UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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ANIXTER INTERNATIONAL INC.
(Name of Registrant as Specified In Its Charter)
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(1) | electing | |
(2) | ratifying the appointment of Ernst & Young LLP as the Company’s independent auditors for the fiscal year | |
(3) | transacting such other business as may properly be brought before the meeting or any adjournment(s) thereof. |
Board of Directors
thirteen.
Present Principal Occupation or | ||
Employment; Material Positions Held | ||
Name and Age | During Past Five Years | |
Lord James Blyth, | Director of the Company since 1995; Vice Chairman of Middlebrook Pharmaceuticals Inc. since 2008 and Chairman from 2000 to 2008 of Diageo plc, a beverage company; Senior Advisor since 2007, Vice Chairman from 2004 to 2007 and Partner from 2002 to 2004 | |
Frederic F. Brace, 51 | Nominee for Director of the Company in 2009; Executive Vice President and Chief Financial Officer from 2002 to 2008; Senior Vice President from 1999 to 2001 and various other management positions since 1988 of UAL Corporation, an air transportation company; Director of Bearing Point, a consulting firm. | |
Linda Walker Bynoe, | Director of the Company since 2006; President and Chief Executive Officer of Telemat Ltd. since 1995, a project management and consulting firm; Director of Simon Property Group, Inc., Prudential Retail Mutual Funds and Northern Trust Corporation. | |
Robert L. Crandall, | Director of the Company since 1999; Chairman of the Board of Directors and Chief Executive Officer from 1985 to 1998 of AMR Corporation, an air transportation and diversified services company; Director of Celestica Inc. | |
Robert J. Eck, | Director of the Company since 2008, and President and Chief Executive Officer of the Company and of Anixter Inc., a subsidiary of the Company since July 2008; Executive Vice President and Chief Operating Officer of the Company | |
Robert W. Grubbs, Jr., | Director of the Company since |
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Present Principal Occupation or | ||
Employment; Material Positions Held | ||
Name and Age | During Past Five Years | |
F. Philip Handy, | Director of the Company since 1986; a private investor; Chief Executive Officer since 2001 of Strategic Industries, LLC, a diversified global manufacturing enterprise; Director of Owens Corning, Inc. | |
Melvyn N. Klein, | Director of the Company since 1985; President of JAKK Holding Corp., | |
George Muñoz, | Director of Company since 2004; Principal of Muñoz Investment Banking Group, LLC, and partner with the law firm of Tobin, Petkus & Muñoz since 2001; President and CEO of Overseas Private Investment Corporation from 1997 to 2001; Assistant Secretary and CFO of the U.S. Treasury Department from 1993 to 1997; Director of Marriott International, Inc. and Altria Group, Inc. |
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Stuart M. Sloan, | Director of the Company since 1994; a Principal since 1984 of Sloan Capital Companies, a private investment company; Director of J. Crew Group, Inc. | |
Thomas C. Theobald, | Director of the Company since 1995; Senior Advisor of Chicago Growth Partners since 2004; Managing Director of William Blair Capital Partners, L.L.C. from 1994 to 2004; Chairman and Chief Executive Officer of Continental Bank Corporation from 1987 to | |
Matthew Zell, | Director of the Company since 2001; Managing Director since 2001 of Equity Group Investments, L.L.C., a private investment company; President from 1990 to 2001 of Prometheus Technologies, Inc. and its predecessor, an information technology consulting firm; Director of Desarrolladora Homex S.A. de C.V. Mr. Zell is the son of Samuel Zell. | |
Samuel Zell, | Director of the Company since 1984, |
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2008.
The Committee operates under a written charter ratified by the Board.
• | annually ensure that the CEO’s compensation is appropriately linked to corporate objectives, evaluate the CEO’s performance in light of those objectives, and set the CEO’s compensation based on this evaluation | |
• | annually review and approve the compensation of the Company’s other senior executives, including the executive officers named in this Proxy Statement | |
• | ||
• | recommend to the Board new or modified cash or equity-based incentive plans | |
• | recommend to the Board the form and amount of compensation for non-employee directors | |
• | review and discuss with management the Compensation Discussion and Analysis prepared by management and, based on its review and discussions, recommend to the Board that the Compensation Discussion and Analysis be included in the Company’s Annual Report onForm 10-K and Proxy Statement. |
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Notwithstanding anything tocourses in the contrary set forth in any of the Company’s filings under the Securities Act of 1933, or the Exchange Act that might incorporate future filings, including this Proxy Statement, in whole or in part, the Report of the Audit Committee and Compensation Committee Report presented in this Proxy Statement shall not be incorporated by reference into any such filings.past two years.
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• | attract and retain talented executives, | |
• | recognize sustained above-market performance with comparably superior compensation, | |
• | motivate continuing improvement and future performance at above-market levels relative to competitive peer group companies, | |
• | drive the achievement of specific strategic objectives designed to enhance long term stockholder value creation, | |
• | promote ownership in the Company at a reasonable cost to the Company’s stockholders, | |
• | be transparent and understandable to the participants and stockholders, and | |
• | be consistent with the Company’s corporate governance principles. |
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performance, a key factor supporting 2008 compensation decisions was the Company’s strong longer term performance and successful recovery from the negative business environment of the last recession, including significant increases in corporate performance measurements, including revenues, operating profits, operating margins, return on shareholder equity, share price and shareholder return, and the successful development of new lines of business.
Our Chief Executive Officer, Mr. Grubbs, was paid a base In the early part of each year, the Compensation Committee meets to review executive salaries. The principal factors considered in making salary of $975,000 in 2007, which represents an 8.3% increase from his 2006 salary. Mr. Grubbs has beenadjustment decisions include the individual’s performance, potential for advancement within the Company, tenure with the Company for 29 years, 13 of themand tenure in his currentthe particular position. This increase,Annual salary increases are effective as of January 1, 2007,1.
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comparable positions.
The MIP was adopted, and approved by the stockholders, to ensure that the full amount of any annual incentive award made under the plan will qualify as performance-based compensation, and therefore be excepted from the $1 million per year limitation imposed by Section 162(m) of the Internal Revenue Code on the deductibility for federal income tax purposes of compensation paid to certain of the named executive officers.
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Robert W. | Dennis J. | Robert J. | John A. | Terrance A. | ||||||||||||||||
Grubbs | Letham | Eck | Dul | Faber | ||||||||||||||||
Target Incentive: | $ | 975,000 | $ | 390,000 | / | $ | 300,000 | / | $ | 104,000 | $ | 95,000 | ||||||||
$ | 420,000 | (1) | $ | 400,000 | (1) | |||||||||||||||
Financial Performance Goals: | ||||||||||||||||||||
Worldwide Operating Earnings | 38 | % | 38 | % | 26 | % | 42 | % | 42 | % | ||||||||||
Worldwide Return on Tangible Capital | 37 | % | 37 | % | 28 | % | 28 | % | ||||||||||||
Selected Operating Earnings | 37 | % | ||||||||||||||||||
Selected Return on Tangible Capital | 14 | % | ||||||||||||||||||
Individual Objectives | 25 | % | 25 | % | 23 | % | 30 | % | 30 | % |
Robert W. | Robert J. | Dennis J. | John A. | Terrance A. | Rodney A. | |||||||||||||||||||
Grubbs | Eck | Letham | Dul | Faber | Smith | |||||||||||||||||||
Target Incentive | $ | 1,000,000 | (1) | $ | 450,000 | / | $ | 450,000 | $ | 125,000 | $ | 100,000 | $ | 125,000 | ||||||||||
$ | 550,000 | (2) | ||||||||||||||||||||||
Financial Performance Goals: | ||||||||||||||||||||||||
Worldwide Operating Earnings | 38 | % | 38 | % | 38 | % | 42 | % | 42 | % | 42 | % | ||||||||||||
Worldwide Return on Tangible Capital | 37 | % | 37 | % | 37 | % | 28 | % | 28 | % | 28 | % | ||||||||||||
Individual Objectives(3) | 25 | % | 25 | % | 25 | % | 30 | % | 30 | % | 30 | % |
(1) | In connection with Mr. Grubbs’ retirement on June 30, 2008, the Compensation Committee authorized a pro rata payment of his annual incentive, based on actual performance goal attainment. | |
(2) | As a result of | |
(3) | The individual qualitative objectives for each named executive officer were as follows: |
Mr. Grubbs: | Continue implementation of general corporate succession program, including the chief executive officer position; evaluate potential acquisition opportunities. | |
Mr. Eck: | Assist in expansion of wire and cable business; assist with IT migration program; participate in expansion plan for the fastener business. | |
Mr. Letham: | Assist in implementation of management succession plan; oversee acquisitions, including integration; oversee revisions to internal audit program. | |
Mr. Dul: | Manage European legal team during transition; enhance corporate compliance program; revise and update the Company’s Ethics and Conduct policy. | |
Mr. Faber: | Implement accounts payable program; evaluate capital structure of foreign entities; review sales tax processing. | |
Mr. Smith: | Redesign employee medical plan; upgrade the HR system; develop global training program. |
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Smith 1.6. Table in this Proxy Statement. percentiles and the Compensation Committee made no adjustment to the 2008 equity awards on this basis. The Compensation Committee also made no adjustment to the 2008 equity awards on this basis. 2008. January 2, 2009. 2008. Mr. Grubbs’ 2008 stock option vested upon his retirement on June 30, 2008. Pursuant to the Separation Agreement entered into between Mr. Grubbs and the Company in connection with his retirement, other outstanding options continue to vest in accordance with their terms, as consideration for extending the terms of the restrictive covenants contained in Mr. Grubbs’ employment agreement. salary and bonus and any benefit amounts restricted by Code limits. hardship as defined by the DCP and IRS. payment would otherwise have been made or begun. Agreement: 2008. There are no related party transactions disclosed above that have not been reviewed and ratified in accordance with the Company’s policies and procedures. subsidiaries. 2007. 2007. February 22, 2010. 20072008 the target and payout levels for each financial performance goal, actual performance, the percentage at which the target was attained, and the actual percentage of the target incentive paid. For each goal a proratapro rata percentage is earned for performance between the threshold and the target and for performance between the target and the maximum. Worldwide Operating Earnings Actual % of Target: $380,277,000 Actual % Attainment Target % of Target Achieved Multiplier Performance of Target Incentive Paid $ 439,123,000 115 % 150 % Less than 85% . 0 85% . 25 100% 1. 0 109% or more 1. 5 Worldwide Return on Tangible
Capital
Target: 28.4% % of Target Achieved 30.4 % 107 % 148 % Less than 87% . 0 87% . 25 100% 1. 0 107.4% or more 1. 5 Selected Operating Earnings
Target: $140,572,000 % of Target Achieved $ 152,592,000 109 % 150 % Less than 85% . 0 85% . 25 100% 1. 0 108% or more 1. 5 Selected Return on Tangible
Capital
Target: 29.0% % of Target Achieved 32 % 110 % 150 % Less than 87% . 0 87% . 25 100% 1. 0 106.2% or more 1. 5 Worldwide Operating Earnings Target: $493,105,000 Actual% of Actual % Attainment of Target Multiplier Performance Target Incentive Paid $ 391,930,000 79 % 0 % Less than 85% .0 85% .25 100% 1 .0 106% or more 1 .5 Worldwide Return on Tangible Capital Target: 29.4%
% of Target Achieved 24.3 % 83 % 0 % Less than 87% .0 87% .25 100% 1 .0 104% or more 1 .5 1.25;1.75; Mr. Eck: 1.75; Mr. Letham: 1.2; Mr. Eck: 1.2;1.75; Mr. Dul: 1.18;1.6; Mr. Faber: 1.75; and Mr. Faber: 1.05.columnand “Bonus” columns of the Summary Compensation Table.Equity-basedEquity-Based Awards: The Company is dedicated to enhancing long-term value for its stockholders, and believes that the best way to ensure its senior executives maintain focus on this goal is to provide a substantial part of their total compensation in the form of equity-based awards. The Company’s use of equity-based awards is designed to promote ownership and align the economic interests of senior executives to those of the12equity basedequity-based compensation, it has historically, and in 2007,2008, chosen to condition the vesting of equity-based awards on the passage of time.rights,right’s, stock awards, performance shares, stock units, performance units and dividend equivalent rights. Until 2003, the Company’s primary method of providing long-term incentives was the granting of non-qualified stock options. In 2003, after considering the number of stock options then outstanding as a percentage of the Company’s outstanding shares, the dilutive effect of these options, and proposed changes in accounting rules which would eliminate or reduce the expense advantage of stock options as compared to other types of equity awards, the Compensation Committee determined that it would begin granting restricted stock units in lieu of additional stock options. From 2003 through 2005, all long-term incentives were provided in the form of restricted stock units. In 2006,had achieved its objective of substantially reducing the potential dilution from its equity award program. Additionally, the Company determined that there were several executives whose equity holdings were deemed insufficienthas provided long term incentive compensation to achieve its long-term incentive and retention goals. Accordingly, the Company reintroduced the use of stock options to provide greater leverage in achieving these goals. In 2007, all senior executives receiving equity-based awards valued at $300,000 or more (which includes all named executive officers) receivedofficers through a combination of stock options and restricted stock units. Theunits (RSUs), other than Mr. Smith, who received only RSUs in 2007. Stock options provide an element of risk to executives in that value is created for the executives only when value is created for shareholders, and they provide a more leveraged vehicle for accomplishing the objectives of long term value. RSUs manage potential increased dilution that would result from using only options, and provide executives with outright value that supports executive retention.their awards solely in restricteda combination of stock units.options and RSUs.
12equity basedequity-based awards to its senior executives so that their total compensation is between the 50th50th and 75th75th percentile of the total compensation provided to similarly situated executives in the comparison group of companies. Because the Company benchmarks total compensation for its senior executives rather than equity awards per se, and total compensation includes total cash compensation, recommendations for equity awards can be affected by total cash compensation determinations. However, management believes that itsTotal compensation, including equity award recommendationsawards, to named executive officers in 2008 ranged from 5% below the 50th percentile to 50% above the 75th percentile of the benchmarked amounts for total compensation. This reflects the Company’s practice of leveraging total compensation relative to the benchmark rates by providing a higher percentage of compensation in the form of equity incentives. The equity awards are consistent with the Company’s philosophy that senior executives should receive a sizable amount of their total compensation as equity in the Company.generally each year, the Compensation Committee also reviews the dilution and value transfer rates of the companies in the comparison group. With respect to dilution, the Consultant presents, for each company in the comparison group, shares reserved as a percentage of total diluted shares outstanding, along with the percentages associated with the 25th, 50th and 75th percentiles. Lower percentiles correlate to lower dilution. Based on that data, the Company was between the 25th and 50th percentiles.Chief Executive Officerchief executive officer for each of the three most recent years available, and the three year average. Percentages associated with the 25th, 50th and 75th percentiles are also presented. Lower percentiles correlate to lower award values in relation to market capitalization. Based on that data, the Company was between the 50th and 75th percentiles in average total value transferred in 2005 through 2007, and between the 50th and 75th percentiles in average value transferred to its Chief Executive Officer during the same period. Management also presents the year-end value of all the Company’s outstanding equity awards.2007.2008. In addition, Mr. Eck received grantsa grant as of OctoberJuly 1, 20072008, in connection with his promotion to Chief OperatingExecutive Officer. These grants are shown in the Grants of Plan-Based Awards tableTable in this Proxy Statement.13tableTable in this Proxy Statement., including the named executive officers, hired before June 1, 2004, the Company provides a non-qualified excess benefit plan which extends the benefit formula in the qualified pension plan to earnings from salary and non-equity incentives which exceed the amount allowed by the IRSInternal Revenue Service (“IRS”) to be included in the calculation of benefits from the qualified plan. All named executive officers other than Mr. Smith (who was hired in 2006) participate in the excess benefit plan, except for Mr. Grubbs, whose benefit under this plan was waived because it is included in his SERP. Additionally, Messrs. Grubbs and Letham participate in a supplemental executive retirement plan (“SERP”) designed to increase their total retirement benefits (qualified plan, excess plan and SERP) at age 65 to 50% of their final average pay. See the discussion accompanying the “Pension Benefits” tablePension Benefits Table in this Proxy Statement.executive officers.senior executives.
13TheThese benefits were determined to be reflective of the market at the time they were negotiated, and the Compensation Committee and its independent advisors believebelieves these payments are fair and proper consideration for the agreement of these executives to post-employment restrictive covenants. Because Mr. Grubbs retired on June 30, 2008, no severance benefits are payable to him under his employment agreement.$1,000,000$l,000,000 per year, but contains an exception for certain performance-based compensation. It is the policy of the Company to structure its incentive and equity-based compensation in a manner whichthat will avoid the limitations imposed by Section 162(m) to the extent it can reasonably do so consistent with its goal of retaining and motivating its executives in a cost effective manner. We review compensation plans in light of applicable tax provisions, including Section 162(m), and may revise compensation plans from time to time to maximize deductibility. However, we may approve compensation that does not qualify for deductibility when we deem it to be in the Company’s best interest. The Company’s previous grants of stock options under its stock option plansStock Incentive Plans and awards under its Management Incentive Plan qualify as “performance-based compensation” under Section 162(m). Base salary does not by its nature qualify as performance-based compensation under Section 162(m). Restricted stock unitsRSUs granted under the Company’s Stock Incentive Plan generally are not considered performance-based, and may not be fully deductible if paid to an executive officer while he is subject to Section 162(m).with Messrs. Grubbs and Letham have been structured so that termination payments will not trigger the application of Section 280G.14stock unitsRSUs and vested stock options is used to determine whether the guidelines have been met. The Compensation Committee is responsible for recommending appropriate actions in respect of persons failing to meet the ownership guidelines. The Company’s Business Ethics and Conduct Policy prohibits hedging against a decline in the Company’s share price.
14 Chief Executive Officer: five times base salary Chief Financial Officer: four times base salary Chief Operating Officer:four times base salaryAll other senior executives: two times base salary Directors: three times annual retainer The value of Mr. Grubbs’ vested equity in the Company at our last fiscal year end exceeded 27 times his base salary — well above the requirement. other directors and executives subject to these requirements are either above their ownership requirements or, taking into account continuing equity-based awards, are on track to achieve their requirement within the five year timeframe prescribed by our guidelines. Prior to 2005,were generally granted on the date they were approved by the Compensation Committee. Since 2005, awards have beenare generally granted on March 1 of each year. The Compensation Committee chose March 1 of each year as the grant date in order to reduce the administrative burden of issuing shares on multiple dates each year as previously issued stock unitsRSUs vested. Under certain limited circumstances, such as in connection with a promotion, the Compensation Committee will make grants on a date other than March 1. In connection with Mr. Eck’s promotion to Chief OperatingExecutive Officer, the Compensation Committee made an additional grant of stock options and restricted stock unitsRSUs to him on OctoberJuly 1, 2007.stock unitsRSUs to be granted to each recipient is determined by dividing the dollar-value award to each participant as approved by the Compensation Committee, by the closing price of stock on the grant date or, if not a trading day, the immediately preceding trading day. The number of options to be granted is similarly determined, using their Black-Scholes value on the grant date.date or, if not a trading day, the immediately preceding trading day. The exercise price of stock options is the closing price of the underlying common stock on the grant date or, if not a trading day, the immediately preceding trading day. We have which give the Company the right of recoupment, if required by law, to the extent compensation, in any form, is awarded or is paid based on the reported financial results of the Company or its affiliates and such financial results are subsequently required to be restated by the Company’s independent auditors. To the extent permitted by law, the Company may seek to recoup any amounts paid to other executives under similar circumstances. FollowingCorporate Governance —stock prices of the Company and the comparison group of companies in 2008, the Compensation Committee has decided to reduce the 2009 equity awards by approximately 25% of the value of the awards made in 2008, and Compensation Discussion and Analysis sectionsaward primarily RSUs in order to reduce the potential number of this Proxy Statement, at its February 2008shares to be issued.
1515meeting the Compensation Committee made the following decisions with respect to executive compensation for 2008:Base salaries:The salary of our Chief Executive Officer, Mr. Grubbs, was increased 2.6% to $1,000,000. Salary increases for the other senior executives (including the named executive officers) range from 3.3% to 16.0%.Annual Incentive Awards:Mr. Grubbs’ incentive target opportunity for 2008 was increased 2.6% to $1,000,000. Target incentive opportunity increases for the other senior executives (including the named executive officers) range from none to 27.5%.Equity-based Awards:For 2008, the Compensation Committee determined that all senior executives would receive half of the value of their award in the form of stock options and half in the form of restricted stock units. Mr. Grubbs’ equity award for 2008 was $700,000. Compared to 2007, equity awards for the other senior executives (including the named executive officers) range from a decrease of 30.2% to an increase of 146.2%. Formform 10-K for the fiscal year ended December 28, 2007.1620072008 SUMMARY COMPENSATION TABLE Change in Pension Value and Non-Equity Nonqualified Incentive Deferred Stock Option Plan Compensation Name and Salary Bonus Awards Awards Compensation Earnings All Other Principal Position Year ($) ($) ($)(1) ($)(2) ($)(3) ($)(4) Compensation ($) Total ($) Robert W. Grubbs 2007 975,000 0 1,916,142 260,417 1,394,348 858,971 (5) 22,118 (6) 5,426,996 President & Chief 2006 900,000 0 1,937,013 104,306 1,312,500 619,486 (7) 120,093 (8) 4,993,398 Executive Officer Dennis J. Letham 2007 436,275 0 742,335 109,374 563,496 466,615 (9) 12,310 (6) 2,330,405 Executive Vice President 2006 400,000 0 782,237 39,115 531,250 377,044 (10) 19,094 (11) 2,148,740 — Finance and Chief Financial Officer Robert J. Eck 2007 361,275 0 240,846 278,460 465,000 123,481 (12) 6,009 (6) 1,475,071 Executive Vice President 2006 265,000 0 150,979 150,898 306,375 79,532 (13) 19,110 (14) 971,894 and Chief Operating Officer John A. Dul 2007 263,300 0 266,900 36,460 145,420 58,296 (15) 6,000 (6) 776,376 Vice President — 2006 245,000 0 262,474 4,172 141,000 38,666 (16) 4,341 (6) 695,653 General Counsel and Secretary Terrance A. Faber 2007 239,700 0 155,400 192,550 129,120 42,829 (17) 5,795 (6) 765,394 Vice President — 2006 217,500 10,000 143,162 121,228 118,065 34,484 (18) 15,971 (19) 660,410 Controller Change in Pension Value and Non-Equity Nonqualified Incentive Deferred Stock Options Plan Compensation Name and Salary Bonus Awards Awards Compensation Earnings All Other Year ($)(1) ($)(2) ($)(3) ($)(4) ($)(5) ($)(6) Compensation ($) Total ($) Robert W. Grubbs 2008 503,846 (7) 31,250 3,735,204 (8) 1,927,197 (9) 187,500 (10) 930,645 (11) 23,166 (12) 7,338,808 President & Chief 2007 975,000 0 1,916,142 260,417 1,394,348 858,971 22,118 5,426,996 Executive Officer 2006 900,000 0 1,937,013 104,306 1,312,500 619,486 120,093 4,993,398 (Retired June 2008) Robert J. Eck 2008 549,615 (13) 31,250 579,660 547,736 187,500 248,155 (14) 6,364 (15) 2,150,280 President & Chief 2007 361,275 0 240,846 278,460 465,000 123,481 6,009 1,475,071 Executive Officer 2006 265,000 0 150,979 150,898 306,375 79,532 19,110 971,894 Dennis J. Letham 2008 500,000 28,125 647,450 245,835 168,750 886,758 (16) 12,898 (15) 2,489,816 Executive Vice 2007 436,275 0 742,335 109,374 563,496 466,615 12,310 2,330,405 President — Finance 2006 400,000 0 782,237 39,115 531,250 377,044 19,094 2,148,740 and Chief Financial Officer John A. Dul 2008 290,000 3,750 243,775 90,629 56,250 93,948 (17) 6,318 (15) 784,670 Vice President — 2007 263,300 0 266,900 36,460 145,420 58,296 6,000 776,376 General Counsel and 2006 245,000 0 262,474 4,172 141,000 38,666 4,341 695,653 Secretary Terrance A. Faber 2008 250,000 7,500 204,628 260,257 45,000 57,532 (18) 6,115 (15) 831,032 Vice President — 2007 239,700 0 155,400 192,550 129,120 42,829 5,795 765,394 Controller 2006 217,500 10,000 143,162 121,228 118,065 34,484 15,971 660,410 Rodney A. Smith 2008 245,000 3,750 142,984 26,039 56,250 3,717 (19) 3,875 (20) 481,615 Vice President — 2007 234,300 0 88,529 0 163,320 2,027 3,875 492,051 Human Resources 2006 82,923 0 0 0 59,681 731 871 144,206 (1) (1) The amounts in this column reflect salaries paid to each named executive officer for the applicable year. Annual salary rate increases are effective as of January 1 of each year.
16(2) Although the maximum payout under the Management Incentive Plan with respect to the individual performance goals of each named executive officer was previously established at 150% of the target opportunity, the Committee determined that actual 2008 performance warranted an increased award. This column shows the amount in excess of the maximum that was paid. Mr. Grubbs’ payment reflects a pro rata amount based on the period of time employed in 2008. (3) The amounts in this column represent the Company’s expense for the fiscal year with respect to all outstanding stock units held by each named executive officer, disregarding any adjustments for potential forfeitures, as discussedand thus include amounts attributable to restricted stock unit awards made in the current and prior years. For an explanation of assumptions used in valuing the awards, see Note 1 to the Consolidated Financial Statements contained in the Company’s 2006Form 10-K, and Note 9 to the Consolidated Financial Statements contained in the Company’s 2007Form 10-K, and Note 8 to the Consolidated Financial Statements contained in the Company’s 2008Form 10-K. (4) (2) The amounts in this column represent the Company’s expense for the fiscal year with respect to all outstanding stock options held by each named executive officer, disregarding any adjustments for potential forfeitures, as discussedand thus include amounts attributable to stock options granted in the current and prior years. For an explanation of the assumptions used in valuing the awards, see Note 1 to the Consolidated Financial Statements contained in the Company’s 2006Form 10-K, and Note 9 to the Consolidated Financial Statements contained in the Company’s 2007Form 10-K and Note 8 to the Consolidated Financial Statements contained in the Company’s 2008Form 10-K. (5) (3) This column shows the cash incentive payments the Company awarded under the Management Incentive Plan to each named executive officer for the fiscal years shown. (6) (4) Amounts shown in this column include the annual increase for the fiscal year in the actuarial present value of each executive’s accumulated benefit under all Company defined benefit plans. See Note 11 to the Consolidated Financial Statements contained in the Company’s 2006Form 10-K, Note 8 to the Consolidated Financial Statements contained in the Company’s 2007Form 10-K and Note 7 to the Consolidated Financial Statements contained in the Company’s 2008Form 10-K. The change in pension value was calculated for 2008 based on the difference between (i) the present value of the accumulated benefit as of the December 31, 2008 measurement date, using the discount rate in effect as of such date and (ii) the present value of the accumulated benefit as of the December 28, 2007 measurement date, using the discount rate in effect as of December 28, 2007. The change in pension value for prior years was based on the difference between the present value of the accumulated benefit as of the then current and prior year measurement dates, in both cases using the discount rate in effect at the then current year measurement date. 2008 change in pension value is based on credited service using an elapsed time method of calculation. Prior years used hours worked as a basis for calculating credited service. This column also includes above market earnings on deferred compensation. These amounts represent an enhanced crediting rate on deferred compensation of up to 2 percentage points per year, which is applied when the Company achieves certain financial goals. The Company considers all enhanced crediting to be above market earnings, even though such amounts may be less than the actual definition of above market rate. Amounts shown also include the annual increase for the fiscal year in the actuarial present value of each executive’s accumulated benefit under all Company defined benefit plans. See Note 11 to the Consolidated Financial Statements contained in the Company’s 2006 and 2007 Form 10-K for an explanation of the assumptions used to value these benefits. (7) (5) Reflects salary paid through June 30, 2008, the date of Mr. Grubbs’ retirement. (8) Includes above market earningsexpensed value of $350,033 relating to full vesting of the 2008 grant and $2,748,664 related to the amendment of all other outstanding restricted stock units to provide for continued vesting in accordance with their terms.(9) Includes expensed value of $349,996 relating to the full vesting of the 2008 grant and $1,420,946 related to the amendment of outstanding stock options to provide for continued vesting and exercise in accordance with their terms. (10) Mr. Grubbs received a pro rata bonus payment under the Management Incentive Plan based on deferred compensationthe period of $27,656time employed and actual performance goal attainment.(11) Includes the annual increase for the fiscal year in the actuarial present value of the accumulated benefit under all Company defined benefit plans of $831,315.$917,772 and above market earnings on deferred compensation of $12,873.
17(12) (6) Includes 401(k) matching contribution and interest on unpaid dividend equivalents relatedof $19,291 paid with respect to unvested stock units.17units that vested. (7) (13)Reflects a salary rate increase from $500,000 to $600,000 effective July 1, 2008 in connection with Mr. Eck’s promotion to CEO. (14) Includes above market earnings on deferred compensation of $25,367 and the annual increase for the fiscal year in the actuarial present value of the accumulated benefit under all Company defined benefit plans of $594,119.(8) Includes 401(k) matching contribution, interest on unpaid dividend equivalents related to unvested stock units$239,105 and perquisites of car allowance, tax preparation assistance, spousal travel (totaling $25,861) and club memberships totaling $94,232.(9) Includes above market earnings on deferred compensation of $38,207$9,050.(15) Includes 401(k) matching contribution and interest on unpaid dividend equivalents paid with respect to restricted stock units that vested. (16) Includes the annual increase for the fiscal year in the actuarial present value of the accumulated benefit under all Company defined benefit plans of $428,408.(10) Includes$861,139 and above market earnings on deferred compensation of $35,044 and$25,619.(17) Includes the annual increase for the fiscal year in the actuarial present value of the accumulated benefit under all Company defined benefit plans of $342,000.(11) Includes 401(k) matching contribution, interest on unpaid dividend equivalents related to unvested stock units$88,510 and perquisites of car allowance and tax preparation assistance.(12) Includes above market earnings on deferred compensation of $11,543 and$5,438.(18) Includes the annual increase for the fiscal year in the actuarial present value of the accumulated benefit under all Company defined benefit plans of $111,938.(13) Includes$56,973 and above market earnings on deferred compensation of $9,145 and$559.(19) Includes the annual increase for the fiscal year in the actuarial present value of the accumulated benefit under all Company defined benefit plans of $70,387.(14) Includes 401(k) matching contribution, interest on unpaid dividend equivalents related to unvested stock units$2,549 and perquisites of car allowance and spousal travel.(15) Includes above market earnings on deferred compensation of $6,741 and the annual increase for the fiscal year in the actuarial present value of the accumulated benefit under all Company defined benefit plans of $51,555.$1,168. (16) (20)Includes above market earnings on deferred compensation of $4,762 and the annual increase for the fiscal year in the actuarial present value of the accumulated benefit under all Company defined benefit plans of $33,904.(17) Includes above market earnings on deferred compensation of $834 and the annual increase for the fiscal year in the actuarial present value of the accumulated benefit under all Company defined benefit plans of $41,995.(18) Includes above market earnings on deferred compensation of $765 and the annual increase for the fiscal year in the actuarial present value of the accumulated benefit under all Company defined benefit plans of $33,719.(19) Includes 401(k) matching contribution, interest on unpaid dividend equivalents related to unvested stock units and perquisite of car allowance.contribution. Theiswas a party to Employment Agreements dated as of January 1, 2006 with Mr. Letham and until June 30, 2008, with Mr. Grubbs, and Mr. Letham that provideeach of which provided for certain compensation and benefits during employment:
181820072008 GRANTS OF PLAN-BASED AWARDS20072008 and (2) restricted stock units and options awarded in 2007. Estimated Possible Payouts All Other Under Non-Equity Incentive Stock All Other Grant Date Plan Awards(1) Awards: Awards: Exercise or Fair Value of Number of Number of Base Price Stock and Committee Shares of Securities of Option Option Grant Approval Threshold Target Maximum Stock or Underlying Awards Awards Name Date Date ($) ($) ($) Units (#) Options (#) ($/Sh) ($)(2) Robert W. Grubbs 2/8/07 243,750 975,000 1,462,500 3/1/07 2/8/07 20,509 45,405 60.95 2,500,023 (3) Dennis J. Letham 2/8/07 99,375 (4) 397,500 (4) 596,250 (4) 3/1/07 2/8/07 8,614 19,070 60.95 1,050,020 (3) Robert J. Eck 2/8/07 81,250 (4) 325,000 (4) 487,500 (4) 3/1/07 2/8/07 6,563 14,530 60.95 800,026 (3) 10/1/07 9/11/07 5,059 12,402 84.01 850,023 (5) John A. Dul 2/8/07 26,000 104,000 156,000 3/1/07 2/8/07 2,871 6,357 60.95 349,996 (3) Terrance A. Faber 2/8/07 23,750 95,000 142,500 3/1/07 2/8/07 4,102 9,081 60.95 500,017 (3) All Other Stock All Other Grant Date Estimated Future Payouts Awards: Awards: Exercise or Fair Value of Under Non-Equity Incentive Number of Number of Base Price Stock and Committee Plan Awards(2) Shares of Securities of Option Option Grant Approval Threshold Target Maximum Stock or Underlying Awards Awards Date Date(1) ($) ($) ($) Units (#) Options (#) ($/Sh) ($)(3) Robert W. Grubbs 2/20/08 250,000 (4) 1,000,000(4 ) 1,500,000 (4) 0 0 0 0 3/1/08 2/20/08 5,353 (5) 14,774 (5) 65.39 700,029 (6) Robert J. Eck 2/20/08 125,000 (7) 500,000 (7) 750,000 (7) 0 0 0 0 3/1/08 2/20/08 9,940 27,438 65.39 1,299,983 (6) 7/1/08 5/13/08 4,982 13,078 60.22 600,025 (8) Dennis J. Letham 2/20/08 112,500 450,000 675,000 0 0 0 0 3/1/08 2/20/08 8,411 23,217 65.39 1,100,006 (6) John A. Dul 2/20/08 31,250 125,000 187,500 0 0 0 0 3/1/08 2/20/08 3,441 9,498 65.39 450,015 (6) Terrance A. Faber 2/20/08 25,000 100,000 150,000 0 0 0 0 3/1/08 2/20/08 4,206 11,608 65.39 550,024 (6) Rodney A. Smith 2/20/08 31,250 125,000 187,500 0 0 0 0 3/1/08 2/20/08 1,912 5,276 65.39 250,014 (6) (1) The Compensation Committee generally approves equity awards at its February meeting, to be granted on the following March 1. March 1 was chosen as the annual grant date to reduce the administrative burden in issuing awards with varying grant dates. The Committee also approved at its May 13, 2008 meeting a grant to be made to Mr. Eck on July 1, 2008 in connection with his promotion to CEO. (2) Payouts under the Management Incentive Plan were based on performance in 2007,2008, which has now occurred. Thus, the amounts shown in the “Threshold,” “Target” and “Maximum” columns reflect the range of potential payouts when the performance goals were set earlier in 2007.2008. Actual amounts paid under the Management Incentive Plan for 20072008 are reflected in the Summary Compensation Table as Non-Equity Incentive Plan Compensation. (2) (3)Calculated in accordance with FAS 123(R) and represents the total projected expense to the Company of grants of stock options and restricted stock units made in 2007.2008. (3) (4)Mr. Grubbs retired on June 30, 2008 and the Committee subsequently exercised its discretion under the Management Incentive Plan to pay him a pro rata portion of the bonus, based on the time he was employed by the Company in 2008 and the actual attainment of the performance goals for 2008. (5) Restricted stock units and stock options granted to Mr. Grubbs on March 1, 2008 vested on June 30, 2008 in connection with his retirement. (6) Except as otherwise noted, the stock options and restricted stock units vest in 1/3 increments during employment beginning on the second anniversary of the March 1, 2008 grant date. The exercise price of the option award is $65.39, which represents the Company’s closing stock price on February 29, 2008, since March 1, 2008 was not a trading day. The weighted-average fair value of the stock option grants was $23.69 per share, which was estimated at the date of grant using the Black-Scholes option pricing model with the following
19assumptions: expected stock price volatility of 27.8%; expected dividend yield of zero; risk-free interest rate of 2.96%; and an average expected life of 7 years. Restricted stock units were valued at $65.39 per unit, which was the closing price of the underlying common stock on February 29, 2008. (7) Amounts shown reflect pro rata adjustments due to an increase in the target incentive amount during 2008 in connection with Mr. Eck’s promotion to CEO on July 1, 2008. (8) The stock options and restricted stock units granted to Mr. Eck on July 1, 2008 vest in 1/3 increments during employment beginning on the second anniversary of the grant date. The exercise price of the option award is $60.95,$60.22, which represents the Company’s closing stock price on the grant date. The weighted-average fair value of the 2007 stock option grantsgrant was $27.53$22.94 per share, which was estimated at the date of grant using the Black-Scholes option pricing model with the following assumptions: expected stock price volatility of 34%28%; expected dividend yield of zero; risk-free interest rate of 4.5%3.62%; and an average expected life of 7 years. Restricted stock units were valued at $60.95$60.22 per unit, which was the closing price of the underlying common stock on the date of grant.(4) Amounts shown reflect pro rata adjustments due to an increase in the target incentive amount during 2007 in connection with job promotions on October 1, 2007.(5) The stock options granted vest in 1/3 increments beginning on the second anniversary of the grant date. The exercise price of the option award is $84.01, which represents the Company’s stock price on the grant date. The weighted-average fair value of the 2007 stock option grants was $34.27 per share which was estimated at the date of grant using the Black-Scholes option pricing model with the following assumptions: expected stock price volatility of 29%; expected dividend yield of zero; risk-free interest rate of 4.4%; and an average expected life of 7 years. Restricted stock units were valued at $84.01 per unit, which was the closing price of the underlying common stock on the date of grant.2007,2008, the Compensation Committee approved annual incentive awards composed of three components: Operating Earnings, Return on Tangible Capital and individual objectives. The Compensation19 also set a target incentive amount for each named executive officer ranging from 37%40% to 100% of base salary. Each component of the annual incentive award can range from zero to 150% of the target incentive opportunity for each component. For each component, a pro rata percentage is earned for performance between the threshold and the target and for performance between target and the maximum.executive officer’ssenior executive’s incentive opportunity was based on financial components. An Operating Earnings target is set each year by the Compensation Committee. If the Company reaches 85% of the Operating Earnings target, the executive is eligible for a threshold of 25% of the Operating Earnings component of the award, with increases in payout as Operating Earnings reachesreach the target. Exceeding the target will result in payments above the target, up to 150% of the target. Similarly, a Return on Tangible Capital target iswas set each year by the Compensation Committee along with a threshold at 87% of target (paying 25% of the target amount) and a maximum (paying 150% of the target amount). For Mr. Eck, the Committee also set an Operating Earnings target and a Return on Tangible Capital target based on his 2007 defined responsibilities, along with a threshold (paying 25% of the target amount) and a maximum (paying 150% of the target amount). For each component, a pro-rata percentage is earned for performance between the threshold and the target and for performance between the target and the maximum. The remaining portion of the bonus opportunity is based on achievement of individual objectives, which are determined subjectively by the executive’s immediate superior, or by the Chairman of the Board in consultation with the Chairman of the Compensation Committee in the case of the Chief Executive Officer. The aggregate incentive award can range from zeroAlthough the maximum payout with respect to the individual performance goals was previously established at 150% of the target incentive opportunity. opportunity, the Committee determined that actual 2008 performance warranted an increased award. Payments under the individual performance goal component for the named executive officers thus ranged from 160% to 175% of target.One-thirdGenerally, one-third of the restricted stock units vestsvest during employment on each anniversary of the grant date beginning with the second anniversary of the grant date. Mr. Grubbs’ 2008 restricted stock unit grant provided for full vesting upon his retirement on June 30, 2008. In addition, pursuant to the Separation Agreement entered into between Mr. Grubbs and the Company in connection with his retirement, all other restricted stock units continue to vest in accordance with their terms, as consideration for extending the terms of the restrictive covenants contained in Mr. Grubbs’ employment agreement. Units convert to an equal number of unrestricted shares of common stock on the date they vest, except that with respect to units granted in 2005 through 2007, executive officers covered by Section 162(m) of the Internal Revenue Code could make an advance election to select the date as of which their vested units will be settled in stock. Holders of restricted stock units have the right to receive dividend equivalents, which are credited at the time dividends are paid and are held by the Company until the units vest. Dividend equivalents are credited with interest equal to 5% per year until the units vest.
20 Stock options wereOptionsExcept for Mr. Grubbs’ award, options granted to the named executive officers in 20072008 vest during employment in thirds on each anniversary of the grant date beginning with the second anniversary of the grant date.2020072008 FISCAL YEAR-ENDDecember 28, 2007January 2, 2009 and (2) each outstanding restricted stock unit that has not vested as of December 28, 2007. Stock Awards Option Awards Number of Shares or Market Number of Number of Units of Value of Securities Securities Stock Shares or Underlying Underlying That Have Units of Unexercised Unexercised Option Option Not Stock That Options (#) Options (#) Exercise Expiration Vested Have Not Name Exercisable(1) Unexercisable Price ($) Date(2) (#)(3) Vested ($)(4) Robert W. Grubbs 47,741 0 17.47 02/18/2010 128,281 7,988,058 269,706 0 21.54 02/14/2011 233,977 0 22.39 02/21/2012 45,405 (5) 60.95 03/01/2017 Dennis J. Letham 36,486 0 10.85 03/01/2009 50,760 3,160,825 76,042 0 17.47 02/18/2010 105,289 0 21.54 02/14/2011 87,741 0 22.39 02/21/2012 19,070 (5) 60.95 03/01/2017 Robert J. Eck 12,548 0 23.77 04/17/2010 18,622 1,159,592 23,398 0 22.39 02/21/2012 48,000 (6) 46.29 03/01/2016 14,530 (5) 60.95 03/01/2017 12,402 (5) 84.01 10/01/2017 John A. Dul 735 0 14.91 02/18/2008 17,750 1,105,293 5,849 0 10.85 03/01/2009 5,849 0 17.47 02/18/2010 5,849 0 21.54 02/14/2011 9,359 0 22.39 02/21/2012 6,357 (5) 60.95 03/01/2017 Terrance A. Faber 5,381 0 21.54 02/14/2011 10,768 670,523 9,359 0 22.39 02/21/2012 40,000 (6) 46.29 03/01/2016 9,081 (5) 60.95 03/01/2017 Stock Awards Number of Option Awards Shares or Market Number of Number of Units of Value of Securities Securities Stock Shares or Underlying Underlying That Have Units of Unexercised Unexercised Option Option Not Stock That Options (#) Options (#) Exercise Expiration Vested Have Not Exercisable(1) Unexercisable Price ($) Date(2) (#)(3) Vested ($)(4) Robert W. Grubbs 74,820 0 21.54 02/14/2011 76,802 2,470,720 139,513 0 22.39 02/21/2012 0 45,405 (6) 60.95 03/01/2017 14,774 (5) 0 65.39 03/01/2018 Robert J. Eck 11,503 0 23.77 04/17/2010 29,211 939,718 23,398 0 22.39 02/21/2012 48,000 (7) 46.29 03/01/2016 14,530 (6) 60.95 03/01/2017 12,402 (6) 84.01 10/01/2017 27,438 (6) 65.39 03/01/2018 13,078 (6) 60.22 07/01/2018 Dennis J. Letham 57,042 0 17.47 02/18/2010 37,789 1,215,672 105,289 0 21.54 02/14/2011 87,741 0 22.39 02/21/2012 19,070 (6) 60.95 03/01/2017 23,217 (6) 65.39 03/01/2018 John A. Dul 5,849 0 17.47 02/18/2010 14,286 459,581 5,849 0 21.54 02/14/2011 9,359 0 22.39 02/21/2012 6,357 (6) 60.95 03/01/2017 9,498 (6) 65.39 03/01/2018 Terrance A. Faber 5,381 0 21.54 02/14/2011 10,975 353,066 9,359 0 22.39 02/21/2012 40,000 (7) 46.29 03/01/2016 9,081 (6) 60.95 03/01/2017 11,608 (6) 65.39 03/01/2018 Rodney A. Smith 5,276 (6) 65.39 03/01/2018 6,713 215,957 (1) StockUnless otherwise noted, stock options in this column vested in 1/1/4 increments beginning on the 1st1st anniversary of each grant date. Unvested awards are generally forfeited upon termination of employment for any reason, except that (i) in connection with his retirement, Mr. Grubbs’ 2008 grant vested on June 30, 2008, his other options were amended so they continue to vest according to their terms and (ii) Mr. Letham’s employment
21agreement provides for acceleration of vesting of certain options upon termination of employment in certain circumstances. (2) Each option was granted 10 years prior to the expiration date shown in this column. (3) Restricted stock units vest during employment in 1/1/3 increments beginning on the 2nd, 3rd and 4thsecond anniversary dates of each grant date. Unvested awards are generally forfeited upon termination of employment for any reason, except that (i) Mr. Grubbs’ 2008 restricted stock unit grant of 5,353 shares vested on June 30, 2008, his retirement date, and his remaining restricted stock units were amended so they continue to vest according to their terms and (ii) Mr Letham’s employment agreement provides for acceleration of vesting of certain restricted stock units upon termination of employment in certain circumstances. The unvested restricted stock units will vest as follows: Name 2/11/2008 3/1/2008 3/1/2009 10/1/2009 3/1/2010 10/1/2010 3/1/2011 10/1/2011 Robert W. Grubbs 13,333 38,146 44,983 0 24,983 0 6,836 0 Dennis J. Letham 6,667 14,715 17,586 0 8,921 0 2,871 0 Robert J. Eck 1,667 2,666 4,855 1,686 2,187 1,687 2,188 1,686 John A. Dul 1,500 5,405 6,360 0 3,528 0 957 0 Terrance A. Faber 1,333 2,666 4,034 0 1,368 0 1,367 0 3/1/2009 10/1/2009 3/1/2010 7/1/2010 10/1/2010 3/1/2011 7/1/2011 10/1/2011 3/1/2012 07/1/2012 Robert W. Grubbs 44,983 0 24,983 0 0 6,836 0 0 0 0 Robert J. Eck 4,855 1,686 5,500 1,661 1,687 5,502 1,660 1,686 3,313 1,661 Dennis J. Letham 17,586 0 11,725 0 0 5,674 0 0 2,804 0 John A. Dul 6,360 0 4,675 0 0 2,104 0 0 1,147 0 Terrance A. Faber 4,034 0 2,770 0 0 2,769 0 0 1,402 0 Rodney A. Smith 1,600 0 2,238 0 2,238 637 0 (4) Represents the value of shares of common stock covered by the restricted stock units, using $62.27,$32.17, which was the closing price of the common stock on December 28, 2007.January 2, 2009. (5) These stock options vested in full on June 30, 2008. (6) These stock options vest during employment in 1/1/3 increments beginning on the 2nd2nd anniversary of the grant date. See Footnote 1 for details regarding other vesting/forfeiture events. (6) (7)These stock options vest during employment in 1/1/3 increments beginning on the 4th4th anniversary date of the grant date. See Footnote 1 for details regarding other vesting/forfeiture events.2120072008 OPTION EXERCISES AND STOCK VESTED20072008 by each named executive officer, (2) the dollar amount realized upon such exercise, (3) the number of shares of common stock acquired during 20072008 as a result of the vesting of restricted stock units and (4) the value of those vested shares. Option Awards Stock Awards Number of Number of Shares Value Shares Value Acquired on Realized on Acquired on Realized on Name Exercise (#) Exercise ($)(1) Vesting (#) Vesting ($)(2) Robert W. Grubbs 360,866 (3) 20,644,096 26,667 (4) 2,787,016 (5) Dennis J. Letham 58,494 3,418,043 12,666 (6) 1,270,783 (5) Robert J. Eck 0 0 5,666 335,063 John A. Dul 700 45,567 5,666 338,270 Terrance A. Faber 0 0 5,168 308,593 Option Awards Stock Awards Number of Number of Shares Value Shares Value Acquired on Realized on Acquired on Realized on Exercise (#) Exercise ($)(1) Vesting (#) Vesting ($)(2) Robert W. Grubbs 337,091 (3) 14,980,842 (3) 56,832 (4) 3,725,251 (4) Robert J. Eck 1,045 48,836 4,333 288,303 Dennis J. Letham 55,486 2,572,940 21,382 (5) 1,418,037 (5) John A. Dul 6,584 272,186 6,905 455,988 Terrance A. Faber 0 0 3,999 265,467 (1) Each executive immediately sold all shares acquired on exercise, except for one exercise each by Mr. Letham and by Mr. Dul. Represents the difference between the exercise price and the price at which the shares acquired upon exercise were sold, or in the case of shares held after exercise, the option are sold anddifference between the exercise price and the closing price of the stock on the date of the exercise, in each case multiplied by the number of shares of common stock covered by the options exercised. Each executive immediately sold all shares acquired on exercise. (2) Represents the value of the common stock on the vesting date. This value equals the number of shares acquired on the vesting date multiplied by either the average of the high and low prices of the stock on the NYSE on such
22date, if the vesting date is a trading day, or the previous trading day’s closing price of the stock on the NYSE, if the vesting date is not a trading day. (3) 127,741308,091 of these options, valued at $8,134,242,$13,755,744, were required to be exercised and sold pursuant to the terms of a qualified domestic relations order. The $13,755,744 value represents the difference between the exercise price and the price at which the shares acquired upon exercise were sold, multiplied by the 308,091 options exercised. (4) Mr. Grubbs previously elected to defer the conversion of 20,00038,146 restricted stock units.units that vested on March 1, 2008. The units will convertconverted to common stock on December 30, 2008, six months after Mr. Grubbs’ separation withretirement. These units are included in the Company. Thesetotals for the columns “Number of Shares Acquired on Vesting” and “Value Realized on Vesting”. 20,000 restricted stock units that vested in 2007 were also converted into shares on December 30, 2008 and are not included in the totals shown above.(5) Mr. Letham previously elected to defer the conversion of 14,715 restricted stock units that vested on March 1, 2008. The units converted to common stock on March 1, 2009 and are included in the totals shown. 8,667 restricted stock units that vested in 2007 were converted on March 1, 2008 and are not included in the totals shown. (5) This amount does not include units with deferred conversion (see footnotes 4 and 6).(6) Mr. Letham elected to defer the conversion of 8,667 restricted stock units. The units converted March 1, 2008. These units are not included in the totals shown.2220072008 PENSION BENEFITSthe planseach plan and (2) the present value of the accumulated benefit payable under each plan to each named executive officer upon retirement at age 65. Number of Present Payments Years Value of During Credited Accumulated Last Fiscal Name Plan Name Service (#)(1) Benefit ($)(2) Year ($) Robert W. Grubbs Anixter Inc. Pension Plan 30.00 1,316,709 0 Anixter Inc. Excess Benefit Plan 30.00 1,316,846 0 Anixter Inc. SERP 30.00 774,065 0 Dennis J. Letham Anixter Inc. Pension Plan 14.92 557,813 0 Anixter Inc. Excess Benefit Plan 14.92 265,358 0 Anixter Inc. SERP 14.92 1,328,203 0 Robert J. Eck Anixter Inc. Pension Plan 18.42 223,671 0 Anixter Inc. Excess Benefit Plan 18.42 129,520 0 John A. Dul Anixter Inc. Pension Plan 18.83 173,378 0 Anixter Inc. Excess Benefit Plan 18.83 45,443 0 Terrance A. Faber Anixter Inc. Pension Plan 7.83 116,456 0 Anixter Inc. Excess Benefit Plan 7.83 34,270 0 Number of Present Payments Years Value of During Credited Accumulated Last Fiscal Service (#)(1) Benefit ($)(2) Year ($) Robert W. Grubbs Anixter Inc. Pension Plan 30.08 1,444,582 0 Anixter Inc. Excess Benefit Plan 30.08 0 (3) 0 Anixter Inc. SERP 30.08 1,875,139 (4) 0 Robert J. Eck Anixter Inc. Pension Plan 19.00 283,331 0 Anixter Inc. Excess Benefit Plan 19.00 308,965 0 Dennis J. Letham Anixter Inc. Pension Plan 15.50 666,090 0 Anixter Inc. Excess Benefit Plan 15.50 460,427 0 Anixter Inc. SERP 15.50 1,465,398 0 John A. Dul Anixter Inc. Pension Plan 19.42 223,980 0 Anixter Inc. Excess Benefit Plan 19.42 83,351 0 Terrance A. Faber Anixter Inc. Pension Plan 8.42 148,963 0 Anixter Inc. Excess Benefit Plan 8.42 58,736 0 Rodney A. Smith Anixter Inc. Pension Plan(5) 2.38 5,005 0 (1) The number of years of service credited to the named executive officer under the specified plan, computed as of December 28, 2007January 2, 2009 which is the same measurement date used for financial statement reporting purposes in the Company’s 2007 2008Form 10-K. Credited service was based on hours worked through July 31, 2006 and an elapsed time method from August 1, 2006 forward. In prior years, the years of credited service shown on this table were based on hours worked. (2) The actuarial present value of the named executive officer’s accumulated benefits under the applicable plan, computed as of the same December 28, 2007January 2, 2009 measurement date used for financial statement reporting purposes in the Company’s 2007 2008Form 10-K.(3) The SERP formula provides a normal monthly retirement benefit equal to 50% of a participant’s Final Average Pay, offset by the monthly benefit paid to the participant under the Pension Plan, Excess Plan and Social
23Security (subject to a minimum benefit). Mr. Grubbs has elected to waive payment of any benefits under the Excess Plan, resulting in an amount equivalent to the Excess Plan benefit being paid under the SERP. (4) This amount reflects the present value of the SERP benefit that would be payable to Mr. Grubbs beginning at age 65. Mr. Grubbs retired on June 30, 2008 and has made an irrevocable election to begin his SERP benefit at age 541/2. The present value of his SERP benefit payable at age 541/2 (assuming commencement of his Pension Plan benefit at age 65) is $3,399,233. (5) Pension benefit based on formula for hires after June 1, 2004. 1/1/12 of the employee’s Covered Compensation (an amount specified in the Pension Plan based on year of birth), plus 1.3% of the portion of the employee’s Final Average Pay in excess of 1/1/12 of the employee’s Covered Compensation. Final Average Pay means the highest average monthly salary and regular bonus (including but not limited to overtime, commissions, performance-based bonuses, employee referral bonuses, and amounts deferred under a nonqualified deferred compensation plan or under Code Sections 125, 401(k), and 132 plans) paid during a 60-consecutive month period occurring in the120-month period prior to termination of employment, taking into account the applicable Internal Revenue Code limits. The monthly benefit formula for employees hired on or after June 1, 2004 is the sum of 0.15% of salary excluding bonuses (up to the applicable Code limits) for each plan year in which the participant’s years of continuous service is fewer than five, plus 0.20% of salary (up to the applicable Code limits) for each plan year in which the participant’s years of continuous service is five or greater.formulaformulas in the Pension Plan, except that the formula is applied to the portion of the Final Average Paysalary and bonus (as described above) and annual benefits that cannot be taken into account under the Pension Plan due to Code limits. The purpose of the Excess Plan is to provide those eligible participants with a retirement benefit that recognizes the participant’s full Final Average Pay.AfterEmployees hired prior to June 1, 2004, after attaining age 55, employees may retire and elect to receive early payment,2310-year certain withand joint and survivor annuity. Lump sums are also available under the Pension Plan and Excess Plan if under $10,000. Participants in the Pension Plan hired on or after June 1, 2004 may elect to receive payments as follows: single life annuity, joint and survivor annuity, and jointlump sum. The lump sum payable to employees hired on or after June 1, 2004 cannot be less than the sum of 2.0% of salary excluding bonuses (up to the applicable Code limits) for each plan year in which the participant’s years of continuous service is fewer than five, plus 2.5% of salary (up to the applicable Code limits) for each plan year in which the participant’s years of continuous service is five or greater. Currently, Mr. Letham and contingent annuity. Currently, TerranceMr. Faber and Dennis Letham are eligible to receivefor early retirement payments under the Pension Plan and the Excess Plan.
24when he retirescommencing at age 65 equal to 50% of his Final Average Pay, offset by the monthly retirement benefits payablepaid to him under Social Security, the Pension Plan and Excess Plan. Mr. Grubbs can electhas made an irrevocable election to commence receiving his benefits as early as his retirement at age 54 in1/2, which caseactuarially reduces his SERP benefit will be actuarially reduced (using the factors set forth in the Pension Plan), subject to a minimum annual benefit of $550,000. Mr. Grubbs has waived payment of his Excess Plan benefit, so his SERP benefit will not include an offset for Excess Plan benefits.at his retirementcommencing at age 65 equal to 50% of his Final Average Pay, offset by the monthly retirement benefits payable to him under Social Security, the Pension Plan and Excess Plan. Mr. Letham can electhas made an irrevocable election to commence receiving hisreceive benefits as early as hisupon retirement. Retirement prior to age 65 will actuarially reduce Mr. Letham’s retirement at age 55, in which case his retirement benefit will be actuarially reducedbenefits (using the factors set forth in the Pension Plan). BenefitsSERP benefits vest over a five year period. Currently, Mr. Letham is eligible to receive early retirement benefits under the SERP.117 to the Company’s Consolidated Financial Statements contained in the Company’s 2007 2008Form 10-K.20072008 NONQUALIFIED DEFERRED COMPENSATION Executive Registrant Aggregate Aggregate Aggregate Contributions Contributions Earnings in Withdrawals/ Balance at in Last in Last Last Distributions Last Name FY ($)(1) FY ($) FY ($)(2) ($) FYE ($)(3) Robert W. Grubbs 0 0 119,610 0 1,458,651 Dennis J. Letham 0 0 165,241 0 2,015,123 Robert J. Eck 76,594 0 49,384 0 608,654 John A. Dul 75,500 0 28,623 0 355,379 Terrance A. Faber 0 0 3,607 0 43,987 Executive Registrant Aggregate Aggregate Aggregate Contributions Contributions Earnings in Withdrawals/ Balance at in Last in Last Last Distributions Last FY ($)(1) FY ($) FY ($)(2) ($) FYE ($)(3) Robert W. Grubbs 0 0 83,413 0 1,542,064 Robert J. Eck 103,750 0 48,444 0 760,848 Dennis J. Letham 0 0 139,686 0 2,154,809 John A. Dul 72,710 0 29,016 0 457,106 Terrance A. Faber 0 0 3,049 0 47,036 Rodney A. Smith 81,660 0 5,660 0 97,982 (1) These amounts are reflected in the Summary Compensation Table, either as “Salary” or, “Non-Equity Incentive Plan Compensation.Compensation” or “Bonus.” (2) The following amounts are reflected as above market earnings in the “Change in Pension Value”Value and “NonqualifiedNonqualified Deferred Compensation Earnings” column of the Summary Compensation Table: Mr. Grubbs $27,656;$12,873; Mr. Eck $9,050; Mr. Letham $38,207; Mr. Eck $11,543;$25,619; Mr. Dul $6,741;$5,438; Mr. Faber $559 and Mr. Faber $834.Smith $1,168. (3) The following amounts have been reported as compensation in this or prior years’ Summary Compensation Tables: Mr. Grubbs $801,450;$814,322; Mr. Eck $235,082; Mr. Letham $1,034,979; Mr. Eck $88,137;$1,060,598; Mr. Dul $281,455;$359,602; Mr. Faber $30,991 and Mr. Faber $30,431.Smith $92,729.242007,2008, the
256.82%5.62%. Active participants are eligible to receive an enhanced crediting rate of up to one-half percentage point per quarter if the Company exceeds certain quarterly performance goals. The enhanced crediting rate is credited at the end of each eligible calendar quarter. Participants must be employed for at least one-half the quarter to be eligible for this enhanced rate. In 2007, the maximum2008, full or partial enhanced crediting rate was paid.paid in three out of four quarters.death, or terminations within 48 months of a change in control of the Company.death. At the time they make their deferral election, participants also elect the form and time of distribution. Retirement and disability payment options are: lump sum, monthly installments or a combination of lump sum and monthly installments. For pre-2005 deferrals, the number of monthly installments may not exceed 120. For post-2004 deferrals, the number of monthly installments may not exceed 180. For all other terminations, participants receive a lump sum on the first of the calendar year two years following employment termination.termination, provided deferrals have been in the DCP for five years. Participants terminating prior to age 55 may elect to defer receipt of pre-2005 balancesdeferrals to a specified date not later than age 55. Pre-2005 deferrals are eligible for an accelerated distribution at any time, subject to a 10% penalty. Post-2004 deferrals have no such accelerated distribution allowance. A participant may receive early distribution without penalty by providing evidence of severe financial hardship.become effectivemust be made at least two calendar years afterprior to the election changecurrent distribution date for pre-2005 deferrals. For post-2004 deferrals, the election may be changed up to 12 months prior to the scheduled distribution,date any amount is distributable, provided that any change must defer the distribution for at least five years beyond the date of the currently scheduled distribution. Executive Registrant Aggregate Aggregate Aggregate Contributions Contributions Earnings in Withdrawals/ Balance at in Last in Last Last Distributions Last Name FY ($) FY ($) FY ($) ($) FYE ($) Robert W. Grubbs 1,209,800 (1) 0 49,140 (2) 244,910 (3) 1,505,507 (4) Dennis J. Letham 524,267 (1) 0 21,581 (5) 112,768 (3) 657,930 (6) Robert J. Eck 0 0 1,720 (7) 29,301 (3) 33,991 (8) John A. Dul 0 0 1,766 (7) 29,042 (3) 34,433 (9) Terrance A. Faber 0 0 1,633 (7) 26,336 (3) 31,919 (10) Aggregate Executive Registrant Earnings Aggregate Aggregate Contributions Contributions (Loss) in Withdrawals/ Balance at in Last in Last Last Distributions Last FY ($) FY ($) FY ($) ($) FYE ($) Robert W. Grubbs 2,494,367 (1) 0 (2,108,495 )(2) 1,798,676 (3) 92,703 (4) Robert J. Eck 0 0 692 (5) 22,322 (6) 12,361 (7) Dennis J. Letham 962,214 (1) 0 (459,499 )(8) 647,091 (9) 513,554 (10) John A. Dul 0 0 726 (5) 22,029 (6) 13,130 (11) Terrance A. Faber 0 0 677 (5) 20,235 (6) 12,361 (12) (1) (1) Represents the value of the restricted stock units that vested in 2008 but conversion to common stock was deferred pursuant to the named executive officer’s advance election, based on the average of the high and low sales prices of the underlying common stock on the date of the vesting. These amounts were or areFor Mr. Grubbs, $803,927 of the amount shown was expensed by the Company in 2008 and is reported in the “Stock Awards” column of the Summary Compensation Table.Table in this Proxy Statement. For Mr. Letham, $293,670 of the amount shown was expensed by the Company in 2008 and is reported in the “Stock Awards” column of the Summary Compensation Table in this Proxy Statement. (2) (2) Includes unrealized appreciationrealized depreciation on conversion of 2007 and 2008 deferred restricted stock units of $35,600 from the date$2,113,714 and $5,219 of deferral through December 28, 2007,interest credited on unpaid dividend equivalents allocated to unvested restricted stock units, neither of which is not reported on the Summary Compensation Table in this Proxy Statement.(3) Includes distribution of executive contributions of $3,704,167 and $13,540realized depreciation of $2,078,114 (net of 2007 unrealized appreciation of $35,600) on conversion of 2007 and 2008 deferred restricted stock units as well as dividend equivalents and related interest of $172,623 on restricted stock units that vested during fiscal 2008.
26(4) Includes dividend equivalents allocated to unvested restricted stock units of $80,000 and interest credited on the unvested dividend equivalents of $12,703, neither of which was reported on the Summary Compensation Table of this Proxy Statement. (5) Represents interest credited on dividend equivalents allocated to unvested restricted stock units, which is not reported on the Summary Compensation Table.Table in this Proxy Statement. (6) (3) Includes payment of dividend equivalents and related interest on restricted stock units that vested during fiscal 2007.year 2008. (7) (4) Includes executive contributions of $1,209,800 (reported on the Summary Compensation Table), dividend equivalents allocated to unvested restricted stock units of $233,333 (not reported on the Summary Compensation Table), interest credited on the unvested dividend equivalents of $26,774 (reported on the Summary Compensation Table) and unrealized appreciation of $35,600 on the deferred stock units (not reported on the Summary Compensation Table).25(5) Includes unrealized appreciation on stock units of $15,427 from the date of deferral through December 28, 2007, which is not reported on the Summary Compensation Table, and $6,154 of interest credited on dividend equivalents allocated to unvested restricted stock units, which is reported on the Summary Compensation Table.(6) Includes executive contributions of $524,267 (reported on the Summary Compensation Table), dividend equivalents allocated to unvested restricted stock units of $106,000 (not reported on the Summary Compensation Table), interest credited on the unvested dividend equivalents of $12,236 (reported on the Summary Compensation Table) and unrealized appreciation of $15,427 on the deferred stock units (not reported on the Summary Compensation Table).(7) Represents interest credited on dividend equivalents allocated to unvested restricted stock units, which is reported on the Summary Compensation Table.(8) Includes dividend equivalents allocated to unvested restricted stock units of $30,500 (not reported on the Summary Compensation Table)$10,668 and interest credited on the unvested dividend equivalents of $3,491$1,693, neither of which was reported on the Summary Compensation Table in this Proxy Statement.(8) Includes unrealized depreciation on stock units of $488,832 from the date of deferral through January 2, 2009, $27,041 of realized appreciation on conversion of 2007 deferred restricted stock units and $2,292 of interest credited on dividend equivalents allocated to unvested restriction units, none of which were reported on the Summary Compensation Table in this Proxy Statement. (9) Includes distribution of executive contributions of $524,267, realized appreciation of $42,468 on conversion of 2007 deferred restricted stock units as well as dividend equivalents and related interest of $80,356 on restricted stock units that vested during fiscal year 2008. (10) Includes executive contributions of $962,214 (reported on the Summary Compensation Table).Table of this Proxy Statement), dividend equivalents allocated to unvested restricted stock units of $34,668, interest credited on unvested dividend equivalents of $5,504 and unrealized depreciation of $488,832 on the deferred stock units, none of which were reported in the Summary Compensation Table in this Proxy Statement. (11) (9) Includes dividend equivalents allocated to unvested restricted stock units of $30,916 (not reported on the Summary Compensation Table)$11,332 and interest credited on the unvested dividend equivalents of $3,517 (reported on$1,798, neither of which was reported in the Summary Compensation Table).Table in this Proxy Statement. (10) (12) Includes dividend equivalents allocated to unvested restricted stock units of $28,667 (not reported on the Summary Compensation Table)$10,668 and interest credited on the unvested dividend equivalents of $3,252 (reported on$1,693, neither of which was reported in the Summary Compensation Table).Table in this Proxy Statement.One-thirdGenerally, one-third of the units vests during employment on each anniversary of the grant date beginning with the second anniversary of the grant date. In connection with Mr. Grubbs’ retirement, his 2008 restricted stock unit vested in full on June 30, 2008. His remaining grants continue to vest per their terms. Units generally convert to an equal number of unrestricted shares of common stock on the date they vest and are paid to the holder of the unitunits at such time. Holders of restricted stock units are credited with dividend equivalents at the time dividends are paid. The deferred dividend equivalents are credited annually with interest at a rate equal to 5% per year until the units vest, at which time the dividend equivalents and accrued interest are paid to the executive. The interest credited on the unvested portion of executives’ stock units is reflected in the “Aggregate Earnings in Last FY” column above.
2726AgreementsAgreement with Mr. Grubbs and Mr. Letham that provideprovides benefits upon certain terminations of employment, including termination following a change in control of the Company. These benefits are in addition to the benefits to which theyhe would be entitled upon a termination of employment generally, such as the vested retirement benefits described in the Pension Benefits and Nonqualified Deferred Compensation Sectionssections of this Proxy Statement, and stock options and restricted stock units that have vested prior to termination.Agreements IfAgreement, although as discussed below, the executiveterms of his Separation Agreement provide for certain benefits.the executive’shis employment for other than cause, the executivehe is entitled to the following benefits: (i) payment of a pro rata portion of his bonus for the year in which termination occurs, (ii) payment of his salary for the next two years, (iii) payment of a termination bonus equal to the sum of the bonuses paid to the executivehim for the two fiscal years preceding the fiscal year in which the termination occurs, (iv) any restricted stock units and stock options that would have vested during the180-day period following the date of termination will be deemed vested as of such termination date, and (v) his medical insurance coverage under the group health plan will continue for two years after termination (or if earlier, until he is eligible for coverage under a group health plan of another employer), with COBRA coverage available at the end of the second year. In addition, if such termination of employment occurs within two years of a change in control of the Company, all of the executive’sMr. Letham’s restricted stock units and stock options and any unvested portion of the SERP will vest immediately. The amounts due to the executiveMr. Letham as described above shall be limited if such payments would constitute “excess parachute payments” within Section 280G of the Internal Revenue Code, so that the executiveMr. Letham shall not receive benefits greater than 333% of the “base amount” (as defined in Section 280G of the Code) or 299.99% of the “base amount” plus $100,000.Agreements: • A change of control will occur if any third person (other than Samuel Zell and his affiliates) acquires more than 50% of the Common Stock of the Company, there is a stockholder approved complete liquidation or dissolution of the Company, there is a sale of all or substantially all the assets of the Company, there is a merger, consolidation or similar event and 50% or less of the outstanding common stock prior to such event is held by the same persons after the event, or if the majority of the directors of the Company is comprised of individuals who were not directors on January 1, 2006 or were not nominated by the previous Board. • Good reason includes a material breach of the agreement by the Company, a material adverse change in the executive’s title orMr. Letham’s authority, the assignment to the executiveMr. Letham of duties which are inconsistent with the duties historically defined, changinga change to whom the executiveMr. Letham reports, and the relocation of the Company’s principal business office to more than 100 miles from its current location within two years of a change in control. • Cause includes illegal or unethical acts or omissions by the executiveMr. Letham that could materially injure the Company or that the Board determines to be a detriment to the executive’sMr. Letham’s position or his ability to perform, willful and material breach of executive’shis fiduciary obligations or of the contract,agreement, or willful failure or refusal to follow the lawful and good faith directions of the Board. Each agreementperiod.period for Mr. Letham. The restrictive covenants prohibit the executiveMr. Letham from (i) the solicitationsoliciting for employment of any Company employees or former employees employed within six months of the solicitation, (ii) directly or indirectly engaging or assisting any person in engaging in any activities competitive to the Company, (iii) attempting to divert, solicit or assist others in soliciting a current or prospective customer, supplier, contractor or service provider of Company or an affiliate and (iv) making any critical or disparaging comments about the Company or an affiliate.
2827the executivesMr. Letham pursuant to his Employment Agreement assuming a qualifying termination of employment occurred at fiscal year end. Termination Payments Robert W. Grubbs Dennis J. Letham — Pro-Rata Bonus $ 1,394,348 $ 563,496 — Salary 1,950,000 930,000 — Termination Bonus 2,400,000 1,055,925 — Vesting of all options/units 10,815,427 4,348,314 — Medical Insurance 12,938 7,995 — Accelerated Vesting of SERP 1,697,292 348,190 — Pro-Rata Bonus $ 1,394,348 $ 563,496 — Salary 1,950,000 930,000 — Termination Bonus 2,400,000 1,055,925 — Vesting of options/units that vest within 180 days of termination 3,205,597 1,331,457 — Medical Insurance 12,938 7,995 Dennis J. Letham — Pro rata Bonus $ 196,875 — Salary 1,000,000 — Termination Bonus 1,094,746 — Vesting of options/units that vest within 180 days of termination 565,742 — Group Health Plan 11,552 — Pro rata Bonus $ 196,875 — Salary 1,000,000 — Termination Bonus 1,094,746 — Vesting of all options/units 939,718 — Group Health Plan 11,552 — Accelerated Vesting of SERP 174,583 (1) Termination for good reason by Mr. Letham or without cause by the executiveCompany at any time. Includes 12 months’ pro rata bonus valued at full value actually received for 2008; two years payment of salary; termination bonus equal to the two bonuses actually paid prior to fiscal year end; the value of the vesting of any unvested stock units and options that would occur within 180 days of termination; and the Company’s portion of two years of group health plan coverage. The vesting of the unvested stock units is valued at the year end closing price for the Company’s common stock. The vesting of the unvested options is valued at the difference between the exercise price and the year end closing price of the Company’s common stock.(2) Termination for good reason by Mr. Letham or without cause by the Company within two years following a change in control of the Company. Includes 12 months’ pro rata bonus valued at full value actually received for 2007,2008; two years’years payment of salary,salary; termination bonus equal to the two bonuses actually paid prior to fiscal year end,end; the value of the vesting of all unvested stock units and optionsoptions; the Company’s portion of two years of group health plan coverage and the accelerated vesting of the SERP. The vesting of the unvested stock units is valued at the year end closing price for the Company’s common stock, the Company’s portion of two years of medical coverage and the acceleratedstock. The vesting of the SERP.unvested options is valued at the difference between the exercise price and the year end closing price of the Company’s common stock. The amounts for accelerated vesting of the SERP represent the difference between the present value of payments to be received under the SERP if fully vested, less the benefit accrued as of fiscal year end, using the valuation assumptions used for financial statement reporting purposes in the Company’s 20072008 Form10-K.(2) Termination for good reason by the executive or without cause by Company at any time. Includes 12 months’ pro rata bonus valued at full value actually received for 2007, two years’ payment of salary, termination bonus equal to the two bonuses actually paid prior to fiscal year end, the value of the vesting of any unvested stock units and options that would occur within 180 days of termination, valued at the year end closing price for the Company’s common stock and the Company’s portion of two years of medical coverage.medicalgroup health plan coverage is paid directly by the Company. An amount equal to 25% of the termination bonus and salary is payable on the seventh month following termination, and 4.266667% of such amount is payable each month thereafter, ending 24 months after termination. (IfIf payments are not subject to Code Section 409A(a)(2)(B)(i), then payments are made in 24 equal monthly installments beginning on the first day of the month following termination.)
2928 Fees Earned or Paid in Cash Stock Awards Name ($) ($)(2) Total ($) Lord James Blyth 0 147,558 147,558 Linda Walker Bynoe 0 174,602 174,602 Robert L. Crandall 0 178,378 178,378 F. Philip Handy 0 153,891 153,891 Melvyn N. Klein 71,500 125,151 196,651 George Muñoz 0 174,602 174,602 Stuart M. Sloan 0 147,609 147,609 Thomas C. Theobald 0 150,115 150,115 Matthew Zell 0 135,094 135,904 Samuel Zell 0 200,121 200,121 Fees Earned or Paid in Cash Stock Awards ($) ($)(2) Total ($) Lord James Blyth 0 150,146 150,146 Linda Walker Bynoe 0 188,125 188,125 Robert L. Crandall 0 193,086 193,086 Robert W. Grubbs 0 65,093 65,093 F. Philip Handy 0 162,649 162,649 Melvyn N. Klein 78,000 125,105 203,105 George Muñoz 0 188,125 188,125 Stuart M. Sloan 0 157,689 157,689 Thomas C. Theobald 0 157,689 157,689 Matthew Zell 0 137,655 137,655 Samuel Zell 0 300,149 300,149 (1) Directors who are employees of the Company are not compensated for their Board service. Mr. Grubbs received the above compensation after his retirement from Company employment on June 30, 2008. Amounts shown include (i) $2,500 for each Board, Compensation Committee and Nominating and Governance Committee meeting attended and a $5,000 annual retainer for the chair of each such committee, (ii) $3,500 for each Audit Committee meeting attended and a $10,000 annual retainer for the chair of the Audit Committee and (iii) an annual retainer of $125,000, except for the Chairman of the Board who received an annual retainer of $200,000.$300,000. The Chairman of the Board does not receive any fees for meetings attended. Annual retainers are paid in vested stock units; each director may elect to receive meeting fees and chair retainers in cash or in stock units. The annual retainer and any chair retainers elected to be received in stock units are paid quarterly in stock units by dividing one-fourth of the amount due by the closing price of the common stock on the last trading day before the grant date. Any meeting fees elected to be received in stock units are paid at the beginning of the next calendar quarter using the closing price of the underlying common stock on the last trading day before the grant date. The stock units convert to Common Stock at a pre-arranged time selected by each director.director prior to the grant date. Due to rounding of stock unit grants upward to whole numbers, amounts reflected above slightly exceed the stated compensation. Any amounts elected to be received in cash are paid quarterly as earned. The Company expenses the units awarded completely in the year of grant. In 2008, the Company had a 53-week fiscal year, ending January 2, 2009 and therefore a fifth quarterly stock grant was made within fiscal year 2008. To maintain comparability from year-to-year, the fifth grant and any cash payments related to a fifth quarterly period will be reported in next year’s proxy statement. Meeting fees related to 2007 but paid in 2008 in cash or stock units are shown.
30(2) Amounts shown were calculated in accordance with FAS 123(R) and reflect the Company’s expense in 2008 with respect to stock units granted. The following stock awards were outstanding at fiscal year end for each non-employee director: Vested Outstanding Stock Units not Converted to Stock Lord James Blyth 33,84837,584 Linda Walker Bynoe 5,1919,299 Robert L. Crandall 24,39029,268Robert W. Grubbs 2,298 F. Philip Handy 7,19810,889 Melvyn N. Klein 12,64015,720 George Muñoz 6,80711,645 Stuart M. Sloan 6,43210,540 Thomas C. Theobald 6,4708,464 Matthew Zell 18,05021,419 Samuel Zell 29,40036,790 292007.December 28, 2007,January 2, 2009, no person who is or was formerly an officer or employee of the Company or any of its subsidiaries served as (i) a member of the Compensation Committee; (ii) a member of the compensation committee (or other board committee or full board performing equivalent functions) of another entity, one of whose executive officers served on the Board of Directors of the Company; or (iii) a director of another entity, one of whose executive officers served on the Board of Directors of the Company.
3121, 2008,20, 2009, certain information with respect to the Common Stock that may be deemed to be beneficially owned (including options exercisable within 60 days) by each director or nominee for director of the Company, the officers named in the Summary Compensation Table and by all directors and officers as a group. Options Common for Common Percent Name of Beneficial Owner(1) Stock Stock Total of Class Lord James Blyth 34,390 (2) — 34,390 * Linda Walker Bynoe 7,926 (3) — 7,926 * Robert L. Crandall 27,145 (4) — 27,145 * F. Philip Handy 86,636 (5) — 86,636 * Melvyn N. Klein 45,542 (6) — 45,542 * George Muñoz 10,950 (7) — 10,950 * Stuart Sloan 69,997 (8) — 69,997 * Thomas C. Theobald 68,410 (9) — 68,410 * Matthew Zell 24,092 (10) — 24,092 * Samuel Zell 4,959,002 (11) — 4,959,002 13.9 (12) Robert W. Grubbs 219,715 (13) 517,424 737,139 2.0 (12) Dennis J. Letham 131,707 (14) 294,554 426,261 1.2 (12) Robert J. Eck 34,338 (15) 35,946 70,284 * John A. Dul 24,201 (16) 26,906 51,107 * Terrance A. Faber 20,425 (17) 14,740 35,165 * All directors and executive officers as a group including the above named persons 5,798,069 925,836 6,723,905 18.4 (12) Options Common for Common Percent Stock Units(2) Stock Stock(3) Total(4) of Class Lord James Blyth 37,584 — — 0 * Frederic F. Brace (director nominee) — — — 0 * Linda Walker Bynoe 9,299 2,000 (5) — 2,000 * Robert L. Crandall 29,268 2,000 — 2,000 * Robert W. Grubbs 34,117 146,461 244,242 390,703 1.1 % F. Philip Handy 10,889 78,795 — 78,795 * Melvyn N. Klein 15,720 32,400 — 32,400 * George Muñoz 11,645 3,608 — 3,608 * Stuart Sloan 10,540 62,942 — 62,942 * Thomas C. Theobald 8,464 65,933 (6) — 65,933 * Matthew Zell 21,419 12,500 — 12,500 * Samuel Zell 36,790 4,928,397 (7) — 4,928,397 14.0 % Robert J. Eck 49,858 13,533 39,744 53,277 * Dennis J. Letham 75,720 103,853 256,429 360,282 1.0 % John A. Dul 13,026 13,603 23,176 36,779 * Terrance A. Faber 22,242 12,045 17,767 29,812 * Rodney A. Smith 11,233 1,029 — 1,029 * All directors and executive officers as a group including the above named persons 419,378 5,493,929 616,454 6,110,383 15.3 % * *Percentage of shares beneficially owned does not exceed one percent of the class. (1) (1) Unless otherwise indicated, each person included in the group has sole investment power and sole voting power with respect to the securities beneficially owned by such person. (2) (2) Includes 34,390 common stock units which convert to Common Stockfully vested common stock on a 1 for 11-for-1 basis at thea time determined whenprearranged prior to grant. None of the stock units were granted.listed will convert within 60 days. (3) (3) Includes 5,926All options are exercisable. No other options will become exercisable within 60 days.(4) Totals presented in this column include common stock units which convert to Common Stock on a 1and options for 1 basis at the time determined when thecommon stock units were granted andbut do not include any stock units.(5) Includes 2,000 shares owned by Ms. Bynoe’s husband to which Ms. Bynoe disclaims beneficial ownership. (6) (4) Includes 25,145 common stock units which convert to Common Stock on a 1 for 1 basis at the time determined when the stock units were granted.(5) Includes 7,841 common stock units which convert to Common Stock on a 1 for 1 basis at the time determined when the stock units were granted.30(6) Includes 13,142 common stock units which convert to Common Stock on a 1 for 1 basis at the time determined when the stock units were granted.(7) Includes 7,542 common stock units which convert to Common Stock on a 1 for 1 basis at the time determined when the stock units were granted.(8) Includes 7,055 common stocks units which convert to Common Stock on a 1 for 1 basis at the time determined when the stock units were granted.(9) Includes 7,093 common stocks units which convert to Common Stock on a 1 for 1 basis at the time determined when the stock units were granted4,500 shares owned by Mr. Theobald’s adult children and 3,00 shares1,500 held in trustcustody account for childrena child, to which Mr. Theobald disclaims beneficial ownership.(10) Includes 18,592 common stocks units which convert to Common Stock on a 1 for 1 basis at the time determined when the stock units were granted. (11) (7)The shares of Common Stock shown in this table include: 1,000 shares held by the Helen Zell Revocable Trust, the trustee of which is Helen Zell, spouse of Mr. Zell; 4,647,147 of such shares are owned by Samstock/SIT, L.L.C., which is held by trusts established for the benefit of Mr. Zell and his family (the “Zell Trusts”). 55,588 of such shares are owned by Samstock/ZFT, L.L.C., whose sole member is ZFT Partnership, of which the general partners are the Zell Trusts. 55,587 shares are owned by Samstock/Alpha, L.L.C., whose sole member is Alphabet Partners, of which the general partners are the Zell Trusts. 28,700 of such shares are owned by SZ Intervivos QTIP Trust. The trustee of the Zell Trusts and the SZ Intervivos QTIP Trust is Chai Trust Company, L.L.C.LLC (“Chai Trust”). Mr. Zell is not an officer or director of Chai Trust and does not have voting or dispositive power over such common shares. Mr. Zell is the sole trustee and beneficiary of the Samuel Zell Revocable Trust; and 169,075140,375 shares and 30,605 common stock units are owned directly by Mr. Zell. Common stock units convert to Common Stock on a 1 for 1 basis at(Also, see the time determined when the stock units were granted. (See “SecuritySecurity Ownership of Principal Stockholders” below).Stockholders Table in this Proxy Statement.) Of these shares, 4,702,7344,758,322 shares are pledged.(12) All options exercisable within 60 days of the date of this table which may be deemed to be beneficially owned by the person or persons for whom the calculation is being made are deemed to have been exercised for the purposes of calculating this percentage.(13) Includes 140,301 common stock units which convert to Common Stock on a 1 for 1 basis at the time determined when the stock units were granted.(14) Includes 52,504 common stock units which convert to Common Stock on a 1 for 1 basis at the time determined when the stock units were granted.(15) Includes 24,229 common stock units which convert to Common Stock on a 1 for 1 basis at the time determined when the stock units were granted.(16) Includes 14,286 common stock units which convert to Common Stock on a 1 for 1 basis at the time determined when the stock units were granted.(17) Includes 10,975 common stocks units which convert to Common Stock on a 1 for 1 basis at the time determined when the stock units were granted.
323121, 200820, 2009 with respect to each person who is known by the management of the Company to be the beneficial owner of more than 5% of the outstanding shares of Common Stock. Unless otherwise indicated, the beneficial owner has sole voting and investment power. Title Name and Address of Amount and Nature of Percent Common Ariel Capital Management LLC 4,967,450 (1) 14.1% 200 East Randolph Drive, Suite 2900 Chicago, IL 60601 Common Samstock/SIT, L.LC. 4,647,147 (2) 14.0% Samstock/ZFT, L.L.C. 55,588 Samstock/Alpha, L.L.C. 55,587 SZ Intervivos QTIP Trust 28,700 Samuel Zell 141,375 Two North Riverside Plaza Chicago, IL 60606 Common Lord, Abbett Co. L.L.C. 4,009,564 (3) 11.4% 90 Hudson Street Jersey City, NJ 07302 Common Neuberger Berman LLC 3,593,267 (4) 10.2% 605 Third Avenue New York, NY 10158 Common Barclays Global Fund Advisors 1,300,803 (5) 5.4% Barclays Global Investors, NA. 584,430 400 Howard Street San Francisco, CA 94105 Barclays Global Investors, Ltd. 20,106 1 Royal Mint Court London, EC2N 4HH TitleName and Address ofAmount and Nature ofPercentof ClassBeneficial OwnerBeneficial Ownershipof ClassCommonAriel Capital Management LLC6,792,432(1)19.1%200 East Randolph DriveSuite 2900Chicago, Illinois 60601CommonSamstock/SIT, L.L.C.4,647,147(2)13.9%Samstock/ZFT, L.L.C.55,588(2)Samstock/Alpha, L.L.C.55,587(2)Samuel Zell200,680(2)Two North Riverside PlazaChicago, Illinois 60606CommonLord, Abbett & Co. L.L.C.3,882,638(3)10.9%90 Hudson StreetJersey City, NJ 07302CommonNeuberger Berman LLC2,486,290(4)7.0%605 Third AvenueNew York, NY 10158(1) According to a Schedule 13G, dated February 12, 2008,13, 2009, Ariel Capital Management LLC has sole power to vote 5,451,2224,365,180 shares and sole power to dispose of 6,777,5324,967,450 shares. (2) Samstock/ SIT, L.L.C. is a limited liability company whose sole member is Sam Investment Trust, whose trustee is Chai Trust Company, L.L.C., a limited liability company (“Chai Trust”). The beneficiaries of Sam Investment Trust are Samuel Zell and members of his family. Samstock/ZFT, L.L.C. is a limited liability company whose sole member is ZFT Partnership, an Illinois general partnership, whose sole partners are various trusts for the benefit of Samuel Zell and members of his family (the “Zell Trusts”). Samstock/Alpha, L.L.C. is a limited liability company whose sole member is Alphabet Partners, an Illinois general partnership, whose sole partners are the Zell Trusts. The trustee of all of the Zell Trusts and the SZ Intervivos QTIP Trust is Chai Trust. Mr. Zell is not an officer or director of Chai Trust and does not have voting or dispositive power over such shares. The amounts shown for Mr. Zell include 1,000 shares held by Helen Zell Revocable Trust to which Mr. Zell disclaims beneficial ownership and 30,605 commonownership. The total does not include 36,790 restricted stock units.units owned by Mr. Zell. (3) According to a Schedule 13G, dated February 14, 2008,13, 2009 Lord, Abbett & Co. L.L.C. has sole power to vote 3,669,7863,636,191 shares and sole power to dispose of 3,882,6384,009,564 shares. (4) According to a Schedule 13G, dated February 13, 2008,12, 2009, Neuberger Berman LLC has sole power to vote 371,580579,597 shares, and shared power to vote 2,001,3952,628,785 shares and shared power to dispose of 2,486,2903,593,267 shares.(5) According to Schedule 13G, dated February 5, 2009, Barclays Global Fund Advisors has sole power to vote 959,213 shares and sole power to dispose 1,300,803 shares; Barclays Global Investors, NA has sole power to vote 484,622 shares and sole power to dispose of 584,430 shares; and Barclays Global Investors, Ltd. has sole power to vote 855 shares and sole power to dispose of 20,106 shares.
33December 28, 2007,January 2, 2009, the Company sold $0.3 million$300,000 of products and paid approximately $240,000 for services to an entity with a presence in the foreign country (the “Reseller”). The Reseller will resell such products to local contractors working on the project. Our Chairman, Samuel Zell, holds an indirect pecuniary interest in an entity which holds approximately 20 percent of the outstanding stock of the Reseller. As a result of this indirect pecuniary interest, Mr. Zell may be deemed to have an interest in the sales value of these transactions. Profits accruing to the benefit of the Reseller overall were de minimis. Total sales to the Reseller over the life of the project were approximately $1.6 million.3220072008 were approximately $130.0 million.$129.4 million, only a portion of these sales result in a commission to the Representatives. Total Company sales into regions for which the Representatives may receive a commission were approximately $23.3$25.6 million.2008.2009. Ernst & Young LLP (and predecessor firm) have audited the Company’s financial statements since 1980. Representatives of Ernst & Young LLP, who are expected to be present at the meeting, will be given an opportunity to make a statement if they so desire and to respond to appropriate questions asked by stockholders. and approximately $3,061,500 in 2006, including fees associated with the annual audit, reviews of the Company’s quarterly reports onForm 10-Q, other SEC filings and statutory audits of foreign subsidiaries, and the audit of management’s assessment and Report on Internal Control Over Financial Reporting required by Section 404 of the Sarbanes-Oxley Act of 2002.$3,000$45,000 in 20072008 and approximately $3,000 in 2006.2007 and approximately $361,100 in 2006.20072008 or 2006.2007.
3433 Number of Securities Number of Remaining Available for Securities to be Weighted-Average Future Issuance Under Issued Upon Exercise Exercise Price of Equity Compensation Plans of Outstanding Outstanding Options, (Excluding Securities Options, Warrants Warrants and Reflected in the First and Rights(1) Rights(2) Column)(3) Equity compensation plans approved by security holders 2,390,945 $ 34.65 1,230,340 Equity compensation plans not approved by security holders 115,388 $ 21.54 0 Total 2,506,333 $ 33.78 1,230,340 (1) The number shown is the number of shares that, as of January 2, 2009, may be issued upon exercise of 1,729,847 outstanding options and vesting of 776,486 restricted stock units under the 2001 and 2006 Stock Incentive Plans. (2) Weighted-average exercise price of outstanding stock options (excludes restricted stock units, which vest at no cost to participants). (3) The number shown is the number of shares that, as of January 2, 2009, may be issued upon exercise of options and other equity awards that may be granted in the future under the Plans. 2007.2008, except for one Form 4 filing by Mr. Grubbs, reporting one transaction, which was late due to an oversight by the Company.
3520092010 Annual Meeting of Stockholders must be received by the Company at its principal offices by December 8, 20082009 in order to be considered for inclusion in the Company’s Proxy Statement and Proxy relating to the 20092010 Annual Meeting of Stockholders. In order for other business to be considered at the 20092010 Annual Meeting of Stockholders, it must be received by the Company on or before March 29, 2009.
36April 8, 2008By Orderc/o National City Bank Shareholder Services Operations Locator 5352 P. O. Box 94509 Cleveland, OH 44101-4509 IMPORTANT NOTICE REGARDING AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 12, 2009. The 2009 Proxy Statement is available at www.anixter.com/SECDocuments The 2008 Annual Report is available at www.anixter.com/AnnualReports YOUR VOTE IS IMPORTANT Regardless of whether you plan to attend the Annual Meeting of Stockholders, you can be sure your shares are represented at the meeting by promptly returning your proxy in the enclosed envelope.Please fold and detach card at perforation before mailing. ANIXTER INTERNATIONAL INC. Proxy Solicited by and On Behalf of the Board of DirectorsJOHN The undersigned hereby appoints John A. DUL,SecretaryDul, Dennis J. Letham and Robert J. Eck and each of them (with full power of substitution in each) proxies of the undersigned to vote at the Annual Meeting of Stockholders of Anixter International Inc. to be held at 8:30 A.M., Central time, May 12, 2009, at Two North Riverside Plaza, 24th Floor, Chicago, Illinois, and at any adjournment thereof, all of the shares of Common Stock of Anixter International Inc. in the name of the undersigned on the record date. Dated: , 2009 Signature (Signature if held jointly) IMPORTANT: Please date this proxy and sign exactly as your name appears hereon. If stock is held jointly, both holders should sign. Executors, administrators, trustees, guardians and others signing in a representative capacity should give full title. PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY IN THE ENCLOSED ENVELOPE.34 c/o National City Bank Corporate Trust Operations Locator 5352 P. O. Box 94509 Cleveland, OH 44101-4509IMPORTANT NOTICE REGARDING AVAILABILITY OF PROXY MATERIALSFOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 13, 2008.The 2008 Proxy Statement is available atwww.anixter.com/axecom/US.NSF/InvestorRelations/SECDocumentsThe 2007 Annual Report is available atwww.anixter.com/axecom/US.NSF/InvestorRelations/AnnualReportsYOUR VOTE IS IMPORTANTRegardless of whether you plan to attend the Annual Meeting of Stockholders, you can be sure yourshares are represented at the meeting by promptly returning your proxy in the enclosed envelope.âPlease fold and detach card at perforation before mailing.âANIXTER INTERNATIONAL INC.Proxy Solicited by and On Behalf of the Board of DirectorsThe undersigned hereby appoints John A. Dul, Dennis J. Letham and Robert W. Grubbs and each of them (with full power of substitution in each) proxies of the undersigned to vote at the Annual Meeting of Stockholders of Anixter International Inc. to be held at 8:30 A.M., Central time, May 13, 2008, at Two North Riverside Plaza, 24th Floor, Chicago, Illinois, and at any adjournment thereof, all of the shares of Common Stock of Anixter International Inc. in the name of the undersigned on the record date.Dated:, 2008Signature(Signature if held jointly)IMPORTANT: Please date this proxy and sign exactly as your nameappears hereon. If stock is held jointly, both holders should sign. Executors, administrators, trustees, guardians and others signing in a representative capacity should give full title.PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY IN THE ENCLOSED ENVELOPE.ELECTRONIC ACCESS TO FUTURE DOCUMENTSNOW AVAILABLEAnixter International Inc. (the “Company”) provides its annual reports and proxy solicitation materials, including notices to stockholders of annual meetings and proxy statements, over the Internet. If you give your consent to access these documents over the Internet, the Company will advise you when these documents become available on the Internet. Providing these documents over the Internet will reduce the Company’s printing and postage costs. Once you give your consent, it will remain in effect until you notify the Company or the Company’s transfer agent, National City Bank, Cleveland, OH, that you wish to resume mail delivery of the annual reports and proxy statements. Even though you give your consent, you still have the right at any time to request copies of these documents.To give your consent, mark the box located on the attached card below.âPlease fold and detach card at perforation before mailing.âThis proxy when properly executed will be voted in the manner directed by the undersigned stockholder. Unless otherwise specified, this proxywill be voted FOR the election of all nominees and FOR proposal 2.ELECTRONIC ACCESS TO FUTURE DOCUMENTS NOW AVAILABLE Anixter International Inc. (the “Company”) provides its annual reports and proxy solicitation materials, including notices to stockholders of annual meetings and proxy statements, over the Internet. If you give your consent to access these documents over the Internet, the Company will advise you when these documents become available on the Internet. Providing these documents over the Internet will reduce the Company’s printing and postage costs. Once you give your consent, it will remain in effect until you notify the Company or the Company’s transfer agent, National City Bank, Cleveland, OH, that you wish to resume mail delivery of the annual reports and proxy statements. Even though you give your consent, you still have the right at any time to request copies of these documents. To give your consent, mark the box located on the attached card below. Please fold and detach card at perforation before mailing. This proxy when properly executed will be voted in the manner directed by the undersigned stockholder. Unless otherwise specified, this proxy will be voted FOR the election of all nominees and FOR proposal 2. 1. Election of the following nominees as directors: oFORall nominees oWITHHOLD AUTHORITY (except (except as marked to the contrary below).to vote for all nominees listed below. Nominees: Lord James Blyth Frederic F. Brace Linda Walker Bynoe Robert L. Crandall Robert J. Eck Robert W. Grubbs Jr. F. Philip Handy Melvyn N. Klein George Muñoz Stuart M. Sloan Thomas C. Theobald Matthew Zell Samuel Zell (INSTRUCTIONS: (INSTRUCTIONS: Write the name of the nominee(s) from whom you are withholding your vote in this space.)The Board of Directors recommends a vote FOR the ratification of Ernst & Young LLP as the Company’s Independent Auditors for fiscal 2008. The Board of Directors recommends a vote FOR the ratification of Ernst & Young LLP as the Company’s Independent Auditors for fiscal 2009. 2. Ratification of Ernst & Young LLP as Independent Auditors. o FORo AGAINSTo ABSTAINIn their discretion, such other matters as properly may come before the meeting or at any adjournment(s) thereof. oPlease check this box if you intend to be present at meeting. oBy checking this box, I consent to access future annual reports, proxy statements, prospectuses and other materials and stockholder communications
electronically via the Internet at a webpage which will be disclosed to me.(Please (Please sign and date the proxy card on the reverse side.)