentive Awards table below. |
|
(3) | | Amounts contributed or accrued for the Named Officers under our savings plans and related supplemental savings plans and, in fiscal 2004, $15,000 paid to Mr. Gelly for consulting services provided to us prior to commencement of his employment on January 5, 2004. |
|
(4) | | President and Chief Executive Officer since February 2004; Senior Vice President and President, Rockwell Automation Control Systems prior thereto; Chairman of the Board since February 2005. |
|
(5) | | Represents the grant of 11,200, 2,800, 3,400, 3,400 and 2,800 restricted shares of our Common Stock for Messrs. Nosbusch, Crandall, Eisenbrown, Gelly and Hagerman, respectively. The restricted stock vests on November 7, 2008. The value set forth is based on the closing price of our Common Stock on the grant date, November 7, 2005, which was $56.36. Restricted stock owners are entitled to any cash dividends paid, but are not entitled to any dividends paid in shares until the restricted shares vest. All grants were made under the 2000 Long-Term Incentives Plan. Messrs. Nosbusch, Crandall, Eisenbrown, Gelly and Hagerman received cash dividends of $10,080, $2,520, $3,060, $3,060 and $2,520 during fiscal year 2006, respectively, related to these restricted shares. Upon a change of control, all restrictions on restricted stock will immediately lapse. |
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| | |
(6) | | Represents the grant of 10,000 restricted shares of our Common Stock. The restricted stock vests on February 5, 2007. The value set forth is based on the closing price on the date of grant, February 5, 2004, which was $30.80. Restricted stock owners are entitled to any cash dividends paid, but are not entitled to any dividends paid in shares until the restricted shares vest. Mr. Nosbusch received cash dividends of $9,000, $7,800 and $4,950 during fiscal years 2006, 2005 and 2004, respectively, related to these restricted shares. Upon a change of control, all restrictions on restricted stock will immediately lapse. |
|
(7) | | Senior Vice President of the Corporation since February 2004. |
|
(8) | | Elected Senior Vice President and Chief Financial Officer on January 5, 2004; not an employee of the Corporation prior thereto. |
|
(9) | | The bonus for Mr. Gelly for 2004 includes a $25,000 signing bonus that was earned on January 5, 2005. |
|
(10) | | Includes $65,059 paid in connection with the relocation of Mr. Gelly’s residence from New Jersey to Wisconsin, including $35,000 as an allowance expense. These were paid in addition to amounts payable under our relocation policy applicable to salaried employee new hires. |
|
(11) | | Represents the grant of 5,000 restricted shares of our Common Stock. The restricted stock vests on January 5, 2007. The value set forth is based on the closing price on the date of grant, January 5, 2004, which was $34.24. Restricted stock owners are entitled to any cash dividends paid, but are not entitled to any dividends paid in shares until the restricted shares vest. Mr. Gelly received cash dividends of $4,500, $3,900 and $2,475 during fiscal years 2006, 2005 and 2004, respectively, related to these restricted shares. Upon a change of control, all restrictions on restricted stock will immediately lapse. |
|
(12) | | Elected Senior Vice President, General Counsel and Secretary on May 1, 2004; not an employee of the Corporation prior thereto. |
|
(13) | | Represents the grant of 5,000 restricted shares of our Common Stock. The restricted stock vests on May 1, 2007. The value set forth is based on the closing price on the date of grant, May 1, 2004, which was $32.69. Restricted stock owners are entitled to any cash dividends paid, but are not entitled to any dividends paid in shares until the restricted shares vest. Mr. Hagerman received cash dividends of $4,500, $3,900 and $1,650 during fiscal years 2006, 2005 and 2004, respectively, related to these restricted shares. Upon a change of control, all restrictions on restricted stock will immediately lapse. |
EQUITY GRANTS
Option Grants
Shown below is further information on grants to the Named Officers of stock options pursuant to the Corporation’s 2000 Long-Term Incentives Plan, as amended (2000 Plan), during the fiscal year ended September 30, 2006, which are reflected in the Summary Compensation Table on page 14. No stock appreciation rights were granted during fiscal 2006.
| | | | | | | | | | | | | | | | | | | | | | | | |
Individual Grants | | | | |
| | | | | Number of
| | | | | | | | | | | | | |
| | | | | Securities
| | | Percentage of
| | | | | | | | | | |
| | | | | Underlying
| | | Total Options
| | | | | | | | | | |
| | | | | Options
| | | Granted to
| | | Exercise or
| | | | | | Grant Date
| |
| | | | | Granted
| | | Employees in
| | | Base Price
| | | Expiration
| | | Present
| |
Name | | Grant Date | | | (Shares)(1) | | | Fiscal 2006 | | | (Per Share) | | | Date | | | Value(2) | |
|
Keith D. Nosbusch | | | 11/07/05 | | | | 145,500 | | | | 9.28 | % | | $ | 56.36 | | | | 11/07/15 | | | $ | 2,541,885 | |
Theodore D. Crandall | | | 11/07/05 | | | | 36,300 | | | | 2.31 | | | | 56.36 | | | | 11/07/05 | | | | 634,161 | |
Steven A. Eisenbrown | | | 11/07/05 | | | | 43,600 | | | | 2.78 | | | | 56.36 | | | | 11/07/15 | | | | 761,692 | |
James V. Gelly | | | 11/07/05 | | | | 43,600 | | | | 2.78 | | | | 56.36 | | | | 11/07/15 | | | | 761,692 | |
Douglas M. Hagerman | | | 11/07/05 | | | | 36,300 | | | | 2.31 | | | | 56.36 | | | | 11/07/15 | | | | 634,161 | |
| | |
(1) | | Exercisable in three substantially equal installments beginning one year from the grant date. |
|
(2) | | These values are based on the Black-Scholes option pricing model which produces a per share option value of $17.47, computed using the following assumptions and inputs: |
| | | | | | | | | | | | | | | | |
| | | | | Dividend
| | | Interest
| | | | |
Grant Date | | Volatility | | | Yield | | | Rate | | | Expected Life (Years) | |
|
11/07/05 | | | .32 | | | | 1.56 | % | | | 4.33 | % | | | 5.3 | |
The interest rate represents the zero coupon Treasury bond rate with a maturity date approximately 5 years from the date the options were granted. The actual value, if any, the executive officers may interpretrealize from these options will depend on the gain in stock price over the exercise price when the options are exercised.
15
Long-Term Incentive Awards
Shown below is information on grants to the Named Officers of performance share awards pursuant to the 2000 Plan during the fiscal year ended September 30, 2006.
| | | | | | | | | | | | | | | | | | | | |
| | Number of Shares,
| | | | | | Estimated Future Payouts
| |
| | Units or Other
| | | Performance or Other
| | | Under Non-Stock Price-Based Plans(1) | |
Name | | Rights (#) | | | Period Until Payout | | | Threshold (#) | | | Target (#) | | | Maximum (#) | |
|
Keith D. Nosbusch | | | 25,800 | | | | 10/1/05-9/30/08 | | | | 0 | | | | 25,800 | | | | 51,600 | |
Theodore D. Crandall | | | 6,500 | | | | 10/1/05-9/30/08 | | | | 0 | | | | 6,500 | | | | 13,000 | |
Steven A. Eisenbrown | | | 7,700 | | | | 10/1/05-9/30/08 | | | | 0 | | | | 7,700 | | | | 15,400 | |
James V. Gelly | | | 7,700 | | | | 10/1/05-9/30/08 | | | | 0 | | | | 7,700 | | | | 15,400 | |
Douglas M. Hagerman | | | 6,500 | | | | 10/1/05-9/30/08 | | | | 0 | | | | 6,500 | | | | 13,000 | |
| | |
(1) | | The amounts shown are the number of shares of our Common Stock that may be issued if performance goals are achieved. The payout in respect of these performance shares will be made in shares of our Common Stockand/or cash (generally calculated based on the closing price of our Common Stock on the trading day preceding the payout date), in an amount determined based on the total shareowner return of our Common Stock, assuming reinvestment of all dividends, compared to the Standard & Poor’s 500 Index for the period from October 1, 2005 to September 30, 2008, if the grantee continues as an employee for that period (subject to provisions relating to the grantee’s death, disability or retirement or a change of control of the Corporation). The payouts will be at zero, the target amount and the maximum amount if our shareowner return is equal to or less than the 30th percentile, equal to the 60th percentile and equal to or greater than the 75th percentile of the Standard & Poor’s 500 Index, respectively, over the applicable three-year period, with the payout interpolated for results between those percentiles. The potential value of a payout will fluctuate with the market value of our Common Stock. At the date of the grant of these awards on November 7, 2005, the closing price of our Common Stock on the NYSE was $56.36. On October 31, 2006, the closing price of our Common Stock was $62.00. |
AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END VALUES
Shown below is information with respect to (i) exercises by the Named Officers during fiscal 2006 of options to purchase our Common Stock granted under the 2000 Plan or the 1995 Long-Term Incentives Plan and (ii) the unexercised options to purchase our Common Stock held by the Named Officers at September 30, 2006.
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | Number of Unexercised
| | | Value of Unexercised
| |
| | Shares
| | | | | | Options Held at
| | | In-the-Money Options Held
| |
| | Acquired on
| | | Value
| | | September 30, 2006 | | | at September 30, 2006(1) | |
Name | | Exercise | | | Realized | | | Exercisable | | | Unexercisable | | | Exercisable | | | Unexercisable | |
|
Keith D. Nosbusch | | | — | | | $ | — | | | | 1,014,985 | | | | 428,835 | | | $ | 38,581,277 | | | $ | 5,520,700 | |
Theodore D. Crandall | | | 64,935 | | | | 3,601,789 | | | | 139,155 | | | | 101,301 | | | | 4,520,937 | | | | 1,282,270 | |
Steven A. Eisenbrown | | | 78,915 | | | | 4,003,251 | | | | 126,190 | | | | 118,601 | | | | 3,962,490 | | | | 1,490,800 | |
James V. Gelly | | | 30,000 | | | | 1,005,153 | | | | 43,332 | | | | 120,268 | | | | 776,308 | | | | 1,389,956 | |
Douglas M. Hagerman | | | 9,863 | | | | 359,588 | | | | 40,136 | | | | 96,301 | | | | 766,510 | | | | 1,064,650 | |
| | |
(1) | | Based on the closing price on the NYSE of our Common Stock on September 30, 2006 ($58.10). |
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Compensation Philosophy
Under our supervision, the Corporation has developed and implemented compensation policies, plans and programs intended to attract and retain executive talent, “pay for performance”, and pay for the creation of shareowner value. Our compensation programs include base salary, annual incentive compensation, and long-term incentives. Our executives participate in our health and welfare plans, pension plan, and 401(k) savings plan that apply to all salaried employees. We also maintain non-qualified pension and savings plans that use the same formulas as the qualified plans that restore the benefits limited in the qualified plans by the Internal Revenue Service. The Corporation also offers a Deferred Compensation Plan for all employees who have base salaries greater than $125,000 per year. Our Deferred Compensation Plan offers a selection of mutual fund investments similar to those in our 401(k) savings plan and does not have any guaranteed rates of return. In
16
addition, executives receive a limited perquisite package that includes an automobile allowance (executives are not eligible for mileage payments for use of their personal vehicle), social club membership, financial planning, personal liability insurance and annual physical. The principal purpose of the perquisite package is to aid in the attraction and retention of high quality executives.
The quality of the Corporation’s leadership impacts its performance, and therefore the purpose of our compensation policies and programs, including base salary, is to attract and retain high quality executives. As such, we set base salaries generally at the median of other major U.S. industrial companies. Increases in base salary are a function of the individual executive’s personal performance, the market value for their position and the executive’s expected future contributions and leadership.
Our annual incentive compensation plans (ICP Plans) reward executives for achieving company and business unit results. The ICP Plans provide for cash compensation generally at the median of other major U.S. industrial companies if the Corporation achieves its annual goals, and above market cash compensation for superior performance. Each year, we establish minimum thresholds for payments to be made under the ICP Plans. For fiscal years 2006 and 2007, participants generally receive no payments under the ICP Plans until our results are equal to the prior year’s financial performance, at which point 25% of the target incentive is available to be awarded. Target amounts are generally earned if we achieve our financial and operational goals set for the year. Above target amounts are generally earned when performance exceeds the annual goals. Target award amounts are generally set at the median of other major U.S. industrial companies, regressed based on Rockwell Automation sales. We participate in the Towers Perrin and Hewitt executive compensation surveys, and use their databases for this analysis. The ICP Plans also include adjustments for individual performance, in relation to individual objectives and Rockwell Automation’s leadership objectives and competencies.
We grant long-term incentives to reward management for creating shareowner value and to align the interests of management with shareowners. Long-term incentive opportunities are generally set between the 50th and 75th percentile of other major U.S. industrial companies using the Towers Perrin executive compensation database, regressed based on Rockwell Automation sales. We generally make long-term incentive grants near the beginning of the fiscal year to align with our performance management process and other compensation actions. Annual equity grants for corporate officers occur on the same dates as our annual equity grants for our other professional and managerial employees, which in fiscal 2006 was the Monday following our November Committee meeting. In fiscal 2007, our grant date occurred on the date of our December Committee meeting. The Chief Executive Officer makes recommendations to the Committee as to equity grants for other corporate officers, and the Committee approves all equity grants for corporate officers. We also award equity grants to new executive hires or recently promoted executives during the year. These grants are approved by the Committee, and the grant date is the date the Committee approves the grant. The exercise price of all stock option grants is the fair market value of our stock at the close of trading on the date of the grant. Our long-term incentive plans are designed to reward the increase in absolute and relative shareowner value. Long-term incentive grants are delivered in a combination of stock options, performance shares and restricted stock. We believe that stock options are an appropriate vehicle to reward management for increases in shareholder value, and they provide no value if share price does not increase. Performance shares are designed to reward management for relative performance compared to the S&P 500 Index over a three-year period, and provide greater rewards than stock options alone when our shareowners experience above market returns and smaller rewards when our shareowners experience below market returns. We grant restricted shares primarily in order to retain high quality executives. Accordingly restricted shares do not vest until three years after the grant.
Compensation Review Process
We consider the total direct compensation (earned or potentially available) of each of the Named Officers and the other corporate officers in establishing each element of compensation. Total Direct Compensation is defined as base salary, plus annual bonus under ICP Plans, plus the value of long-term incentive grants. We believe that a significant portion of an executive’s compensation should be directly linked to the creation of shareowner value and generally target approximately 60% to 70% of total direct compensation in the form of long-term incentives delivered as grants of stock options, performance shares and restricted stock.
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As part of this process we conduct a total compensation or “Tally Sheet” review consisting of all elements of compensation, including base salary, annual incentives, long-term incentive grants, health benefits, perquisites and retirement and termination benefits. This review includes a calculation of amounts to be paid to our corporate officers if their employment is terminated, as well as upon retirement. We review the potential outcomes of annual incentives and long-term incentive grants under a variety of scenarios from low to high performance. We also review the officers’ current balances in various compensation and benefit plans and consider that corporate officers also receive payments for annual executive physical exams, financial planning, automobile allowance, personal liability insurance, and social club membership. We also consider industry, peer group and national surveys of other major U.S. industrial companies and performance judgments as to the past and expected future contributions of the individual corporate officers. We also review the amounts held from prior equity grants, but do not take these values into account in determining future long-term incentive grants for the following reasons: (i) we want to encourage long-term holding of equity grants, rather than encourage early sales in order to receive future grants; (ii) we have share ownership guidelines for our corporate officers that we believe provide the appropriate balance in retaining equity to align the financial interests of our corporate officers with those of our shareowners; (iii) our corporate officers are not allowed to exercise equity if they are not at our ownership guidelines; and (iv) to continue to provide additional rewards for increasing shareowner value.
We have engaged Towers Perrin, an independent executive compensation consulting firm that is directly accountable to us, to provide advice and market information that we use in fulfilling our duties. Based on our reviews, we found the total compensation of Mr. Nosbusch and the Named Officers, as well as the potential payouts to Mr. Nosbusch and the Named Officers in termination, change of control and retirement scenarios, in the aggregate, to be reasonable and consistent with our executive compensation philosophy.
Executive Stock Ownership
We believe the focus on “pay for performance” is sharpened by aligning closely the financial interests of the Corporation’s officers with those of shareowners. Accordingly, we have set minimum ownership guidelines for corporate officers. The minimum ownership guidelines (multiple of base salary) are as follows:
| | | | |
| | Common Stock
| |
| | Market Value | |
|
Chief Executive Officer | | | 5 | |
Senior Vice Presidents | | | 3 | |
Other Corporate Officers | | | 1.5 | |
Shares owned directly (including restricted shares) or through the Corporation’s savings plans (including share equivalents under the Corporation’s supplemental savings plans) and the after-tax value of vested unexercised stock options are considered in determining whether an executive meets the guidelines, except that not more than 50% of the guidelines can be met by the after-tax value of unexercised vested options. At September 30, 2006, the 17 executives subject to the guidelines owned an aggregate of 417,506 shares (including share equivalents under our supplemental savings plans) of the Corporation’s Common Stock, with an aggregate market value of $24.3 million at September 30, 2006. All corporate officers met the guidelines as of September 30, 2006.
Components of Compensation
• Base Salary—We reviewed and approved the base salaries of all corporate officers, including the Chief Executive Officer, and reviewed an annual salary plan for other executives in senior management positions, near the beginning of the 2006 fiscal year.
• Annual Incentives—In the early part of each fiscal year, we review with the Chief Executive Officer the Corporation’s financial and operating goals for the fiscal year. These include measurable financial and operating goals as well as long-term leadership goals that in part require more subjective assessments. After the end of the year, we evaluate the Corporation’s performance and consider the results together with the contributions made by and the levels of responsibility of the individual executives in awarding annual incentive compensation under our ICP Plans. The incentive compensation for executives responsible for the management of business groups is largely determined by the extent to which the respective business group achieves goals established at the beginning of each year tailored to the particular business group. Annual incentives for Messrs. Nosbusch, Gelly
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and Hagerman are based upon the performance of the Corporation, and the annual incentives for Messrs. Eisenbrown and Crandall are based upon a combination of the performance of the Corporation and their business groups.
The following table shows the Corporation’s performance against its principal 2006 financial goals:
| | | | |
Performance Measure | | Goal | | Performance Achieved |
|
Revenue | | $5.3 billion | | $5.6 billion |
Earnings per share from continuing operations before accounting change | | $3.05 | | $3.49 |
Free cash flow(1) | | $280 million | | $324 million |
Return on invested capital(2) | | 20.0% after-tax | | 22.2% after-tax |
| | |
(1) | | We define free cash flow, an internal performance measure, as cash provided by operating activities ($426.2 million in 2006), plus excess income tax benefit from stock option exercises ($47.4 million in 2006), minus capital expenditures ($150.1 million in 2006). In the first quarter of fiscal 2006, we adopted SFAS 123(R), which requires that we report excess tax benefits related to share-based compensation as a financing cash flow rather than as an operating cash flow. We have added this benefit back to our operating cash flow to present free cash flow on a basis that is consistent with our historical presentation. Our definition of free cash flow, which is a non-GAAP financial measure, takes into consideration the capital investment required to maintain the operations of our businesses and execute our strategy. Our definition of free cash flow may be different from definitions used by other companies. Free cash flow includes the effect of our $450 million voluntary contribution to our U.S. pension plan. The contribution was considered in establishing the 2006 goal. |
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(2) | | For a complete definition and explanation of our calculation of return on invested capital, see Supplemental Financial Information on page 25. |
• Long-Term Incentives—In fiscal 2006, long-term incentives for senior executives were provided through a combination of stock options, performance shares and restricted stock. Stock options were worth approximately5/8 of the value of the grant, performance shares approximately1/4 of the value of the grant, and restricted stock approximately1/8 of the value of the grant. We determined the allocation of equity vehicles based upon a review of market practices and our belief that long-term incentives should have a greater performance link than the general market practice. The payout in respect of performance shares granted in November 2005 and December 2006 will be made in shares of our Common Stock or cash, and will range from zero to 200% of the target based on the Corporation’s total shareowner return compared to the S&P 500 Index over a three-year period. The payouts will be at zero, the target amount and the maximum amount if our total shareowner return is equal to or less than the 30th percentile, equal to the 60th percentile and equal to or greater than the 75th percentile of the S&P 500 Index, respectively, over the applicable three-year period, with the payout interpolated for results between those percentiles. Long-term incentives for mid-level executives in fiscal 2006 were provided through stock option grants. All equity grants were generally made near the beginning of the fiscal year. During fiscal year 2006, stock options equal to approximately 0.9% of outstanding shares were granted to senior and middle-management executives and other employees. Total options outstanding at the end of the 2006 fiscal year were approximately 5.2% of outstanding shares. The Committee takes these figures into account when determining the annual grant for executives.
In addition, certain executives received stock optionsand/or restricted stock awards in connection with promotions or as new hires.
• Compensation Deductibility—Internal Revenue Code Section 162(m) provides that publicly held companies may not deduct in any taxable year compensation in excess of one million dollars paid in that year to its Chief Executive Officer and its other four most highly compensated executive officers unless the compensation is “performance based”. Grants of stock options, performance shares and awards under our Annual Incentive Compensation Plan for Senior Executive Officers are considered “performance based” compensation. Since we retain discretion with respect to base salaries and other annual incentive compensation awards, those elements would not qualify as “performance based” compensation for these purposes. We do not anticipate that any portion of the fiscal year 2006 compensation to the Named Officers will be subject to any deductibility limitations under Section 162(m).
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Compensation of the Chairman of the Board and Chief Executive Officer
Mr. Nosbusch’s base salary was increased to $925,000 from $800,000 in December 2005. His total annual cash compensation continues to depend substantially on annual incentive compensation tied to our assessment of his and the Corporation’s performance.
At the beginning of fiscal 2006, we granted Mr. Nosbusch options for 145,500 shares, 11,200 restricted shares and 25,800 performance shares, consistent with our executive compensation philosophy. We considered information on Mr. Nosbusch’s total compensation compared to the compensation of chief executive officers of other major U.S. industrial companies; historical information regarding his long-term compensation opportunities, as well as Mr. Nosbusch’s past and expected future contributions to the Corporation’s long-term performance.
In determining Mr. Nosbusch’s annual incentive compensation for 2006, we concluded that under his leadership in 2006 the Corporation had strong financial and operating performance. In addition, we recognized the substantial return to shareowners during the 2006 fiscal year, which resulted in an increase in market capitalization of $615 million (see the Shareowner Return Performance Presentation on Page 21). Based on the foregoing, we awarded Mr. Nosbusch $1,450,000 in annual incentive compensation.
The Board in Executive Session (without Mr. Nosbusch present) received and discussed our evaluation of the Corporation’s and Mr. Nosbusch’s performance in the 2006 fiscal year, together with Mr. Nosbusch’s compensation.
The Committee and the Board believe that the skill and motivation of all our employees, and especially our executive leaders, are essential to the Corporation’s performance and to creating shareowner value. We believe our compensation program motivates performance that differentiates us from our competitors. We will continue to provide an effective compensation program that we believe serves shareowners’ interests and is worthy of shareowner support.
Compensation and Management Development Committee
Joseph F. Toot, Jr.,Chairman
Betty C. Alewine
William T. McCormick, Jr.
Bruce M. Rockwell
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SHAREOWNER RETURN PERFORMANCE PRESENTATION
The following line graph compares the cumulative total shareowner return on our Common Stock against the cumulative total return of the S&P Composite-500 Stock Index and the S&P Electrical Components & Equipment Index for the period of five fiscal years from October 1, 2001 to September 30, 2006, assuming in each case a fixed investment of $100 at the respective closing prices on September 30, 2001 and reinvestment of all dividends.
Comparison of Five-Year Cumulative Total Return*
Rockwell Automation, S&P Composite-500 & S&P Electrical Components & Equipment
The cumulative total returns on Rockwell Automation Common Stock and each index as of each September 30,2001-2006 plotted in the above graph are as follows:
| | | | | | | | | | | | | | | | | | | | | | | | |
| | 2001 | | | 2002 | | | 2003 | | | 2004 | | | 2005 | | | 2006 | |
|
Rockwell Automation* | | $ | 100.00 | | | $ | 114.71 | | | $ | 190.48 | | | $ | 286.37 | | | $ | 397.31 | | | $ | 442.67 | |
S&P Composite—500 | | | 100.00 | | | | 79.51 | | | | 98.91 | | | | 112.63 | | | | 126.43 | | | | 140.08 | |
S&P Electrical Components & Equipment | | | 100.00 | | | | 90.78 | | | | 125.32 | | | | 154.72 | | | | 192.63 | | | | 223.00 | |
Cash dividends per common share | | | 0.93 | | | | 0.66 | | | | 0.66 | | | | 0.66 | | | | 0.78 | | | | 0.90 | |
* Includes the reinvestment of all dividends in our Common Stock.
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RETIREMENT PLANS
The following table shows the estimated annual retirement benefits payable at age 65 on a straight life annuity basis to the Named Officers, in the earnings and years of service classifications indicated, under our retirement plans that cover most officers and other salaried employees on a non-contributory basis. Such benefits reflect a reduction to recognize in part our cost of Social Security benefits related to service for us. Our plans also provide for the payment of benefits to an employee’s surviving spouse or other beneficiary.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Average
| | | | | | | | | | | | | | | | | | | | | | | | | | |
Annual
| | | | Years of Credited Service | |
Earnings(1) | | | | 5 Years | | | 10 Years | | | 15 Years | | | 20 Years | | | 25 Years | | | 30 Years(2) | | | 35 Years | | | 40 Years | |
|
$ 250,000 | | | | $ | 17,442 | | | $ | 34,884 | | | $ | 52,327 | | | $ | 69,769 | | | $ | 87,211 | | | $ | 104,653 | | | $ | 122,095 | | | $ | 136,470 | |
500,000 | | | | | 36,192 | | | | 72,384 | | | | 108,577 | | | | 144,769 | | | | 180,961 | | | | 217,153 | | | | 253,345 | | | | 283,345 | |
750,000 | | | | | 54,942 | | | | 109,884 | | | | 164,827 | | | | 219,769 | | | | 274,711 | | | | 329,653 | | | | 384,595 | | | | 430,220 | |
1,000,000 | | | | | 73,692 | | | | 147,384 | | | | 221,077 | | | | 294,769 | | | | 368,461 | | | | 442,153 | | | | 515,845 | | | | 577,095 | |
1,500,000 | | | | | 111,192 | | | | 222,384 | | | | 333,577 | | | | 444,769 | | | | 555,961 | | | | 667,153 | | | | 778,345 | | | | 870,845 | |
2,000,000 | | | | | 148,692 | | | | 297,384 | | | | 446,077 | | | | 594,769 | | | | 743,461 | | | | 892,153 | | | | 1,040,845 | | | | 1,164,595 | |
2,500,000 | | | | | 186,192 | | | | 372,384 | | | | 558,577 | | | | 744,769 | | | | 930,961 | | | | 1,117,153 | | | | 1,303,345 | | | | 1,458,345 | |
3,000,000 | | | | | 223,692 | | | | 447,384 | | | | 671,077 | | | | 894,769 | | | | 1,118,461 | | | | 1,342,153 | | | | 1,565,845 | | | | 1,752,095 | |
| | |
(1) | | Average annual earnings includes salary and annual bonus. The calculation of retirement benefits under the plans generally is based upon average earnings for the highest five years of the ten years preceding retirement. The credited years of service for Messrs. Nosbusch, Crandall, Eisenbrown, Gelly and Hagerman are 33, 20, 31, 3 and 3. |
|
(2) | | Employees of the Corporation hired before January 1, 1993 who were part of our corporate staff at the time of the spin-off of our former Rockwell Collins avionics and communications business on June 29, 2001, including Mr. Nosbusch, but not Messrs. Crandall, Eisenbrown, Gelly or Hagerman, are entitled to receive the benefits set forth above or, if higher, the benefits under our corporate retirement plan existing at June 29, 2001. For Mr. Nosbusch (who has 33 credited years of service), the benefits under our corporate retirement plan existing at June 29, 2001 would be higher in the “30 Years” column under Years of Credited Service, but not under the “35 Years” or “40 Years” columns. The estimated annual retirement benefits payable at age 65 on a straight life annuity basis to participants under our corporate retirement plan existing at June 29, 2001, including Mr. Nosbusch, at 30 years of credited service and the earnings classifications indicated below, are as follows: |
| | | | |
Earnings | | Benefits | |
|
$1,000,000 | | $ | 469,798 | |
1,500,000 | | | 707,298 | |
2,000,000 | | | 944,798 | |
2,500,000 | | | 1,182,298 | |
3,000,000 | | | 1,419,798 | |
Sections 401(a)(17) and 415 of the Internal Revenue Code of 1986, as amended, limit the annual benefits that may be paid from a tax-qualified retirement plan. As permitted by the Employee Retirement Income Security Act of 1974, we have a nonqualified supplemental pension plan that authorizes the payment out of our general funds of any benefits calculated under provisions of the applicable retirement plan that may be above the limits under these sections.
OTHER ARRANGEMENTS
In May and June 2004, we entered into “double trigger” change of control agreements with Messrs. Nosbusch, Gelly and Hagerman. These agreements are intended to provide for continuity of management in the event of a change of control. Each agreement becomes effective if there is a “change of control” of the Corporation before September 30, 2007. Each agreement provides for the continuing employment of the executive for three years after the change of control on conditions no less favorable than those in effect before the change of control. If the executive’s employment is terminated by us without “cause” or if the executive terminates his employment for “good reason” within that three year period, the executive is entitled to severance benefits equal to three times his annual compensation, including bonus, and continuation of other benefits for three years. In addition, if the executive terminates his own employment for any
22
reason during a30-day window period beginning one year after the change of control, the executive is also entitled to these severance benefits. The executives are entitled to an additional payment, if necessary, to make them whole as a result of any excise tax imposed on these change of control payments, unless the safe harbor amount above which the excise tax is imposed is not exceeded by more than 10%, in which event the payments will be reduced to avoid the excise tax.
The Named Officers participate in our non-qualified supplemental pension plan, supplemental savings plan and deferred compensation plan. These non-qualified plans are available on the same terms to certain other salaried employees. We have established a master rabbi trust relating to these non-qualified plans. The master rabbi trust requires that, upon a change of control, we fund the trust in a cash amount equal to the unfunded accrued liabilities of these non-qualified plans as of such time.
PROPOSAL TO APPROVE THE SELECTION OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee has selected the firm of D&T as our independent registered public accounting firm for the fiscal year ending September 30, 2007, subject to the approval of the shareowners. D&T, and its predecessors, have acted as our independent registered public accounting firm since 1934.
Before the Audit Committee selected D&T, it carefully considered the independence and qualifications of that firm, including their performance in prior years and their reputation for integrity and for competence in the fields of accounting and auditing. We expect that representatives of D&T will be present at the Annual Meeting to respond to appropriate questions and to make a statement if they desire to do so.
Audit Fees
The following table sets forth the aggregate fees for services provided by D&T for the fiscal years ended September 30, 2006 and 2005 (in millions), all of which were approved by the Audit Committee:
| | | | | | | | |
| | Year Ended
| |
| | September 30, | |
| | 2006 | | | 2005 | |
|
Audit Fees | | | | | | | | |
Integrated Audit of Consolidated Financial Statements and Internal Control over Financial Reporting | | $ | 3.8 | | | | — | |
Annual Audit | | | — | | | $ | 2.7 | |
Sarbanes-Oxley Internal Control over Financial Reporting Attestation | | | — | | | | 1.2 | |
Statutory Audits | | | 1.6 | | | | 1.4 | |
| | | | | | | | |
Audit-Related Fees | | | | | | | | |
Employee Benefit Plan Audits and Other Audits | | | 0.3 | | | | 0.3 | |
Divestiture Related Audit Services | | | 1.1 | | | | — | |
Enterprise Resource Planning Internal Control Review | | | 0.2 | | | | — | |
| | | | | | | | |
Tax Fees | | | | | | | | |
Compliance | | | — | | | | 0.2 | |
Other Consulting | | | — | | | | — | |
| | | | | | | | |
All Other Fees | | | — | | | | — | |
| | | | | | | | |
Total | | $ | 7.0 | | | $ | 5.8 | |
| | | | | | | | |
The Audit Committee considered and determined that the provision of non-audit services by D&T was compatible with maintaining the firm’s independence.
Audit Committee Pre-Approval Policies and Procedures
The Audit Committee is responsible for the appointment and compensation of, and oversight of the work performed by, our independent registered public accounting firm. The Audit Committee pre-approves all audit
23
(including audit-related) services and permitted non-audit services provided by our independent registered public accounting firm in accordance with the pre-approval policies and procedures established by the Audit Committee. During fiscal 2006, there was one instance in which the Audit Committee approved de minimis non-audit services (expatriate tax return services for one employee) of less than $2,000 after the services were provided, which services constituted less than 0.2% of the Audit-Related, Tax and Other services provided by our independent registered public accounting firm. These services were transitioned from D&T to another firm.
The Audit Committee annually approves the scope and fee estimates for the year-end audit, statutory audits and employee benefit plan audits to be performed by our independent registered public accounting firm for the next fiscal year. With respect to other permitted services, management defines and presents specific projects for which the advance approval of the Audit Committee is requested. The Audit Committee pre-approves specific engagements and projects on a fiscal year basis, subject to individual project thresholds and annual thresholds. At each Audit Committee meeting, the Controller reports to the Audit Committee regarding the aggregate fees charged by our independent registered public accounting firm compared to the pre-approved amounts.
The Board of Directors recommends that you vote differently.
“FOR” the proposal to approve the selection of D&T as our independent registered public accounting firm, which is presented as item (b).
OTHER MATTERS
The Board of Directors does not know of any other matters whichthat may be presented at the meeting. The Corporation's OurBy-Laws required notice by November 9, 20013, 2006 for any matter to be brought before the meeting by a shareowner. In the event of a vote on any matters other than those referred to in items (a), (b)
and (c) of the accompanying Notice of 20022007 Annual Meeting of Shareowners, it is
intended that proxies in the accompanying form will be voted thereon in accordance with the judgment of the person or persons voting such proxies.
COMPLIANCE WITH
SECTION 16(a) OF THE SECURITIES EXCHANGE ACT
BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act requires the Corporation'sour executive officers and directors, and persons who own more than ten percent of a registered class of the Corporation'sour equity securities, to file reports of ownership and changes in ownership on Forms 3, 4 and 5 with the Securities and
Exchange CommissionSEC and the New York Stock Exchange. Officers, directors and
greater than ten percent shareowners are required by Securities and Exchange
Commission regulation to furnish the Corporation with copies of all Forms 3, 4
and 5 they file.
NYSE.
Based solely on the Corporation'sour review of the copies of such forms it hasthat we have received and written representations from certain reporting persons confirming that they were not required to file Forms 5 for specified fiscal years, the
Corporation believeswe believe that all itsour executive officers, directors and greater than ten percent beneficial owners complied with allapplicable SEC filing requirements applicable to
them with respect to transactions during fiscal 2001.
2006.
ANNUAL REPORTS
The Corporation'sREPORT
Our Annual Report to Shareowners, including the Annual Report on
Form 10-K and financial statements, for the fiscal year ended September 30,
2001, has been2006, was mailed to shareowners
in advance ofwith this
Proxy Statement.
16
proxy statement. SHAREOWNER PROPOSALS FOR ANNUAL MEETING IN 2003
2008
To be eligible for inclusion in the Corporation'sour proxy statement, shareowner proposals for the 20032008 Annual Meeting of Shareowners must be received on or before August 23, 2002 at16, 2007 by the Office of the Secretary at the Corporation's
Worldour Global Headquarters, 777 East Wisconsin Avenue,1201 South Second Street, Milwaukee, Wisconsin 53202.53204. In addition, the Corporation'sour By-Laws require a shareowner desiring to propose any matter for consideration of the shareowners at the 20032008 Annual Meeting of Shareowners to notify the Corporation'sCorporation’s Secretary in writing at the address listed in the preceding sentence on or after October 9, 200210, 2007 and on or before November 8, 2002.9, 2007. If the number of directors to be elected to the Board at the 20032008 Annual Meeting of Shareowners is increased and there is nowe do not make a public announcement by the Corporation naming all of the nominees for director or specifying the increased size of the Board on or before October 29, 2002,30, 2007, a shareowner proposal with respect to nominees for any new position created by such increase will be considered timely if received by the Corporation'sour Secretary by not later than the tenth day following suchour public announcement of the increase.
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SHAREOWNERS SHARING THE SAME ADDRESS
We have adopted a procedure called “householding”, which has been approved by the Corporation.
SEC. Under this procedure, we are delivering only one copy of the annual report and this proxy statement to multiple shareowners who share the same address and have the same last name, unless we have received contrary instructions from an affected shareowner. This procedure reduces our printing and mailing costs. Shareowners who participate in householding will continue to receive separate proxy cards.
We will deliver promptly upon written or oral request a separate copy of the annual report and this proxy statement to any shareowner at a shared address to which a single copy of the documents was delivered. To receive a separate copy of the annual report or proxy statement, you may write or call Rockwell Automation Shareowner Relations, 1201 South Second Street, Milwaukee, WI 53204, telephone:414-382-8410. You may also access our annual report and proxy statement on our website atwww.rockwellautomation.com; click on the heading: “About Us”, then the heading “Investor Relations”, then the heading: “SEC Filings”.
If you are a holder of record and would like to revoke your householding consent and receive a separate copy of the annual report or proxy statement in the future, please contact Automatic Data Processing, Inc. (ADP), either by calling toll free at(800) 542-1061 or by writing to ADP, Householding Department, 51 Mercedes Way, Edgewood, New York 11717. You will be removed from the householding program within 30 days of receipt of the revocation of your consent.
Any shareowners of record who share the same address and currently receive multiple copies of our annual report and proxy statement who wish to receive only one copy of these materials per household in the future should contact Rockwell Automation Shareowner Relations at the address or telephone number listed above to participate in the householding program.
Some brokerage firms have instituted householding. If you hold your shares in street name, please contact your bank, broker or other holder of record to request information about householding.
EXPENSES OF SOLICITATION
The
We will bear the cost of the solicitation of
proxies will be borne by the Corporation.proxies. In addition to
the use of the mails,mail ande-mail, proxies may be solicited personally, or by telephone
facsimile or
e-mail,facsimile, by a few
of our regular employees
of the Corporation without additional compensation.
The Corporation does not expect to pay any
compensation for the solicitation of proxies butWe will reimburse brokers and other persons holding stock in their names, or in the names of nominees, for their expenses for
sendingforwarding proxy
materialmaterials to principals and
beneficial owners and obtaining their proxies.
December 17, 2001
17
APPENDIX A
ROCKWELL INTERNATIONAL CORPORATION
AUDIT COMMITTEE CHARTER
The Audit Committee has been constituted by the Board SUPPLEMENTAL FINANCIAL INFORMATION
This proxy statement contains information regarding return on invested capital (ROIC), which is a non-GAAP financial measure. Management believes that ROIC is useful to assist the Board
in overseeing (1) the integrityinvestors as a measure of performance and of the financial statementseffectiveness of the Corporation,
(2) the compliance by the Corporation with legal and regulatory requirements and
(3) the independence and performanceuse of the Corporation's internal and external
auditors.
The Audit Committee shall consist of at least three members of the Board of
Directors,capital in our operations. Management uses ROIC as one of which shall be designated as the chairman, each of whom shall
meet the independence and experience requirements of the New York Stock
Exchange. The members and the chairman of the Audit Committee shall be appointed
by the Board. The Audit Committee shall meet at least four times a year and
shall make regular reports to the Board.
The Audit Committee shall have the authority to retain special legal,
accounting or other consultants to advise the Committee. The Audit Committee may
request any officer or employee of the Corporation or the Corporation's outside
counsel or independent auditors to attend a meeting of the Committee or to meet
with any members of, or consultants to, the Committee.
The Audit Committee shall:
1. Review and reassess the adequacy of this Charter annually and
recommend any proposed changes to the Board for approval.
2. Review the annual audited financial statements with management and the
independent auditors, including major issues regarding accounting and auditing
principles and practices as well as the adequacy of internal controls that could
significantly affect the Corporation's financial statements.
3. Recommend to the Board of Directors that the annual audited financial
statements be included in the Corporation's Annual Report on Form 10-K. Submit
the report required by the rules of the Securities and Exchange Commission to be
included in the Corporation's annual meeting proxy statement.
4. Review with management and the independent auditors significant
financial reporting issues and judgments made in connection with the preparation
of the Corporation's financial statements, including major changes to the
Corporation's accounting principles and practices.
5. Review by the Chairman of the Committee (or another member of the
Committee designated by the Chairman) with management and the independent
auditors the quarterly earnings news release prior to issuance and the
Corporation's quarterly financial statements prior to the filing of the
Quarterly Report on Form 10-Q.
6. Meet periodically to review with management and the independent
auditors their views on the Corporation's major financial risk exposures and the
steps management has takenmeasure to monitor and control such exposures.
7. Evaluateevaluate our performance. Our measure of ROIC is likely to differ from that used by other companies. We define ROIC as the performancepercentage resulting from the following calculation:
(a) Income from continuing operations before accounting change, if any, and before interest expense, income tax provision, and purchase accounting depreciation and amortization, divided by;
(b) average invested capital for the year, calculated as a five quarter rolling average using the sum of short-term debt, long-term debt, shareowners’ equity, cumulative impairments of goodwill and intangibles required under SFAS No. 142, and accumulated amortization of goodwill and other intangible assets, minus cash and cash equivalents, multiplied by;
(c) one minus the independent auditorsadjusted effective tax rate for the period, the adjusted effective tax rate is calculated by excluding the effect of separately reported tax items in continuing operations.
25
ROIC is calculated as follows (in millions, except percentages):
| | | | | | | | |
| | Year Ended
| |
| | September 30, | |
| | 2006 | | | 2005 | |
|
(a) Return | | | | | | | | |
Income from continuing operations before cumulative effect of accounting change | | $ | 628.1 | | | $ | 518.4 | |
Interest expense | | | 58.4 | | | | 45.8 | |
Income tax provision | | | 263.3 | | | | 218.6 | |
Purchase accounting depreciation and amortization | | | 13.3 | | | | 14.7 | |
Gain on sale of investment | | | (19.9 | ) | | | — | |
| | | | | | | | |
Return | | | 943.2 | | | | 797.5 | |
| | | | | | | | |
(b) Average Invested Capital | | | | | | | | |
Short-term debt | | | 115.6 | | | | 0.4 | |
Long-term debt | | | 746.9 | | | | 752.2 | |
Shareowners’ equity | | | 1,691.9 | | | | 1,870.1 | |
Impairments of goodwill and intangibles | | | 108.0 | | | | 108.0 | |
Accumulated amortization of goodwill and intangibles | | | 682.5 | | | | 659.7 | |
Cash and cash equivalents | | | (353.2 | ) | | | (471.7 | ) |
| | | | | | | | |
Average invested capital | | | 2,991.7 | | | | 2,918.7 | |
| | | | | | | | |
(c) Adjusted Effective Tax Rate | | | | | | | | |
Income tax provision | | | 263.3 | | | | 218.6 | |
Separately reported tax items in continuing operations | | | — | | | | 19.7 | |
| | | | | | | | |
Income tax provisions before separately reported tax items in continuing operations | | | 263.3 | | | | 238.3 | |
| | | | | | | | |
Income from continuing operations before income taxes and cumulative effect of accounting change | | $ | 891.4 | | | $ | 737.0 | |
| | | | | | | | |
Adjusted effective tax rate | | | 29.5 | % | | | 32.3 | % |
| | | | | | | | |
(a) / (b) * (1–c) Return On Invested Capital | | | 22.2 | % | | | 18.5 | % |
| | | | | | | | |
December 14, 2006
26
ADMISSION TO THE 2007 ANNUAL MEETING
An admission card (or other proof of stock ownership) and
recommendproper identification will be required for admission to the
Board the appointmentAnnual Meeting of
the independent auditors, which firm is ultimately
accountable to the Audit Committee and Board.
8. Approve the fees to be paid to the independent auditors.
9. Receive periodic reports from the independent auditors regarding the
auditors' independence, discuss such reports with the auditors, and if so
determined by the Audit Committee, recommend that the Board take appropriate
action to satisfy itself of the independence of the auditors.
10. Meet with the independent auditors to review and approve the scope of
the audit.
11. Obtain from the independent auditors assurance that Section 10A of the
Securities Exchange Act of 1934 has not been implicated.
18
12. Discuss with the independent auditors the matters required to be
discussed by StatementShareowners in Milwaukee, Wisconsin on Auditing Standards Nos. 61 and 90 relating to the
conduct of the audit.
13. Review with the independent auditors any significant problems or
difficulties the auditors may have encountered and any management letter
provided by the auditors and the Corporation's response to that letter. Such
review should include any restrictions on the scope of activities or access to
required information, significant changes to the Audit Plan and any
disagreements with management, which if not satisfactorily resolved would have
affected the auditor's opinion.
14. Review the appointment of and periodically review the performance of
the General Auditor.
15. Review with the Corporation's General Auditor:
(a) the internal audit department responsibilities, budget and
staffing;
(b) the scope of the annual internal audit plan;
(c) any comments the General Auditor may have on major issues related
to the internal audit activities or restrictions, if any, imposed
on them; and
(d) any significant findings of internal audits and management's
responses.
16. Monitor compliance by the employees of the Corporation and its
subsidiary and controlled affiliated entities with the Corporation's standards
of business conduct policies.
17. Review with the Corporation's General Counsel legal matters that may
have a material effect on the financial statements, the Corporation's compliance
policies and any material reports or inquiries received from regulators or
governmental agencies.
18. Meet regularly with the Corporation's senior executive officers, the
Corporation's General Auditor and the independent auditors in separate executive
sessions.
19. Review any other matter brought to its attention within the scope of
its duties.
While the Audit Committee has the responsibilities and powers set forth in
this Charter, it is not the duty of the Audit Committee to plan or conduct
audits or to determine that the Corporation's financial statements are complete
and accurate and are in accordance with generally accepted accounting
principles. Those duties are the responsibility of management and the
independent auditors. Nor is it the duty of the Audit Committee to conduct
investigations, to resolve disagreements, if any, between management and the
independent auditors or to assure compliance with laws and regulations and the
Corporation's standards of business conduct policies.
19
February 7, 2007. If you plan to attend the Annual Meeting, of Shareowners TO BE HELD IN MILWAUKEE,
WISCONSIN on February 6, 2002, please be sure to request an admittance card by:
- - | | |
| • | marking the appropriate box on the proxy card and mailing the card using the enclosed envelope; |
|
| • | indicating your desire to attend the meeting through our Internet voting procedure; or |
|
| • | calling our Shareowner Relations line at414-382-8410. |
An admission card and mailingwill be mailed to you if:
| | |
| • | your Rockwell Automation shares are registered in your name; or |
|
| • | your Rockwell Automation shares are held in the name of a broker or other nominee and you provide written evidence of your stock ownership as of the December 11, 2006 record date, such as a brokerage statement or letter from your broker. |
Your admission card
using the
enclosed envelope;
- - indicatingwill serve as verification of your
desire to attend the meeting through the Corporation's
telephone or internet voting procedure; or
- - calling the Corporation's Shareowner Relations line at 414-212-5300.
Please mark
your votes as
indicated in [X]
this example
WHERE Aownership.
ROCKWELL AUTOMATION, INC.
ANNUAL MEETING OF SHAREOWNERS
WEDNESDAY, FEBRUARY 7, 2007
10:00 AM CST
THE PFISTER HOTEL
424 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN
YOUR VOTE IS IMPORTANT!
YOU CAN VOTE BY INTERNET, TELEPHONE OR MAIL. SEE THE
INSTRUCTIONS ON THE OTHER SIDE OF THIS PROXY AND DIRECTION CARD.
IF YOU DID NOT SPECIFIED,RECEIVE PAPER COPIES OF THE PROXIES WILL VOTEROCKWELL AUTOMATION
PROXY STATEMENT AND ANNUAL REPORT BECAUSE YOU
CONSENTED TO VIEW THEM ON THE SHARES REPRESENTED
BY
INTERNET, GO TO THE FOLLOWING INTERNET ADDRESSES:
PROXY "FOR" THE ELECTION OF DIRECTORS, "FOR" PROPOSAL (B) AND "FOR"
PROPOSAL (C) AND WILL VOTE IN ACCORDANCE WITH THEIR DISCRETION ON SUCH OTHER
MATTERS AS MAY PROPERLY COME BEFORE THE MEETING. THE BOARD OF DIRECTORS
RECOMMENDS A VOTE "FOR" THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS (B) AND
(C).
FOR all nominees WITHHOLD AUTHORITY
(A) Election of directors: listed below to vote for all
(except as marked nominees listed
to the contrary) below
[ ] [ ]
Nominees: 01 B.M. Rockwell, 02 J.F. Toot, Jr., 03 K.F. Yontz
(Instruction: To withhold authority to vote for any individual
nominee, write that nominee's name on the space provided below.)
- ----------------------------------------------------------
FOR AGAINST ABSTAIN
(B) The selection of auditors: [ ] [ ] [ ]
FOR AGAINST ABSTAIN
(C) The change of corporate name: [ ] [ ] [ ]
Mark here if you plan to attend the meeting.
We will send you an Admittance Card. [ ]
By checking the box to the right, I consent to view the
Annual Reports and Proxy Statements electronically via the
Internet. I understand that the Corporation may no longer
distribute printed materials to me for any future shareowner
meetings until my consent is revoked. I understand that I
may revoke my consent at any time by giving written notice
to the Corporation. [ ]
In their discretion, the proxies are authorized to vote upon
such other business as may properly come before the meeting
or any postponement(s) or adjournment(s) thereof.
SIGNATURE ____________ SIGNATURE(S) IF HELD JOINTLY ________________ DATE ______
Please sign this proxy as your name appears on the Corporation's corporate
records. Joint owners should each sign personally. Trustees and others signing
in a representative capacity should indicate the capacity in which they sign.
- --------------------------------------------------------------------------------
- STATEMENT: http://www.rockwellautomation.com/investors/get/2007_proxy.pdf
ANNUAL REPORT: http://www.rockwellautomation.com/investors/get/AR2006.pdf
FOLD AND DETACH HERE -
VOTE BY INTERNET OR TELEPHONE OR MAIL
24 HOURS A DAY, 7 DAYS A WEEK
YOUR VOTE IS IMPORTANT
INTERNET
http://www.eproxy.com/rok
Use the Internet to vote your proxy. Have your proxy card in hand when you
access the website. You will be prompted to enter your CONTROL NUMBER,
located in the box below, to create and submit an electronic ballot.
OR
TELEPHONE
1-800-435-6710
(FOR U.S. SHAREOWNERS ONLY)
Use any touch-tone telephone to vote your proxy. Have your proxy card in hand
when you call. You will be prompted to enter your CONTROL NUMBER, located in the
box below, and then follow the directions given. After voting, you will be asked
if you wish to attend the meeting or consent to view annual reports and proxy
statements via the Internet.
OR
MAIL
Mark, sign and date your proxy card and return it in the enclosed postage-paid
envelope.
IF YOU VOTE YOUR
PROXY BY INTERNET OR BY TELEPHONE,
YOU DO NOT NEED TO MAIL BACK YOUR PROXY CARD.
YOUR INTERNET OR TELEPHONE INSTRUCTIONS WILL AUTHORIZE THE NAMED PROXIES TO VOTE
YOUR SHARES IN THE SAME MANNER AS IF YOU RETURNED A SIGNED PROXY CARD.
THANK YOU FOR VOTING.
PROXY
AND DIRECTION CARD ROCKWELL INTERNATIONAL CORPORATION
AUTOMATION, INC.
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints D.H. Davis, Jr., W.T. McCormick,Verne G. Istock, Joseph F. Toot, Jr. and J.D. Nichols,Douglas M. Hagerman, jointly and severally, proxies, with full power of substitution, to vote shares of capitalcommon stock which the undersigned is entitled to vote at the Annual Meeting of Shareowners to be held at The Pfister Hotel, 424 East Wisconsin Avenue, Milwaukee, Wisconsin, on February 6, 20027, 2007 or any postponement or adjournment thereof.SUCH PROXIES ARE DIRECTED TO VOTE AS SPECIFIED OR, IF NO SPECIFICATION IS MADE, "FOR"“FOR” THE ELECTION OF THE THREE NOMINEES PROPOSED FOR ELECTION AS DIRECTORS WITH TERMS EXPIRING AT THE ANNUAL MEETING IN 2005, "FOR"2010 and “FOR” PROPOSAL (B) AND "FOR" PROPOSAL (C), AND TO VOTE IN ACCORDANCE WITH THEIR DISCRETION ON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING.
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS'DIRECTORS’ RECOMMENDATIONS, JUST SIGN AND DATE THE OTHER SIDE;DATE; NO BOXES NEED TO BE CHECKED.
Comments:
---------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
---------------------------------------------------------------------
(continued and to be signed on the other side)
- --------------------------------------------------------------------------------
- FOLD
TO: FIDELITY MANAGEMENT TRUST COMPANY, TRUSTEE AND
DETACH HERE -
ROCKWELL INTERNATIONAL CORPORATION
ANNUAL MEETING OF SHAREOWNERS
WEDNESDAY, FEBRUARY 6, 2002
10:00 A.M.
THE PFISTER HOTEL
424 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN
YOUR VOTE IS IMPORTANT!
YOU CAN VOTE BY INTERNET, TELEPHONE OR MAIL.
SEE THE INSTRUCTIONS ON THE OTHER SIDE OF THIS PROXY CARD.
IF YOU DID NOT RECEIVE PAPER COPIES OF ROCKWELL INTERNATIONAL'S
PROXY STATEMENT AND ANNUAL REPORT BECAUSE YOU
CONSENTED TO VIEW THEM ON THE
INTERNET, GO TO THE FOLLOWING INTERNET ADDRESSES:
PROXY STATEMENT: http://www.rockwellautomation.com/invrelations/
pdfs/2002_proxy.pdf
ANNUAL REPORT: http://www.rockwellautomation.com/invrelations/
report2001/index.html
Please mark
your votes as
indicated in [X]
this example
WHERE A VOTE IS NOT SPECIFIED, YOU ARE DIRECTED TO VOTE THE SHARES HELD FOR MY
ACCOUNT "FOR" THE ELECTION OF DIRECTORS, "FOR" PROPOSAL (B) AND "FOR" PROPOSAL
(C) AND TO VOTE IN ACCORDANCE WITH YOUR DISCRETION ON SUCH OTHER MATTERS AS MAY
PROPERLY COME BEFORE THE MEETING. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS (B) AND (C).
FOR all nominees WITHHOLD AUTHORITY
(A) Election of directors: listed below to vote for all
(except as marked nominees listed
to the contrary) below
[ ] [ ]
Nominees: 01 B.M. Rockwell, 02 J.F. Toot, Jr., 03 K.F. Yontz
(Instruction: To withhold authority to vote for any
individual nominee, write that nominee's name on the
space provided below.)
- ----------------------------------------------------------
FOR AGAINST ABSTAIN
(B) The selection of auditors: [ ] [ ] [ ]
FOR AGAINST ABSTAIN
(C) The change of corporate name: [ ] [ ] [ ]
Mark here if you plan to attend the meeting.
We will send you an Admittance Card. [ ]
By checking the box to the right, I consent to view the
Annual Reports and Proxy Statements electronically via the
Internet. I understand that the Corporation may no longer
distribute printed materials to me for any future shareowner
meetings until my consent is revoked. I understand that I may
revoke my consent at any time by giving written notice to the
Corporation. [ ]
In its discretion, the trustee is authorized to vote upon such
other business as may properly come before the meeting or any
postponement(s) or adjournment(s) thereof.
SIGNATURE _______________ SIGNATURE(S) IF HELD JOINTLY____________ DATE ________
In signing as attorney, executor, administrator, trustee or guardian, please
give full title as such, and, if signing for a corporation, please give your
title. Please sign, date and return the direction card promptly using the
enclosed envelope.
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
VOTE BY INTERNET OR TELEPHONE OR MAIL
24 HOURS A DAY, 7 DAYS A WEEK
YOUR VOTE IS IMPORTANT
INTERNET
http://www.eproxy.com/rok
Use the Internet to vote. Have your direction card in hand when you access the
website. You will be prompted to enter your CONTROL NUMBER, located in the box
below, to create and submit an electronic ballot.
OR
TELEPHONE
1-800-435-6710
(FOR U.S. SHAREOWNERS ONLY)
Use any touch-tone telephone to vote. Have your direction card in hand when you
call. You will be prompted to enter your CONTROL NUMBER, located in the box
below, and then follow the directions given. After voting, you will be asked if
you wish to attend the meeting or consent to view annual reports and proxy
statements via the Internet.
OR
MAIL
Mark, sign and date your direction card and return it in the enclosed
postage-paid envelope.
IF YOU VOTE BY INTERNET OR BY TELEPHONE,
YOU DO NOT NEED TO MAIL BACK YOUR DIRECTION CARD.
YOUR INTERNET OR TELEPHONE INSTRUCTIONS WILL AUTHORIZE THE
COMPUTERSHARE TRUST COMPANY, TRUSTEE
IN THE SAME MANNER AS IF YOU RETURNED A SIGNED DIRECTION CARD.
THANK YOU FOR VOTING.
DIRECTION CARD
ROCKWELL COLLINS RETIREMENT SAVINGS PLAN
FOR BARGAINING UNIT EMPLOYEES
TO: WELLS FARGO BANK, N.A., TRUSTEE You are hereby directed to vote, with respect to the proposals listed on the other side of this Proxy and Direction Card, the number of shares of Rockwell International capitalAutomation common stock held for mythis account in the savings plans of Rockwell CollinsAutomation, Inc. (Rockwell Automation Retirement Savings Plan for Bargaining UnitSalaried Employees, Rockwell Automation Retirement Savings Plan for Hourly Employees, Rockwell Automation Savings and Investment Plan for Represented Hourly Employees and Rockwell Automation Retirement Savings Plan for Represented Hourly Employees) and/or the United Space Alliance Employee Stock Purchase Plan at the Annual Meeting of Shareowners of Rockwell International CorporationAutomation, Inc. to be held at The Pfister Hotel, 424 East Wisconsin Avenue, Milwaukee, Wisconsin, on February 6, 2002,7, 2007, and at any postponement or adjournment thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS'DIRECTORS’ RECOMMENDATIONS, CHECK THE BOXES "FOR"“FOR” EACH PROPOSAL LISTED, ON THE OTHER SIDE, THEN SIGN, DATE AND RETURN THIS CARD.
(continuedCARD BY FEBRUARY 3, 2007.
If you do not provide voting directions by February 3, 2007, the shares attributable to this account in savings plans of Rockwell Automation or the United Space Alliance Employee Stock Purchase Plan will not be voted.
| | |
Address Changes/Comments: | |
|
(If you noted any Address Changes/Comments above, please check corresponding box on the reverse side.If you do not check the comments box on the reverse side, we will not receive your comments.)
(continued and to be dated and signed on the other side)
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
ROCKWELL INTERNATIONAL CORPORATION
ANNUAL MEETING OF SHAREOWNERS
WEDNESDAY, FEBRUARY 6, 2002
10:00 A.M.
THE PFISTER HOTEL
424 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN
| | |
(ROCKWELL AUTOMATION LOGO) | | VOTE BY INTERNET OR TELEPHONE OR MAIL |
24 HOURS A DAY-7 DAYS A WEEK
YOUR VOTE IS IMPORTANT!IMPORTANT
ROCKWELL AUTOMATION, INC.
1201 SOUTH SECOND STREET
MILWAUKEE, WI 53204
INTERNET:http://www.proxyvote.com
Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time on February 4, 2007. Have your proxy and direction card in hand when you access the website and follow the instructions to obtain your records and to create an electronic voting instruction form.
OR
TELEPHONE: 1-800-690-6903 (For US Shareowners Only) Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time on February 4, 2007. Have your proxy and direction card in hand when you call and then follow the instructions.
OR
MAIL: Mark, sign and date your proxy and direction card and return it in the enclosed postage-paid envelope provided or return it to Rockwell Automation, Inc., c/o ADP, 51 Mercedes Way, Edgewood, NY 11717 by February 3, 2007.
NOTE: If you transmit your voting instructions by Internet or telephone, you DO NOT NEED TO MAIL BACK your proxy and direction card. Your Internet or telephone instructions will authorize the named proxies in the same manner as if you returned a signed proxy and direction card.
THANK YOU CAN VOTE BY INTERNET, TELEPHONE OR MAIL.
SEE THE INSTRUCTIONS ON THE OTHER SIDE OF FOR VOTING.
| | | | |
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: | | ROKAU1 | | KEEP THIS PORTION FOR YOUR RECORDS |
|
| | DETACH AND RETURN THIS PORTION ONLY |
THIS PROXY AND DIRECTION CARD.
IF YOU DID NOT RECEIVE PAPER COPIES OF CARD IS VALID ONLY WHEN SIGNED AND DATED.
ROCKWELL INTERNATIONAL'S
PROXY STATEMENT AND ANNUAL REPORT BECAUSE YOU
CONSENTED TO VIEW THEM ON THE
INTERNET, GO TO THE FOLLOWING INTERNET ADDRESSES:
PROXY STATEMENT: http://www.rockwellautomation.com/invrelations/
pdfs/2002_proxy.pdf
ANNUAL REPORT: http://www.rockwellautomation.com/invrelations/
report2001/index.html
Please mark
your votes as
indicated in [X]
this example
WHERE A VOTE IS NOT SPECIFIED, YOU ARE DIRECTED TO VOTE THE SHARES HELD FOR MY
ACCOUNT "FOR" THE ELECTION OF DIRECTORS. "FOR" PROPOSAL (B) AND "FOR" PROPOSAL
(C) AND TO VOTE IN ACCORDANCE WITH YOUR DISCRETION ON SUCH OTHER MATTERS AS MAY
PROPERLY COME BEFORE THE MEETING. AUTOMATION, INC. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"“FOR”
EACH OF THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS (B) AND (C).
FOR all nominees WITHHOLD AUTHORITY
(A) Election of directors: listed below to vote for all
(except as marked nominees listed
to the contrary) below
[ ] [ ]
Nominees: 01 B.M. Rockwell, 02 J.F. Toot, Jr., 03 K.F. Yontz
(Instruction: To withhold authority to vote for any
individual nominee, write that nominee's name on the
space provided below.)
- ----------------------------------------------------------
FOR AGAINST ABSTAIN
(B) The selection of auditors: [ ] [ ] [ ]
FOR AGAINST ABSTAIN
(C) The change of corporate name: [ ] [ ] [ ]
Mark here if you plan to attend the meeting.
We will send you an Admittance Card. [ ]
By checking the box to the right, I consent to view the
Annual Reports and Proxy Statements electronically via the
Internet. I understand that the Corporation may no longer
distribute printed materials to me for any future shareowner
meetings until my consent is revoked. I understand that I may
revoke my consent at any time by giving written notice to the
Corporation. [ ]
FOLLOWING:
| | | | | | | | | | | | |
(A) | | Election of directors: | | For | | Withhold | | For All | | To withhold authority to vote for any individual nominee, mark “For All Except” and write that nominee’s number on the line below. |
| | Nominees: | | | | All | | All | | Except | |
| | | | 01) Barry C. Johnson | | | | | | | |
| | | | 02) William T. McCormick, Jr. | | | | | | | |
| | | | 03) Keith D. Nosbusch | | o | | o | | o | | |
| | | | | | | | | | | | |
| | | | | | | | | | |
Vote On Proposal | | For | | Against | | Abstain | | |
(B) | | Approve the selection of independent registered public accounting firm: | o | | o | | o | | |
In itstheir discretion, the trustee isproxies are authorized to vote upon such other business as may properly come before the meeting or any postponement(s)postponement or adjournment(s)adjournment thereof.
SIGNATURE _______________ SIGNATURE(S) IF HELD JOINTLY____________ DATE ________
In signing as attorney, executor, administrator, trustee or guardian, please
give full title as such, and, if signing for a corporation, please give your
title.
Please sign
datethis proxy and
return the direction card
promptly using the
enclosed envelope.
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
VOTE BY INTERNET OR TELEPHONE OR MAIL
24 HOURS A DAY, 7 DAYS A WEEK
YOUR VOTE IS IMPORTANT
INTERNET
http://www.eproxy.com/rok
Use the Internet to vote. Haveas your
direction card in hand when you access the
website. You will be prompted to enter your CONTROL NUMBER, located in the box
below, to create and submit an electronic ballot.
OR
TELEPHONE
1-800-435-6710
(FOR U.S. SHAREOWNERS ONLY)
Use any touch-tone telephone to vote. Have your direction card in hand when you
call. You will be prompted to enter your CONTROL NUMBER, located in the box
below, and then follow the directions given. After voting, you will be asked if
you wish to attend the meeting or consent to view annual reports and proxy
statements via the Internet.
OR
MAIL
Mark, sign and date your direction card and return it in the enclosed
postage-paid envelope.
IF YOU VOTE BY INTERNET OR BY TELEPHONE,
YOU DO NOT NEED TO MAIL BACK YOUR DIRECTION CARD.
YOUR INTERNET OR TELEPHONE INSTRUCTIONS WILL AUTHORIZE THE TRUSTEE
IN THE SAME MANNER AS IF YOU RETURNED A SIGNED DIRECTION CARD.
THANK YOU FOR VOTING.
DIRECTION CARD
ROCKWELL COLLINS RETIREMENT SAVINGS PLAN
FOR HOURLY EMPLOYEES
TO: WELLS FARGO BANK, N.A., TRUSTEE
You are hereby directed to vote, with respect to the proposals listedname appears on the other side of this Direction Card,Corporation’s corporate records. Joint owners should each sign personally. Trustees and others signing in a representative capacity should indicate the number of shares of Rockwell
International capital stock held for my accountcapacity in the Rockwell Collins
Retirement Savings Plan for Hourly Employees at the Annual Meeting of
Shareowners of Rockwell International Corporation to be held at The Pfister
Hotel, 424 East Wisconsin Avenue, Milwaukee, Wisconsin, on February 6, 2002, and
at any adjournment thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS
CHECK THE BOXES "FOR" EACH PROPOSAL LISTED ON THE OTHER SIDE, THEN SIGN, DATE
AND RETURN THIS CARD.
(continued and to be signed on the other side)
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
ROCKWELL INTERNATIONAL CORPORATION
ANNUAL MEETING OF SHAREOWNERS
WEDNESDAY, FEBRUARY 6, 2002
10:00 A.M.
THE PFISTER HOTEL
424 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN
YOUR VOTE IS IMPORTANT!
YOU CAN VOTE BY INTERNET, TELEPHONE OR MAIL.
SEE THE INSTRUCTIONS ON THE OTHER SIDE OF THIS DIRECTION CARD.
IF YOU DID NOT RECEIVE PAPER COPIES OF ROCKWELL INTERNATIONAL'S
PROXY STATEMENT AND ANNUAL REPORT BECAUSE YOU
CONSENTED TO VIEW THEM ON THE
INTERNET, GO TO THE FOLLOWING INTERNET ADDRESSES:
PROXY STATEMENT: http://www.rockwellautomation.com/invrelations/pdfs/2002_proxy.pdf
ANNUAL REPORT: http://www.rockwellautomation.com/invrelations/report2001/index.html
Please mark
your votes as
indicated in [X]
this example
WHERE A VOTE IS NOT SPECIFIED, YOU ARE DIRECTED TO VOTE THE SHARES HELD FOR MY
ACCOUNT "FOR" THE ELECTION OF DIRECTORS, "FOR" PROPOSAL (B) AND "FOR" PROPOSAL
(C) AND TO VOTE IN ACCORDANCE WITH YOUR DISCRETION ON SUCH OTHER MATTERS AS MAY
PROPERLY COME BEFORE THE MEETING. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS (B) AND (C).
FOR all nominees WITHHOLD
(A) Election of directors: listed below AUTHORITY
(except as marked to vote for all
to the contrary) nominees listed below
[ ] [ ]
Nominees: 01 B.M. Rockwell, 02 J.F. Toot, Jr., 03 K.F. Yontz
(Instruction: To withhold authority to vote for any
individual nominee, write that nominee's name on the
space provided below.)
- ----------------------------------------------------
FOR AGAINST ABSTAIN
(B) The selection of auditors: [ ] [ ] [ ]
FOR AGAINST ABSTAIN
(C) The change of corporate name: [ ] [ ] [ ]
Mark here if you plan to attend the meeting. We
will send you an Admittance Card. [ ]
By checking the box to the right, I consent to view the
Annual Reports and Proxy Statements electronically via the
Internet. I understand that the Corporation may no longer
distribute printed materials to me for any future shareowner
meetings until my consent is revoked. I understand that I may
revoke my consent at any time by giving written notice to the
Corporation. [ ]
In its discretion, the trustee is authorized to vote upon such
other business as may properly come before the meeting or any
postponement(s) or adjournment(s) thereof.
SIGNATURE _______________ SIGNATURE(S) IF HELD JOINTLY____________ DATE ________
In signing as attorney, executor, administrator, trustee or guardian, please
give full title as such, and, if signing for a corporation, please give your
title. Please sign, date and return the direction card promptly using the
enclosed envelope.
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
VOTE BY INTERNET OR TELEPHONE OR MAIL
24 HOURS A DAY, 7 DAYS A WEEK
YOUR VOTE IS IMPORTANT
INTERNET
http://www.eproxy.com/rok
Use the Internet to vote. Have your direction card in hand when you access the
website. You will be prompted to enter your CONTROL NUMBER, located in the box
below, to create and submit an electronic ballot.
OR
TELEPHONE
1-800-435-6710
(FOR U.S. SHAREOWNERS ONLY)
Use any touch-tone telephone to vote. Have your direction card in hand when you
call. You will be prompted to enter your CONTROL NUMBER, located in the box
below, and then follow the directions given. After voting, you will be asked if
you wish to attend the meeting or consent to view annual reports and proxy
statements via the Internet.
OR
MAIL
Mark, sign and date your direction card and return it in the enclosed
postage-paid envelope.
IF YOU VOTE BY INTERNET OR BY TELEPHONE,
YOU DO NOT NEED TO MAIL BACK YOUR DIRECTION CARD.
YOUR INTERNET OR TELEPHONE INSTRUCTIONS WILL AUTHORIZE THE TRUSTEE
IN THE SAME MANNER AS IF YOU RETURNED A SIGNED DIRECTION CARD.
THANK YOU FOR VOTING.
DIRECTION CARD
ROCKWELL COLLINS RETIREMENT SAVINGS PLAN
FOR SALARIED EMPLOYEES
TO: WELLS FARGO BANK, N.A., TRUSTEE
You are hereby directed to vote, with respect to the proposals listed on
the other side of this Direction Card, the number of shares of Rockwell
International capital stock held for my account in the Rockwell Collins
Retirement Savings Plan for Salaried Employees at the Annual Meeting of
Shareowners of Rockwell International Corporation to be held at The Pfister
Hotel, 424 East Wisconsin Avenue, Milwaukee, Wisconsin, on February 6, 2002, and
at any adjournment thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS CHECK
THE BOXES "FOR" EACH PROPOSAL LISTED ON THE OTHER SIDE, THEN SIGN, DATE AND
RETURN THIS CARD.
(continued and to be signed on the other side)
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
ROCKWELL INTERNATIONAL CORPORATION
ANNUAL MEETING OF SHAREOWNERS
WEDNESDAY, FEBRUARY 6, 2002
10:00 A.M.
THE PFISTER HOTEL
424 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN
YOUR VOTE IS IMPORTANT!
YOU CAN VOTE BY INTERNET, TELEPHONE OR MAIL.
SEE THE INSTRUCTIONS ON THE OTHER SIDE OF THIS DIRECTION CARD.
IF YOU DID NOT RECEIVE PAPER COPIES OF ROCKWELL INTERNATIONAL'S
PROXY STATEMENT AND ANNUAL REPORT BECAUSE YOU
CONSENTED TO VIEW THEM ON THE
INTERNET, GO TO THE FOLLOWING INTERNET ADDRESSES:
PROXY STATEMENT: http://www.rockwellautomation.com/invrelations/
pdfs/2002_proxy.pdf
ANNUAL REPORT: http://www.rockwellautomation.com/invrelations/
report2001/index.html
Please mark
your votes as
indicated in [X]
this example
WHERE A VOTE IS NOT SPECIFIED, YOU ARE DIRECTED TO VOTE THE SHARES HELD FOR MY
ACCOUNT "FOR" THE ELECTION OF DIRECTORS, "FOR" PROPOSAL (B) AND "FOR" PROPOSAL
(C) AND TO VOTE IN ACCORDANCE WITH YOUR DISCRETION ON SUCH OTHER MATTERS AS MAY
PROPERLY COME BEFORE THE MEETING. THE BOARD OF DIRECTORS RECOMMENDS A VOTE
"FOR" THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS (B) AND (C).
FOR all nominees WITHHOLD AUTHORITY
(A) Election of directors: listed below to vote for all
(except as marked nominees listed
to the contrary) below
[ ] [ ]
Nominees: 01 B.M. Rockwell, 02 J.F. Toot, Jr., 03 K.F. Yontz
(Instruction: To withhold authority to vote for any
individual nominee, write that nominee's name on the
space provided below.)
- ----------------------------------------------------------
FOR AGAINST ABSTAIN
(B) The selection of auditors: [ ] [ ] [ ]
FOR AGAINST ABSTAIN
(C) The change of corporate name: [ ] [ ] [ ]
Mark here if you plan to attend the meeting. We
will send you an Admittance Card. [ ]
By checking the box to the right, I consent to view the
Annual Reports and Proxy Statements electronically via the
Internet. I understand that the Corporation may no longer
distribute printed materials to me for any future shareowner
meetings until my consent is revoked. I understand that I may
revoke my consent at any time by giving written notice to the
Corporation. [ ]
In its discretion, the trustee is authorized to vote upon such
other business as may properly come before the meeting or any
postponement(s) or adjournment(s) thereof.
SIGNATURE _______________ SIGNATURE(S) IF HELD JOINTLY____________ DATE ________
In signing as attorney, executor, administrator, trustee or guardian, please
give full title as such, and, if signing for a corporation, please give your
title. Please sign, date and return the direction card promptly using the
enclosed envelope.
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
VOTE BY INTERNET OR TELEPHONE OR MAIL
24 HOURS A DAY, 7 DAYS A WEEK
YOUR VOTE IS IMPORTANT
INTERNET
http://www.eproxy.com/rok
Use the Internet to vote. Have your direction card in hand when you access the
website. You will be prompted to enter your CONTROL NUMBER, located in the box
below, to create and submit an electronic ballot.
OR
TELEPHONE
1-800-435-6710
(FOR U.S. SHAREOWNERS ONLY)
Use any touch-tone telephone to vote. Have your direction card in hand when you
call. You will be prompted to enter your CONTROL NUMBER, located in the box
below, and then follow the directions given. After voting, you will be asked if
you wish to attend the meeting or consent to view annual reports and proxy
statements via the Internet.
OR
MAIL
Mark, sign and date your direction card and return it in the enclosed
postage-paid envelope.
IF YOU VOTE BY INTERNET OR BY TELEPHONE,
YOU DO NOT NEED TO MAIL BACK YOUR DIRECTION CARD.
YOUR INTERNET OR TELEPHONE INSTRUCTIONS WILL AUTHORIZE THE TRUSTEE
IN THE SAME MANNER AS IF YOU RETURNED A SIGNED DIRECTION CARD.
THANK YOU FOR VOTING.
DIRECTION CARD
ROCKWELL RETIREMENT SAVINGS PLAN
FOR CERTAIN EMPLOYEES
TO: WELLS FARGO BANK, N.A., TRUSTEE
You are hereby directed to vote, with respect to the proposals listed on
the other side of this Direction Card, the number of shares of Rockwell
International capital stock held for my account in the Rockwell Retirement
Savings Plan for Certain Employees at the Annual Meeting of Shareowners of
Rockwell International Corporation to be held at The Pfister Hotel, 424 East
Wisconsin Avenue, Milwaukee, Wisconsin, on February 6, 2002, and at any
adjournment thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS CHECK
THE BOXES "FOR" EACH PROPOSAL LISTED ON THE OTHER SIDE, THEN SIGN, DATE AND
RETURN THIS CARD.
(continued and to be signed on the other side)
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
ROCKWELL INTERNATIONAL CORPORATION
ANNUAL MEETING OF SHAREOWNERS
WEDNESDAY, FEBRUARY 6, 2002
10:00 A.M.
THE PFISTER HOTEL
424 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN
YOUR VOTE IS IMPORTANT!
YOU CAN VOTE BY INTERNET, TELEPHONE OR MAIL.
SEE THE INSTRUCTIONS ON THE OTHER SIDE OF THIS DIRECTION CARD.
IF YOU DID NOT RECEIVE PAPER COPIES OF ROCKWELL INTERNATIONAL'S
PROXY STATEMENT AND ANNUAL REPORT BECAUSE YOU
CONSENTED TO VIEW THEM ON THE
INTERNET, GO TO THE FOLLOWING INTERNET ADDRESSES:
PROXY STATEMENT: http://www.rockwellautomation.com/invrelations/
pdfs/2002_proxy.pdf
ANNUAL REPORT: http://www.rockwellautomation.com/invrelations/
report2001/index.html
Please mark
your votes as
indicated in [X]
this example
WHERE A VOTE IS NOT SPECIFIED, YOU ARE DIRECTED TO VOTE THE SHARES HELD FOR MY
ACCOUNT "FOR" THE ELECTION OF DIRECTORS, "FOR" PROPOSAL (B) AND "FOR" PROPOSAL
(C) AND TO VOTE IN ACCORDANCE WITH YOUR DISCRETION ON SUCH OTHER MATTERS AS MAY
PROPERLY COME BEFORE THE MEETING. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS (B) AND (C).
FOR all nominees WITHHOLD AUTHORITY
(A) Election of directors: listed below to vote for all
(except as marked nominees listed
to the contrary) below
[ ] [ ]
Nominees: 01 B.M. Rockwell, 02 J.F. Toot, Jr., 03 K.F. Yontz
(Instruction: To withhold authority to vote for any
individual nominee, write that nominee's name on the
space provided below.)
- ----------------------------------------------------------
FOR AGAINST ABSTAIN
(B) The selection of auditors: [ ] [ ] [ ]
FOR AGAINST ABSTAIN
(C) The change of corporate name: [ ] [ ] [ ]
Mark here if you plan to attend the meeting. We
will send you an Admittance Card. [ ]
By checking the box to the right, I consent to view the
Annual Reports and Proxy Statements electronically via the
Internet. I understand that the Corporation may no longer
distribute printed materials to me for any future shareowner
meetings until my consent is revoked. I understand that I may
revoke my consent at any time by giving written notice to the
Corporation. [ ]
In its discretion, the trustee is authorized to vote upon such
other business as may properly come before the meeting or any
postponement(s) or adjournment(s) thereof.
SIGNATURE _______________ SIGNATURE(S) IF HELD JOINTLY____________ DATE ________
In signing as attorney, executor, administrator, trustee or guardian, please
give full title as such, and, if signing for a corporation, please give your
title. Please sign, date and return the direction card promptly using the
enclosed envelope.
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
VOTE BY INTERNET OR TELEPHONE OR MAIL
24 HOURS A DAY, 7 DAYS A WEEK
YOUR VOTE IS IMPORTANT
INTERNET
http://www.eproxy.com/rok
Use the Internet to vote. Have your direction card in hand when you access the
website. You will be prompted to enter your CONTROL NUMBER, located in the box
below, to create and submit an electronic ballot.
OR
TELEPHONE
1-800-435-6710
(FOR U.S. SHAREOWNERS ONLY)
Use any touch-tone telephone to vote. Have your direction card in hand when you
call. You will be prompted to enter your CONTROL NUMBER, located in the box
below, and then follow the directions given. After voting, you will be asked if
you wish to attend the meeting or consent to view annual reports and proxy
statements via the Internet.
OR
MAIL
Mark, sign and date your direction card and return it in the enclosed
postage-paid envelope.
IF YOU VOTE BY INTERNET OR BY TELEPHONE,
YOU DO NOT NEED TO MAIL BACK YOUR DIRECTION CARD.
YOUR INTERNET OR TELEPHONE INSTRUCTIONS WILL AUTHORIZE THE TRUSTEE
IN THE SAME MANNER AS IF YOU RETURNED A SIGNED DIRECTION CARD.
THANK YOU FOR VOTING.
DIRECTION CARD
ROCKWELL INTERNATIONAL CORPORATION RETIREMENT SAVINGS PLAN
FOR REPRESENTED HOURLY EMPLOYEES
TO: WELLS FARGO BANK, N.A., TRUSTEE
You are hereby directed to vote, with respect to the proposals listed on
the other side of this Direction Card, the number of shares of Rockwell
International capital stock held for my account in the Rockwell International
Corporation Retirement Savings Plan for Represented Hourly Employees at the
Annual Meeting of Shareowners of Rockwell International Corporation to be held
at The Pfister Hotel, 424 East Wisconsin Avenue, Milwaukee, Wisconsin, on
February 6, 2002, and at any adjournment thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS CHECK
THE BOXES "FOR" EACH PROPOSAL LISTED ON THE OTHER SIDE, THEN SIGN, DATE AND
RETURN THIS CARD.
(continued and to be signed on the other side)
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
ROCKWELL INTERNATIONAL CORPORATION
ANNUAL MEETING OF SHAREOWNERS
WEDNESDAY, FEBRUARY 6, 2002
10:00 A.M.
THE PFISTER HOTEL
424 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN
YOUR VOTE IS IMPORTANT!
YOU CAN VOTE BY INTERNET, TELEPHONE OR MAIL.
SEE THE INSTRUCTIONS ON THE OTHER SIDE OF THIS DIRECTION CARD.
IF YOU DID NOT RECEIVE PAPER COPIES OF ROCKWELL INTERNATIONAL'S
PROXY STATEMENT AND ANNUAL REPORT BECAUSE YOU
CONSENTED TO VIEW THEM ON THE
INTERNET, GO TO THE FOLLOWING INTERNET ADDRESSES:
PROXY STATEMENT: http://www.rockwellautomation.com/invrelations/
pdfs/2002_proxy.pdf
ANNUAL REPORT: http://www.rockwellautomation.com/invrelations/
report2001/index.html
Please mark
your votes as
indicated in [X]
this example
WHERE A VOTE IS NOT SPECIFIED, YOU ARE DIRECTED TO VOTE THE SHARES HELD FOR MY
ACCOUNT "FOR" THE ELECTION OF DIRECTORS, "FOR" PROPOSAL (B) AND "FOR" PROPOSAL
(C) AND TO VOTE IN ACCORDANCE WITH YOUR DISCRETION ON SUCH OTHER MATTERS AS MAY
PROPERLY COME BEFORE THE MEETING. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS (B) AND (C).
FOR all nominees WITHHOLD AUTHORITY
(A) Election of directors: listed below to vote for all
(except as marked nominees listed
to the contrary) below
[ ] [ ]
Nominees: 01 B.M. Rockwell, 02 J.F. Toot, Jr., 03 K.F. Yontz
(Instruction: To withhold authority to vote for any
individual nominee, write that nominee's name on the
space provided below.)
- ----------------------------------------------------------
FOR AGAINST ABSTAIN
(B) The selection of auditors: [ ] [ ] [ ]
FOR AGAINST ABSTAIN
(C) The change of corporate name: [ ] [ ] [ ]
Mark here if you plan to attend the meeting.
We will send you an Admittance Card. [ ]
By checking the box to the right, I consent to view the
Annual Reports and Proxy Statements electronically via the
Internet. I understand that the Corporation may no longer
distribute printed materials to me for any future shareowner
meetings until my consent is revoked. I understand that I may
revoke my consent at any time by giving written notice to the
Corporation. [ ]
In its discretion, the trustee is authorized to vote upon such
other business as may properly come before the meeting or any
postponement(s) or adjournment(s) thereof.
SIGNATURE _______________ SIGNATURE(S) IF HELD JOINTLY____________ DATE ________
In signing as attorney, executor, administrator, trustee or guardian, please
give full title as such, and, if signing for a corporation, please give your
title. Please sign, date and return the direction card promptly using the
enclosed envelope.
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
VOTE BY INTERNET OR TELEPHONE OR MAIL
24 HOURS A DAY, 7 DAYS A WEEK
YOUR VOTE IS IMPORTANT
INTERNET
http://www.eproxy.com/rok
Use the Internet to vote. Have your direction card in hand when you access the
website. You will be prompted to enter your CONTROL NUMBER, located in the box
below, to create and submit an electronic ballot.
OR
TELEPHONE
1-800-435-6710
(FOR U.S. SHAREOWNERS ONLY)
Use any touch-tone telephone to vote. Have your direction card in hand when you
call. You will be prompted to enter your CONTROL NUMBER, located in the box
below, and then follow the directions given. After voting, you will be asked if
you wish to attend the meeting or consent to view annual reports and proxy
statements via the Internet.
OR
MAIL
Mark, sign and date your direction card and return it in the enclosed
postage-paid envelope.
IF YOU VOTE BY INTERNET OR BY TELEPHONE,
YOU DO NOT NEED TO MAIL BACK YOUR DIRECTION CARD.
YOUR INTERNET OR TELEPHONE INSTRUCTIONS WILL AUTHORIZE THE TRUSTEE
IN THE SAME MANNER AS IF YOU RETURNED A SIGNED DIRECTION CARD.
THANK YOU FOR VOTING.
DIRECTION CARD
ROCKWELL EMPLOYEE SAVINGS AND INVESTMENT PLAN
FOR REPRESENTED HOURLY EMPLOYEES
TO: WELLS FARGO BANK, N.A., TRUSTEE
You are hereby directed to vote, with respect to the proposals listed on
the other side of this Direction Card, the number of shares of Rockwell
International capital stock held for my account in the Rockwell Employee Savings
and Investment Plan for Represented Hourly Employees at the Annual Meeting of
Shareowners of Rockwell International Corporation to be held at The Pfister
Hotel, 424 East Wisconsin Avenue, Milwaukee, Wisconsin, on February 6, 2002, and
at any adjournment thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS CHECK
THE BOXES "FOR" EACH PROPOSAL LISTED ON THE OTHER SIDE, THEN SIGN, DATE AND
RETURN THIS CARD.
(continued and to be signed on the other side)
- --------------------------------------------------------------------------------
FOLD AND DETACH HERE
ROCKWELL INTERNATIONAL CORPORATION
ANNUAL MEETING OF SHAREOWNERS
WEDNESDAY, FEBRUARY 6, 2002
10:00 A.M.
THE PFISTER HOTEL
424 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN
YOUR VOTE IS IMPORTANT!
YOU CAN VOTE BY INTERNET, TELEPHONE OR MAIL.
SEE THE INSTRUCTIONS ON THE OTHER SIDE OF THIS DIRECTION CARD.
IF YOU DID NOT RECEIVE PAPER COPIES OF ROCKWELL INTERNATIONAL'S
PROXY STATEMENT AND ANNUAL REPORT BECAUSE YOU
CONSENTED TO VIEW THEM ON THE
INTERNET, GO TO THE FOLLOWING INTERNET ADDRESSES:
PROXY STATEMENT: http://www.rockwellautomation.com/invrelations/
pdfs/2002_proxy.pdf
ANNUAL REPORT: http://www.rockwellautomation.com/invrelations/
report2001/index.html
Please mark
your votes as
indicated in [X]
this example
WHERE A VOTE IS NOT SPECIFIED, YOU ARE DIRECTED TO VOTE THE SHARES HELD FOR MY
ACCOUNT "FOR" THE ELECTION OF DIRECTORS, "FOR" PROPOSAL (B) AND "FOR" PROPOSAL
(C) AND TO VOTE IN ACCORDANCE WITH YOUR DISCRETION ON SUCH OTHER MATTERS AS MAY
PROPERLY COME BEFORE THE MEETING. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS (B) AND (C).
FOR all nominees WITHHOLD AUTHORITY
(A) Election of directors: listed below to vote for all
(except as marked nominees listed
to the contrary) below
[ ] [ ]
Nominees: 01 B.M. Rockwell, 02 J.F. Toot, Jr., 03 K.F. Yontz
(Instruction: To withhold authority to vote for any individual nominee,
write that nominee's name on the space provided below.)
- ----------------------------------------------------------
FOR AGAINST ABSTAIN
(B) The selection of auditors: [ ] [ ] [ ]
FOR AGAINST ABSTAIN
(C) The change of corporate name: [ ] [ ] [ ]
Mark here if you plan to attend the meeting. We
will send you an Admittance Card. [ ]
By checking the box to the right, I consent to view the
Annual Reports and Proxy Statements electronically via the
Internet. I understand that the Corporation may no longer
distribute printed materials to me for any future shareowner
meetings until my consent is revoked. I understand that I may
revoke my consent at any time by giving written notice to the
Corporation. [ ]
In its discretion, the trustee is authorized to vote upon such
other business as may properly come before the meeting or any
postponement(s) or adjournment(s) thereof.
SIGNATURE _______________ SIGNATURE(S) IF HELD JOINTLY____________ DATE ________
In signing as attorney, executor, administrator, trustee or guardian, please
give full title as such, and, if signing for a corporation, please give your
title. Please sign, date and return the direction card promptly using the
enclosed envelope.
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
VOTE BY INTERNET OR TELEPHONE OR MAIL
24 HOURS A DAY, 7 DAYS A WEEK
YOUR VOTE IS IMPORTANT
INTERNET
http://www.eproxy.com/rok
Use the Internet to vote. Have your direction card in hand when you access the
website. You will be prompted to enter your CONTROL NUMBER, located in the box
below, to create and submit an electronic ballot.
OR
TELEPHONE
1-800-435-6710
(FOR U.S. SHAREOWNERS ONLY)
Use any touch-tone telephone to vote. Have your direction card in hand when you
call. You will be prompted to enter your CONTROL NUMBER, located in the box
below, and then follow the directions given. After voting, you will be asked if
you wish to attend the meeting or consent to view annual reports and proxy
statements via the Internet.
OR
MAIL
Mark, sign and date your direction card and return it in the enclosed
postage-paid envelope.
IF YOU VOTE BY INTERNET OR BY TELEPHONE,
YOU DO NOT NEED TO MAIL BACK YOUR DIRECTION CARD.
YOUR INTERNET OR TELEPHONE INSTRUCTIONS WILL AUTHORIZE THE TRUSTEE
IN THE SAME MANNER AS IF YOU RETURNED A SIGNED DIRECTION CARD.
THANK YOU FOR VOTING.
DIRECTION CARD
ROCKWELL NON-REPRESENTED HOURLY RETIREMENT SAVINGS PLAN
TO: WELLS FARGO BANK, N.A., TRUSTEE
You are hereby directed to vote, with respect to the proposals listed on
the other side of this Direction Card, the number of shares of Rockwell
International capital stock held for my account in the Rockwell Non-Represented
Hourly Retirement Savings Plan at the Annual Meeting of Shareowners of Rockwell
International Corporation to be held at The Pfister Hotel, 424 East Wisconsin
Avenue, Milwaukee, Wisconsin, on February 6, 2002, and at any adjournment
thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS CHECK
THE BOXES "FOR" EACH PROPOSAL LISTED ON THE OTHER SIDE, THEN SIGN, DATE AND
RETURN THIS CARD.
(continued and to be signed on the other side)
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
ROCKWELL INTERNATIONAL CORPORATION
ANNUAL MEETING OF SHAREOWNERS
WEDNESDAY, FEBRUARY 6, 2002
10:00 A.M.
THE PFISTER HOTEL
424 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN
YOUR VOTE IS IMPORTANT!
YOU CAN VOTE BY INTERNET, TELEPHONE OR MAIL.
SEE THE INSTRUCTIONS ON THE OTHER SIDE OF THIS DIRECTION CARD.
IF YOU DID NOT RECEIVE PAPER COPIES OF ROCKWELL INTERNATIONAL'S
PROXY STATEMENT AND ANNUAL REPORT BECAUSE YOU
CONSENTED TO VIEW THEM ON THE
INTERNET, GO TO THE FOLLOWING INTERNET ADDRESSES:
PROXY STATEMENT: http://www.rockwellautomation.com/invrelations/
pdfs/2002_proxy.pdf
ANNUAL REPORT: http://www.rockwellautomation.com/invrelations/
report2001/index.html
Please mark
your votes as
indicated in [X]
this example
WHERE A VOTE IS NOT SPECIFIED, YOU ARE DIRECTED TO VOTE THE SHARES HELD FOR MY
ACCOUNT "FOR" THE ELECTION OF DIRECTORS, "FOR" PROPOSAL (B) AND "FOR" PROPOSAL
(C) AND TO VOTE IN ACCORDANCE WITH YOUR DISCRETION ON SUCH OTHER MATTERS AS MAY
PROPERLY COME BEFORE THE MEETING. THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR"
THE ELECTION OF DIRECTORS AND "FOR" PROPOSALS (B) AND (C).
FOR all nominees WITHHOLD AUTHORITY
(A) Election of directors: listed below to vote for all
(except as marked nominees listed
to the contrary) below
[ ] [ ]
Nominees: 01 B.M. Rockwell, 02 J.F. Toot, Jr., 03 K.F. Yontz
(Instruction: To withhold authority to vote for any individual nominee,
write that nominee's name on the space provided below.)
- ----------------------------------------------------------
FOR AGAINST ABSTAIN
(B) The selection of auditors: [ ] [ ] [ ]
FOR AGAINST ABSTAIN
(C) The change of corporate name: [ ] [ ] [ ]
Mark here if you plan to attend the meeting.
We will send you an Admittance Card. [ ]
By checking the box to the right, I consent to view the
Annual Reports and Proxy Statements electronically via the
Internet. I understand that the Corporation may no longer
distribute printed materials to me for any future shareowner
meetings until my consent is revoked. I understand that I may
revoke my consent at any time by giving written notice to the
Corporation. [ ]
In its discretion, the trustee is authorized to vote upon such
other business as may properly come before the meeting or any
postponement(s) or adjournment(s) thereof.
SIGNATURE _______________ SIGNATURE(S) IF HELD JOINTLY____________ DATE ________
In signing as attorney, executor, administrator, trustee or guardian, please
give full title as such, and, if signing for a corporation, please give your
title. Please sign, date and return the direction card promptly using the
enclosed envelope.
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
VOTE BY INTERNET OR TELEPHONE OR MAIL
24 HOURS A DAY, 7 DAYS A WEEK
YOUR VOTE IS IMPORTANT
INTERNET
http://www.eproxy.com/rok
Use the Internet to vote. Have your direction card in hand when you access the
website. You will be prompted to enter your CONTROL NUMBER, located in the box
below, to create and submit an electronic ballot.
OR
TELEPHONE
1-800-435-6710
(FOR U.S. SHAREOWNERS ONLY)
Use any touch-tone telephone to vote. Have your direction card in hand when you
call. You will be prompted to enter your CONTROL NUMBER, located in the box
below, and then follow the directions given. After voting, you will be asked if
you wish to attend the meeting or consent to view annual reports and proxy
statements via the Internet.
OR
MAIL
Mark, sign and date your direction card and return it in the enclosed
postage-paid envelope.
IF YOU VOTE BY INTERNET OR BY TELEPHONE,
YOU DO NOT NEED TO MAIL BACK YOUR DIRECTION CARD.
YOUR INTERNET OR TELEPHONE INSTRUCTIONS WILL AUTHORIZE THE TRUSTEE
IN THE SAME MANNER AS IF YOU RETURNED A SIGNED DIRECTION CARD.
THANK YOU FOR VOTING.
DIRECTION CARD
ROCKWELL INTERNATIONAL CORPORATION
SALARIED RETIREMENT SAVINGS PLAN
TO: WELLS FARGO BANK, N.A., TRUSTEE
You are hereby directed to vote, with respect to the proposals listed on
the other side of this Direction Card, the number of shares of Rockwell
International capital stock held for my account in the Rockwell International
Corporation Salaried Retirement Savings Plan at the Annual Meeting of
Shareowners of Rockwell International Corporation to be held at The Pfister
Hotel, 424 East Wisconsin Avenue, Milwaukee, Wisconsin, on February 6, 2002, and
at any adjournment thereof, as follows:
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATIONS CHECK
THE BOXES "FOR" EACH PROPOSAL LISTED ON THE OTHER SIDE, THEN SIGN, DATE AND
RETURN THIS CARD.
(continued and to be signed on the other side)
- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
ROCKWELL INTERNATIONAL CORPORATION
ANNUAL MEETING OF SHAREOWNERS
WEDNESDAY, FEBRUARY 6, 2002
10:00 A.M.
THE PFISTER HOTEL
424 EAST WISCONSIN AVENUE
MILWAUKEE, WISCONSIN
YOUR VOTE IS IMPORTANT!
YOU CAN VOTE BY INTERNET, TELEPHONE OR MAIL.
SEE THE INSTRUCTIONS ON THE OTHER SIDE OF THIS DIRECTION CARD.
IF YOU DID NOT RECEIVE PAPER COPIES OF ROCKWELL INTERNATIONAL'S
PROXY STATEMENT AND ANNUAL REPORT BECAUSE YOU
CONSENTED TO VIEW THEM ON THE
INTERNET, GO TO THE FOLLOWING INTERNET ADDRESSES:
PROXY STATEMENT: http://www.rockwellautomation.com/invrelations/
pdfs/2002_proxy.pdf
ANNUAL REPORT: http://www.rockwellautomation.com/invrelations/
report2001/index.html
[WELLS FARGO LOGO]
December 27, 2001
TO PARTICIPANTS IN THE:
ROCKWELL INTERNATIONAL CORPORATION SALARIED RETIREMENT SAVINGS PLAN
ROCKWELL INTERNATIONAL CORPORATION NON-REPRESENTED HOURLY
RETIREMENT SAVINGS PLAN
ROCKWELL INTERNATIONAL CORPORATION EMPLOYEE SAVINGS AND INVESTMENT
PLAN FOR REPRESENTED HOURLY EMPLOYEES
ROCKWELL INTERNATIONAL CORPORATION RETIREMENT SaVINGS PLAN FOR
REPRESENTED HOURLY EMPLOYEES
ROCKWELL INTERNATIONAL CORPORATION RETIREMENT SAVINGS PLAN FOR
CERTAIN EMPLOYEES
ROCKWELL COLLINS RETIREMENT SAVINGS PLAN FOR SALARIED EMPLOYEES
ROCKWELL COLLINS RETIREMENT SAVINGS PLAN FOR HOURLY EMPLOYEES
ROCKWELL COLLINS RETIREMENT SAVINGS PLAN FOR BARGAINING UNIT EMPLOYEES
In connection with the Annual Meeting of Shareowners of Rockwell International
Corporation to be held February 6, 2002, enclosed are the following:
- Rockwell International Corporation Notice of 2002 Annual
Meeting and Proxy Statement
- Direction Card and a return envelope
The enclosed Direction Card should be used to instruct us with respect to our
voting of the shares which we are holding for your account in the Rockwell
International Corporation Savings Plans as listed above.
You should note that Internet and telephone voting has been made available to
you. Please follow the Internet or telephone instructions on the Direction Card
or sign, date and return the Direction Card in the enclosed pre-addressed
stamped envelope by February 1, 2002 so that we may vote the shares of Rockwell
International Corporation that are held for your account in accordance with your
instructions. If you do not properly complete your Internet or telephone vote or
properly complete and return the enclosed Direction Card by the above date,
Wells Fargo Bank, N.A., as Trustee, will vote such shares as it deems proper.
Sincerely,
/s/ Kristin L. Wahlstrom
Kristin L. Wahlstrom
Vice President
they sign. | | | | |
For address changes and/or comments, please check this box and write them on the back where indicated | | o | | |
| | | | |
| | Yes | | No |
Please indicate if you plan to attend this meeting. We will send you an admittance card. | | o | | o |
| | |
Signature [PLEASE SIGN WITHIN BOX] Date | | Signature (Joint Owners) Date |