o Preliminary Proxy Statement | ||
þ Definitive Proxy Statement | ||
o Definitive Additional Materials | ||
o Soliciting Material Pursuant toRule 14a-12 | ||
o Confidential, for the Use of the Commission Only (as permitted byRule 14a-6(e)(2)) |
þ | No fee required. |
o | Fee computed on table below per Exchange ActRules 14a-6(i)(1) and 0-11. |
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o | Fee paid previously with preliminary materials. |
o | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
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(4) | Date Filed: |
Steven R. Loranger Chairman, President and Chief Executive Officer | ITT Corporation 1133 Westchester Avenue White Plains, NY 10604-3543 |
Time: | 10:30 a.m. Eastern Time, on Tuesday, May | |
Place: | 1133 Westchester Avenue, White Plains, NY10604-3543 | |
Items of Business: | 1. Election of the ten nominees named in the attached Proxy Statement as members of the Board of | |
2. Ratification of the appointment of Deloitte & Touche LLP as ITT’s Independent Registered Public Accounting Firm for | ||
3. | ||
4. Approval of a proposal to amend the Company’s Restated Articles of Incorporation to allow shareholders to call special meetings. | ||
5. To approve, in a non-binding vote, the compensation of our named executive officers. | ||
6. To determine, in a non-binding vote, whether a shareholder vote to approve the compensation of our named executive officers should occur every one, two or three years. | ||
7. To vote on a shareholder proposal | ||
8. To transact such other business as may properly | ||
Who May Vote: | You can vote if you were a shareholder at the close of business on March 16, | |
Annual Report to Shareholders andAnnual Report on Form | Copies of our |
Mailing or Availability Date: | Beginning on or about March |
About Proxy Voting: | Your vote is important. Proxy voting permits shareholders unable to attend the Annual Meeting to vote their shares through a proxy. Most shareholders are unable to attend the Annual Meeting. By appointing a |
proxy, your shares will be represented and voted in accordance with your instructions. If you do not provide instructions on how to vote, the proxies will vote as recommended by the Board of Directors. | ||
Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to be held on Tuesday, May 10, 2011 at 10:30 a.m. at 1133 Westchester Avenue, White Plains, NY10604-3543. The Company’s 2011 Proxy Statement, 2010 Annual Report onForm 10-K and Annual Report to Shareholders will be available online at https://www.proxydocs.com/itt. |
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1. | Election of the ten nominees named in the attached Proxy Statement as members of the Board of |
2. | Ratification of the appointment of Deloitte & Touche LLP as ITT’s Independent Registered Public Accounting Firm for |
3. | |
4. | Approval of a proposal to amend the Company’s Restated Articles of Incorporation to allow shareholders to call special meetings. |
5. | Approval, in a non-binding vote, of the compensation of our named executive officers. |
6. | Determination, in a non-binding vote, of whether a shareholder vote to approve the compensation of our named executive officers should occur every one, two or three years. |
7. | A shareholder proposal |
8. | To transact such other business as may properly |
• | By the Internet, |
• | By Telephone, |
• | By Mail. |
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Non-Management Directors | 5 X Annual Retainer Amount | |
CEO | 5 X Annual Base Salary | |
CFO | 3 X Annual Base Salary | |
Senior Vice Presidents | 2 X Annual Base Salary | |
Vice Presidents | 1 X Annual Base Salary |
Amount and Nature of Beneficial Ownership | Amount and Nature of Beneficial Ownership | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | ITT Common | Total | ITT Common | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Title of Class | Shares | Stock | Title of Class | Shares | Stock | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Name of Beneficial | ITT Common | Beneficially | Shares | Stock | Percentage | ITT Common | Beneficially | Shares | Stock | Percentage | ||||||||||||||||||||||||||||||||||||||||||||||||
Owner | Stock | Owned | Owned | Options(1) | Units | of Class | Stock | Owned(1) | Owned | Options(2) | Units | of Class(5) | ||||||||||||||||||||||||||||||||||||||||||||||
Steven R. Loranger | Common Stock | 755,915 | 133,464 | 494,400 | 173,051 | 0.416 | % | Common Stock | 1,027,553 | 305,586 | 721,967 | — | 0.557 | % | ||||||||||||||||||||||||||||||||||||||||||||
Curtis J. Crawford | Common Stock | 48,879 | 31,098 | 16,426 | 1,355 | 0.027 | % | Common Stock | 60,436 | 37,535 | 22,901 | 1,715 | 0.033 | % | ||||||||||||||||||||||||||||||||||||||||||||
Christina A. Gold | Common Stock | 38,938 | 21,157 | 16,426 | 1,355 | 0.021 | % | Common Stock | 49,323 | 26,422 | 22,901 | 1,715 | 0.027 | % | ||||||||||||||||||||||||||||||||||||||||||||
Ralph F. Hake | Common Stock | 25,898 | 11,677 | 12,866 | 1,355 | 0.014 | % | Common Stock | 36,312 | 16,971 | 19,341 | 1,715 | 0.020 | % | ||||||||||||||||||||||||||||||||||||||||||||
John J. Hamre | Common Stock | 35,031 | 17,250 | 16,426 | 1,355 | 0.019 | % | Common Stock | 47,233 | 24,332 | 22,901 | 1,715 | 0.026 | % | ||||||||||||||||||||||||||||||||||||||||||||
Paul J. Kern | Common Stock | 1,016 | — | — | 1,016 | 0.001 | % | Common Stock | 10,007 | 4,926 | 5,081 | 1,715 | 0.005 | % | ||||||||||||||||||||||||||||||||||||||||||||
Frank T. MacInnis | Common Stock | 32,450 | 14,669 | 16,426 | 1,355 | 0.018 | % | Common Stock | 42,992 | 20,091 | 22,901 | 1,715 | 0.023 | % | ||||||||||||||||||||||||||||||||||||||||||||
Surya N. Mohapatra | Common Stock | 4,910 | 2,342 | 1,213 | 1,355 | 0.003 | % | Common Stock | 14,848 | 7,607 | 7,241 | 1,715 | 0.008 | % | ||||||||||||||||||||||||||||||||||||||||||||
Linda S. Sanford | Common Stock | 39,851 | 22,070 | 16,426 | 1,355 | 0.022 | % | Common Stock | 50,315 | 27,414 | 22,901 | 1,715 | 0.027 | % | ||||||||||||||||||||||||||||||||||||||||||||
Markos I. Tambakeras | Common Stock | 31,659 | 13,878 | 16,426 | 1,355 | 0.017 | % | Common Stock | 40,577 | 17,676 | 22,901 | 1,715 | 0.022 | % | ||||||||||||||||||||||||||||||||||||||||||||
Denise L. Ramos | Common Stock | 24,088 | 24,088 | — | — | 0.013 | % | Common Stock | 71,618 | 37,074 | 34,544 | — | 0.039 | % | ||||||||||||||||||||||||||||||||||||||||||||
Nicholas P. Hill | Common Stock | 67,466 | 14,924 | 52,542 | — | 0.037 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
Gretchen W. McClain | Common Stock | 160,178 | 86,295 | 73,883 | — | 0.087 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
Vincent A. Maffeo | Common Stock | 91,310 | 44,752 | 46,558 | — | 0.050 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
David F. Melcher | Common Stock | 35,451 | 15,224 | 20,227 | — | 0.019 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
Gretchen W. McClain | Common Stock | 79,024 | 26,862 | 52,162 | — | 0.043 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
Frank R. Jimenez | Common Stock | 16,587 | 7,111 | 9,476 | — | 0.009 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||
All Directors and Executive Officers as a Group | Common Stock | 1,732,730 | (6) | 478,303 | 1,069,520 | 184,907 | 0.953 | %(6) | Common Stock | 1,771,184 | 671,917 | 1,099,267 | 15,435 | 0.960 | % | |||||||||||||||||||||||||||||||||||||||||||
(1) | With respect to Mr. Loranger and certain Non-Management Directors, total shares beneficially owned include restricted stock units that have vested but are deferred until a later date. | |
(2) | More detail on outstanding option awards is provided in the | |
On June 28, 2004, Mr. Loranger received an award of 250,000 Restricted Stock Units (“RSUs”) under the ITT Corporation 2003 Equity Incentive Plan (the “2003 Plan”), as amended and restated, in connection with his employment agreement. Approximately, one-third of the units, 85,342 units, vested on June 28, 2007 approximately, one-third of the units, |
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Mr. Loranger received credit for | ||
(5) | ||
Amount and | Amount and | |||||||||||||||
nature of | nature of | |||||||||||||||
Name and address | beneficial | Percent of | beneficial | Percent of | ||||||||||||
of beneficial owner | ownership | Class | ownership | Class | ||||||||||||
Barrow, Hanley, Mewhinney & Strauss, Inc.(1) | 13,763,155 | 7.58 | % | |||||||||||||
Barrow, Hanley, Mewhinney & Strauss, LLC(1) | 13,008,379 | 7.09 | % | |||||||||||||
2200 Ross Avenue, 31st Floor Dallas, TX75201-2761 | ||||||||||||||||
Vanguard Windsor Funds-Vanguard Windsor II Fund(2) | 10,267,500 | 5.65 | % | |||||||||||||
100 Vanguard Blvd. Malvern, PA 10355 |
(1) | As reported on Schedule 13G/A dated February 11, | |
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1. | Election of Directors |
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Steven R. Loranger Chairman, President and Chief Executive Officer, ITT Corporation |
Curtis J. Crawford, Ph.D. President and Chief Executive Officer, XCEO, Inc., a leadership and corporate governance consulting firm |
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Christina A. Gold Former President, Chief Executive Officer and Director, The Western Union Company, Inc., a global leader in money transfer and financial services |
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Ralph F. Hake Former Chairman and Chief Executive Officer, Maytag Corporation, a home and commercial appliance company |
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John J. Hamre, Ph.D. President and Chief Executive Officer, Center for Strategic & International Studies (“CSIS”), a public policy research institution dedicated to strategic, bipartisan global analysis and policy impact |
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General Paul J. Kern, U.S. Army (Ret.) |
Frank T. MacInnis Chairman and former Chief Executive Officer, EMCOR Group, Inc., one of the world’s largest providers of electrical and mechanical construction services, energy infrastructure and facilities services. |
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Surya N. Mohapatra, Ph.D. Chairman of the Board, President and Chief Executive Officer of Quest Diagnostics Incorporated, the |
Linda S. Sanford Senior Vice President, Enterprise |
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Markos I. Tambakeras Former Chairman, President and Chief Executive Officer, Kennametal, Inc., a premier global tooling solutions, engineered components and advanced materials supplier to the automotive, aerospace, energy, mining, construction and other industries |
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2. | Ratification of Appointment of the Independent Registered Public Accounting Firm |
• | independence |
• | experience |
• | technical capabilities |
• | client service assessment |
• | responsiveness |
• | financial strength |
• | industry insight |
• | PCAOB’s |
• | leadership |
• | |
• | management structure |
• | peer review program |
• | commitment to quality report |
• | appropriateness of fees charged |
• | compliance and ethics programs |
Fiscal Year Ended | Fiscal Year Ended | |||||||||||||||
(in thousands) | 2010 | 2009 | ||||||||||||||
2008 | 2007 | (In thousands) | ||||||||||||||
Audit Fees(1) | $ | 10,835 | $ | 8,643 | $ | 8,423 | $ | 8,319 | ||||||||
Audit-Related Fees(2) | 1,034 | 951 | 2,745 | 1,015 | ||||||||||||
Tax Fees(3) | ||||||||||||||||
Tax Compliance Services | 506 | 428 | 1,448 | 1,163 | ||||||||||||
Tax Planning Services | 505 | 230 | 501 | 209 | ||||||||||||
Total Tax Services | 1,011 | 658 | 1,949 | 1,372 | ||||||||||||
Other Fees(4) | 1,500 | — | ||||||||||||||
Total | $ | 12,880 | $ | 10,252 | $ | 14,617 | $ | 10,706 | ||||||||
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(1) | Fees for audit services billed in |
• | Audit of the Company’s annual financial statements and internal control over financial reporting; | |
• | Reviews of the Company’s quarterly financial statements; |
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• | Statutory and regulatory audits, consents and other services related to SEC matters; and | |
• | Financial accounting and reporting consultations. |
(2) | Fees for audit-related services billed in |
• | Employee benefit plan audits; | |
• | Audits and other attest work related to acquisitions and dispositions; | |
• | Internal control advisory services; and | |
• | Other miscellaneous attest services. |
(3) | Fees for tax services billed in |
• | Tax compliance services are services rendered, based upon facts already in existence or transactions that have already occurred, to document, compute, and obtain government approval for amounts to be included in tax filings consisting primarily of: |
• | Tax planning services are services and advice rendered with respect to proposed transactions or services that alter the structure of a transaction to obtain an anticipated tax result. Such services consisted primarily of: |
2008 | 2007 | |||||||
Ratio of Tax Planning and Advice to Total Fees | 3.9% | 2.2% |
(4) | Fees for other services consisted of consulting services in connection with the Company’s value-based commercial excellence programs. |
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1. | Due diligence, closing balance sheet audit services, purchase price dispute support and other services related to mergers, acquisitions and divestitures; |
2. | Employee benefit advisory services, independent audits and preparation of tax returns for the Company’s defined contribution, defined benefit and health and welfare benefit plans, preparation of the associated tax returns or other employee benefit advisory services; |
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3. | Tax compliance and certain tax planning and advice work; and |
4. | Accounting consultations and support related to generally accepted accounting principles (“GAAP”) or government contract compliance. |
1. | Bookkeeping or other services related to the accounting records or financial statements of the Company; |
2. | Financial information systems design and implementation; |
3. | Appraisal or valuation services, fairness opinions, orcontribution-in-kind reports; |
4. | Actuarial services; |
5. | Internal auditing services; |
6. | Management functions or human resources services; |
7. | Broker-dealer, investment adviser or investment banking services; or |
8. | Legal services and other expert services unrelated to the audit. |
3. |
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(c) | ||||||||||||
Number of Securities | ||||||||||||
Remaining Available | ||||||||||||
for Future Issuance | ||||||||||||
(a) | Under Equity | |||||||||||
Number of Securities | Compensation Plans | |||||||||||
to be Issued Upon | (b) | (Excluding | ||||||||||
Exercise of | Weighted-Average | Securities | ||||||||||
Outstanding Options, | Exercise Price of | Reflected in | ||||||||||
Warrants and Rights | Outstanding Options, | Column (a)) | ||||||||||
Plan Category | (Thousands) | Warrants and Rights | (Thousands) | |||||||||
Equity Compensation Plans Approved by Security Holders(1)(2) | 9,116 | (3) | $ | 42.54 | (4) | 2,881 | (5) | |||||
Equity Compensation Plans Not Approved by Security Holders | — | — | — | |||||||||
Total | 9,116 | $ | 42.54 | 2,881 |
(1) | Equity compensation plans approved by shareholders include the 1994 ITT Incentive Stock Plan, the 1996 Plan, the 2002 ITT Stock Option Plan for Non-Employee Directors and the 2003 Plan. | |
(2) | Since the approval of the 2003 Plan, no additional awards, including awards of restricted stock, will be granted under the other plans referred to in footnote (1) above. Under the 2003 Plan |
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currently in effect, restricted stock and restricted stock units may be awarded up to a maximum aggregate grant of 300,000 shares or units in any one plan year to any one participant. | ||
(3) | The weighted-average remaining contractual life of the total number of outstanding options was 3.1 years as disclosed in Note 17 to the Consolidated Financial Statements in the Company’s 2010 Annual Report onForm 10-K. | |
(4) | The weighted-average exercise price pertains only to 7,405 outstanding options and not to outstanding restricted stock units, which by their nature have no exercise price. | |
(5) | As of December 31, 2010, the number of shares available for future issuance under the 2003 Plan with respect to restricted stock and restricted stock unit awards was approximately 1,447,257, which is included in the 2,881,070 disclosed above. |
4. | Approval of a Proposal to Amend the Company’s Restated Articles of Incorporation to Allow Shareholders to Call Special Meetings |
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5. | Non-Binding Advisory Vote to Ratify Named Executive Officers’ Compensation |
• | alignment of executive and shareholder interests by providing incentives linked to earnings per share performance, revenue, free cash flow and return on invested capital; |
• | the ability for executives to achieve long-term shareholder value creation without undue business risk; |
• | creating a clear link between an executive’s compensation and his or her individual contribution and performance; |
• | the extremely competitive nature of the industries in which we operate, whether in manufacturing or defense, and our need to attract and retain the most creative and talented industry leaders; and |
• | comparability to the practices of peers in the industries that we operate in and other comparable companies generally. |
6. | Non-Binding Advisory Vote on the Frequency of Shareholder Votes on Executive Compensation |
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7. | Shareholder Proposal Requesting the Company Amend, where Applicable, ITT’s Policies Related to Human Rights |
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• | Our values are our compass — we strive to do the right thing always | |
• | Treat others fairly and courteously | |
• | Sustain a culture of diversity and inclusion |
• | Providing safe and secure conditions for those working on our Company’s behalf | |
• | Protecting the environment | |
• | Following all applicable wage and hour laws | |
• | Strictly prohibiting human trafficking and the use of child or forced labor, including prison or bonded labor | |
• | Treating each other fairly and equitably |
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• | the Company’s businesses are conducted in conformity with applicable laws and regulations; |
• | the Company’s systems of financial reporting and internal controls are adequate and properly |
• | there is continuity in the leadership of the Company; |
• | management develops sound business strategies; |
• | adequate capital and managerial resources are available to implement the business strategies; |
• | the Company’s long-term strategies, significant investments in new businesses, joint ventures and partnerships and significant business acquisitions, including assessment of balance sheet impacts and other financial matters, are reviewed and approved; and |
• | the Company’s operating plans and capital, research and development and engineering budgets are reviewed and approved. |
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(b) | In addition, a director is not independent if: |
(i) | The director is, or has been within the last three years, an employee of the listed company, or an immediate family member is, or has been within the last three years, an executive officer, of the listed company. |
(ii) | The director has received, or has an immediate family member who has received, during any twelve-month period within the last three years, more than |
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(iii) | (A) The director or an immediate family member is a current partner of a firm that is the company’s internal or external auditor; (B) the director is a current employee of such a firm; (C) the director has an immediate family member who is a current employee of such a firm and who participates in the firm’s audit, assurance or tax compliance (but not tax planning) practice; or (D) the director or an immediate family member was within the last three years (but is no longer) a partner or employee of such a firm and personally worked on the listed company’s audit within that time. |
(iv) | The director or an immediate family member is, or has been within the last three years, employed as an executive officer of another company where any of the listed company’s present executive officers at the same time serves or served on that company’s compensation committee. |
(v) | The director is a current employee, or an immediate family member is a current executive officer, of a company that has made payments to, or received payments from, the listed company for property or services in an amount which, in any of the last three |
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fiscal years, exceeds the greater of $1 million, or 2% of such other company’s consolidated gross revenues. |
• | has not been employed by the Company in an executive capacity; |
• | has not been an advisor or consultant to the Company, and has not been affiliated with a company or a firm that is; |
• | has not been affiliated with a significant customer or supplier of the Company; |
• | has not had a personal services contract with the Company; |
• | has not been affiliated with a tax-exempt entity that receives significant contributions from the Company; |
• | has not been related to any of the persons described above; and |
• | has not been part of an interlocking directorate in which an executive officer of the Company is a member of the compensation committee of the company that employs the Director. |
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Christina A. Gold Ralph F. Hake Surya N. Mohapatra Linda S. Sanford | ||
Meetings in | ||
Responsibilities: | • Subject to any action that may be taken by the full Board, the Audit Committee has the ultimate authority and responsibility to determine Deloitte qualifications and independence, and to appoint (or nominate for shareholder ratification), evaluate, and where appropriate, consider rotation or replacement of Deloitte. | |
• Review and discuss with management and Deloitte, and approve the audited financial statements of the |
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Company and make a recommendation regarding inclusion of those financial statements in any public filing including the Company’s Annual Report onForm 10-K (or the Annual Report to Shareholders if distributed prior to the filing ofForm 10-K), including discussion of the Company’s disclosures under Management’s Discussion and Analysis of Financial Condition and Results of Operations. | ||
• Review and consider with Deloitte matters required to be discussed by PCAOB Standards, Statement of Auditing Standards (“SAS”) No. 114 (The Auditor’s Communication with Those Charged with Governance) and all other applicable regulatory agencies. | ||
• Review with management and Deloitte the effect of regulatory and accounting initiatives on the Company’s financial statements. | ||
• As a whole, or through the Committee chair, review and discuss with Deloitte the Company’s interim financial results to be included in the Company’s earnings report or quarterly reports to be filed with the SEC, including discussion of the Company’s disclosures under Management’s Discussion and Analysis of Financial Condition and Results of Operations prior to the filing of itsForm 10-Q with the SEC. | ||
• Review and discuss with management the types of information to be disclosed and the types of presentations to be made with respect to the Company’s earning releases and rating agency presentations. | ||
• Monitor and discuss with management and Deloitte the quality and adequacy of the Company’s internal controls and their |
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effectiveness, and meet regularly and privately with the | ||
• Annually request from Deloitte a formal written statement delineating all relationships between Deloitte and the Company, consistent with the | ||
• With respect to such relationships, the Audit Committee shall: | ||
• Discuss with Deloitte any disclosed relationships and the impact of the relationship on Deloitte independence; and | ||
• Assess and recommend appropriate action in response to the Deloitte report to satisfy itself of the auditor’s independence. | ||
• Adopt and monitor implementation and compliance with the Company’s Non-Audit Services Policy, which addresses approval requirements and the |
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limited circumstances in which Deloitte or other service providers may be retained for non-audit services. | ||
• Confirm the scope of audits to be performed by Deloitte and any outside internal audit service provider, monitor progress and review results. Review fees and expenses charged by Deloitte and any party retained to provide internal audit services. | ||
• On an annual basis, discuss with Deloitte its internal quality control procedures, material issues raised in quality control or peer review and any inquiries by governmental or professional authorities regarding the firm’s independent audits of other clients. | ||
• Review significant findings or unsatisfactory internal audit reports or audit problems or difficulties encountered by Deloitte, and monitor management’s response to such findings. | ||
• Provide oversight and discuss with management, internal auditors and Deloitte, the adequacy and effectiveness of the Company’s overall risk assessment and risk management | ||
• Review its performance and Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. | ||
• Review regularly and consider the Company’s environmental, safety and health reserves. | ||
• Review expense accounts of senior executives. | ||
• Update the Board of Directors on a regular basis with respect to matters coming to its attention that may have a significant impact on the Company’s financial condition or affairs and the Company’s compliance with legal or regulatory requirements and the performance and independence of Deloitte and the internal audit function. | ||
• Review major issues regarding accounting principles and financial statement presentations, significant changes to the Company’s selection or application of accounting principles and major issues relating to the Company’s internal controls including any |
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specifically required steps to correct identified major internal control issues. The Audit Committee also reviews management or Deloitte’s analyses regarding significant financial reporting issues and judgments made in preparing financial statements including analyses of alternative GAAP methods as well as the effect of regulatory and accounting initiatives and |
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off-balance sheet structures, if any, on the Company’s financial statements. | ||
• Review all material related party transactions prior to initiation of the transaction and make recommendations to the Board of Directors for approval or disapproval. | ||
• In conjunction with the Board of Directors, evaluate the qualifications of its members and its own performance on an annual basis. | ||
• Meet separately, on a regular basis, with Deloitte, internal auditors, and members of management, as well as privately as a Committee. | ||
• Establish policies regarding the Company’s employment and retention of current or former employees of Deloitte or outsourced internal auditor. | ||
• With respect to complaints concerning accounting, internal accounting controls or auditing matters: | ||
• Review and approve procedures for receipt, retention and treatment of complaints received by the Company; and | ||
• Establish procedures for the confidential, anonymous submission of complaints to the Audit Committee. | ||
• Establish levels for payment by the Company of fees to Deloitte and any advisors retained by the Audit Committee. | ||
• Receive regular reports from the Chief Executive Officer, Chief Financial Officer and from the Company’s disclosure control committee representative on the status of the Company’s disclosure controls and related certifications, including disclosure of any material weaknesses or significant deficiencies in the design or operation of internal controls and any fraud that involves management or other employees with a significant role in internal controls. | ||
• Prepare the Report of the Audit Committee for the Company’s Proxy Statement. | ||
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Linda S. Sanford, Chair Curtis J. Crawford Ralph F. Hake Frank T. MacInnis | ||
Meetings in | ||
The Committee’s primary objective is to establish a competitive executive compensation program that clearly links executive compensation to business performance and shareholder return, without excessive enterprise risk. | ||
Responsibilities: | • Approve and oversee administration of the Company’s employee compensation program including incentive plans and | |
• Evaluate senior management and Chief Executive Officer performance, evaluate enterprise risk and other risk factors with respect to compensation objectives, set annual performance objectives for the Chief Executive Officer and approve individual compensation actions for the Chief Executive Officer and officers at the vice president level and above, as well as certain other selected positions. | ||
• Oversee the establishment and administration of the Company’s benefit programs. | ||
• Select, retain and determine the terms of engagement for independent compensation and benefits consultants and other outside counsel, as needed, to provide independent advice to the Committee with respect to the Company’s current and proposed executive compensation and employee benefit programs. In | ||
• Oversee and approve the continuity planning process and review with the full Board of Directors, which provides final approval. | ||
• Regularly report to the Board of Directors on compensation, benefits, continuity and related matters. | ||
• Prepare the Compensation Committee Report for the Company’s Proxy Statement. |
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• Review regularly and consider the Company’s Inclusion & Diversity strategy and the effectiveness of related programs and policies. | ||
• Review its performance and Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. |
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John J. Hamre, Chair Linda S. Sanford Markos I. Tambakeras | ||
Meetings in | ||
Responsibilities: | • Review and make recommendations concerning the Company’s roles and responsibilities as a good corporate citizen. | |
• Review and consider major claims and litigation involving the Company and its subsidiaries. | ||
• Regularly assess the adequacy and effectiveness of the Company’s Code of Corporate Conduct and review any violations of the Code. | ||
• Review its performance and Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. |
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John J. Hamre, Chair Curtis J. Crawford Paul J. Kern Markos I. Tambakeras | ||
Meetings in |
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Responsibilities: | • Develop, annually review, update and recommend to the Board of Directors corporate governance principles for the Company. | |
• In the event it is necessary to select a new chief executive officer, lead the process for candidate evaluation, consideration and screening. The full Board of Directors has the final responsibility to select the Company’s chief executive officer. | ||
• Evaluate and make recommendations to the Board of Directors concerning the composition, governance and structure of the Board. | ||
• Make recommendations to the Board of Directors concerning the qualifications, compensation and retirement age of Directors. | ||
• Administer the Board of Directors’ annual evaluation process. | ||
• Review and recommend to the full Board matters and agenda items relating to the Company’s Annual Meeting of shareholders. | ||
• Review the form of Annual Report to Shareholders, Proxy Statement and related materials. | ||
• Review the Company’s business continuity and disaster recovery programs and plans. | ||
• Review the Company’s communication and advertising program and other activities involving community relations, major charitable contributions and promotion of the Company’s public image. | ||
• Determine desired Board and Director skills and attributes and conduct searches for prospective board members whose skills and attributes reflect those desired for the Board of Directors. | ||
• Identify, evaluate and propose nominees for election to the Board of Directors. | ||
• Make recommendations to the Board of Directors concerning the appointment of Directors to Board Committees and the selection of Board Committee Chairs. | ||
• Evaluate and make recommendations regarding senior management requests for approval to accept membership on outside boards. |
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• Review regularly and consider the Company’s programs and policies for effecting compliance with laws and regulations involving the environment, safety and health. | ||
• Provide oversight and discuss with management, internal auditors and Deloitte the adequacy and effectiveness of the Company’s insurance programs. | ||
• Review and consider the Company’s policies and efforts with respect to compliance with government contracts, international laws and regulations and export controls. | ||
• Review its performance and Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. |
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Markos I. Tambakeras, Chair Christina A. Gold John J. Hamre Paul J. Kern Surya N. Mohapatra | ||
Meetings in | 4 | |
Responsibilities: | • Receive periodic updates on global macroeconomic issues. | |
• Review and consider the Company’s: | ||
• Strategic | ||
• Operations excellence | ||
• Operating | ||
• Capital structure, including stock repurchases, debt offerings and | ||
• Corporate | ||
• Acquisition |
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• Pension plan performance, | ||
• Tax compliance, tax planning and related | ||
• | ||
• Investor relations | ||
• Risk assessment with respect to financial liquidity and financing; and | ||
• Strategic | ||
• | ||
• Review and assess its performance on an annual | ||
• Review and approve its Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. | ||
The Strategy and Finance Committee oversees all areas of strategy and corporate finance to |
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27
Change in | ||||||||||||||||||||||||||||||||||||||||||||||||
Pension | ||||||||||||||||||||||||||||||||||||||||||||||||
Value and | ||||||||||||||||||||||||||||||||||||||||||||||||
Fees | Nonqualified | Fees | ||||||||||||||||||||||||||||||||||||||||||||||
Earned or | Non-Equity | Deferred | Earned or | |||||||||||||||||||||||||||||||||||||||||||||
Paid in | Stock | Option | Incentive Plan | Compensation | All Other | Paid in | Stock | Option | All Other | |||||||||||||||||||||||||||||||||||||||
Name | Cash | Awards | Awards | Compensation | Earnings | Compensation | Total | Cash | Awards | Awards | Compensation | Total | ||||||||||||||||||||||||||||||||||||
(a) | (b) ($) | (c) ($) | (d) ($) | (e) ($) | (f) ($) | (g) ($) | (h) ($) | (b) ($) | (c) ($) | (d) ($) | (g) ($) | (h) ($) | ||||||||||||||||||||||||||||||||||||
Curtis J. Crawford | 90,000 | 141,308 | 37,378 | — | — | — | 268,686 | 90,000 | 90,192 | 40,126 | — | 220,318 | ||||||||||||||||||||||||||||||||||||
Christina A. Gold | 90,000 | 117,764 | 37,378 | — | — | — | 245,142 | 90,000 | 90,192 | 40,126 | — | 220,318 | ||||||||||||||||||||||||||||||||||||
Ralph F. Hake | 100,000 | 117,764 | 37,378 | — | — | — | 255,142 | 90,000 | 90,192 | 40,126 | — | 220,318 | ||||||||||||||||||||||||||||||||||||
John J. Hamre | 90,000 | 141,308 | 37,378 | — | — | — | 268,686 | 90,000 | 90,192 | 40,126 | — | 220,318 | ||||||||||||||||||||||||||||||||||||
Paul J. Kern(i) | 67,500 | 35,432 | 4,579 | — | — | — | 107,511 | |||||||||||||||||||||||||||||||||||||||||
Raymond W. LeBoeuf(j) | — | 60,399 | 27,743 | — | — | — | 88,142 | |||||||||||||||||||||||||||||||||||||||||
Paul J. Kern | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||||||||||||||||||||||||||||||
Frank T. MacInnis | 90,000 | 125,975 | 37,378 | — | — | — | 253,353 | 100,000 | 90,192 | 40,126 | — | 230,318 | ||||||||||||||||||||||||||||||||||||
Surya N. Mohapatra(k) | 90,000 | 60,246 | 12,338 | — | — | — | 162,584 | |||||||||||||||||||||||||||||||||||||||||
Surya N. Mohapatra | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||||||||||||||||||||||||||||||
Linda S. Sanford | 90,000 | 120,793 | 37,378 | — | — | — | 248,171 | 90,000 | 90,192 | 40,126 | — | 220,318 | ||||||||||||||||||||||||||||||||||||
Markos I. Tambakeras | 90,000 | 136,125 | 37,378 | — | — | — | 263,503 | 90,000 | 90,192 | 40,126 | — | 220,318 |
(b) | Fees earned may be paid, at the election of the Director, in cash or deferred cash. Non-Management Directors may irrevocably elect deferral into an interest-bearing cash account or an account that tracks an index of the Company’s stock. Mr. |
(c) and (d) | Awards reflect the | |
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Outstanding | Outstanding | Outstanding | Outstanding | |||||||||||||
Non-Management | Restricted Common | Stock Option | Restricted Common | Stock Option | ||||||||||||
Director Name | Stock Awards | Awards | Stock Awards | Awards | ||||||||||||
Curtis J. Crawford | 28,502 | 19,300 | 22,160 | 26,130 | ||||||||||||
Christina A. Gold | 21,152 | 19,300 | 23,026 | 26,130 | ||||||||||||
Ralph F. Hake | 8,952 | 15,740 | 10,466 | 22,570 | ||||||||||||
John J. Hamre | 16,796 | 19,300 | 14,224 | 26,130 | ||||||||||||
Paul J. Kern | 1,016 | 2,200 | 3,910 | 9,050 | ||||||||||||
Raymond W. LeBoeuf(2) | — | 16,340 | ||||||||||||||
Frank T. MacInnis | 12,452 | 19,300 | 13,314 | 26,130 | ||||||||||||
Surya N. Mohapatra(3) | 1,697 | 3,640 | ||||||||||||||
Surya N. Mohapatra | 3,412 | 10,470 | ||||||||||||||
Linda S. Sanford | 9,272 | 19,300 | 8,591 | 26,130 | ||||||||||||
Markos I. Tambakeras | 8,130 | 19,300 | 4,674 | 26,130 |
• | $90,000 payable at the election of each Non-Management Director in cash or deferred cash. Directors choosing deferred cash payment may irrevocably elect to have the deferred cash deposited into an interest-bearing cash account, at an interest rate determined as of the Company’s next Annual Meeting, or deposited into an account that tracks an index of the Company’s common stock. No deferred compensation selections provide for preferential treatment for Directors; |
• | Approximately2/3 of the remainder provided in the form of restricted stock units (such restricted stock units payable in shares |
• | Approximately1/3 of the remainder provided in the form of non-qualified stock options (vesting over a three-year period in one-third |
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• | the fifth anniversary of the grant of the shares unless extended as described below; | |
• | the Director retires at age 72; | |
• | there is a Change of Control of the Company; | |
• | the Director becomes disabled or dies; | |
• | the Director’s service is terminated in certain specified, limited circumstances; or | |
• | any other circumstance in which the Compensation and Personnel Committee believes, in its sole discretion, that the purposes for which the grants of restricted stock were made have been fulfilled and, as such, is consistent with the intention of the Plan. |
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(c) | ||||||||||||
Number of Securities | ||||||||||||
Remaining Available | ||||||||||||
for Future Issuance | ||||||||||||
(a) | Under Equity | |||||||||||
Number of Securities | Compensation Plans | |||||||||||
to be Issued Upon | (b) | (Excluding | ||||||||||
Exercise of | Weighted-Average | Securities | ||||||||||
Outstanding Options, | Exercise Price of | Reflected in | ||||||||||
Warrants and Rights | Outstanding Options, | Column (a)) | ||||||||||
Plan Category | (Thousands) | Warrants and Rights | (Thousands) | |||||||||
Equity Compensation Plans Approved by Security Holders(1)(2) | 9,116 | (3) | $ | 42.54 | (4) | 2,881 | (5) | |||||
Equity Compensation Plans Not Approved by Security Holders | — | — | — | |||||||||
Total | 9,116 | $ | 42.54 | 2,881 |
(1) | Equity compensation plans approved by shareholders include the 1994 ITT Incentive Stock Plan, the 1996 Plan, the 2002 ITT Stock Option Plan for Non-Employee Directors and the 2003 Plan. | |
(2) | Since the approval of the 2003 Plan, no additional awards, including awards of restricted stock, will be granted under the other plans referred to in footnote (1) above. Under the 2003 Plan |
23
currently in effect, restricted stock and restricted stock units may be awarded up to a maximum aggregate grant of 300,000 shares or units in any one plan year to any one participant. | ||
(3) | The weighted-average remaining contractual life of the total number of outstanding options was 3.1 years as disclosed in Note 17 to the Consolidated Financial Statements in the Company’s 2010 Annual Report onForm 10-K. | |
(4) | The weighted-average exercise price pertains only to 7,405 outstanding options and not to outstanding restricted stock units, which by their nature have no exercise price. | |
(5) | As of December 31, 2010, the number of shares available for future issuance under the 2003 Plan with respect to restricted stock and restricted stock unit awards was approximately 1,447,257, which is included in the 2,881,070 disclosed above. |
4. | Approval of a Proposal to Amend the Company’s Restated Articles of Incorporation to Allow Shareholders to Call Special Meetings |
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5. | Non-Binding Advisory Vote to Ratify Named Executive Officers’ Compensation |
• | |
• | the ability for executives to achieve long-term shareholder value creation without undue business risk; |
• | creating a clear link between an executive’s compensation and his or her individual contribution and performance; |
• | the extremely competitive nature of the |
• | comparability to the practices of peers in the industries that we operate in and other comparable companies generally. |
6. | Non-Binding Advisory Vote on the Frequency of Shareholder Votes on Executive Compensation |
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7. | Shareholder Proposal Requesting the Company Amend, where Applicable, ITT’s Policies Related to Human Rights |
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• | Our values are our compass — we strive to do the right thing always | |
• | Treat others fairly and courteously | |
• | Sustain a culture of diversity and inclusion |
• | Providing safe and secure conditions for those working on our Company’s behalf | |
• | Protecting the environment | |
• | Following all applicable wage and hour laws | |
• | Strictly prohibiting human trafficking and the use of child or forced labor, including prison or bonded labor | |
• | Treating each other fairly and equitably |
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• | |
• | the |
• | |
• | |
• | |
• | the Company’s long-term strategies, significant investments in new businesses, joint ventures and partnerships and significant business acquisitions, including assessment of |
• |
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The director is, or has been within the last three years, an employee of the |
listed company, or an immediate family member is, or has been within the last three years, an executive officer, of the listed company. | |
(ii) | The director has received, or has an immediate family member who has received, during any twelve-month period within the last three years, more than $120,000 in direct compensation from the listed company, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service). | |
(iii) | (A) The director or an immediate family member is a current partner of | |
(iv) | The director or an immediate family member is, or has been within the last three years, employed as an executive officer of another company where any of the listed company’s present executive officers at the same time serves or served on that company’s compensation committee. | |
(v) | The director is a current employee, or an immediate family member is a current executive officer, of a company that has made payments to, or received payments from, the listed company for property or services in an amount which, in any of the last three |
32
fiscal years, exceeds the greater of $1 million, or 2% of such other company’s consolidated gross revenues. |
• | has not been employed by the Company in an executive capacity; |
• | has not been an advisor or consultant to the Company, and has not been affiliated with a company or a firm that is; |
• | has not been affiliated with a significant customer or supplier of the Company; |
• | has not had a personal services contract with the Company; |
• | has not been affiliated with a tax-exempt entity that receives significant contributions from the Company; |
• | has not been related to any of the persons described above; and |
• | has not been part of an interlocking directorate in which an executive officer of the Company is a member of the compensation committee of the company that employs the Director. |
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Frank T. MacInnis, Chair Christina A. Gold Ralph F. Hake Surya N. Mohapatra Linda S. Sanford | ||
Meetings in 2010: | 10 | |
Responsibilities: | • Subject to any action that may be taken by the full Board, the Audit Committee has the ultimate authority and responsibility to determine Deloitte qualifications and independence, and to appoint (or nominate for shareholder ratification), evaluate, and where appropriate, consider rotation or replacement of Deloitte. | |
• Review and discuss with management and Deloitte, and approve the audited financial statements of the |
35
Company and make a recommendation regarding inclusion of those financial statements in any public filing including the Company’s Annual Report onForm 10-K (or the Annual Report to Shareholders if distributed prior to the filing ofForm 10-K), including discussion of the Company’s disclosures under Management’s Discussion and Analysis of Financial Condition and Results of Operations. | ||
• Review and consider with Deloitte matters required to be discussed by PCAOB Standards, Statement of Auditing Standards (“SAS”) No. 114 (The Auditor’s Communication with Those Charged with Governance) and all other applicable regulatory agencies. | ||
• Review with management and Deloitte the effect of regulatory and accounting initiatives on the Company’s financial statements. | ||
• As a whole, or through the Committee chair, review and discuss with Deloitte the Company’s interim financial results to be included in the Company’s earnings report or quarterly reports to be filed with the SEC, including discussion of the Company’s disclosures under Management’s Discussion and Analysis of Financial Condition and Results of Operations prior to the filing of itsForm 10-Q with the SEC. | ||
• Review and discuss with management the types of information to be disclosed and the types of presentations to be made with respect to the Company’s earning releases and rating agency presentations. | ||
• Monitor and discuss with management and Deloitte the quality and adequacy of the Company’s internal controls and their effectiveness, and meet regularly and privately with the General Auditor. | ||
• Annually request from Deloitte a formal written statement delineating all relationships between Deloitte and the Company, consistent with the PCAOB Rule 3526. | ||
• With respect to such relationships, the Audit Committee shall: | ||
• Discuss with Deloitte any disclosed relationships and the impact of the relationship on Deloitte independence; and | ||
• Assess and recommend appropriate action in response to the Deloitte report to satisfy itself of the auditor’s independence. | ||
• Adopt and monitor implementation and compliance with the Company’s Non-Audit Services Policy, which addresses approval requirements and the |
36
limited circumstances in which Deloitte or other service providers may be retained for non-audit services. | ||
• Confirm the scope of audits to be performed by Deloitte and any outside internal audit service provider, monitor progress and review results. Review fees and expenses charged by Deloitte and any party retained to provide internal audit services. | ||
• On an annual basis, discuss with Deloitte its internal quality control procedures, material issues raised in quality control or peer review and any inquiries by governmental or professional authorities regarding the firm’s independent audits of other clients. | ||
• Review significant findings or unsatisfactory internal audit reports or audit problems or difficulties encountered by Deloitte, and monitor management’s response to such findings. | ||
• Provide oversight and discuss with management, internal auditors and Deloitte, the adequacy and effectiveness of the Company’s overall risk assessment and risk management process, including all risk mitigation processes. | ||
• Review its performance and Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. | ||
• Review regularly and consider the Company’s environmental, safety and health reserves. | ||
• Review expense accounts of senior executives. | ||
• Update the Board of Directors on a regular basis with respect to matters coming to its attention that may have a significant impact on the Company’s financial condition or affairs and the Company’s compliance with legal or regulatory requirements and the performance and independence of Deloitte and the internal audit function. | ||
• Review major issues regarding accounting principles and financial statement presentations, significant changes to the Company’s selection or application of accounting principles and major issues relating to the Company’s internal controls including any specifically required steps to correct identified major internal control issues. The Audit Committee also reviews management or Deloitte’s analyses regarding significant financial reporting issues and judgments made in preparing financial statements including analyses of alternative GAAP methods as well as the effect of regulatory and accounting initiatives and |
37
off-balance sheet structures, if any, on the Company’s financial statements. | ||
• Review all material related party transactions prior to initiation of the transaction and make recommendations to the Board of Directors for approval or disapproval. | ||
• In conjunction with the Board of Directors, evaluate the qualifications of its members and its own performance on an annual basis. | ||
• Meet separately, on a regular basis, with Deloitte, internal auditors, and members of management, as well as privately as a Committee. | ||
• Establish policies regarding the Company’s employment and retention of current or former employees of Deloitte or outsourced internal auditor. | ||
• With respect to complaints concerning accounting, internal accounting controls or auditing matters: | ||
• Review and approve procedures for receipt, retention and treatment of complaints received by the Company; and | ||
• Establish procedures for the confidential, anonymous submission of complaints to the Audit Committee. | ||
• Establish levels for payment by the Company of fees to Deloitte and any advisors retained by the Audit Committee. | ||
• Receive regular reports from the Chief Executive Officer, Chief Financial Officer and from the Company’s disclosure control committee representative on the status of the Company’s disclosure controls and related certifications, including disclosure of any material weaknesses or significant deficiencies in the design or operation of internal controls and any fraud that involves management or other employees with a significant role in internal controls. | ||
• Prepare the Report of the Audit Committee for the Company’s Proxy Statement. | ||
Although more than one member of the Board of Directors satisfies the requirements of the audit committee financial expert, the Board of Directors has identified Ralph F. Hake as the audit committee financial expert. |
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Linda S. Sanford, Chair Curtis J. Crawford Ralph F. Hake Frank T. MacInnis | ||
Meetings in 2010: | 6 | |
The Committee’s primary objective is to establish a competitive executive compensation program that clearly links executive compensation to business performance and shareholder return, without excessive enterprise risk. | ||
Responsibilities: | • Approve and oversee administration of the Company’s employee compensation program including incentive plans and equity-based compensation plans. | |
• Evaluate senior management and Chief Executive Officer performance, evaluate enterprise risk and other risk factors with respect to compensation objectives, set annual performance objectives for the Chief Executive Officer and approve individual compensation actions for the Chief Executive Officer and officers at the vice president level and above, as well as certain other selected positions. | ||
• Oversee the establishment and administration of the Company’s benefit programs. | ||
• Select, retain and determine the terms of engagement for independent compensation and benefits consultants and other outside counsel, as needed, to provide independent advice to the Committee with respect to the Company’s current and proposed executive compensation and employee benefit programs. In 2010 and prior years, the Committee obtained such advice. | ||
• Oversee and approve the continuity planning process and review with the full Board of Directors, which provides final approval. | ||
• Regularly report to the Board of Directors on compensation, benefits, continuity and related matters. | ||
• Prepare the Compensation Committee Report for the Company’s Proxy Statement. |
39
• Review regularly and consider the Company’s Inclusion & Diversity strategy and the effectiveness of related programs and policies. | ||
• Review its performance and Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. |
John J. Hamre, Chair Linda S. Sanford Markos I. Tambakeras | ||
Meetings in 2010: | 1 | |
Responsibilities: | • Review and make recommendations concerning the Company’s roles and responsibilities as a good corporate citizen. | |
• Review and consider major claims and litigation involving the Company and its subsidiaries. | ||
• Regularly assess the adequacy and effectiveness of the Company’s Code of Corporate Conduct and review any violations of the Code. | ||
• Review its performance and Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. |
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John J. Hamre, Chair Curtis J. Crawford Paul J. Kern Markos I. Tambakeras | ||
Meetings in 2010: | 4 | |
Responsibilities: | • Develop, annually review, update and recommend to the Board of Directors corporate governance principles for the Company. | |
• In the event it is necessary to select a new chief executive officer, lead the process for candidate evaluation, consideration and screening. The full Board of Directors has the final responsibility to select the Company’s chief executive officer. | ||
• Evaluate and make recommendations to the Board of Directors concerning the composition, governance and structure of the Board. | ||
• Make recommendations to the Board of Directors concerning the qualifications, compensation and retirement age of Directors. | ||
• Administer the Board of Directors’ annual evaluation process. | ||
• Review and recommend to the full Board matters and agenda items relating to the Company’s Annual Meeting of shareholders. | ||
• Review the form of Annual Report to Shareholders, Proxy Statement and related materials. | ||
• Review the Company’s business continuity and disaster recovery programs and plans. | ||
• Review the Company’s communication and advertising program and other activities involving community relations, major charitable contributions and promotion of the Company’s public image. | ||
• Determine desired Board and Director skills and attributes and conduct searches for prospective board members whose skills and attributes reflect those desired for the Board of Directors. | ||
• Identify, evaluate and propose nominees for election to the Board of Directors. | ||
• Make recommendations to the Board of Directors concerning the appointment of Directors to Board Committees and the selection of Board Committee Chairs. | ||
• Evaluate and make recommendations regarding senior management requests for approval to accept membership on outside boards. |
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• Review regularly and consider the Company’s programs and policies for effecting compliance with laws and regulations involving the environment, safety and health. | ||
• Provide oversight and discuss with management, internal auditors and Deloitte the adequacy and effectiveness of the Company’s insurance programs. | ||
• Review and consider the Company’s policies and efforts with respect to compliance with government contracts, international laws and regulations and export controls. | ||
• Review its performance and Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. |
Markos I. Tambakeras, Chair Christina A. Gold John J. Hamre Paul J. Kern Surya N. Mohapatra | ||
Meetings in 2010: | 4 | |
Responsibilities: | • Receive periodic updates on global macroeconomic issues. | |
• Review and consider the Company’s: | ||
• Strategic plans; | ||
• Operations excellence performance; | ||
• Operating plan; | ||
• Capital structure, including stock repurchases, debt offerings and financing, and dividends; | ||
• Corporate guarantees; | ||
• Acquisition integration; |
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• Pension plan performance, style and asset allocation and ERISA compliance; | ||
• Tax compliance, tax planning and related matters; | ||
• Commodity hedge transactions and strategies; | ||
• Investor relations matters; | ||
• Risk assessment with respect to financial liquidity and financing; and | ||
• Strategic issues. | ||
• Review and recommend for approval significant business acquisitions and divestitures, and other related matters. | ||
• Review and assess its performance on an annual basis. | ||
• Review and approve its Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. | ||
The Strategy and Finance Committee oversees all areas of strategy and corporate finance to ensure the Company maintains adequate financial liquidity and appropriate credit ratings and to ensure the Company’s strategic initiatives are consistent with the Company’s financial and strategic plans. The Board of Directors retains the ultimate power and authority with respect to strategic direction and major strategic and financial decisions. |
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Fees | ||||||||||||||||||||
Earned or | ||||||||||||||||||||
Paid in | Stock | Option | All Other | |||||||||||||||||
Name | Cash | Awards | Awards | Compensation | Total | |||||||||||||||
(a) | (b) ($) | (c) ($) | (d) ($) | (g) ($) | (h) ($) | |||||||||||||||
Curtis J. Crawford | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
Christina A. Gold | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
Ralph F. Hake | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
John J. Hamre | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
Paul J. Kern | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
Frank T. MacInnis | 100,000 | 90,192 | 40,126 | — | 230,318 | |||||||||||||||
Surya N. Mohapatra | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
Linda S. Sanford | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
Markos I. Tambakeras | 90,000 | 90,192 | 40,126 | — | 220,318 |
(b) | Fees earned may be paid, at the election of the Director, in cash or deferred cash. Non-Management Directors may irrevocably elect deferral into an interest-bearing cash account or an account that tracks an index of the Company’s stock. Mr. MacInnis received an additional $10,000 as the Audit Committee Chair. |
(c) and (d) | Awards reflect the grant date fair value computed in accordance with Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) Topic 718, Stock Compensation. Non-Management Directors do not receive differing amounts of equity compensation, the grant date fair value for restricted stock units was $52.59 and was determined on May 11, 2010, the date of the Company’s 2010 Annual Meeting. The grant price reflects the closing price of ITT stock on the grant date. The grant date fair value ofnon-qualified stock options was $14.03, determined on March 5, 2010, the date on which Director stock options were awarded. The assumptions used in calculating these values may be found in Note 17, Long-Term Incentive Employee Compensation, to the Consolidated Financial Statements in the Company’s 2010 Form10-K. |
(g) | No perquisites or other personal benefits were received by Non-Management Directors. |
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Outstanding | Outstanding | |||||||
Non-Management | Restricted Common | Stock Option | ||||||
Director Name | Stock Awards | Awards | ||||||
Curtis J. Crawford | 22,160 | 26,130 | ||||||
Christina A. Gold | 23,026 | 26,130 | ||||||
Ralph F. Hake | 10,466 | 22,570 | ||||||
John J. Hamre | 14,224 | 26,130 | ||||||
Paul J. Kern | 3,910 | 9,050 | ||||||
Frank T. MacInnis | 13,314 | 26,130 | ||||||
Surya N. Mohapatra | 3,412 | 10,470 | ||||||
Linda S. Sanford | 8,591 | 26,130 | ||||||
Markos I. Tambakeras | 4,674 | 26,130 |
• | $90,000 payable at the election of each Non-Management Director in cash or deferred cash. Directors choosing deferred cash payment may irrevocably elect to have the deferred cash deposited into an interest-bearing cash account, at an interest rate determined as of the Company’s next Annual Meeting, or deposited into an account that tracks an index of the Company’s common stock. No deferred compensation selections provide for preferential treatment for Directors; |
• | Approximately2/3 of the remainder provided in the form of restricted stock units (such restricted stock units payable in shares following the Non-Management Director’s termination of service on the Board of Directors or on a date selected by the Director); and |
• | Approximately1/3 of the remainder provided in the form of non-qualified stock options (vesting over a three-year period in one-third installments on the anniversary of the date of grant). |
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• | the fifth anniversary of the grant of the shares unless extended as described below; | |
• | the Director retires at age 72; | |
• | there is a Change of Control of the Company; | |
• | the Director becomes disabled or dies; | |
• | the Director’s service is terminated in certain specified, limited circumstances; or | |
• | any other circumstance in which the Compensation and Personnel Committee believes, in its sole discretion, that the purposes for which the grants of restricted stock were made have been fulfilled and, as such, is consistent with the intention of the Plan. |
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(c) | ||||||||||||||||||||||||
(c) | Number of Securities | |||||||||||||||||||||||
Number of Securities | Remaining Available | |||||||||||||||||||||||
Remaining Available | for Future Issuance | |||||||||||||||||||||||
(a) | for Future Issuance | (a) | Under Equity | |||||||||||||||||||||
Number of Securities | Under Equity | Number of Securities | Compensation Plans | |||||||||||||||||||||
to be Issued Upon | (b) | Compensation Plans | to be Issued Upon | (b) | (Excluding | |||||||||||||||||||
Exercise of | Weighted-Average | (Excluding Securities | Exercise of | Weighted-Average | Securities | |||||||||||||||||||
Outstanding Options, | Exercise Price of | Reflected in | Outstanding Options, | Exercise Price of | Reflected in | |||||||||||||||||||
Warrants and Rights | Outstanding Options, | Column (a)) | Warrants and Rights | Outstanding Options, | Column (a)) | |||||||||||||||||||
Plan Category | (Thousands) | Warrants and Rights | (Thousands) | (Thousands) | Warrants and Rights | (Thousands) | ||||||||||||||||||
Equity Compensation Plans Approved by Security Holders(1)(2) | 9,576 | (3) | $ | 46.07 | 4,996 | (4) | 9,116 | (3) | $ | 42.54 | (4) | 2,881 | (5) | |||||||||||
Equity Compensation Plans Not Approved by Security Holders | None | None | None | — | — | — | ||||||||||||||||||
Total | 9,576 | $ | 46.07 | 4,996 | 9,116 | $ | 42.54 | 2,881 |
(1) | Equity compensation plans approved by shareholders include the 1994 ITT Incentive Stock Plan, the 1996 Plan, the 2002 ITT Stock Option Plan for Non-Employee Directors and the 2003 Plan. | |
(2) | Since the approval of the 2003 Plan, no additional awards, including awards of restricted stock, will be granted under the other plans referred to in footnote (1) above. Under the 2003 Plan |
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currently in effect, restricted stock and restricted stock units may be awarded up to a maximum aggregate grant of 300,000 shares or units in any one plan year to any one participant. | ||
(3) | The weighted-average remaining contractual life of the total number of outstanding options was | |
(4) | The weighted-average exercise price pertains only to 7,405 outstanding options and not to outstanding restricted stock units, which by their nature have no exercise price. | |
(5) | As of December 31, |
4. | Approval of a Proposal to Amend the Company’s Restated Articles of Incorporation to Allow Shareholders to Call Special Meetings |
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5. | Non-Binding Advisory Vote to Ratify Named Executive Officers’ Compensation |
• | alignment of executive and shareholder interests by providing incentives linked to earnings per share performance, revenue, free cash flow and return on invested capital; |
• | the ability for executives to achieve long-term shareholder value creation without undue business risk; |
• | creating a clear link between an executive’s compensation and his or her individual contribution and performance; |
• | the extremely competitive nature of the industries in which we operate, whether in manufacturing or defense, and our need to attract and retain the most creative and talented industry leaders; and |
• | comparability to the practices of peers in the industries that we operate in and other comparable companies generally. |
6. | Non-Binding Advisory Vote on the Frequency of Shareholder Votes on Executive Compensation |
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7. | Shareholder Proposal Requesting the Company Amend, where Applicable, ITT’s Policies Related to Human Rights |
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• | Our values are our compass — we strive to do the right thing always | |
• | Treat others fairly and courteously | |
• | Sustain a culture of diversity and inclusion |
• | Providing safe and secure conditions for those working on our Company’s behalf | |
• | Protecting the environment | |
• | Following all applicable wage and hour laws | |
• | Strictly prohibiting human trafficking and the use of child or forced labor, including prison or bonded labor | |
• | Treating each other fairly and equitably |
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• | the Company’s businesses are conducted in conformity with applicable laws and regulations; |
• | the Company’s systems of financial reporting and internal controls are adequate and properly implemented and the Company has appropriate risk management structures in place; |
• | there is continuity in the leadership of the Company; |
• | management develops sound business strategies; |
• | adequate capital and managerial resources are available to implement the business strategies; |
• | the Company’s long-term strategies, significant investments in new businesses, joint ventures and partnerships and significant business acquisitions, including assessment of balance sheet impacts and other financial matters, are reviewed and approved; and |
• | the Company’s operating plans and capital, research and development and engineering budgets are reviewed and approved. |
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(b) | In addition, a director is not independent if: |
(i) | The director is, or has been within the last three years, an employee of the listed company, or an immediate family member is, or has been within the last three years, an executive officer, of the listed company. | |
(ii) | The director has received, or has an immediate family member who has received, during any twelve-month period within the last three years, more than $120,000 in direct compensation from the listed company, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service). | |
(iii) | (A) The director or an immediate family member is a current partner of a firm that is the company’s internal or external auditor; (B) the director is a current employee of such a firm; (C) the director has an immediate family member who is a current employee of such a firm and who participates in the firm’s audit, assurance or tax compliance (but not tax planning) practice; or (D) the director or an immediate family member was within the last three years (but is no longer) a partner or employee of such a firm and personally worked on the listed company’s audit within that time. | |
(iv) | The director or an immediate family member is, or has been within the last three years, employed as an executive officer of another company where any of the listed company’s present executive officers at the same time serves or served on that company’s compensation committee. | |
(v) | The director is a current employee, or an immediate family member is a current executive officer, of a company that has made payments to, or received payments from, the listed company for property or services in an amount which, in any of the last three |
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fiscal years, exceeds the greater of $1 million, or 2% of such other company’s consolidated gross revenues. |
• | has not been employed by the Company in an executive capacity; |
• | has not been an advisor or consultant to the Company, and has not been affiliated with a company or a firm that is; |
• | has not been affiliated with a significant customer or supplier of the Company; |
• | has not had a personal services contract with the Company; |
• | has not been affiliated with a tax-exempt entity that receives significant contributions from the Company; |
• | has not been related to any of the persons described above; and |
• | has not been part of an interlocking directorate in which an executive officer of the Company is a member of the compensation committee of the company that employs the Director. |
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Frank T. MacInnis, Chair Christina A. Gold Ralph F. Hake Surya N. Mohapatra Linda S. Sanford | ||
Meetings in 2010: | 10 | |
Responsibilities: | • Subject to any action that may be taken by the full Board, the Audit Committee has the ultimate authority and responsibility to determine Deloitte qualifications and independence, and to appoint (or nominate for shareholder ratification), evaluate, and where appropriate, consider rotation or replacement of Deloitte. | |
• Review and discuss with management and Deloitte, and approve the audited financial statements of the |
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Company and make a recommendation regarding inclusion of those financial statements in any public filing including the Company’s Annual Report onForm 10-K (or the Annual Report to Shareholders if distributed prior to the filing ofForm 10-K), including discussion of the Company’s disclosures under Management’s Discussion and Analysis of Financial Condition and Results of Operations. | ||
• Review and consider with Deloitte matters required to be discussed by PCAOB Standards, Statement of Auditing Standards (“SAS”) No. 114 (The Auditor’s Communication with Those Charged with Governance) and all other applicable regulatory agencies. | ||
• Review with management and Deloitte the effect of regulatory and accounting initiatives on the Company’s financial statements. | ||
• As a whole, or through the Committee chair, review and discuss with Deloitte the Company’s interim financial results to be included in the Company’s earnings report or quarterly reports to be filed with the SEC, including discussion of the Company’s disclosures under Management’s Discussion and Analysis of Financial Condition and Results of Operations prior to the filing of itsForm 10-Q with the SEC. | ||
• Review and discuss with management the types of information to be disclosed and the types of presentations to be made with respect to the Company’s earning releases and rating agency presentations. | ||
• Monitor and discuss with management and Deloitte the quality and adequacy of the Company’s internal controls and their effectiveness, and meet regularly and privately with the General Auditor. | ||
• Annually request from Deloitte a formal written statement delineating all relationships between Deloitte and the Company, consistent with the PCAOB Rule 3526. | ||
• With respect to such relationships, the Audit Committee shall: | ||
• Discuss with Deloitte any disclosed relationships and the impact of the relationship on Deloitte independence; and | ||
• Assess and recommend appropriate action in response to the Deloitte report to satisfy itself of the auditor’s independence. | ||
• Adopt and monitor implementation and compliance with the Company’s Non-Audit Services Policy, which addresses approval requirements and the |
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limited circumstances in which Deloitte or other service providers may be retained for non-audit services. | ||
• Confirm the scope of audits to be performed by Deloitte and any outside internal audit service provider, monitor progress and review results. Review fees and expenses charged by Deloitte and any party retained to provide internal audit services. | ||
• On an annual basis, discuss with Deloitte its internal quality control procedures, material issues raised in quality control or peer review and any inquiries by governmental or professional authorities regarding the firm’s independent audits of other clients. | ||
• Review significant findings or unsatisfactory internal audit reports or audit problems or difficulties encountered by Deloitte, and monitor management’s response to such findings. | ||
• Provide oversight and discuss with management, internal auditors and Deloitte, the adequacy and effectiveness of the Company’s overall risk assessment and risk management process, including all risk mitigation processes. | ||
• Review its performance and Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. | ||
• Review regularly and consider the Company’s environmental, safety and health reserves. | ||
• Review expense accounts of senior executives. | ||
• Update the Board of Directors on a regular basis with respect to matters coming to its attention that may have a significant impact on the Company’s financial condition or affairs and the Company’s compliance with legal or regulatory requirements and the performance and independence of Deloitte and the internal audit function. | ||
• Review major issues regarding accounting principles and financial statement presentations, significant changes to the Company’s selection or application of accounting principles and major issues relating to the Company’s internal controls including any specifically required steps to correct identified major internal control issues. The Audit Committee also reviews management or Deloitte’s analyses regarding significant financial reporting issues and judgments made in preparing financial statements including analyses of alternative GAAP methods as well as the effect of regulatory and accounting initiatives and |
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off-balance sheet structures, if any, on the Company’s financial statements. | ||
• Review all material related party transactions prior to initiation of the transaction and make recommendations to the Board of Directors for approval or disapproval. | ||
• In conjunction with the Board of Directors, evaluate the qualifications of its members and its own performance on an annual basis. | ||
• Meet separately, on a regular basis, with Deloitte, internal auditors, and members of management, as well as privately as a Committee. | ||
• Establish policies regarding the Company’s employment and retention of current or former employees of Deloitte or outsourced internal auditor. | ||
• With respect to complaints concerning accounting, internal accounting controls or auditing matters: | ||
• Review and approve procedures for receipt, retention and treatment of complaints received by the Company; and | ||
• Establish procedures for the confidential, anonymous submission of complaints to the Audit Committee. | ||
• Establish levels for payment by the Company of fees to Deloitte and any advisors retained by the Audit Committee. | ||
• Receive regular reports from the Chief Executive Officer, Chief Financial Officer and from the Company’s disclosure control committee representative on the status of the Company’s disclosure controls and related certifications, including disclosure of any material weaknesses or significant deficiencies in the design or operation of internal controls and any fraud that involves management or other employees with a significant role in internal controls. | ||
• Prepare the Report of the Audit Committee for the Company’s Proxy Statement. | ||
Although more than one member of the Board of Directors satisfies the requirements of the audit committee financial expert, the Board of Directors has identified Ralph F. Hake as the audit committee financial expert. |
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Linda S. Sanford, Chair Curtis J. Crawford Ralph F. Hake Frank T. MacInnis | ||
Meetings in 2010: | 6 | |
The Committee’s primary objective is to establish a competitive executive compensation program that clearly links executive compensation to business performance and shareholder return, without excessive enterprise risk. | ||
Responsibilities: | • Approve and oversee administration of the Company’s employee compensation program including incentive plans and equity-based compensation plans. | |
• Evaluate senior management and Chief Executive Officer performance, evaluate enterprise risk and other risk factors with respect to compensation objectives, set annual performance objectives for the Chief Executive Officer and approve individual compensation actions for the Chief Executive Officer and officers at the vice president level and above, as well as certain other selected positions. | ||
• Oversee the establishment and administration of the Company’s benefit programs. | ||
• Select, retain and determine the terms of engagement for independent compensation and benefits consultants and other outside counsel, as needed, to provide independent advice to the Committee with respect to the Company’s current and proposed executive compensation and employee benefit programs. In 2010 and prior years, the Committee obtained such advice. | ||
• Oversee and approve the continuity planning process and review with the full Board of Directors, which provides final approval. | ||
• Regularly report to the Board of Directors on compensation, benefits, continuity and related matters. | ||
• Prepare the Compensation Committee Report for the Company’s Proxy Statement. |
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• Review regularly and consider the Company’s Inclusion & Diversity strategy and the effectiveness of related programs and policies. | ||
• Review its performance and Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. |
John J. Hamre, Chair Linda S. Sanford Markos I. Tambakeras | ||
Meetings in 2010: | 1 | |
Responsibilities: | • Review and make recommendations concerning the Company’s roles and responsibilities as a good corporate citizen. | |
• Review and consider major claims and litigation involving the Company and its subsidiaries. | ||
• Regularly assess the adequacy and effectiveness of the Company’s Code of Corporate Conduct and review any violations of the Code. | ||
• Review its performance and Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. |
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John J. Hamre, Chair Curtis J. Crawford Paul J. Kern Markos I. Tambakeras | ||
Meetings in 2010: | 4 | |
Responsibilities: | • Develop, annually review, update and recommend to the Board of Directors corporate governance principles for the Company. | |
• In the event it is necessary to select a new chief executive officer, lead the process for candidate evaluation, consideration and screening. The full Board of Directors has the final responsibility to select the Company’s chief executive officer. | ||
• Evaluate and make recommendations to the Board of Directors concerning the composition, governance and structure of the Board. | ||
• Make recommendations to the Board of Directors concerning the qualifications, compensation and retirement age of Directors. | ||
• Administer the Board of Directors’ annual evaluation process. | ||
• Review and recommend to the full Board matters and agenda items relating to the Company’s Annual Meeting of shareholders. | ||
• Review the form of Annual Report to Shareholders, Proxy Statement and related materials. | ||
• Review the Company’s business continuity and disaster recovery programs and plans. | ||
• Review the Company’s communication and advertising program and other activities involving community relations, major charitable contributions and promotion of the Company’s public image. | ||
• Determine desired Board and Director skills and attributes and conduct searches for prospective board members whose skills and attributes reflect those desired for the Board of Directors. | ||
• Identify, evaluate and propose nominees for election to the Board of Directors. | ||
• Make recommendations to the Board of Directors concerning the appointment of Directors to Board Committees and the selection of Board Committee Chairs. | ||
• Evaluate and make recommendations regarding senior management requests for approval to accept membership on outside boards. |
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• Review regularly and consider the Company’s programs and policies for effecting compliance with laws and regulations involving the environment, safety and health. | ||
• Provide oversight and discuss with management, internal auditors and Deloitte the adequacy and effectiveness of the Company’s insurance programs. | ||
• Review and consider the Company’s policies and efforts with respect to compliance with government contracts, international laws and regulations and export controls. | ||
• Review its performance and Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. |
Markos I. Tambakeras, Chair Christina A. Gold John J. Hamre Paul J. Kern Surya N. Mohapatra | ||
Meetings in 2010: | 4 | |
Responsibilities: | • Receive periodic updates on global macroeconomic issues. | |
• Review and consider the Company’s: | ||
• Strategic plans; | ||
• Operations excellence performance; | ||
• Operating plan; | ||
• Capital structure, including stock repurchases, debt offerings and financing, and dividends; | ||
• Corporate guarantees; | ||
• Acquisition integration; |
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• Pension plan performance, style and asset allocation and ERISA compliance; | ||
• Tax compliance, tax planning and related matters; | ||
• Commodity hedge transactions and strategies; | ||
• Investor relations matters; | ||
• Risk assessment with respect to financial liquidity and financing; and | ||
• Strategic issues. | ||
• Review and recommend for approval significant business acquisitions and divestitures, and other related matters. | ||
• Review and assess its performance on an annual basis. | ||
• Review and approve its Charter at least annually and make recommendations to the Board of Directors for approval and adoption of its Charter. | ||
The Strategy and Finance Committee oversees all areas of strategy and corporate finance to ensure the Company maintains adequate financial liquidity and appropriate credit ratings and to ensure the Company’s strategic initiatives are consistent with the Company’s financial and strategic plans. The Board of Directors retains the ultimate power and authority with respect to strategic direction and major strategic and financial decisions. |
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Fees | ||||||||||||||||||||
Earned or | ||||||||||||||||||||
Paid in | Stock | Option | All Other | |||||||||||||||||
Name | Cash | Awards | Awards | Compensation | Total | |||||||||||||||
(a) | (b) ($) | (c) ($) | (d) ($) | (g) ($) | (h) ($) | |||||||||||||||
Curtis J. Crawford | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
Christina A. Gold | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
Ralph F. Hake | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
John J. Hamre | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
Paul J. Kern | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
Frank T. MacInnis | 100,000 | 90,192 | 40,126 | — | 230,318 | |||||||||||||||
Surya N. Mohapatra | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
Linda S. Sanford | 90,000 | 90,192 | 40,126 | — | 220,318 | |||||||||||||||
Markos I. Tambakeras | 90,000 | 90,192 | 40,126 | — | 220,318 |
(b) | Fees earned may be paid, at the election of the Director, in cash or deferred cash. Non-Management Directors may irrevocably elect deferral into an interest-bearing cash account or an account that tracks an index of the Company’s stock. Mr. MacInnis received an additional $10,000 as the Audit Committee Chair. |
(c) and (d) | Awards reflect the grant date fair value computed in accordance with Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) Topic 718, Stock Compensation. Non-Management Directors do not receive differing amounts of equity compensation, the grant date fair value for restricted stock units was $52.59 and was determined on May 11, 2010, the date of the Company’s 2010 Annual Meeting. The grant price reflects the closing price of ITT stock on the grant date. The grant date fair value ofnon-qualified stock options was $14.03, determined on March 5, 2010, the date on which Director stock options were awarded. The assumptions used in calculating these values may be found in Note 17, Long-Term Incentive Employee Compensation, to the Consolidated Financial Statements in the Company’s 2010 Form10-K. |
(g) | No perquisites or other personal benefits were received by Non-Management Directors. |
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Outstanding | Outstanding | |||||||
Non-Management | Restricted Common | Stock Option | ||||||
Director Name | Stock Awards | Awards | ||||||
Curtis J. Crawford | 22,160 | 26,130 | ||||||
Christina A. Gold | 23,026 | 26,130 | ||||||
Ralph F. Hake | 10,466 | 22,570 | ||||||
John J. Hamre | 14,224 | 26,130 | ||||||
Paul J. Kern | 3,910 | 9,050 | ||||||
Frank T. MacInnis | 13,314 | 26,130 | ||||||
Surya N. Mohapatra | 3,412 | 10,470 | ||||||
Linda S. Sanford | 8,591 | 26,130 | ||||||
Markos I. Tambakeras | 4,674 | 26,130 |
• | $90,000 payable at the election of each Non-Management Director in cash or deferred cash. Directors choosing deferred cash payment may irrevocably elect to have the deferred cash deposited into an interest-bearing cash account, at an interest rate determined as of the Company’s next Annual Meeting, or deposited into an account that tracks an index of the Company’s common stock. No deferred compensation selections provide for preferential treatment for Directors; |
• | Approximately2/3 of the remainder provided in the form of restricted stock units (such restricted stock units payable in shares following the Non-Management Director’s termination of service on the Board of Directors or on a date selected by the Director); and |
• | Approximately1/3 of the remainder provided in the form of non-qualified stock options (vesting over a three-year period in one-third installments on the anniversary of the date of grant). |
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• | the fifth anniversary of the grant of the shares unless extended as described below; | |
• | the Director retires at age 72; | |
• | there is a Change of Control of the Company; | |
• | the Director becomes disabled or dies; | |
• | the Director’s service is terminated in certain specified, limited circumstances; or | |
• | any other circumstance in which the Compensation and Personnel Committee believes, in its sole discretion, that the purposes for which the grants of restricted stock were made have been fulfilled and, as such, is consistent with the intention of the Plan. |
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• | determination of qualifications and independence of Deloitte & Touche LLP (“Deloitte”); |
• | the appointment, compensation and oversight of Deloitte in preparing or issuing audit reports and related work; |
• | review of financial reports and other financial information provided by the Company, its systems of internal accounting and financial controls, and the annual independent audit of the Company’s financial statements; |
• | oversight and review of procedures developed for consideration of accounting, internal accounting controls and auditing-related complaints; |
• | review of risk assessment and risk management processes on a company-wide basis; and |
• | adoption of and monitoring the implementation and compliance with the Company’s Non-Audit Services Policy. |
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1. | NEO Compensation Tied to Internal Business Performance and Long-Term Share Price Performance |
2. | Pay for Performance — Compensation At Risk |
• | The Company’s share price performance significantly lagged industrial companies in the TSR Performance Index (the S&P Industrials Companies, without consideration of utility and transportation service industries, (described herein as the “TSR Performance Index”)) for the2008-2010 Total Shareholder Return (“TSR”) award performance period (TSR is an element of NEO compensation based on relative share price performances over three years). The payout for TSR awards for this performance period was zero, as the Company’s total shareholder return over the three year measurement period, ending December 31, 2010 was ranked at the 25.89 percentile relative to the TSR Performance Index. This rank was below the threshold required for any payment. | |
• | In 2010, the Company’s internal business performance was strong, resulting in an Annual Incentive Plan (“AIP”) payout above target (where target is 100%). The AIP award is an element of NEO compensation which rewards annual operating performance and earnings per share appreciation. The 2010 AIP emphasized total Company performance and collaboration among businesses. | |
• | Stock option and restricted stock grants directly tie NEO compensation to absolute share price performance. |
3. | Changes in the NEO Compensation Program |
• | Tax reimbursements for financial counseling have been eliminated for financial counseling and tax preparation associated with the 2011 tax year. No compensating salary increase will be provided. | |
• | In 2011, the Committee determined to award restricted stock units, rather than restricted stock. This change was made to provide more uniform tax treatment on a global basis. |
4. | Good Pay Practices |
• | Recoupment Policy (p. 67) | |
• | Officer Stock Ownership Guidelines (p. 6) | |
• | Policy Prohibits Speculation in Company Stock (p. 52) |
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• | Independent Compensation Consultant Advises the Committee (p. 52) | |
• | No Repricing or Replacing of Stock Options Without Shareholder Approval (p. 63) |
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Compensation Component or Policy | Risk Mitigation Factor | ||
Salary | • Based on market rates. | ||
• Provides stability and minimizes risk-taking incentives. | |||
Annual Incentive Plan | • AIP design emphasizes overall performance and collaboration among business Groups. The Company’s Fluid Technology, Motion & Flow Control and Defense & Information Solutions businesses are each a business segment or (“Group”). | ||
• AIP components focus on metrics which encourage operating performance and earnings per share appreciation. | |||
• AIP design tailored to meet unique business considerations for Corporate headquarters and business Groups. | |||
• Individual AIP components and total AIP awards are capped. | |||
Long-Term Incentive Awards | • The three-year vesting threshold for senior vice presidents and the Chief Executive Officer and seven and ten-year option terms encourage long-term behaviors. | ||
• Restricted Stock or Restricted Stock Units | • Restricted stock or restricted stock units generally vest after three years. | ||
• Stock Options | • Stock options vest after three years for the Chief Executive Officer and for senior vice presidents and in one-third cumulative annual installments after the first, second and third anniversary of the grant date for other optionees. Options awarded in 2010 and 2011 and options awarded prior to 2005 expire ten years after the grant date. Options awarded between 2005 and 2009 expire seven years after the grant date. | ||
• Total Shareholder Return Awards | • The TSR long-term award is based on three-year share price performance and encourages behaviors focused on long-term goals, while discouraging behaviors focused on short-term risks. | ||
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Compensation Component or Policy | Risk Mitigation Factor | ||
Perquisites | Limited perquisites are based on competitive market data. The Committee has determined that tax reimbursements related to financial counseling and tax preparation for senior executives associated with the 2011 tax year will be eliminated. No salary increase will be provided to offset the elimination of tax reimbursement. | ||
Severance and Pension benefits | Severance and pension benefits are in line with competitive market data. | ||
Recoupment Policy | Provides mechanism for senior executive compensation recapture in certain situations involving fraud or willful misconduct. | ||
Officer Share Ownership Guidelines | Company officers are required to own Company shares or share equivalents up to 5x base salary, depending on the level of the officer (discussed on page 6). Share ownership guidelines align executive and shareholder interests. Company policy prohibits speculative trading in and out of ITT securities, including prohibitions on short sales and leverage transactions, such as puts, calls, and listed and unlisted options. | ||
Services performed that related solely to work performed for, and at the direction of, the Committee or the Nominating and Governance Committee, and analyses of documents prepared by management for the Committee’s review during 2010: | $308,460 | ||||
Other services performed for the Company during 2010: | $0 | ||||
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53
Annual Base Salary | Annual Incentive Target | Long-Term Incentive | Total Compensation | |||||||||
Named Executive | Position as Percentage of | Position as Percentage of | Position as Percentage of | Position as Percentage of | ||||||||
Officer and Title | Market Median | Market Median | Market Median | Market Median | ||||||||
Steven R. Loranger, | 96% | 91% | 112% | 105% | ||||||||
Chairman, President and Chief Executive Officer | Above targeted percentage | |||||||||||
Denise L. Ramos, SVP | 98% | 100% | 82% | 90% | ||||||||
and Chief Financial Officer | Below targeted percentage | |||||||||||
Gretchen W. McClain, | 96% | 94% | 84% | 89% | ||||||||
SVP and President, Fluid and Motion Control | Below targeted percentage | Below targeted percentage | ||||||||||
David F. Melcher, SVP | 91% | 83% | 70% | 77% | ||||||||
and President, Defense and Information Solutions | Below targeted percentage | Below targeted percentage | Below targeted percentage | |||||||||
Frank R. Jimenez, VP | 82% | 66% | 50% | 61% | ||||||||
and General Counsel | Below targeted percentage | Below targeted percentage | Below targeted percentage | Below targeted percentage | ||||||||
• | Annual performance reviews for the prior year, | |
• | Base salary merit increases — normally established | |
• | ||
and | ||
• | Long-term incentive |
• | ||
• | ||
• | ||
• | ||
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How We Achieve Our Objectives | |||||||||
Objective | General Principle | Specific Approach | |||||||
Attract and | Design our executive compensation program to attract, reward and retain capable executives. | The Company’s overarching philosophy is to target total compensation at the competitive median of the | |||||||
In addition to salary, we include short-term and long-term performance | We believe the mix of short-term and long-term performance-based incentives | ||||||||
Provide a clear link between at-risk compensation | We believe the measures of performance in our compensation programs must be aligned with measures key to the success of our businesses. | The | The Company links compensation and performance through its long-term incentive program, comprised of restricted stock or restricted stock unit awards, non-qualified stock options awards and total shareholder return target awards. If performance goals are not met, at-risk compensation is reduced or not | ||||||
As executives move to greater levels of responsibility, the proportion of compensation at risk, whether through annual incentive plans or long-term incentive programs, increases in relation to the increased level of responsibility. | |||||||||
Tie short-term executive compensation to specific business objectives. | The AIP performance | The AIP sets out short-term performance components. If specific short-term performance goals are met, cash payments that reflect | |||||||
Tie long-term executive compensation to increasing shareholder return. | Long-term executive compensation is | ||||||||
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How We Achieve Our Objectives | ||||||
Objective | General Principle | Specific Approach | ||||
Provide reasonable and competitive benefits and perquisites. | Make sure that other employee benefits, including perquisites, are reasonable in the context of a competitive compensation program. | NEOs participate in many of the same benefit plans with the same benefit plan terms as other employees. Certain other benefit plans are available to NEOs and described more fully | ||||
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General Principle | Specific Approach | ||
A competitive salary provides a necessary element of stability. | Salary levels reflect comparable salary levels based on survey data provided by the Compensation Consultant. Salary levels are reviewed annually. | ||
Base salary should recognize individual performance, market value of a position and the incumbent’s tenure, experience, responsibilities, contribution to the Company and growth in his or her role. | Merit increases are based on overall performance and relative competitive market position. | ||
General Principle | Specific Approach | ||
The | The AIP focuses on operating performance, targeting premier metrics considered predictive of top-ranking operating performance. 2010 AIP targets • earnings per share | ||
• free cash flow, • sum of Group return on invested capital, and • the | |||
Structure AIP target awards to achieve competitive compensation levels when targeted performance results are achieved. Use objective formulas to establish potential AIP performance awards. | The Company’s AIP provides for an annual cash payment to participating executives established as a target percentage of base | ||
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General Principle | Specific Approach | ||
Design long-term incentives for NEOs to link payouts to success in the creation of shareholder value over time. | The Committee believes that long-term incentives directly reward NEOs for success in the creation of long-term value creation and enhanced total shareholder • alignment of executive interests with shareholder interests, • a multi-year plan that • long-term awards included as part of a competitive total compensation package, and • retention. | ||
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For NEOs, long-term | |||
Review | As part of its annual compensation review, the Committee determines long-term incentive award program components, the percentage weight of each component, and long-term award target amounts. | ||
Use competitive market survey data provided by the Compensation Consultant from a | In | ||
Balance absolute share price return and relative share price return. | The Committee balanced long-term awards | ||
67. | |||
Consider the median of competitive market data, as well as individual contributions and business performance in determining target awards. | Specific target awards are set out in the Grants of Plan-Based Awards table on page | ||
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3M Co. | General Electric Co. | |
United Technologies Corp. | Emerson Electric Co. | |
Illinois Tool Works, Inc. | Danaher Corp. |
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Premier Performance Metric | Why this metric | ||
• | |||
• Free cash flow | Free cash flow reflects the Company’s emphasis on cash flow generation. Free cash flow is defined as GAAP net cash flow from operating activities, less capital expenditures and adjusted for other non-cash special items and discretionary pension contributions. Free cash flow should not be considered a substitute for cash flow data prepared in accordance with GAAP. The Company’s definition of free cash flow may not be comparable to similar measures utilized by other companies. Management believes that free cash flow is an important measure of performance and it is utilized as a measure of the Company’s ability to generate cash. | ||
• Sum of Group return on invested capital (“ROIC”) | The Committee considers ROIC to be an | ||
• | The Committee believes that EPS | ||
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Fluid Technology and | Defense Electronics | ||||||||||||||
2008 Metrics | Motion & Flow Control | and Services | Corporate | ||||||||||||
Margin Rate | 21 | % | — | — | |||||||||||
Organic Revenue | 14 | % | 14 | % | — | ||||||||||
Cash Flow | 14 | % | 14 | % | 20 | % | |||||||||
ROIC | 21 | % | 28 | % | 30 | % | |||||||||
EDO Performance(1) | — | 14 | % | — | |||||||||||
EPS Growth | 30% | 50 | % | ||||||||||||
Total Enterprise | |||||
2010 Metrics | Performance | ||||
Sum of | 20 | % | |||
Free Cash Flow | 20 | % | |||
Sum of Group ROIC | 20 | % | |||
EPS Performance | 40 | % | |||
Earnings Per Share Performance | $ | 3.75 | $ | 4.00 | $ | 4.50 | |||||||||
Earnings Per Share Payout Percentage of Target | 50% | 100% | 200% | ||||||||||||
2010 AIP Attainment and Payout Design | ||||||||||||||||||||||||||||||
Revenue | Remaining Metrics | |||||||||||||||||||||||||||||
Performance Percentage of Target | 90% | 100% | 110% | 85% | 100% | 120% | ||||||||||||||||||||||||
Payout Percentage of Target | 50% | 100% | 200% | 50% | 100% | 200% | ||||||||||||||||||||||||
2008 Attainment/Payout % | ||||||||||||||||||||||||||||||
Margin Rate | All Other Metrics | |||||||||||||||||||||||||||||
Performance Percentage | 90% | 100% | 110% | 85% | 100% | 120% | ||||||||||||||||||||||||
Payout Percentage | 50% | 100% | 200% | 50% | 100% | 200% | ||||||||||||||||||||||||
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Metric (all $ amounts in millions other than earnings per share performance) | Performance Target at 100% Payment | 2010 Performance | ||||
EPS Performance | $4.00 | $4.34 | ||||
Free Cash Flow | $740 | $924 | ||||
Sum of Group Revenue | $11,200 | $10,831 | ||||
Metric (all amounts in millions) | Goal | 2008 Performance | ||||
Free Cash Flow | 679 | 871 | ||||
EPS Growth | 18% | 23% | ||||
Performance Target at | ||||||
Metric (all $ amounts in millions other than earnings per share performance) | 100% Payment | 2010 Performance | ||||
EPS Performance | $4.00 | $4.34 | ||||
Free Cash Flow | $740 | $924 | ||||
Sum of Group Revenue | $11,200 | $10,831 | ||||
• | ||
• | ||
• | ||
• |
Target Award | Return on | Target Award | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Percentage | Invested | ITT EPS | Free Cash | External | Percentage | Sum of Group | Free Cash | Sum of Group | ITT EPS | |||||||||||||||||||||||||||||||||||||||||||||||||||
of | Capital | Growth | Flow | Total Corporate | Premier Metric | of | Revenue | Flow | ROIC | Performance | Total Enterprise | |||||||||||||||||||||||||||||||||||||||||||||||||
Named Executive Officer | Base Salary | (a) | (b) | (c) | Performance | Cap | Base Salary | (a) | (b) | (c) | (d) | Performance | ||||||||||||||||||||||||||||||||||||||||||||||||
Steven R. Loranger | 130 | %(1) | 30 | % | 50 | % | 20 | % | a+b+c | Not >1.20 | x | 130 | % | 20 | % | 20 | % | 20 | % | 40 | % | a+b+c+d | ||||||||||||||||||||||||||||||||||||||
Denise L. Ramos | 85 | % | 30 | % | 50 | % | 20 | % | a+b+c | Not >1.20 | x | 85 | % | 20 | % | 20 | % | 20 | % | 40 | % | a+b+c+d | ||||||||||||||||||||||||||||||||||||||
Vincent A. Maffeo | 70 | % | 30 | % | 50 | % | 20 | % | a+b+c | Not >1.20 | x | |||||||||||||||||||||||||||||||||||||||||||||||||
Gretchen W. McClain | 80 | % | 20 | % | 20 | % | 20 | % | 40 | % | a+b+c+d | |||||||||||||||||||||||||||||||||||||||||||||||||
David F. Melcher | 80 | % | 20 | % | 20 | % | 20 | % | 40 | % | a+b+c+d | |||||||||||||||||||||||||||||||||||||||||||||||||
Frank R. Jimenez | 60 | % | 20 | % | 20 | % | 20 | % | 40 | % | a+b+c+d | |||||||||||||||||||||||||||||||||||||||||||||||||
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Return on | Organic | ||||||||||||||||||||||||||||||||||||||||
Target Award | Invested | Operating | Organic | Operating | 70% | Total | External | ||||||||||||||||||||||||||||||||||
Percentage of | Capital | Margin | Revenue | Cash Flow | Segment Perf. | EPS Growth | Segment | Premier Metric | |||||||||||||||||||||||||||||||||
Named Executive Officer | Base Salary | (d) | (e) | (f) | (h) | (i) | (j) | Perf. | Cap | ||||||||||||||||||||||||||||||||
ITT EPS growth 30% | |||||||||||||||||||||||||||||||||||||||||
Gretchen W. McClain | 80 | % | 40 | % | 20 | % | 20 | % | 20 | % | (d+e+f+h) x 70% | b x 30% | i + j | Not >1.2 | x | ||||||||||||||||||||||||||
Nicholas P. Hill | 70 | % | 40 | % | 20 | % | 20 | % | (d+e+f+h) x 70% | b x 30% | i + j | Not >1.2 | x | ||||||||||||||||||||||||||||
Named Executive Officers | AIP | ||
Steven R. Loranger | |||
Denise L. Ramos | |||
Gretchen W. McClain | |||
David F. Melcher | $654,700 | ||
Frank R. Jimenez | $384,500 | ||
• | restricted stock or restricted stock unit awards. In 2010 the Committee awarded restricted stock awards. In 2011 the Committee determined to award restricted stock units, which will be settled in shares upon vesting. Restricted stock units provide the same economic risk or reward as restricted stock, but recipients do not have voting rights and do not receive cash dividends during the restriction period. Dividend equivalents are accrued and paid in cash upon vesting of the restricted stock units. The Committee determined to award restricted stock units rather than restricted stock in 2011 because restricted stock unit awards provide consistent tax treatment for domestic and international employees, | |
• | non-qualified stock option awards, and | |
• | TSR, a target cash award that directly links the Company’s three-year total shareholder return performance to the performance of companies in the |
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TSR | Non-Qualified | ||||||||||||||
(Target Cash | Stock Option | Restricted Stock | |||||||||||||
Award) | Award | Award | |||||||||||||
Named Executive Officer | $ | # Options | # Shares | ||||||||||||
Steven R. Loranger | 1,980,000 | 132,265 | 41,267 | ||||||||||||
Denise L. Ramos | 400,000 | 26,721 | 8,337 | ||||||||||||
Gretchen W. McClain | 360,000 | 24,049 | 7,503 | ||||||||||||
David F. Melcher | 360,000 | 24,049 | 7,503 | ||||||||||||
Frank R. Jimenez | 166,700 | 11,890 | 3,474 | ||||||||||||
• | Holders of restricted stock have the right to receive dividends and vote the | |
• | Restricted stock generally | |
• | If an acceleration event occurs (as described on pages | |
• | If an employee dies or becomes disabled, the restricted stock vests in full, | |
• | If an employee leaves the Company prior to vesting, whether through resignation or termination for cause, the restricted stock is |
62
• | If an employee retires or is terminated other than for cause, a pro-rata portion of the restricted stock award |
45
• | The option exercise price of stock options awarded is the NYSE closing price of the Company’s common stock on the | |
• | For options granted to new executives, the option exercise price of approved stock option awards is the closing price on the grant date, generally the day following the first day of | |
• | Options cannot be exercised prior to | |
• | Three-year cliff vesting is required for executives at the level of senior vice president or above. Stock options vest in one-third cumulative annual installments for executives below the senior vice president level, | |
• | If an acceleration event occurs (as described on pages 90 to 91 of this Proxy Statement) the stock option award vests in full, | |
• | Options awarded in 2010 and 2011 and prior to 2005 expire ten years after the grant date. Options awarded between 2005 and 2009 expire seven years after the grant date. | |
• | If | |
• | The 2003 Plan | |
• | There may be adjustments to the |
63
termination by the Company other than for cause. Any |
46
• | Currently, no individual may receive more than 600,000 options under the 2003 Plan in any one year. |
Restricted Stock or Restricted Stock Units | Non-qualified Stock Options | ||
A restricted stock award is a grant of Company stock, subject to certain vesting restrictions. A restricted stock unit award is a promise to deliver to the recipient, upon vesting, shares of Company stock. Both restricted stock and restricted stock units carry the same economic risk and reward. | Non-qualified stock options provide the opportunity to purchase Company stock at a specified price called the “exercise price” at a future date. | ||
Holders of restricted stock, as shareholders of the Company, are entitled to vote the shares and receive dividends or dividend equivalents prior to vesting. Holders of restricted stock units are not entitled to vote the shares and do not receive cash dividends during the restriction period. Dividend equivalents are paid in cash upon restricted stock unit vesting beginning with the 2011 awards. | Stock option holders do not receive dividends on shares underlying options and cannot vote their shares. | ||
Non-qualified stock options increase focus on activities primarily related to absolute share price appreciation. | |||
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Feature | Implementation | ||
TSR rewards comparative | The Committee, at its discretion, determines the size and frequency of target TSR awards, performance measures and performance goals, in addition to performance periods. In determining the size of target TSR awards for executives, the Committee considers | ||
47
Three-year performance | A three-year TSR performance period encourages behaviors and performance geared to the Company’s long-term goals and, in the view of the Committee, discourages behaviors that might distract from the three-year period focus. | ||
Performance measurement | The Company’s performance for purposes of the TSR awards is measured by comparing the average stock price over the trading days in the month of December immediately prior to the start of the TSR three-year performance period to the average stock price over the trading days in the last month of the three-year cycle as well as dividend yields and other forms of shareholder return. | ||
TSR awards are expressed as target cash awards and paid in cash. | Cash awards compensate relative performance while | ||
Components of | The Committee considered the components of a measurable return of value to shareholders, reviewed peer practices and received input from the Compensation Consultant. Based on that review the Committee determined that the most significant factors to measure return of value to shareholders were: | ||
• dividend yields, | |||
• cumulative relative change in stock price, and | |||
• extraordinary shareholder payouts. | |||
TSR | TSR = the sum of 1) | ||
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• | If a participant’s employment terminates before the end of the three-year performance period, the award is forfeited except in two |
48
• | The Company’s performance for purposes of the TSR awards is measured by comparing the average stock price performance over the trading days in the month of December immediately prior to the start of the TSR three-year performance period to the average stock price performance, over the trading days in the last month of the three-year |
• | Payment, if any, of |
• | Subject to the provisions of Section 409A, in the event of an acceleration event in a change of control (described on pages |
• | Performance goals for the applicable TSR performance period are established in writing no later than ninety days after the beginning of the applicable performance period. |
If Company’s Total Shareholder Return Rank Against the | ||||
Companies that Comprise the | Payout Factor | |||
TSR Performance Index is | (% of Target Award) | |||
less than the 35th percentile | 0 | % | ||
at the 35th percentile | 50 | % | ||
at the 50th percentile | 100 | % | ||
at the 80th percentile or more | 200 | % |
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If Company’s Total Shareholder Return Rank Against the | ||||||||
Companies that Comprise the | Payout Factor | |||||||
(% of Target Award) | ||||||||
less than the 35th percentile | 0 | % | ||||||
at the 35th percentile | 50 | % | ||||||
at the 50th percentile | 100 | % | ||||||
at the 80th percentile or more | 200 | % |
49
TSR | Non-Qualified | ||||||||||||||
(Target Cash | Stock Option | Restricted Stock | |||||||||||||
Named Executive | Award) | Award | Award | ||||||||||||
Officer | $ | # Options | # Shares | ||||||||||||
Mr. Loranger | 1,980,000 | 165,690 | 52,243 | ||||||||||||
Ms. Ramos | 360,000 | 30,130 | 9,499 | ||||||||||||
Ms. McClain | 360,000 | 30,130 | 9,499 | ||||||||||||
TSR | Non-Qualified | ||||||||||||||
(Target Cash | Stock Option | Restricted Stock | |||||||||||||
Named Executive | Award) | Award | Unit Award | ||||||||||||
Officer | $ | # Options | # Units | ||||||||||||
Steven R. Loranger | 2,133,300 | 133,835 | 36,442 | ||||||||||||
Denise L. Ramos | 533,300 | 33,459 | 9,111 | ||||||||||||
Gretchen W. McClain | 533,300 | 33,459 | 9,111 | ||||||||||||
David F. Melcher | 533,300 | 33,459 | 9,111 | ||||||||||||
Frank R. Jimenez | 233,300 | 16,205 | 3,986 | ||||||||||||
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50
5168
• | the executive terminates his or her own employment, | |
• | the executive’s employment is terminated for cause, | |
• | termination occurs after the executive’s normal retirement date under the ITT Salaried Retirement Plan, or | |
• | termination occurs in certain divestiture instances if the executive accepts employment or refuses comparable employment. |
5269
• | provide for continuing cohesive operations as executives evaluate a transaction, which, without change of control protection, could be personally adverse to the executive, | |
• | keep executives focused on preserving value for shareholders, | |
• | retain key talent in the face of potential transactions, and | |
• | aid in attracting talented employees in the competitive marketplace. |
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5471
Change in | |||||||||||||||||||||||||||||||||||||||||||||
Pension | |||||||||||||||||||||||||||||||||||||||||||||
Value & | |||||||||||||||||||||||||||||||||||||||||||||
Non- | Non- | ||||||||||||||||||||||||||||||||||||||||||||
Equity | qualified | ||||||||||||||||||||||||||||||||||||||||||||
Incentive | Deferred | ||||||||||||||||||||||||||||||||||||||||||||
Name & Principal | Stock | Option | Plan | Compensation | All Other | ||||||||||||||||||||||||||||||||||||||||
Position | Year | Salary | Bonus | Awards | Awards | Compensation | Earnings | Compensation | Total | ||||||||||||||||||||||||||||||||||||
(a) | (b) | ($)(c) | ($)(d) | ($)(e) | ($)(f) | ($)(g) | ($)(h) | ($)(i) | ($)(j) | ||||||||||||||||||||||||||||||||||||
Steven R. Loranger | 2008 | 1,119,615 | — | 7,801,117 | 1,813,890 | 2,534,025 | 2,508,911 | 211,125 | 15,988,683 | ||||||||||||||||||||||||||||||||||||
Chief Executive Officer | 2007 | 1,056,539 | — | 6,690,495 | 2,341,689 | 2,250,000 | 1,220,271 | 211,975 | 13,770,969 | ||||||||||||||||||||||||||||||||||||
2006 | 983,846 | — | 5,019,399 | 1,189,442 | 1,732,500 | 1,422,940 | 220,325 | 10,568,452 | |||||||||||||||||||||||||||||||||||||
Denise L. Ramos(k) | 2008 | 533,077 | 150,000 | 1,030,362 | 188,719 | 870,900 | 70,593 | 184,727 | 3,028,378 | ||||||||||||||||||||||||||||||||||||
Senior Vice President | 2007 | 250,000 | 150,000 | 407,945 | 52,025 | 525,000 | 17,743 | 358,155 | 1,760,868 | ||||||||||||||||||||||||||||||||||||
& Chief Financial Officer | |||||||||||||||||||||||||||||||||||||||||||||
Nicholas P. Hill(l) | 2008 | 428,192 | 5,400 | 1,681,131 | 435,327 | 394,600 | 399,459 | 43,812 | 3,387,921 | ||||||||||||||||||||||||||||||||||||
Senior Vice President | |||||||||||||||||||||||||||||||||||||||||||||
Vincent A. Maffeo(m) | 2008 | 473,231 | — | 880,190 | 195,766 | 632,200 | 751,215 | 67,254 | 2,999,856 | ||||||||||||||||||||||||||||||||||||
Senior Vice President and | |||||||||||||||||||||||||||||||||||||||||||||
General Counsel | 2006 | 437,092 | — | 500,378 | 195,876 | 400,000 | 396,439 | 50,983 | 1,980,768 | ||||||||||||||||||||||||||||||||||||
Gretchen W. McClain(n) Senior Vice President & President, Fluid and Motion Control | 2008 2007 | 426,462 381,250 | — 49,920 | 1,153,750 964,489 | 340,857 323,628 | 527,700 340,080 | 39,611 29,647 | 139,099 213,189 | 2,627,479 2,302,203 | ||||||||||||||||||||||||||||||||||||
�� | |||||||||||||||||||||||||||||||||||||||||||||
Change in | |||||||||||||||||||||||||||||||||||||||||||||
Pension | |||||||||||||||||||||||||||||||||||||||||||||
Non- | Value & | ||||||||||||||||||||||||||||||||||||||||||||
Equity | Nonqualified | ||||||||||||||||||||||||||||||||||||||||||||
Incentive | Deferred | ||||||||||||||||||||||||||||||||||||||||||||
Name and Principal | Stock | Option | Plan | Compensation | All Other | ||||||||||||||||||||||||||||||||||||||||
Position | Year | Salary | Bonus | Awards | Awards | Compensation | Earnings | Compensation | Total | ||||||||||||||||||||||||||||||||||||
(a) | (b) | ($)(c) | ($)(d) | ($)(e) | ($)(f) | ($)(g) | ($)(h) | ($)(i) | ($)(j) | ||||||||||||||||||||||||||||||||||||
Steven R. Loranger | 2010 | 1,154,231 | — | 4,187,372 | 2,047,462 | 2,328,352 | 2,602,844 | 314,791 | 12,635,052 | ||||||||||||||||||||||||||||||||||||
Chairman, President and | 2009 | 1,130,000 | — | 3,713,945 | 1,744,716 | 1,909,700 | 4,940,075 | 406,545 | 13,844,981 | ||||||||||||||||||||||||||||||||||||
Chief Executive Officer | 2008 | 1,119,615 | — | 4,806,163 | 1,499,000 | 2,534,025 | 2,508,911 | 211,125 | 12,678,839 | ||||||||||||||||||||||||||||||||||||
Denise L. Ramos | 2010 | 580,384 | — | 845,946 | 413,641 | 774,300 | 124,047 | 67,981 | 2,806,299 | ||||||||||||||||||||||||||||||||||||
Senior Vice President | 2009 | 540,000 | — | 675,272 | 317,269 | 596,700 | 135,414 | 63,377 | 2,328,032 | ||||||||||||||||||||||||||||||||||||
and Chief Financial Officer | 2008 | 533,077 | 150,000 | 873,838 | 272,593 | 870,900 | 70,593 | 184,727 | 2,955,728 | ||||||||||||||||||||||||||||||||||||
Gretchen W. McClain | 2010 | 527,604 | — | 761,335 | 372,279 | 654,700 | 97,308 | 74,141 | 2,487,367 | ||||||||||||||||||||||||||||||||||||
Senior Vice President and | 2009 | 504,054 | 61,000 | 2,426,708 | 317,269 | 474,600 | 70,753 | 65,453 | 3,919,837 | ||||||||||||||||||||||||||||||||||||
President, Fluid and Motion Control | 2008 | 426,462 | — | 801,010 | 249,883 | 527,700 | 39,611 | 139,099 | 2,183,765 | ||||||||||||||||||||||||||||||||||||
David F. Melcher | 2010 | 509,808 | — | 761,335 | 372,279 | 654,700 | 93,107 | 56,959 | 2,448,188 | ||||||||||||||||||||||||||||||||||||
Senior Vice President and President, Defense & Information Solutions | 2009 | 425,000 | — | 468,921 | 224,733 | 386,750 | 66,150 | 58,217 | 1,629,771 | ||||||||||||||||||||||||||||||||||||
Frank R. Jimenez Vice President and General Counsel | 2010 | 412,115 | — | 352,524 | 166,817 | 384,500 | 47,578 | 54,855 | 1,418,389 | ||||||||||||||||||||||||||||||||||||
(d) | Ms. Ramos joined the Company on July 1, 2007. Ms. Ramos received a sign-on payment in 2008 following one year of service. For the 2009 performance year, the Committee awarded Ms. McClain a discretionary bonus of $61,000, which payment was outside the AIP plan. This award was in recognition of Ms. McClain’s exceptional business leadership of the Fluid Technology and Motion and Flow Control business segments during difficult economic conditions. | |
(e) | Amounts in the Stock Awards column include | |
(f) | Amounts | |
(g) | Amounts in the Non-Equity Incentive Plan Compensation column represent AIP awards for performance year | |
(h) | No NEO received preferential or above-market earnings |
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December 31, 2008, 6.00% at December 31, |
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(i) | ||
Perquisites | Other Compensation | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investment | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Excess | Savings | Other Compensation | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Personal | Savings | Plan | Personal | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Use of | Plan | Tax | Match | Total | Use of | Excess | Tax | Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate | Financial | Club | Auto | Total | Match | Reimburse- | Relocation | and | All Other | Corporate | Financial | Auto | Total | Savings Plan | Reimburse- | 401(K) | All Other | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Aircraft | Counseling | Dues | Allowances | Other | Perquisites | and Floor | ments | Expense | Floor | Compensation | Aircraft | Counseling | Allowances | Perquisites | Contributions | ments | Match | Other | Compensation | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Name | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | (k) | (l) | (b) | (c) | (d) | (f) | (g) | (h) | (i) | (j) | (k) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Steven R. Loranger | 151,316 | — | — | 15,600 | 4,902 | 171,818 | 31,257 | — | — | 8,050 | 211,125 | 152,979 | 63,166 | 15,600 | 231,745 | 31,823 | 37,746 | 8,575 | 4,902 | 314,791 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Denise L. Ramos | 3,908 | 6,601 | — | 15,600 | 1,331 | 27,440 | 7,846 | 59,602 | 81,789 | 8,050 | 184,727 | — | 16,331 | 15,600 | 31,931 | 11,738 | 14,273 | 8,575 | 1,464 | 67,981 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nicholas P. Hill | — | 13,730 | 15,600 | 4,296 | 33,626 | — | 10,186 | — | — | 43,812 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Vincent A. Maffeo | — | 17,800 | — | 15,600 | 2,182 | 35,582 | 8,578 | 15,044 | — | 8,050 | 67,254 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gretchen W. McClain | 4,780 | 2,750 | — | 15,400 | 677 | 23,607 | 6,973 | 46,321 | 54,148 | 8,050 | 139,099 | 8,936 | 15,895 | 15,600 | 40,431 | 10,011 | 14,263 | 8,575 | 861 | 74,141 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
David F. Melcher | — | 14,648 | 15,139 | 29,787 | 9,267 | 6,957 | 8,575 | 2,373 | 56,959 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Frank R. Jimenez | — | 14,800 | 15,600 | 30,400 | 5,849 | 9,079 | 8,575 | 952 | 54,855 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(b) | Amounts reflect the aggregate incremental cost to ITT | |
(c) | Amounts represent financial counseling and tax service fees paid during 2010. Financial counseling and tax service fees reflect fees for | |
Auto allowances are provided to a range of executives, including the NEOs. | ||
(g) | Company contributions to the ITT Excess Savings Plan are unfunded and earnings accrue at the same rate as the Stable Value Fund available to participants in the Company’s ITT Salaried Investment and Savings Plan. | |
(h) | Amounts | |
56
preparation services. | ||
Amounts represent the | ||
(j) | Amounts include taxable group term-life insurance premiums attributable to each NEO. |
73
All | All | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other | Other | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock | All Other | Grant | Stock | All Other | Grant | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Awards: | Option | Date | Awards: | Option | Date | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Number | Awards: | Exercise | Fair | Estimated Future Payouts Under | Number | Awards: | Exercise | Fair | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
of | Number | or Base | Value | Non-Equity Incentive Plan | Estimated Future Payouts Under | of | Number | or Base | Value | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | of Securities | Price of | Equity- | Awards | Equity Incentive Plan Awards | Shares | of Securities | Price of | of Stock | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | of Stock | Underlying | Option | Incentive | of Stock | Underlying | Option | and Option | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Grant | or Units | Options | Awards | Plan | Grant | Threshold | Target | Maximum | Threshold | Target | Maximum | or Units | Options | Awards | Awards | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Name | Date | Threshold | Target | Maximum | Threshold | Target | Maximum | (#)(3) | (#)(4) | ($/Sh)(5) | Awards(6) | Date | ($) | ($) | ($) | (#) | (#) | (#) | (#) | (#) | ($/Sh) | ($) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(a) | (b) | ($)(c) | ($)(d) | ($)(e) | (#)(f) | (#)(g) | (#)(h) | (i) | (j) | (k) | $(l) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | (k) | (l) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Steven R. Loranger | 734,500 | 1,469,000 | 2,938,000 | 754,000 | 1,508,000 | 3,016,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
01-Jan-08 | 1,650,000 | 3,300,000 | 6,600,000 | 3,300,000 | 05-Mar-10 | 990,000 | 1,980,000 | 3,960,000 | 1,980,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10-Mar-08 | 30,771 | 1,648,851 | 05-Mar-10 | 41,267 | 2,207,372 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10-Mar-08 | 100,000 | 53.09 | 1,499,000 | 05-Mar-10 | 132,265 | 53.49 | 2,047,462 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Denise L. Ramos | 229,500 | 459,000 | 918,000 | 250,750 | 501,500 | 1,003,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
01-Jan-08 | 300,000 | 600,000 | 1,200,000 | 600,000 | 05-Mar-10 | 200,000 | 400,000 | 800,000 | 400,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10-Mar-08 | 5,158 | 273,838 | 05-Mar-10 | 8,337 | 445,946 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10-Mar-08 | 18,185 | 53.09 | 272,593 | 05-Mar-10 | 26,721 | 53.49 | 413,641 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nicholas. P. Hill(7) | 151,200 | 302,400 | 604,800 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
01-Jan-08 | 225,000 | 450,000 | 900,000 | 450,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10-Mar-08 | 3,869 | 205,405 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10-Mar-08 | 13,640 | 53.09 | 204,464 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Vincent A. Maffeo(8) | 166,600 | 333,200 | 666,400 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
01-Jan-08 | 225,000 | 450,000 | 900,000 | 450,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10-Mar-08 | 3,869 | 205,405 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10-Mar-08 | 13,640 | 53.09 | 204,464 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gretchen W. McClain | 172,800 | 345,600 | 691,200 | 212,000 | 424,000 | 848,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
01-Jan-08 | 275,000 | 550,000 | 1,100,000 | 550,000 | 05-Mar-10 | 180,000 | 360,000 | 720,000 | 360,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10-Mar-08 | 4,728 | 251,010 | 05-Mar-10 | 7,503 | 401,335 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10-Mar-08 | 16,670 | 53.09 | 249,883 | 05-Mar-10 | 24,049 | 53.49 | 372,279 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
David F. Melcher | 212,000 | 424,000 | 848,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
05-Mar-10 | 180,000 | 360,000 | 720,000 | 360,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
05-Mar-10 | 7,503 | 401,335 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
05-Mar-10 | 24,049 | 53.49 | 372,279 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Frank R. Jimenez | 124,500 | 249,000 | 498,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
05-Mar-10 | 83,350 | 166,700 | 333,400 | 166,700 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
05-Mar-10 | 3,474 | 185,824 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
05-Mar-10 | 11,890 | 53.49 | 166,817 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
57
Amounts reflect the threshold, target and maximum payment levels, respectively, if an award payout is achieved under the Company’s AIP described on pages 58 to 61. These potential payments are based on achievement of specific performance metrics and are completely at risk. The target award is computed based upon the applicable range of net estimated payments denominated in dollars where the target award is equal to 100% of the award potential, the threshold is equal to 50% of target and the maximum is equal to 200% of target. |
74
(f)(g)(h) | Amounts reflect the threshold, target and maximum payment levels, if an award | |
58
75
59
76
60
• | One-half of the total award was in the form of a $550,000 target award for January 1, 2007 through December 31, 2009. This award was granted under the ITT 1997 Long-Term Incentive Plan. The measurement period for this award |
77
• | One-fourth of the total award ($275,000) was in the form of an ITT restricted stock award under the 2003 Plan. These shares, |
• | One-fourth of the total award ($275,000) was in the form of a non-qualified stock option award under the 2003 Plan. The option exercise price |
61
• | 6,000 shares |
• | the remaining 6,000 shares will vest four years after the grant date of Ms. Ramos’ fourth anniversary of employment (i.e., 2011) |
62
63
6478
Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity | Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity | Equity | Incentive | Equity | Equity | Incentive | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Incentive | Incentive | Plan Awards: | Incentive | Incentive | Plan Awards: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Plan | Plan Awards: | Market or Payout | Plan | Plan Awards: | Market or Payout | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Awards: | Market | Number of | Value of | Awards: | Market | Number of | Value of | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Number of | Number of | Number of | Number of | Value | Unearned | Unearned | Number of | Number of | Number of | Number of | Value | Unearned | Unearned | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Securities | Securities | Securities | Shares | of Shares | Shares, | Shares, | Securities | Securities | Securities | Shares | of Shares | Shares, | Shares, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Underlying | Underlying | Underlying | or Units | or Units | Units or | Units or | Underlying | Underlying | Underlying | or Units | or Units | Units or | Units or | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unexercised | Unexercised | Unexercised | Option | Option | of Stock | of Stock | Other Rights | Other Rights | Unexercised | Unexercised | Unexercised | Option | Option | of Stock | of Stock | Other Rights | Other Rights | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Options | Options | Unearned | Exercise | Expiration | That Have | That Have | That Have | That Have | Options (#) | Options (#) | Unearned | Exercise | Expiration | That Have | That Have | That Have | That Have | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Name | Exercisable | Unexercisable | Options | Price | Date | Not Vested | Not Vested | Not Vested | Not Vested | Exercisable | Unexercisable | Options | Price | Date | Not Vested | Not Vested | Not Vested | Not Vested | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(a) | (b) (#) | (c) (#) | (d) (#) | (e) ($) | (f) | (g) (#) | (h) ($) | (i) (#) | (j) ($) | (b) | (c) | (#)(d) | ($)(e) | (f) | (#)(g) | ($)(h) | (#)(i) | ($)(j) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Steven R. Loranger | 166,668 | 83,332 | — | 41.52 | 28-Jun-14 | 159,883 | 7,353,019 | 6,300,000 | 12,600,000 | 199,120 | — | — | 45.47 | 3/8/2012 | 121,880 | 6,351,167 | 3,960,000 | 1,980,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
199,120 | — | — | 45.47 | 8-Mar-12 | 83,612 | — | — | 52.68 | 3/6/2013 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 83,612 | — | 52.68 | 6-Mar-13 | 89,235 | — | — | 57.99 | 3/7/2014 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 89,235 | — | 57.99 | 7-Mar-14 | 250,000 | — | — | 41.52 | 6/28/2014 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 100,000 | — | 53.09 | 10-Mar-15 | — | 100,000 | — | 53.09 | 3/10/2015 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 165,690 | — | 33.19 | 3/5/2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Denise L. Ramos | — | 16,359 | — | 69.00 | 2-Jul-14 | 24,088 | 1,107,807 | 1,150,000 | 2,300,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 18,185 | — | 53.09 | 10-Mar-15 | — | 132,265 | — | 53.49 | 3/5/2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nicholas P. Hill | 2,000 | — | — | 25.32 | 4-Jan-12 | 10,688 | 491,541 | 850,000 | 1,700,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
14,000 | — | — | 30.91 | 4-Jan-13 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
12,542 | — | 52.68 | 6-Mar-13 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
14,000 | — | — | 37.46 | 2-Feb-14 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
11,900 | — | 57.99 | 7-Mar-14 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
10,000 | — | — | 38.16 | 10-May-14 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 13,640 | — | 53.09 | 10-Mar-15 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Vincent A. Maffeo | 33,180 | — | — | 45.47 | 8-Mar-12 | 11,333 | 521,205 | 900,000 | 1,800,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Denise L. Ramos | 16,359 | — | — | 69.00 | 7/2/2014 | 28,994 | 1,510,877 | 760,000 | 380,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 13,378 | — | 52.68 | 6-Mar-13 | — | 18,185 | — | 53.09 | 3/10/2015 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 13,385 | — | 57.99 | 7-Mar-14 | — | 30,130 | — | 33.19 | 3/5/2016 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 13,640 | — | 53.09 | 10-Mar-15 | — | 26,721 | — | 53.49 | 3/5/2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gretchen W. McClain | 33,333 | — | — | 55.59 | 19-Sep-12 | 22,580 | 1,038,454 | 1,000,000 | 2,000,000 | 33,333 | — | — | 55.59 | 9/19/2012 | 74,500 | 3,882,195 | 720,000 | 360,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
5,817 | 2,908 | — | 52.68 | 6-Mar-13 | 8,725 | — | — | 52.68 | 3/6/2013 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
5,052 | 10,103 | — | 57.99 | 7-Mar-14 | 15,155 | — | — | 57.99 | 3/7/2014 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 16,670 | — | 53.09 | 10-Mar-15 | — | 16,670 | — | 53.09 | 3/10/2015 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 30,130 | — | 33.19 | 3/5/2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 24,049 | — | 53.49 | 3/5/2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
David F. Melcher | 3,690 | 1,845 | — | 66.45 | 8/18/2015 | 15,224 | 793,323 | 610,000 | 305,000 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
8,269 | 16,536 | — | 33.19 | 3/5/2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 24,049 | — | 53.49 | 3/5/2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Frank R. Jimenez | 5,512 | 11,023 | — | 45.81 | 6/9/2016 | 7,111 | 370,554 | 333,400 | 166,700 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
— | 11,890 | — | 53.49 | 3/5/2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(c) | Vesting Schedule for Unexercisable Options (options vest on the applicable anniversary of the grant date.) |
Vesting Schedule (#’s) | |||||||||||||||||||||||||
Name | Grant Date | Expiration Date | 2011 | 2012 | 2013 | ||||||||||||||||||||
Steven R. Loranger | 3/10/2008 | 3/10/15 | 100,000 | ||||||||||||||||||||||
3/5/2009 | 3/5/16 | 165,690 | |||||||||||||||||||||||
3/5/2010 | 3/5/20 | 132,265 | |||||||||||||||||||||||
Denise L. Ramos | 3/10/2008 | 3/10/15 | 18,185 | ||||||||||||||||||||||
3/5/2009 | 3/5/16 | 30,130 | |||||||||||||||||||||||
3/5/2010 | 3/5/20 | 26,721 | |||||||||||||||||||||||
Gretchen W. McClain | 3/10/2008 | 3/10/15 | 16,670 | ||||||||||||||||||||||
3/5/2009 | 3/5/16 | 30,130 | |||||||||||||||||||||||
3/5/2010 | 3/5/20 | 24,049 | |||||||||||||||||||||||
David F. Melcher | 8/18/2008 | 8/18/15 | 1,845 | ||||||||||||||||||||||
3/5/2009 | 3/5/16 | 8,268 | 8,268 | ||||||||||||||||||||||
3/5/2010 | 3/5/20 | 24,049 | |||||||||||||||||||||||
Frank R. Jimenez | 6/9/2009 | 6/9/16 | 5,512 | 5,511 | |||||||||||||||||||||
3/5/2010 | 3/5/20 | 3,964 | 3,963 | 3,963 | |||||||||||||||||||||
79
(g) |
Vesting Schedule(#) | |||||||||||||||||||||||||
Name | Grant Date | 2011 | 2012 | 2013 | 2014 | ||||||||||||||||||||
Steven R. Loranger | 3/10/2008 | 28,370 | |||||||||||||||||||||||
3/5/2009 | 52,243 | ||||||||||||||||||||||||
3/5/2010 | 41,267 | ||||||||||||||||||||||||
Denise L. Ramos | 7/2/2007 | 6,000 | |||||||||||||||||||||||
3/10/2008 | 5,158 | ||||||||||||||||||||||||
3/5/2009 | 9,499 | ||||||||||||||||||||||||
3/5/2010 | 8,337 | ||||||||||||||||||||||||
Gretchen W. McClain | 3/10/2008 | 4,728 | |||||||||||||||||||||||
3/5/2009 | 9,499 | ||||||||||||||||||||||||
3/5/2009 | 52,770 | ||||||||||||||||||||||||
3/5/2010 | 7,503 | ||||||||||||||||||||||||
David F. Melcher | 8/18/2008 | 1,125 | |||||||||||||||||||||||
3/5/2009 | 6,596 | ||||||||||||||||||||||||
3/5/2010 | 7,503 | ||||||||||||||||||||||||
Frank R. Jimenez | 6/9/2009 | 3,637 | |||||||||||||||||||||||
3/5/2010 | 3,474 | ||||||||||||||||||||||||
(h) | Reflects the Company’s closing stock price of $52.11 on December 31, 2010. |
(i) |
The following table represents the vesting schedule of TSR on December 31 of each year awards with each TSR unit reflecting $1 of value. |
Vesting Schedule | ||||||||||||||||||
Equity Incentive Plan Awards | Approval Date(1) | Target Award in units(#) | 2011 | 2012 | ||||||||||||||
Steven R. Loranger | 3/5/2009 | 1,980,000 | 1,980,000 | |||||||||||||||
3/5/2010 | 1,980,000 | 1,980,000 | ||||||||||||||||
Denise L. Ramos | 3/5/2009 | 360,000 | 360,000 | |||||||||||||||
3/5/2010 | 400,000 | 400,000 | ||||||||||||||||
Gretchen W. McClain | 3/5/2009 | 360,000 | 360,000 | |||||||||||||||
3/5/2010 | 360,000 | 360,000 | ||||||||||||||||
David F. Melcher | 3/5/2009 | 250,000 | 250,000 | |||||||||||||||
3/5/2010 | 360,000 | 360,000 | ||||||||||||||||
Frank R. Jimenez(2) | 6/9/2009 | 166,700 | 166,700 | |||||||||||||||
3/5/2010 | 166,700 | 166,700 | ||||||||||||||||
(1) | For purposes of the TSR, the grant date is January 1, the first day of the performance period for the year in which the award is approved. | |
(2) | Mr. Jimenez joined the Company on June 8, 2009. His target TSR award was granted effective on the next business day. |
6580
Option Awards | Stock Awards | Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||||||
Number of | Value | Number of | Value | Number of | Value | Number of | Value | |||||||||||||||||||||||||||||||||
Shares | Realized | Shares | Realized | Shares | Realized | Shares | Realized | |||||||||||||||||||||||||||||||||
Acquired on | on | Acquired on | on | Acquired on | on | Acquired on | on | |||||||||||||||||||||||||||||||||
Exercise | Exercise | Vesting | Vesting | Exercise | Exercise | Vesting | Vesting | |||||||||||||||||||||||||||||||||
Name | (#) | ($) | (#) | ($) | (#) | ($) | (#) | ($)(1) | ||||||||||||||||||||||||||||||||
(a) | (b) | (c) | (d) | (e) | (b) | (c) | (d) | (e) | ||||||||||||||||||||||||||||||||
Steven R. Loranger | — | — | 86,265 | 9,018,342 | — | — | 115,522 | 5,562,859 | ||||||||||||||||||||||||||||||||
Denise L. Ramos | — | — | — | — | — | — | 6,930 | 309,702 | ||||||||||||||||||||||||||||||||
Nicholas P. Hill | 21,300 | 422,805 | — | 540,134 | ||||||||||||||||||||||||||||||||||||
Vincent A. Maffeo | — | — | — | 576,143 | ||||||||||||||||||||||||||||||||||||
Gretchen W. McClain | — | — | 6,000 | 688,553 | — | — | 3,671 | 195,150 | ||||||||||||||||||||||||||||||||
David F. Melcher | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Frank R. Jimenez | — | — | — | — | ||||||||||||||||||||||||||||||||||||
(1) | Reflects aggregate dollar value upon vesting of restricted stock reflected in column (d). | |
(e) | On June 28, 2004, Mr. Loranger received an award of 250,000 Restricted Stock Units (“RSUs”) under the ITT 2003 Equity Incentive Plan in connection with his employment agreement. | |
With respect to all NEOs, the amount in column (e) |
66
• | 11/2% of his or her average final compensation (as defined below) for each year of benefit service up to 40 years, reduced by | |
• | 11/4% of his or her primary Social Security benefit for each year of benefit service up to a maximum of 40 years. |
81
• | the participant’s average annual base salary for the five calendar years of the last 120 consecutive calendar months of eligibility service that would result in the highest average annual base salary amount, plus | |
• | the participant’s average annual pension eligible compensation, not including base salary, for the five calendar years of the participant’s last 120 consecutive calendar months of eligibility service that would result in the highest average annual compensation amount. |
67
82
68
Present Value of Accumulated Present Value Benefit at Number of of Accumulated Earliest Payments Years Benefit at Date for During Credited Normal Unreduced Last Fiscal Service Retirement Benefit Year Name(a) Plan Name(b) (#)(c) ($)(d)(1) (e) ($)(f) Steven R. Loranger ITT Salaried Retirement Plan 6.51 150,257 150,257 — ITT Excess Pension Plan 6.51 2,017,943 2,017,943 — Special Pension Arrangement 6.51 5,579,701 10,732,988 Denise L. Ramos ITT Salaried Retirement Plan 3.50 68,423 68,423 — ITT Excess Pension Plan 3.50 279,374 279,374 — Gretchen W. McClain ITT Salaried Retirement Plan 5.29 72,062 72,062 — ITT Excess Pension Plan 5.29 193,588 193,588 — David F. Melcher ITT Salaried Retirement Plan 2.38 50,938 50,938 — ITT Excess Pension Plan 2.38 133,311 133,311 — Frank R. Jimenez ITT Salaried Retirement Plan 1.56 17,912 17,912 — ITT Excess Pension Plan 1.56 29,666 29,666 ��
(1) |
6983
Present Value | |||||||||||||||||||||||
of Accumulated | |||||||||||||||||||||||
Present Value | Benefit at | ||||||||||||||||||||||
Number of | of Accumulated | Earliest | |||||||||||||||||||||
Years | Benefit at | Date for | Payments | ||||||||||||||||||||
Credited | Normal | Unreduced | During Last | ||||||||||||||||||||
Name | Plan Name | Service | Retirement Age | Benefits | Fiscal Year | ||||||||||||||||||
(a) | (b) | (#)(c) | ($)(d) | ($)(e) | ($)(f) | ||||||||||||||||||
Steven R. Loranger(g) | ITT Salaried Retirement Plan | 4.51 | 80,427 | 80,427 | — | ||||||||||||||||||
ITT Excess Pension Plan | 4.51 | 894,810 | 894,810 | — | |||||||||||||||||||
Special Pension Arrangement | 4.51 | 2,159,559 | 4,383,031 | — | |||||||||||||||||||
Denise L. Ramos | ITT Salaried Retirement Plan | 1.51 | 21,299 | 21,299 | — | ||||||||||||||||||
ITT Excess Pension Plan | 1.51 | 67,037 | 67,037 | — | |||||||||||||||||||
Nicholas P. Hill | ITT Industries General Pension | 32.75 | 3,875,407 | 3,875,407 | — | ||||||||||||||||||
Plan (the UK Plan) | |||||||||||||||||||||||
Vincent A. Maffeo | ITT Salaried Retirement Plan | 31.49 | 786,489 | 1,240,540 | — | ||||||||||||||||||
ITT Excess Pension Plan | 31.49 | 3,621,496 | 5,218,528 | — | |||||||||||||||||||
Gretchen W. McClain | ITT Salaried Retirement Plan | 3.29 | 33,715 | 33,715 | — | ||||||||||||||||||
ITT Excess Pension Plan | 3.29 | 63,874 | 63,874 | — | |||||||||||||||||||
(d) | The accumulated benefit is based on service and earnings (base salary and bonus and/or AIP payment) considered by the plans for the period through December 31, | |
(e) | The amounts represent the actuarial present value of the accumulated benefit at December 31, | |
Mr. |
7084
85
Executive | Registrant | Aggregate | Aggregate | Executive | Registrant | Aggregate | Aggregate | |||||||||||||||||||||||||||||||||||||||||||
Contributions | Contributions | Aggregate | Withdrawals/ | Balance at | Contributions in | Contributions | Aggregate | Withdrawals/ | Balance at | |||||||||||||||||||||||||||||||||||||||||
Name | in Last FY | in Last | Earnings in | Distributions | Last FYE | Last FY | in Last | Earnings in | Distributions | Last FYE | ||||||||||||||||||||||||||||||||||||||||
(a) | ($)(b) | FY ($)(c)(3) | Last FY ($)(d) | ($)(e) | ($)(f) | ($)(b) | FY ($)(c) | Last FY ($)(d) | ($)(e) | ($)(f) | ||||||||||||||||||||||||||||||||||||||||
Steven R. Loranger | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Non-qualified savings | 53,377 | 31,257 | 12,940 | — | 348,271 | 54,554 | 31,823 | 15,197 | — | 545,021 | ||||||||||||||||||||||||||||||||||||||||
Deferred Compensation | — | — | (304,494 | ) | — | 3,995,598 | — | — | 424,590 | — | 7,829,325 | |||||||||||||||||||||||||||||||||||||||
Vested but Undelivered Shares(1) | — | 2,086,701 | 452,801 | — | 6,921,198 | |||||||||||||||||||||||||||||||||||||||||||||
Total | 53,377 | 31,257 | (291,554 | ) | — | 4,343,869 | 54,554 | 2,118,524 | 892,588 | — | 15,295,544 | |||||||||||||||||||||||||||||||||||||||
Denise L. Ramos | ||||||||||||||||||||||||||||||||||||||||||||||||||
Non-qualified savings | 13,408 | 7,846 | 151 | — | 21,405 | 20,123 | 11,738 | 1,901 | — | 84,121 | ||||||||||||||||||||||||||||||||||||||||
Deferred Compensation | — | — | — | — | — | 696,870 | — | 24,951 | — | 1,258,851 | ||||||||||||||||||||||||||||||||||||||||
Total | 13,408 | 7,846 | 151 | — | 21,405 | 716,993 | 11,738 | 26,852 | — | 1,342,972 | ||||||||||||||||||||||||||||||||||||||||
Vincent A. Maffeo | — | |||||||||||||||||||||||||||||||||||||||||||||||||
Gretchen W. McClain | ||||||||||||||||||||||||||||||||||||||||||||||||||
Non-qualified savings | 14,594 | 8,578 | 13,686 | — | 339,094 | 16,956 | 10,011 | 2,498 | — | 100,417 | ||||||||||||||||||||||||||||||||||||||||
Deferred Compensation | 50,000 | — | (108,485 | ) | — | 303,846 | 229,145 | — | 23,976 | — | 612,990 | |||||||||||||||||||||||||||||||||||||||
Total | 64,594 | 8,578 | (94,799 | ) | — | 642,940 | 246,101 | 10,011 | 26,474 | — | 713,407 | |||||||||||||||||||||||||||||||||||||||
Gretchen W. McClain(4) | ||||||||||||||||||||||||||||||||||||||||||||||||||
David F. Melcher | ||||||||||||||||||||||||||||||||||||||||||||||||||
Non-qualified savings | 11,788 | 6,973 | 1,279 | — | 45,292 | 15,888 | 9,267 | 736 | — | 43,180 | ||||||||||||||||||||||||||||||||||||||||
Deferred Compensation | 136,500 | — | (40,940 | ) | (34,888 | ) | 130,421 | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||
Total | 148,288 | 6,973 | 39,661 | (34,888 | ) | 175,713 | 15,888 | 9,267 | 736 | — | 43,180 | |||||||||||||||||||||||||||||||||||||||
Nicholas P. Hill(5) | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||||
Frank R. Jimenez | ||||||||||||||||||||||||||||||||||||||||||||||||||
Non-qualified savings | 10,027 | 5,849 | 105 | — | 15,981 | |||||||||||||||||||||||||||||||||||||||||||||
Deferred Compensation | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||
Total | — | — | — | — | 10,027 | 5,849 | 105 | — | 15,981 | |||||||||||||||||||||||||||||||||||||||||
(1) | ||
(b) | Amounts for Executive Contributions in Last Fiscal Year for Ms. Ramos and Ms. McClain represent the deferred portion of the AIP for each respective NEO, which amounts were included in the Summary Compensation Table in the Company’s 2011 Proxy Statement. |
7186
The amounts in column (c) non-qualified savings are also reflected in column | ||
Rate of | Rate of | ||||||||||||
Return | Return | ||||||||||||
1/1/08 – | 1/1/08 – | ||||||||||||
Name of Fund | 12/31/08 | Name of Fund | 12/31/08 | ||||||||||
Fixed Rate Option(1) | 7.15 | % | American Funds Growth Fund of America R4 (RGAEX) | (39.07 | )% | ||||||||
JPMorgan Prime Money Market Fund (VPMXX) | 2.65 | % | Oppenheimer Global Fund (OPPAX) | (41.03 | )% | ||||||||
PIMCO Short-Term Institutional (PTSHX) | (1.27 | )% | Hotchkis and Wiley Mid-Cap Value A (HWMAX) | (43.16 | )% | ||||||||
Managers Intermediate Duration Govt. (MGIDX) | 0.85 | % | Artisan Mid Cap (ARTMX) | (44.13 | )% | ||||||||
Vanguard Total Bond Index (VBMFX) | 5.05 | % | American Century Small Cap Value (ASVIX) | (27.63 | )% | ||||||||
Western Asset Core Fl (WAPIX) | (11.13 | )% | Baron Small Cap (BSCFX) | (40.24 | )% | ||||||||
American Funds American Balanced R4 (RLBEX) | (25.75 | )% | Vanguard Developed Markets Index (VDMIX) | (41.62 | )% | ||||||||
UBS Global Allocation Y (BPGLX) | (35.88 | )% | Artio International Equity A (BJBIX) | (43.89 | )% | ||||||||
American Century Real Estate Inv (REACX) | (43.26 | )% | First Eagle Overseas A (SGOVX) | (20.97 | )% | ||||||||
Vanguard 500 Index (VFINX) | (37.02 | )% | Lehman Brothers High Income Bond Fund Inv (LBHBX) | (19.09 | )% | ||||||||
American Century Equity Income Inv (TWEIX) | (20.05 | )% | Bernstein Emerging Markets Value (SNEMX) | (56.51 | )% | ||||||||
Legg Mason Value Trust — Financial Intermediary (LMVFX) | (54.77 | )% | ITT Corporation Stock Fund (ITT) | (30.4 | )% | ||||||||
Dodge & Cox Stock (DODGX) | (43.31 | )% | |||||||||||
Rate of | Rate of | ||||||||||||
Return | Return | ||||||||||||
1/1/10 | 1/1/10 | ||||||||||||
Name of Fund | 12/31/10 | Name of Fund | 12/31/10 | ||||||||||
Fixed Rate Option(1) | 5.80 | % | Vanguard Developed Markets Index (VDMIX) | 8.54% | |||||||||
PIMCO Total Return Institutional (PTTRX) | 8.86 | % | Artio International Equity A (BJBIX) | 8.52% | |||||||||
PIMCO Real Return Institutional (PRRIX) | 7.68 | % | American Fnds EuroPacific Growth (REREX) | 9.39% | |||||||||
T Rowe Price High Yield (PRHYX) | 14.40 | % | First Eagle Overseas A (SGOVX) | 19.24% | |||||||||
Dodge & Cox Stock (DODGX) | 13.49 | % | Lazard Emerging Markets Equity Open (LZOEX) | 22.43% | |||||||||
Vanguard 500 Index (VFINX) | 14.91 | % | AIM Global Real Estate (AGREX) | 16.97% | |||||||||
American Funds Growth Fund of America R4 (RGAEX) | 12.29 | % | Model Portfolio* — Conservative | 8.11% | |||||||||
Perkins Mid Cap Value (JMCVX) | 14.81 | % | Model Portfolio* — Moderate Conservative | 10.51% | |||||||||
Artisan Mid Cap (ARTMX) | 31.57 | % | Model Portfolio* — Moderate | 12.43% | |||||||||
American Century Small Cap Value (ASVIX) | 24.15 | % | Model Portfolio* — Moderate Aggressive | 13.45% | |||||||||
Perimeter Small Cap Growth (PSCGX) | 25.14 | % | Model Portfolio* — Aggressive | 14.70% | |||||||||
Harbor International (HIINX) | 11.57 | % | ITT Corporation Stock Fund (ITT) | 6.97% | |||||||||
Vanguard Total Bond Market Index (VBMFX) | 6.42 | % | |||||||||||
(1) | The Fixed Rate Option | |
* | The returns shown in the model portfolio are not subsidized by the Company, but represent returns for a managed portfolio based on funds available to deferred compensation participants. |
87
72
• | Accrued salary and vacation pay; | |
• | Regular pension benefits under the ITT Salaried Retirement Plan; | |
• | Health care benefits provided to retirees under the ITT Salaried Retirement Plan, including retiree medical and dental insurance. Employees who terminate prior to retirement are eligible for continued benefits under COBRA; and | |
• | Distributions of plan balances under the ITT Salaried Investment and Savings Plan and amounts currently vested under the ITT Excess Savings Plan. |
88
73
• | any accrued but unpaid base salary, bonus (AIP payment), unreimbursed expenses and employee benefits, including vacation; | |
• | two or three times the highest annual base salary rate during the three fiscal years immediately preceding the date of termination and two or three times the highest annual | |
• | continuation of health and life insurance benefits and certain perquisites at the same levels for two or three years; | |
• | a lump-sum payment equal to the difference between the total lump-sum value of his or her pension benefit under the Company’s pension plans, or any successor pension plans (provided such plans are no less favorable to the executive than the Company pension plans), and the total lump-sum value of his or her pension benefit under the pension plans after crediting an additional two or three years of age and eligibility and benefit service using the highest annual base salary rate and bonus for purposes of determining final average compensation under the pension plans; | |
• | credit for an additional two or three years of age and two or three years of eligibility service under the retiree health and retiree life insurance benefits; | |
• | a lump-sum payment equal to two or three times the highest annual base salary rate during the three years preceding termination or an acceleration event times the highest percentage rate of the Company’s contributions to the ITT Salaried Investment and Savings Plan and the ITT Excess Savings Plan, such payment not to exceed 3.5% per year; and | |
• | taxgross-up for excise taxes imposed on the covered | |
• | one year of outplacement. |
89
74
90
• | the 2011 Omnibus Incentive Plan, as proposed for shareholders approval in this 2011 Proxy Statement; | |
• | the 2003 Equity Incentive Plan; | |
• | the 1994 Incentive Stock Plan; | |
• | the 1996 Restricted Stock Plan for Non-Employee Directors; | |
• | the 1997 Annual Incentive Plan for Executive Officers; | |
• | the 1997 Annual Incentive Plan; | |
• | the 1997 Long-Term Incentive Plan; | |
• | the Special Senior Executive Severance Pay Plan; | |
• | the Enhanced Severance Pay Plan; |
75
• | the Deferred Compensation Plan; | |
• | the Excess Savings Plan; | |
• | the Excess Pension Plans; | |
• | the Salaried Retirement Plan; | |
• | the Steven R. Loranger Employment Agreement; and | |
• | the Ramos Letter | |
91
Steven R. Loranger | ||||||||||||||||||||||||||||||
Termination | ||||||||||||||||||||||||||||||
Not For Cause | ||||||||||||||||||||||||||||||
or With Good | ||||||||||||||||||||||||||||||
Reason | ||||||||||||||||||||||||||||||
Termination | Termination | After Change | ||||||||||||||||||||||||||||
Resignation | For Cause | Death | Disability | Not For Cause | Of Control | |||||||||||||||||||||||||
($)(a) | ($)(b) | ($)(c) | ($)(d) | ($)(e) | ($)(f) | |||||||||||||||||||||||||
Cash Severance(1) Salary | — | — | — | — | 2,260,000 | 3,390,000 | ||||||||||||||||||||||||
AIP | — | — | — | — | 2,938,000 | 6,750,000 | ||||||||||||||||||||||||
Total | — | — | — | — | 5,198,000 | 10,140,000 | ||||||||||||||||||||||||
Unvested TSR Unit Awards(2) 2007 — 09 TSR Units | — | — | 3,000,000 | 3,000,000 | 3,000,000 | 6,000,000 | ||||||||||||||||||||||||
2008 — 10 TSR Units | — | — | 3,300,000 | 3,300,000 | 3,300,000 | 6,600,000 | ||||||||||||||||||||||||
Total | — | — | 6,300,000 | 6,300,000 | 6,300,000 | 12,600,000 | ||||||||||||||||||||||||
Unvested Equity Awards(3) 6/28/04 Stock Option | — | — | 372,494 | 372,494 | 372,494 | 372,494 | ||||||||||||||||||||||||
6/28/04 RSUs | — | — | 3,979,147 | 3,979,147 | 3,979,147 | 3,979,147 | ||||||||||||||||||||||||
3/6/06 Restricted Stock | — | — | 1,090,239 | 1,090,239 | 1,090,239 | 1,090,239 | ||||||||||||||||||||||||
3/7/07 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/7/07 Restricted Stock | — | — | 1,125,559 | 1,125,559 | 1,125,559 | 1,125,559 | ||||||||||||||||||||||||
3/10/08 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/10/08 Restricted Stock | — | — | 1,304,736 | 1,304,736 | 1,232,251 | 1,304,736 | ||||||||||||||||||||||||
Total | — | — | 7,872,175 | 7,872,175 | 7,799,690 | 7,872,175 | ||||||||||||||||||||||||
Non-Qualified Retirement Benefits | ||||||||||||||||||||||||||||||
ITT Excess Pension Plan(4) | 894,810 | 894,810 | 509,518 | — | 894,810 | 894,810 | ||||||||||||||||||||||||
Special Pension Arrangement(5) | — | — | 4,383,031 | — | 4,383,031 | 8,990,931 | ||||||||||||||||||||||||
ITT Excess Savings Plan(6) | — | — | 21,989 | 21,989 | — | 118,650 | ||||||||||||||||||||||||
Total | 894,810 | 894,810 | 4,914,538 | 21,989 | 5,277,841 | 10,004,391 | ||||||||||||||||||||||||
Other Benefits | ||||||||||||||||||||||||||||||
Outplacement | — | — | — | — | — | — | ||||||||||||||||||||||||
Health & Welfare(7) | — | — | — | — | 4,416 | 4,416 | ||||||||||||||||||||||||
IRC 280(g) TaxGross-Up(8) | — | — | — | — | — | 12,324,209 | ||||||||||||||||||||||||
Total | 894,810 | 894,810 | 19,086,713 | 14,194,164 | 24,579,947 | 52,945,191 | ||||||||||||||||||||||||
Steven R. Loranger | ||||||||||||||||||||||||||||||
Termination | ||||||||||||||||||||||||||||||
Not For Cause | ||||||||||||||||||||||||||||||
or With Good | ||||||||||||||||||||||||||||||
Reason | ||||||||||||||||||||||||||||||
Termination | Termination | After Change | ||||||||||||||||||||||||||||
Resignation | For Cause | Death | Disability | Not For Cause | Of Control | |||||||||||||||||||||||||
($)(a) | ($)(b) | ($)(c) | ($)(d) | ($)(e) | ($)(f) | |||||||||||||||||||||||||
Cash Severance(1) Salary | — | — | — | — | 2,320,000 | 3,480,000 | ||||||||||||||||||||||||
AIP | — | — | — | — | 3,016,000 | 7,602,075 | ||||||||||||||||||||||||
Total | — | — | — | — | 5,336,000 | 11,082,075 | ||||||||||||||||||||||||
Unvested Non-Equity Awards(2) | ||||||||||||||||||||||||||||||
2009 — 11 TSR Award | — | — | 1,320,000 | 1,320,000 | — | 660,000 | ||||||||||||||||||||||||
2010 — 12 TSR Award | — | — | 660,000 | 660,000 | — | 1,320,000 | ||||||||||||||||||||||||
Total | — | — | 1,980,000 | 1,980,000 | — | 1,980,000 | ||||||||||||||||||||||||
Unvested Equity Awards(3) | ||||||||||||||||||||||||||||||
3/10/08 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/10/08 Restricted Stock | 1,355,164 | — | 1,478,361 | 1,478,361 | 1,478,361 | 1,478,361 | ||||||||||||||||||||||||
3/5/09 Stock Option | 1,828,665 | — | 3,134,855 | 3,134,855 | 3,134,855 | 3,134,855 | ||||||||||||||||||||||||
3/5/09 Restricted Stock | 1,588,057 | 2,722,383 | 2,722,383 | 2,722,383 | 2,722,383 | |||||||||||||||||||||||||
3/5/10 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/5/10 Restricted Stock | 537,606 | 2,150,423 | 2,150,423 | 1,971,221 | 2,150,423 | |||||||||||||||||||||||||
Total | 5,309,492 | — | 9,486,022 | 9,486,022 | 9,306,820 | 9,486,022 | ||||||||||||||||||||||||
Non-Qualified Retirement Benefits | ||||||||||||||||||||||||||||||
ITT Excess Pension Plan(4) | 2,017,943 | 2,017,943 | 1,060,143 | — | 2,017,943 | 3,329,785 | ||||||||||||||||||||||||
Special Pension Arrangement(5) | 10,689,765 | 10,689,765 | 10,689,765 | — | 10,689,765 | 13,741,918 | ||||||||||||||||||||||||
ITT Excess Savings Plan(6) | — | — | — | — | — | 121,800 | ||||||||||||||||||||||||
Total | 12,707,708 | 12,707,708 | 11,749,908 | — | 12,707,708 | 17,193,503 | ||||||||||||||||||||||||
Other Benefits | ||||||||||||||||||||||||||||||
Outplacement | — | — | — | — | — | — | ||||||||||||||||||||||||
Health & Welfare(7) | — | — | — | 4,992 | 4,992 | 7,488 | ||||||||||||||||||||||||
IRC 280(g) TaxGross-Up(8) | — | — | — | — | — | — | ||||||||||||||||||||||||
Total | — | — | — | 4,992 | 4,992 | 7,488 | ||||||||||||||||||||||||
Total | 18,017,200 | 12,707,708 | 23,215,930 | 11,471,014 | 27,355,520 | 39,749,088 | ||||||||||||||||||||||||
(b) | If Mr. Loranger voluntarily terminates without good reason or is terminated for cause prior to the normal retirement age of 65 under the ITT Salaried Retirement Plan, he is entitled only to his base salary through the date of termination. He has no further rights to any compensation or any other benefits not vested prior to his termination date. Mr. Loranger is eligible to retire under the Steven R. Loranger Special Pension Arrangement. |
76
(c) | and (d) If Mr. Loranger terminates due to death or disability, Mr. Loranger, or his estate, is entitled to receive his 1) base salary and 2) any | |
(e) | Termination |
(1) |
92
(2) | Based on total shareholder return performance through December 31, 2010, outstanding TSR awards for the2009-11 and2010-12 performance periods would not earn a payout. Should Mr. Loranger resign or be terminated for cause, he would receive no TSR payment. In the event of death or disability, he would receive a pro-rated payment, if any, for outstanding TSR awards at target and in the event of termination without cause |
(3) | ||
(4) | Mr. Loranger became vested in the ITT Excess Pension Plan benefit effective January 1, 2008 because of the plan change described on page | |
(5) | Mr. Loranger vested in The Special Pension Arrangement | |
(6) | No additional ITT Excess Savings Plan payments are made in the event of voluntary or involuntary termination or termination for cause, because vesting in ITT Excess Savings Plan contributions occurs at five years of employment. Mr. Loranger was fully vested as of December 31, 2010 under the terms of the Steven R. Loranger Employment Agreement. ITT Excess Savings Plan amounts reflect credits in addition to any currently vested amount. | |
(7) | In accordance with |
77
(8) | Amounts in column (f) assume termination occurs immediately upon a change of control based on the Company’s December 31, |
93
Denise L. Ramos | Denise L. Ramos | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Termination | Termination | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Not For Cause | Not For Cause | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
or With Good | or With Good | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reason | Reason | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Termination | Termination | After Change | Termination | Termination | After Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Resignation | For Cause | Death | Disability | Not For Cause | of Control | Resignation | For Cause | Death | Disability | Not For Cause | of Control | |||||||||||||||||||||||||||||||||||||||||||||||||
$(a) | $(b) | $(c) | $(d) | $(e) | $(f) | $(a) | $(b) | $(c) | $(d) | $(e) | $(f) | |||||||||||||||||||||||||||||||||||||||||||||||||
Cash Severance(1) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Salary | — | — | — | — | 1,080,000 | 1,620,000 | — | — | — | — | 1,180,000 | 1,770,000 | ||||||||||||||||||||||||||||||||||||||||||||||||
AIP | — | — | — | — | — | 1,575,000 | — | — | — | — | — | 2,612,700 | ||||||||||||||||||||||||||||||||||||||||||||||||
Total | — | — | — | — | 1,080,000 | 3,195,000 | — | — | — | — | 1,180,000 | 4,382,700 | ||||||||||||||||||||||||||||||||||||||||||||||||
Unvested TSR Unit Awards | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2007 — 09 TSR Units | — | — | 550,000 | 550,000 | 550,000 | 1,100,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
2008 — 10 TSR Units | — | — | 600,000 | 600,000 | 600,000 | 1,200,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unvested Non-Equity Awards(2) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2009 — 11 TSR Award | — | — | — | — | — | 120,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
2010 — 12 TSR Award | — | — | — | — | — | 266,667 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | — | — | 1,150,000 | 1,150,000 | 1,150,000 | 2,300,000 | — | — | — | — | — | 386,667 | ||||||||||||||||||||||||||||||||||||||||||||||||
Unvested Equity Awards | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
7/2/07 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
7/2/07 Restricted Stock | — | — | 870,591 | 870,591 | 870,591 | 870,591 | — | — | 312,660 | 312,660 | 312,660 | 312,660 | ||||||||||||||||||||||||||||||||||||||||||||||||
3/10/08 Stock Option | — | — | — | — | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||
3/10/08 Restricted Stock | — | — | 237,216 | 237,216 | 224,038 | 237,216 | — | — | 268,783 | 268,783 | 268,783 | 268,783 | ||||||||||||||||||||||||||||||||||||||||||||||||
3/5/09 Stock Option | — | — | 570,060 | 570,060 | 570,060 | 570,060 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
3/5/09 Restricted Stock | — | — | 494,993 | 494,993 | 494,993 | 494,993 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
3/5/10 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
3/5/10 Restricted Stock | — | — | 434,441 | 434,441 | 398,238 | 434,441 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | — | — | 1,107,807 | 1,107,807 | 1,094,629 | 1,107,807 | — | — | 2,080,937 | 2,080,937 | 2,044,734 | 2,080,937 | ||||||||||||||||||||||||||||||||||||||||||||||||
Non-Qualified Retirement Benefits | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
ITT Excess Pension Plan(3) | — | — | — | — | — | 399,575 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
ITT Excess Savings Plan(4) | — | — | 5,401 | 5,401 | — | 56,700 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
ITT Excess Pension Plan(4) | 279,374 | 279,374 | 151,980 | — | 279,374 | 1,533,284 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
ITT Excess Savings Plan(5) | — | — | 10,611 | 10,611 | — | 61,950 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | — | — | 5,401 | 5,401 | — | 456,275 | 279,374 | 279,374 | 162,591 | 10,611 | 279,374 | 1,595,234 | ||||||||||||||||||||||||||||||||||||||||||||||||
Other Benefits | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outplacement(5) | — | — | — | — | 75,000 | 75,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Health & Welfare(6) | — | — | — | — | 2,385 | 3,577 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
IRC 280(g) TaxGross-Up | — | — | — | — | — | 2,662,939 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Outplacement(6) | — | — | — | — | 75,000 | 75,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Health & Welfare(7) | — | — | — | — | 7,392 | 11,088 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
IRC 280(g) TaxGross-Up(8) | — | — | — | — | — | 2,711,673 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | — | — | — | — | 82,392 | 2,797,761 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | — | — | 2,263,208 | 2,263,208 | 3,402,014 | 9,800,598 | 279,374 | 279,374 | 2,243,528 | 2,091,548 | 3,586,500 | 11,243,299 | ||||||||||||||||||||||||||||||||||||||||||||||||
(1) | Under Ms. Ramos’ employment agreement, described on pages | |
78
Nicholas P. Hill | ||||||||||||||||||||||||||||||
Termination | ||||||||||||||||||||||||||||||
Not For Cause | ||||||||||||||||||||||||||||||
or With Good | ||||||||||||||||||||||||||||||
Reason | ||||||||||||||||||||||||||||||
Termination | Termination | After Change | ||||||||||||||||||||||||||||
Resignation | For Cause | Death | Disability | Not For Cause | of Control | |||||||||||||||||||||||||
$(a) | $(b) | $(c) | $(d) | $(e) | $(f) | |||||||||||||||||||||||||
Cash Severance(1) | ||||||||||||||||||||||||||||||
Salary | — | — | — | — | 864,000 | 1,296,000 | ||||||||||||||||||||||||
AIP | — | — | — | — | — | 1,470,000 | ||||||||||||||||||||||||
Total | — | — | — | — | 864,000 | 2,766,000 | ||||||||||||||||||||||||
Unvested TSR Unit Awards(2) 2007 — 09 TSR Units | — | — | 400,000 | 400,000 | 400,000 | 800,000 | ||||||||||||||||||||||||
2008 — 10 TSR Units | — | — | 450,000 | 450,000 | 450,000 | 900,000 | ||||||||||||||||||||||||
Total | — | — | 850,000 | 850,000 | 850,000 | 1,700,000 | ||||||||||||||||||||||||
Unvested Equity Awards(3) 3/6/06 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/6/06 Restricted Stock | — | — | 163,540 | 163,540 | 163,540 | 163,540 | ||||||||||||||||||||||||
3/7/07 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/7/07 Restricted Stock | — | — | 150,065 | 150,065 | 150,065 | 150,065 | ||||||||||||||||||||||||
3/10/08 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/10/08 Restricted Stock | — | — | 177,935 | 177,935 | 168,050 | 177,935 | ||||||||||||||||||||||||
Total | — | — | 491,540 | 491,540 | 481,655 | 491,540 | ||||||||||||||||||||||||
Non-Qualified Retirement Benefits UK Plan | — | — | — | — | — | 1,424,094 | ||||||||||||||||||||||||
Total | — | — | — | — | — | 1,424,094 | ||||||||||||||||||||||||
Other Benefits | ||||||||||||||||||||||||||||||
Outplacement(4) | — | — | — | — | 75,000 | 75,000 | ||||||||||||||||||||||||
Health & Welfare | — | — | — | — | — | — | ||||||||||||||||||||||||
IRC 280(g) TaxGross-Up | — | — | — | — | — | 2,735,536 | ||||||||||||||||||||||||
Total | — | — | 1,341,540 | 1,341,540 | 2,270,655 | 9,192,170 | ||||||||||||||||||||||||
(2) | Based on total shareholder return performance through December 31, 2010, outstanding TSR awards for the 2009-11 and 2010-12 performance periods would not earn a payout. Should |
94
(3) | Unvested equity awards reflect the market value of stock and | |
79
Vincent A. Maffeo | ||||||||||||||||||||||||||||||
Termination | ||||||||||||||||||||||||||||||
Not For Cause | ||||||||||||||||||||||||||||||
or With Good | ||||||||||||||||||||||||||||||
Reason | ||||||||||||||||||||||||||||||
Termination | Termination | After Change | ||||||||||||||||||||||||||||
Resignation | For Cause | Death | Disability | Not For Cause | of Control | |||||||||||||||||||||||||
$(a) | $(b) | $(c) | $(d) | $(e) | $(f) | |||||||||||||||||||||||||
Cash Severance(1) | ||||||||||||||||||||||||||||||
Salary | — | — | — | — | 952,000 | 1,428,000 | ||||||||||||||||||||||||
AIP | — | — | — | — | — | 1,641,000 | ||||||||||||||||||||||||
Total | — | — | — | — | 952,000 | 3,069,000 | ||||||||||||||||||||||||
Unvested TSR Unit Awards(2) 2007 — 09 TSR Units | 300,000 | — | 450,000 | 450,000 | 450,000 | 900,000 | ||||||||||||||||||||||||
2008 — 10 TSR Units | 150,000 | — | 450,000 | 450,000 | 450,000 | 900,000 | ||||||||||||||||||||||||
Total | 450,000 | — | 900,000 | 900,000 | 900,000 | 1,800,000 | ||||||||||||||||||||||||
Unvested Equity Awards(3) 3/6/06 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/6/06 Restricted Stock | 164,749 | — | 174,440 | 174,440 | 174,440 | 174,440 | ||||||||||||||||||||||||
3/7/07 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/7/07 Restricted Stock | 103,173 | — | 168,829 | 168,829 | 168,829 | 168,829 | ||||||||||||||||||||||||
3/10/08 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/10/08 Restricted Stock | 49,426 | — | 177,935 | 177,935 | 168,050 | 177,935 | ||||||||||||||||||||||||
Total | 317,348 | — | 521,204 | 521,204 | 511,319 | 521,204 | ||||||||||||||||||||||||
Non-Qualified Retirement Benefits | ||||||||||||||||||||||||||||||
ITT Excess Pension Plan(4) | 5,446,296 | 5,446,296 | 2,329,475 | — | 5,446,296 | 8,106,812 | ||||||||||||||||||||||||
ITT Excess Savings Plan(5) | — | — | — | — | — | 49,980 | ||||||||||||||||||||||||
Total | 5,446,296 | 5,446,296 | 2,329,475 | — | 5,446,296 | 8,156,792 | ||||||||||||||||||||||||
Other Benefits | ||||||||||||||||||||||||||||||
Outplacement(6) | — | — | — | — | 75,000 | 75,000 | ||||||||||||||||||||||||
Health & Welfare(7) | — | — | — | — | 2,102 | 3,153 | ||||||||||||||||||||||||
IRC 280(g) TaxGross-Up | — | — | — | — | — | — | ||||||||||||||||||||||||
Total | 6,213,644 | 5,446,296 | 3,750,679 | 1,421,204 | 7,886,717 | 13,625,149 | ||||||||||||||||||||||||
80
(4) | Column (a) and column (b) amounts reflect the present value of the annual vested benefit payable under the ITT Excess Pension Plan, as of December 31, 2010 assuming a | |
(5) | No additional ITT Excess Savings Plan payments are made in the event of voluntary or involuntary termination, or termination for | |
(6) | The Company’s Senior Executive Severance Pay Plan includes one year of | |
(7) | In the event of termination | |
(8) | Amounts in column (f) assume termination occurs immediately upon a change of control based on the Company’s December 31, 2010 closing stock price of $52.11. |
95
Gretchen W. McClain | ||||||||||||||||||||||||||||||
Termination | ||||||||||||||||||||||||||||||
Not For Cause | ||||||||||||||||||||||||||||||
or With Good | ||||||||||||||||||||||||||||||
Reason | ||||||||||||||||||||||||||||||
Termination | Termination | After Change | ||||||||||||||||||||||||||||
Resignation | For Cause | Death | Disability | Not For Cause | of Control | |||||||||||||||||||||||||
$(a) | $(b) | $(c) | $(d) | $(e) | $(f) | |||||||||||||||||||||||||
Cash Severance(1) Salary | — | — | — | — | 432,000 | 1,296,000 | ||||||||||||||||||||||||
AIP | — | — | — | — | — | 1,170,000 | ||||||||||||||||||||||||
Total | — | — | — | — | 432,000 | 2,466,000 | ||||||||||||||||||||||||
Unvested Non-TSR Units(2) 2007 — 09 TSR Units | — | — | 450,000 | 450,000 | 450,000 | 900,000 | ||||||||||||||||||||||||
2008 — 10 TSR Units | — | — | 550,000 | 550,000 | 366,667 | 1,100,000 | ||||||||||||||||||||||||
Total | — | — | 1,000,000 | 1,000,000 | 816,667 | 2,000,000 | ||||||||||||||||||||||||
Unvested Equity Awards(3) 9/19/05 Restricted Stock | — | — | 551,880 | 551,880 | 551,880 | 551,880 | ||||||||||||||||||||||||
3/6/06 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/6/06 Restricted Stock | — | — | 100,304 | 100,304 | 100,304 | 100,304 | ||||||||||||||||||||||||
3/7/07 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/7/07 Restricted Stock | — | — | 168,829 | 168,829 | 159,450 | 168,829 | ||||||||||||||||||||||||
3/10/08 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/10/08 Restricted Stock | — | — | 217,441 | 217,441 | 132,880 | 217,441 | ||||||||||||||||||||||||
Total | — | — | 1,038,454 | 1,038,454 | 944,514 | 1,038,454 | ||||||||||||||||||||||||
Non-Qualified Retirement Benefits ITT Excess Pension Plan(4) | 63,874 | 63,874 | 31,937 | — | 63,874 | 306,712 | ||||||||||||||||||||||||
ITT Excess Savings Plan(5) | — | — | 5,708 | 5,708 | — | 45,360 | ||||||||||||||||||||||||
ITT Total | 63,874 | 63,874 | 37,645 | 5,708 | 63,874 | 352,072 | ||||||||||||||||||||||||
Other Benefits | ||||||||||||||||||||||||||||||
Outplacement(6) | — | — | — | — | 75,000 | 75,000 | ||||||||||||||||||||||||
Health & Welfare(7) | — | — | — | — | 954 | 2,861 | ||||||||||||||||||||||||
IRC 280(g) TaxGross-Up | — | — | — | — | — | 2,269,796 | ||||||||||||||||||||||||
Total | 63,874 | 63,874 | 2,076,099 | 2,044,162 | 2,333,009 | 8,204,183 | ||||||||||||||||||||||||
81
Gretchen W. McClain | ||||||||||||||||||||||||||||||
Termination | ||||||||||||||||||||||||||||||
Not For Cause | ||||||||||||||||||||||||||||||
or With Good | ||||||||||||||||||||||||||||||
Reason | ||||||||||||||||||||||||||||||
Termination | Termination | After Change | ||||||||||||||||||||||||||||
Resignation | For Cause | Death | Disability | Not For Cause | of Control | |||||||||||||||||||||||||
$(a) | $(b) | $(c) | $(d) | $(e) | $(f) | |||||||||||||||||||||||||
Cash Severance(1) | ||||||||||||||||||||||||||||||
Salary | — | — | — | — | 618,333 | 1,590,000 | ||||||||||||||||||||||||
AIP | — | — | — | — | — | 1,606,800 | ||||||||||||||||||||||||
Total | — | — | — | — | 618,333 | 3,196,800 | ||||||||||||||||||||||||
Unvested Non-Equity Units(2) | ||||||||||||||||||||||||||||||
2009 — 11 TSR Award | — | — | — | — | — | 120,000 | ||||||||||||||||||||||||
2010 — 12 TSR Award | — | — | — | — | — | 240,000 | ||||||||||||||||||||||||
Total | — | — | — | — | — | 360,000 | ||||||||||||||||||||||||
Unvested Equity Awards(3) | ||||||||||||||||||||||||||||||
3/10/08 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/10/08 Restricted Stock | — | — | 246,376 | 246,376 | 246,376 | 246,376 | ||||||||||||||||||||||||
3/5/09 Stock Option | — | — | 570,060 | 570,060 | — | 570,060 | ||||||||||||||||||||||||
3/5/09 Restricted Stock | — | — | 3,244,838 | 3,244,838 | 2,085,319 | 3,244,838 | ||||||||||||||||||||||||
3/5/10 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/5/10 Restricted Stock | — | — | 390,981 | 390,981 | 249,794 | 390,981 | ||||||||||||||||||||||||
Total | — | — | 4,452,255 | 4,452,255 | 2,581,489 | 4,452,255 | ||||||||||||||||||||||||
Non-Qualified Retirement Benefits ITT Excess Pension Plan(4) | 193,588 | 193,588 | 105,312 | — | 193,588 | 1,057,111 | ||||||||||||||||||||||||
ITT Excess Savings Plan(5) | — | — | — | — | — | 55,650 | ||||||||||||||||||||||||
Total | 193,588 | 193,588 | 105,312 | — | 193,588 | 1,112,761 | ||||||||||||||||||||||||
Other Benefits | ||||||||||||||||||||||||||||||
Outplacement(6) | — | — | — | — | 75,000 | 75,000 | ||||||||||||||||||||||||
Health & Welfare(7) | — | — | — | — | 5,940 | 8,910 | ||||||||||||||||||||||||
IRC 280(g) TaxGross-Up(8) | — | — | — | — | — | 2,747,791 | ||||||||||||||||||||||||
Total | — | — | — | — | 80,940 | 2,831,701 | ||||||||||||||||||||||||
Total | 193,588 | 193,588 | 4,557,567 | 4,452,255 | 3,474,350 | 11,953,517 | ||||||||||||||||||||||||
(1) | Ms. McClain is covered under the Company’s Senior Executive Severance Pay Plan. Under that plan, described on pages | |
(2) | Based on total shareholder return performance through December 31, 2010, outstanding TSR awards would not earn a payout. Should Ms. McClain resign or be terminated for cause, she would receive no TSR payment. In the event of death or disability, she would receive payment, if any, for outstanding TSR awards | |
(3) | Unvested equity awards reflect the market value of stock andin-the-money value of options based on the Company’s December 31, |
96
(4) | Column (a) and column (b) amounts reflect the present value of the annual vested benefit payable under the ITT Excess Pension Plan, as of December 31, 2010 assuming a |
(5) | No additional ITT Excess Savings Plan payments are made in the event of voluntary or involuntary termination, or termination for |
(6) | The Company’s Senior Executive Severance Pay Plan includes one year of outplacement services. Amounts shown in columns (e) and (f) are based on a current competitive bid. | |
(7) | In the event of termination not for cause, the Company will pay life insurance premiums for fourteen months and in the event of a change of control, the Company will pay life insurance premiums for three years. | |
(8) | Amounts in column (f) assume termination occurs immediately upon a change of control based on the Company’s December 31, 2010 closing stock price of $52.11. |
97
David F. Melcher | ||||||||||||||||||||||||||||||
Termination | ||||||||||||||||||||||||||||||
Not For Cause | ||||||||||||||||||||||||||||||
or With Good | ||||||||||||||||||||||||||||||
Reason | ||||||||||||||||||||||||||||||
Termination | Termination | After Change | ||||||||||||||||||||||||||||
Resignation | For Cause | Death | Disability | Not For Cause | of Control | |||||||||||||||||||||||||
$(a) | $(b) | $(c) | $(d) | $(e) | $(f) | |||||||||||||||||||||||||
Cash Severance(1) | ||||||||||||||||||||||||||||||
Salary | — | — | — | — | 530,000 | 1,590,000 | ||||||||||||||||||||||||
AIP | — | — | — | — | — | 1,460,700 | ||||||||||||||||||||||||
Total | — | — | — | — | 530,000 | 3,050,700 | ||||||||||||||||||||||||
Unvested Non-Equity Awards(2) | ||||||||||||||||||||||||||||||
2009 — 11 TSR Award | — | — | — | — | — | 83,333 | ||||||||||||||||||||||||
2010 — 12 TSR Award | — | — | — | — | — | 240,000 | ||||||||||||||||||||||||
Total | — | — | — | — | — | 323,333 | ||||||||||||||||||||||||
Unvested Equity Awards(3) | ||||||||||||||||||||||||||||||
8/18/08 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
8/18/08 Restricted Stock | — | — | 58,624 | 58,624 | 58,624 | 58,624 | ||||||||||||||||||||||||
3/5/09 Stock Option | — | — | 312,861 | 312,861 | 156,431 | 312,861 | ||||||||||||||||||||||||
3/5/09 Restricted Stock | — | — | 343,718 | 343,718 | 315,074 | 343,718 | ||||||||||||||||||||||||
3/5/10 Stock Option | — | — | — | — | — | — | ||||||||||||||||||||||||
3/5/10 Restricted Stock | — | — | 390,981 | 390,981 | 228,072 | 390,981 | ||||||||||||||||||||||||
Total | — | — | 1,106,184 | 1,106,184 | 758,201 | 1,106,184 | ||||||||||||||||||||||||
Non-Qualified Retirement Benefits | ||||||||||||||||||||||||||||||
ITT Excess Pension Plan(4) | — | — | — | — | — | 1,016,262 | ||||||||||||||||||||||||
ITT Excess Savings Plan(5) | — | — | 8,166 | 8,166 | — | 55,650 | ||||||||||||||||||||||||
Total | — | — | 8,166 | 8,166 | — | 1,071,912 | ||||||||||||||||||||||||
Other Benefits | ||||||||||||||||||||||||||||||
Outplacement(6) | — | — | — | — | 75,000 | 75,000 | ||||||||||||||||||||||||
Health & Welfare(7) | — | — | — | — | 1,872 | 2,808 | ||||||||||||||||||||||||
IRC 280(g) TaxGross-Up(8) | — | — | — | — | — | 1,989,845 | ||||||||||||||||||||||||
Total | — | — | — | — | 76,872 | 2,067,653 | ||||||||||||||||||||||||
Total | — | — | 1,114,350 | 1,114,350 | 1,365,073 | 7,619,782 | ||||||||||||||||||||||||
(1) | Mr. Melcher is covered under the Senior Executive Severance Pay Plan. Under that plan, the Company will pay a severance benefit equal to 12 months of base salary if terminated other than for cause unless termination occurs after the normal retirement date. In the event of a change of control, Mr. Melcher is covered under the Company’s Special Senior Executive Severance Pay Plan, described on pages 89 to 90 of this Proxy Statement, and under the terms of the plan, would be paid a lump sum payment equal to three times his current salary plus three times the highest AIP award paid in the three years prior to a change of control. | |
(2) | Based on total shareholder return performance through December 31, 2010, outstanding TSR awards for the 2009-11 and 2010-12 performance periods would not earn a payout. Should Mr. Melcher resign or be terminated for cause, he would receive no TSR payment. In the event of death or disability, he would receive payment, if any, for outstanding TSR awards and in the event of termination without cause he would receive payment, if any, based on a pro-rata portion of the outstanding TSR awards as of the termination date, based on the Company’s performance during the three-year period, in accordance with Section 409A. TSR awards provide that, in the event of a change of control, a pro-rata portion of outstanding awards will be paid through the date of the change of control based on actual performance and the balance of the award will be paid at target (100%). | |
(3) | Unvested equity awards reflect the market value of stock andin-the-money value of options based on the Company’s December 31, 2010 closing stock price of $52.11. |
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(4) | Mr. Melcher has not yet accrued a vested pension benefit. Column (f) provides the lump sum payable by the Company in accordance with the Special Senior Executive Severance Pay Plan in the event of a change of control. | |
(5) | No additional ITT Excess Savings Plan payments are made in the event of voluntary or involuntary termination, or termination for cause. In the case of death or disability, the participant becomes 100% vested in the Company match. Column (f) reflects the additional cash payment representing Company contributions, which would be made following a change of control as described in the Special Senior Executive Severance Pay Plan on pages 89 to 90 of this Proxy Statement. | |
(6) | The Company’s Senior Executive Severance Pay Plan includes one year of | |
(7) | In the event of termination not for cause, the Company will pay life insurance premiums for one year and in the event of a change of control, the Company will pay life insurance for three years. | |
(8) | Amounts in column (f) assume termination occurs immediately upon a change of control based on the Company’s December 31, 2010 closing stock price of $52.11. |
99
Frank R. Jimenez | ||||||||||||||||||||||||||||||
Termination | ||||||||||||||||||||||||||||||
Not For Cause | ||||||||||||||||||||||||||||||
or With Good | ||||||||||||||||||||||||||||||
Reason | ||||||||||||||||||||||||||||||
Termination | Termination | After Change | ||||||||||||||||||||||||||||
Resignation | For Cause | Death | Disability | Not For Cause | of Control | |||||||||||||||||||||||||
$(a) | $(b) | $(c) | $(d) | $(e) | $(f) | |||||||||||||||||||||||||
Cash Severance(1) | ||||||||||||||||||||||||||||||
Salary | — | — | — | — | 415,000 | 830,000 | ||||||||||||||||||||||||
AIP | — | — | — | — | — | 624,000 | ||||||||||||||||||||||||
Total | — | — | — | — | 415,000 | 1,454,000 | ||||||||||||||||||||||||
Unvested TSR Non-Equity Awards(2) | ||||||||||||||||||||||||||||||
2009 — 11 TSR Award | — | — | — | — | — | 55,567 | ||||||||||||||||||||||||
2010 — 12 TSR Award | — | — | — | — | — | 111,133 | ||||||||||||||||||||||||
Total | — | — | — | — | — | 166,700 | ||||||||||||||||||||||||
Unvested Equity Awards(3) | ||||||||||||||||||||||||||||||
6/9/09 Stock Options | — | — | 69,445 | 69,445 | 34,726 | 69,445 | ||||||||||||||||||||||||
6/9/09 Restricted Stock | — | — | 189,524 | 189,524 | 157,937 | 189,524 | ||||||||||||||||||||||||
3/5/10 Stock Options | — | — | — | — | — | — | ||||||||||||||||||||||||
3/5/10 Restricted Stock | — | — | 181,030 | 181,030 | 105,601 | 181,030 | ||||||||||||||||||||||||
Total | — | — | 439,999 | 439,999 | 298,264 | 439,999 | ||||||||||||||||||||||||
Non-Qualified Retirement Benefits | ||||||||||||||||||||||||||||||
ITT Excess Pension Plan(4) | — | — | — | — | — | 463,661 | ||||||||||||||||||||||||
ITT Excess Savings Plan(5) | — | — | 4,037 | 4,037 | — | 29,050 | ||||||||||||||||||||||||
Total | — | — | 4,037 | 4,037 | — | 492,711 | ||||||||||||||||||||||||
Other Benefits | ||||||||||||||||||||||||||||||
Outplacement(6) | — | — | — | — | 75,000 | 75,000 | ||||||||||||||||||||||||
Health & Welfare(7) | — | — | — | — | 1,494 | 1,494 | ||||||||||||||||||||||||
IRC 280(g) TaxGross-Up(8) | — | — | — | — | — | — | ||||||||||||||||||||||||
Total | — | — | — | — | 76,494 | 76,494 | ||||||||||||||||||||||||
Total | — | — | 444,036 | 444,036 | 789,758 | 2,629,904 | ||||||||||||||||||||||||
(1) | Mr. Jimenez is covered under the Senior Executive Severance Pay Plan. Under that plan, the Company will pay a severance benefit equal to 12 months of base salary if terminated other than for cause unless termination occurs after the normal retirement date. In the event of a change of control, Mr. Jimenez is covered under the Company’s Special Senior Executive Severance Pay Plan, described on pages 89 to 90 of this Proxy Statement, and under the terms of the plan, would be paid a lump sum payment equal to two times his current salary plus two times the highest AIP award paid in the three years prior to a change of control. | |
(2) | Based on total shareholder return performance through December 31, 2010, outstanding TSR awards for the2009-11 and2010-12 performance periods would not earn a payment. Should Mr. Jimenez resign or be terminated for cause, he would receive no TSR payment. In the event of death or disability, he would receive payment, if any, for outstanding TSR awards and in the event of termination without cause he would receive payment, if any, based on a pro-rata portion of the outstanding TSR awards as of the termination date, based on the Company’s performance during the three-year period, in accordance with Section 409A. The TSR awards, in the event of a change of control, provide that a pro-rata portion of outstanding awards will be paid through the date of the change of control based on actual performance and the balance of the award will be paid at target (100%). | |
(3) | Unvested equity awards reflect the market value of stock andin-the-money value of options based on the Company’s December 31, 2010 closing stock price of $52.11. |
100
(4) | Mr. Jimenez has not yet accrued a vested pension benefit. Column (f) provides the lump sum payable by the Company in accordance with the Special Senior Executive Severance Pay Plan in the event of a change of control. | |
(5) | No additional ITT Excess Savings Plan payments are made in the event of voluntary or involuntary termination, or termination for cause. In the case of death or disability, the participant becomes 100% vested in the Company match. Amounts in column (f) reflect the additional cash payment representing Company contributions, which would be made following a change of control as described in the Special Senior Executive Severance Pay Plan on pages 89 to 90 of this Proxy Statement. | |
(6) | The Company’s Senior Executive Severance Pay Plan includes one year of outplacement services. Amounts shown in columns (e) and (f) are based on a current competitive bid. | |
(7) | In the event of termination without cause, the Company will pay life | |
(8) | Amounts in column (f) assume termination occurs immediately upon a change of control based on the Company’s December 31, 2010 closing stock price of $52.11. |
82101
Abbott Laboratories | eBay | Kohl’s | Sara Lee | |||
Advanced Micro Devices | Ecolab | Leggett and Platt | Schering-Plough | |||
Agilent Technologies | Eli Lilly | Lexmark International | Schlumberger | |||
Air Products and Chemicals | El Paso Corporation | Life Technologies | Sealed Air | |||
Alcoa | EMC | Limited | Sherwin-Williams | |||
Allergan | Emerson | Lockheed Martin | Spectra Energy | |||
Amazon.com | Equifax | Lorillard Tobacco | Sprint Nextel | |||
Amgen | Fiserv | L-3 Communications | Staples | |||
Apollo Group | Fluor | Marriott International | Starbucks | |||
Applied Materials | Ford | Masco | Starwood Hotels & Resorts | |||
AT&T | Forest Laboratories | Mattel | Sun Microsystems | |||
Automatic Data Processing | Fortune Brands | McDonald’s | Sunoco | |||
Avery Dennison | Freeport-McMoRan Copper & Gold | McKesson | Target | |||
Avon Products | Gannett | MeadWestvaco | Tellabs | |||
Ball | Gap | Medco Health Solutions | Tenet Healthcare | |||
Baxter International | General Dynamics | Medtronic | Teradata | |||
Best Buy | General Electric | Merck & Co | Textron | |||
Big Lots | General Mills | Microsoft | 3M | |||
Biogen Idec | Genzyme | Millipore | Time Warner | |||
Boeing | Gilead Sciences | Molson Coors Brewing | Time Warner Cable | |||
Boston Scientific | Goodrich | Monsanto | UnitedHealth | |||
Bristol-Myers Squibb | Goodyear Tire & Rubber | Motorola | United States Steel | |||
Brown-Forman | Newmont Mining | United Technologies | ||||
CA | Harley-Davidson | New York Times | Valero Energy | |||
Cameron International | Harman International Industries | NIKE | Verizon | |||
Cardinal Health | Hershey | Northrop Grumman | VF | |||
Caterpillar | Hess | Novell | Viacom | |||
Celgene | Honeywell | Occidental Petroleum | Vulcan Materials | |||
Cephalon | Hormel Foods | Office Depot | Walt Disney | |||
CIGNA | Hospira | Owens-Illinois | Waste Management | |||
Coca-Cola Enterprises | Humana | Parker Hannifin | Watson Pharmaceuticals | |||
Colgate-Palmolive | IBM | PepsiCo | Western Digital | |||
ConAgra Foods | IMS Health | Pfizer | Western Union | |||
Convergys | Intel | Pitney Bowes | Weyerhaeuser | |||
CVS Caremark | International Flavors & Fragrances | PPG Industries | Whirlpool | |||
Dean Foods | International Game Technology | Praxair | Whole Foods Market | |||
Dentsply | International Paper | Pulte Homes | Williams Companies | |||
DIRECTV | Jacobs Engineering | QUALCOMM | W.W. Grainger | |||
Dow Chemical | Johnson Controls | Quest Diagnostics | Wyeth Pharmaceuticals | |||
Dr Pepper Snapple | Johnson & Johnson | Qwest Communications | Wyndham Worldwide | |||
DuPont | KB Home | Raytheon | Xerox | |||
Eastman Chemical | Kellogg | Rockwell Automation | Yum! Brands | |||
Eastman Kodak | Kimberly-Clark | Rockwell Collins | ||||
Eaton | KLA-Tencor | R.R. Donnelley |
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1. | SHAREHOLDERS. |
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2. | DIRECTORS. |
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3. | OFFICERS. |
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4. | INDEMNIFICATION. |
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5. | CAPITAL STOCK. |
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6. | SECURITIES HELD BY THE CORPORATION. |
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7. | DEPOSITARIES AND SIGNATORIES. |
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8. | SEAL. |
9. | FISCAL YEAR. |
10. | WAIVER OF OR DISPENSING WITH NOTICE. |
11. | POLITICAL NONPARTISANSHIP OF THE CORPORATION. |
12. | AMENDMENT OF BY-LAWS. |
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13. | OFFICES AND AGENT. |
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ITT CORPORATION 1133 WESTCHESTER AVENUE WHITE PLAINS, NY 10604 WWW.ITT.COM | WE ENCOURAGE YOU TO TAKE ADVANTAGE OF INTERNET OR TELEPHONE | ||
VOTING, BOTH ARE AVAILABLE 24 HOURS A DAY, 7 DAYS A WEEK. Internet and telephone voting is available through 11:59 PM Eastern Time the day before the | |||
VOTE BY INTERNET -www.proxyvote.com Use the Internet to vote your proxy. Have your proxy card in hand when you access the website. VOTE BY TELEPHONE - 1-800-690-6903 Use any touch-tone telephone to vote your proxy. Have your proxy card in hand when you call. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years. |
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: | M30902-P06787 | |||
KEEP THIS PORTION FOR YOUR RECORDS | ||||
DETACH AND RETURN THIS PORTION ONLY |
ITT CORPORATION THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” PROPOSALS 1, 2, 3, 4 AND 5. | FOR ALL | WITHHOLD ALL | FOR ALL EXCEPT | To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below. | ||||||||||
Vote on Directors | ¨ | ¨ | ¨ |
Election of ten members of the Board of Directors. Nominees: | ||||||||||||||
01) Steven R. Loranger, 02) Curtis J. Crawford, 03) Christina A. Gold, 04) Ralph F. Hake, 05) John J. Hamre, | 06) Paul J. Kern, 07) Frank T. MacInnis, 08) Surya N. Mohapatra, 09) Linda S. Sanford, and 10) Markos I. Tambakeras |
Vote on Proposals | FOR | AGAINST | ABSTAIN | |||||||||||
2. | Ratification of the appointment of Deloitte & Touche LLP as ITT’s Independent Registered Public Accounting Firm for | |||||||||||||
Approval of the ITT Corporation 2011 Omnibus Incentive Plan. | ¨ | ¨ | ¨ | |||||||||||
4. |
5. | To approve, in a non-binding vote, the compensation of our named executive officers. | ¨ | ¨ | ¨ |
THE BOARD OF DIRECTORS RECOMMENDS YOU VOTE 1 YEAR ON THE FOLLOWING PROPOSAL: | 1 YEAR | 2 YEARS | 3 YEARS | ABSTAIN | ||||||||||||||
¨ | ¨ | ¨ |
THE BOARD OF DIRECTORS RECOMMENDS YOU VOTE AGAINST PROPOSAL 7: | ABSTAIN | ||||||||
7. | To vote on a shareholder proposal requesting that the Company amend, where applicable, ITT’s policies related to human rights. | ¨ | ¨ | ¨ |
For address changes and/or comments, please check this box and write them on the back where indicated. | ¨ | ||||||
Please indicate if you plan to attend this meeting. | ¨ Yes | ¨ No | |||||
(When signing as attorney, executor, administrator, trustee or guardian, give full title. If more than one trustee, all should sign.) |
Signature [PLEASE SIGN WITHIN BOX] | Date | Signature (Joint Owners) | Date |
Address Changes/Comments: | ||||||||