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Graphic Packaging Corporation
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•To elect three Class II Directors to serve a three-year term and until the 2008 Annual Meeting of Stockholders;•To approve an amendment to the Riverwood Holding, Inc. Stock Incentive Plan to permit the extension of the terms of options granted under such plan in 1996 and 1997, to facilitate a cashless method of exercising stock options and to change the definition of retirement under the plan; and•To transact any other business that may be properly brought before the Annual Meeting.•A Director who is an employee of the Company, or whose immediate family member serves as one of the Company's executive officers, may not be deemed independent until three years after the end of such employment relationship.•A Director who receives, or whose immediate family member receives, more than $100,000 per year in direct compensation from the Company, other than Board and committee fees and pension or other forms of deferred compensation for prior service, may not be deemed independent until three years after he or she ceases to receive more than $100,000 per year in such compensation. Compensation received by an immediate family member for service as one of the Company's non-executive employees will not be considered in determining independence under this test.•A Director who is affiliated with or employed by, or whose immediate family member is affiliated with or employed in a professional capacity by, the Company's present or former internal or external auditor may not be deemed independent until three years after the end of the affiliation or the employment or auditing relationship.•A Director who is employed, or whose immediate family member is employed, as an executive officer of another company where any of the Company's current executive officers serve on that company's compensation committee may not be deemed independent until three years after the end of such service or the employment relationship.•A Director who is an executive officer, general partner or employee, or whose immediate family member is an executive officer or general partner, of an entity that makes payments to, or receives payments from the Company for property or services in an amount which, in any single fiscal year, exceeds the greater of $1 million or 2% of such other entity's consolidated gross revenues, may not be deemed independent until three years after falling below that threshold.•the integrity of the Company's financial statements;•compliance with legal and regulatory requirements;•systems of internal accounting and financial controls;•the performance of the annual independent audit of the Company's financial statements;•the Company's independent auditor's qualifications and independence; and•the performance of the internal audit function.•reviewing and making recommendations as to the compensation of the President and Chief Executive Officer, the four other most highly-compensated executive officers and any other individuals whose compensation the Compensation and Benefits Committee anticipates may become subject to Section 162(m) of the Internal Revenue Code (the "Code");•approving any awards of stock or options to those of the Company's Directors who are employees and to other individuals who are "officers" for purposes of Section 16 of the Exchange Act; and•administering the Company's short- and long-term incentive plans.•the highest personal and professional integrity,•commitment to driving the Company's success;•an ability to provide informed and thoughtful counsel on a range of issues; and•exceptional ability and judgment.(1)In accordance with the rules of the SEC, the compensation set forth in the table does not include (i) medical, dental, group life insurance or other benefits that are available to all salaried employees and (ii) certain perquisites and personal benefits that do not exceed the lesser of $50,000 or 10% of the Named Executive Officer's salary and bonus shown in the table.(2)Except as otherwise noted, amounts shown consist of certain perquisites, none of which had a value exceeding 25% of the total value of all perquisites provided.(3)Includes $11,973 of perquisites and $196,500, which is the amount of interest that would have been paid on a $5.0 million non-interest bearing loan made to Mr. Humphrey, had such loan borne interest at 3.93% per annum, the applicable federal rate at the time the loan was extended.(4)Includes $10,435 of perquisites and $196,500, which is the amount of interest that would have been paid on a $5.0 million non-interest bearing loan made to Mr. Humphrey, had such loan borne interest at 3.93% per annum, the applicable federal rate at the time the loan was extended.(5)The value of the restricted stock units equals the number of such units granted multiplied by the price of the Company's common stock ($3.99) on August 8, 2003, the date of grant. One-third of these restricted stock units vest on each of the first three anniversaries of the date of grant, subject to the Named Executive Officer's continuous employment. No dividend equivalents are payable with respect to the restricted stock units.(6)Includes $10,460 of perquisites and $196,500, which is the amount of interest that would have been paid on a $5.0 million non-interest bearing loan made to Mr. Humphrey, had such loan borne interest at 3.93% per annum, the applicable federal rate at the time the loan was extended.(7)Of these options, 340,522 were exchanged for new options on August 8, 2003.(8)The amounts shown include (i) matching contributions on behalf of Mr. Coors to the Company's 401(k) savings plans of $8,200 and $7,200 in 2004 and 2003, respectively; and (ii) $12,125 for executive life insurance premiums paid by the Company in 2004 and 2003.(9)Mr. Coors was appointed Executive Chairman effective August 8, 2003.(10)Amounts shown include (i) matching contributions on behalf of Mr. Scheible to the Company's 401(k) savings plan of $8,200 and $7,200 in 2004 and 2003, respectively, and (ii) $2,213 and $1,587 for executive life insurance premiums paid by the Company in 2004 and 2003, respectively.(11)Mr. Scheible was appointed as Executive Vice President, Commercial Operations effective August 8, 2003.(12)The amount shown includes $22,500 of club initiation fees, $51,216 of relocation benefits and tax reimbursement of $36,183 related to such relocation benefits.(13)Consists of matching contributions on behalf of Mr. Baldwin to the Company's 401(k) savings plan.(14)Includes $14,617 of taxable relocation benefits and tax reimbursement of $13,278 related to such relocation benefits.(15)The value of the restricted stock units equals the number of such units granted multiplied by the price of the Company's common stock ($4.00) on September 8, 2003, the date of grant. One third of the restricted stock units vest on each of the first three anniversaries of the date of grant, subject to Mr. Baldwin's continuous employment. No dividend equivalents are payable with respect to the restricted stock units.(16)Amounts shown consist of matching contributions on behalf of Mr. Spiller to the Company's 401(k) savings plan.(17)The value of the restricted stock units equals the number of such units granted multiplied by the price of the Company's common stock ($3.65) on November 24, 2003, the date of grant. One third of the restricted stock units vest on each of the first three anniversaries of August 8, 2003, subject to Mr. Spiller's continuous employment. No dividend equivalents are payable with respect to the restricted stock units.(18)All of these options were exchanged for new options on November 24, 2003.(1)The dollar amounts set forth under this heading are calculated based on a price of $7.20 per share, the closing price of the Company's common stock on December 31, 2004 on the NYSE.(1)These plans are the Graphic Packaging Corporation 2004 Stock and Incentive Compensation Plan (the "2004 Plan"), the 2003 Riverwood Holding, Inc. Long-Term Incentive Plan, the 2003 Riverwood Holding, Inc. Directors Stock Incentive Plan, the Riverwood Holding, Inc. 2002 Stock Incentive Plan, the Riverwood Holding, Inc. Supplemental Long-Term Incentive Plan, the 1996 SIP, the Graphic Packaging Equity Incentive Plan, and the Graphic Packaging Equity Compensation Plan for Non-Employee Directors. With the exception of the 2004 Plan, each of these plans has been amended to provide that no additional awards will be granted thereunder.(2)Includes an aggregate of 16,656,683 stock options, 3,274,757 restricted stock units and 8,030 shares of phantom stock.(3)Weighted-average exercise price of outstanding options; excludes restricted stock units and shares of phantom stock.•base salary for the shorter of the remainder of the employment term or three years;•a pro rata bonus for the year in which his employment is terminated, provided that applicable performance objectives have been achieved;•continued life, medical, dental, accidental death and dismemberment and prescription drug insurance benefits for as long as base salary is paid; and•reimbursement for outplacement and career counseling services in an amount not to exceed the lesser of $25,000 or 20% of base salary.•willful failure substantially to perform his duties (other than due to physical or mental illness) or other willful and material breach of any of his obligations under the agreement, after a demand for substantial performance is delivered and a reasonable opportunity to cure is given;•engaging in willful and serious misconduct that has caused or would reasonably be expected to result in material injury to the Company or its affiliates; or•conviction of, or entering a plea ofnolo contendereto, a felony.•the assignment of duties that are significantly different from and that result in a substantial diminution of his duties at the commencement of the employment term;•the Company's failure to require a successor to assume the agreement;•a reduction in his base salary; or•the Company's breach of any of its obligations under the agreement, the option agreement with Mr. Humphrey or any other incentive award agreement granted to Mr. Humphrey.•all cash target amounts under GPIC's long-term incentive plans that were not previously paid or had not expired, regardless of whether the performance targets for those plans had been achieved;•the conversion of certain options previously granted under GPIC's equity incentive plan or long-term incentive plans, which options were immediately exercisable and will remain exercisable until August 8, 2013; and•restricted stock units representing the right to receive shares of the Company's common stock, one-third of which vested on August 8, 2004, with the remainder vesting in equal increments on August 8, 2005 and August 8, 2006. However, the restricted shares vest in full immediately if: (1) Mr. Coors' employment is terminated without cause, due to death, disability or retirement, or he terminates employment for good reason; or (2) upon a change of control.•the greater of the amount of his highest bonus under the Company's bonus plan, or any comparable bonus under any predecessor or successor plan, for the last three full fiscal years, and the annual bonus paid or payable to him under the Company's short-term incentive plan or plans;•a lump sum in cash equal to three times:•his highest annual base salary for any of the past three years;•an amount equal to his highest base salary during any of the past three years multiplied by the highest percentage payout of bonus under a short-term incentive plan paid or accrued during any of the past three years; and•the highest one-year cash equivalent amount of fringe benefits paid in any of the past three years;
•any benefits due under any supplemental executive retirement plan in accordance with the provisions of the plan, with the amount of benefits to be adjusted to reflect five additional years of service and five additional years of age (with such additional years of service to decrease by one for each year of employment following the merger);•welfare benefits for him and his family for three years or, if earlier, until he receives such benefits through subsequent employment; and•outplacement services for one year (with a cost not to exceed $15,000).•willful and continued failure to perform substantially his duties (other than due to physical or mental illness), after a written demand for substantial performance is delivered; or•willful engagement in illegal conduct or gross misconduct that is materially and demonstrably injurious to the Company.•material diminution of his title, responsibilities and duties;•failure to pay compensation;•failure to pay the gross-up described below;•purported termination of employment otherwise than as expressly permitted by the agreement; or•mandatory relocation, other than in connection with a promotion, of Mr. Coors' principal office to a location more than 35 miles from the location of such office on August 8, 2003.•directly or indirectly owning, managing, operating, lending money to or participating in the ownership, management, operation or control of, or serving as a director, officer, employee, partner, consultant, agent or independent contractor with a business or organization in the printing and packaging business in a capacity that assists such competitor in a material respect in the printing and packaging business in the geographic areas where the Company or any of its subsidiaries or affiliates operate;•owning a controlling interest in a business that competes in a material respect in the printing or packaging business in the geographic areas where the Company or any of its subsidiaries or affiliates operate; or•soliciting or interfering with the Company's suppliers, customers or employees or any of its subsidiaries or affiliates.•all cash target amounts under GPIC's long-term incentive plans that were not previously paid or had not expired, regardless of whether the performance targets for those plans had been achieved;•the conversion of certain options previously granted under GPIC's equity incentive plan or long-term incentive plans, which options were immediately exercisable and will remain exercisable until August 8, 2013; and•restricted stock units representing the right to receive shares of the Company's common stock, one-third of which vested on August 8, 2004, with the remainder vesting in equal increments on August 8, 2005 and August 8, 2006. However, the restricted shares vest in full immediately if: (1) Mr. Scheible's employment is terminated without cause, due to death, disability or retirement, or he terminates employment for good reason; or (2) upon a change of control.•the greater of the amount of his highest bonus under the Company's bonus plan, or any comparable bonus under any predecessor or successor plan, for the last three full fiscal years, and the annual bonus paid or payable to him under the Company's short-term incentive plan or plans;•a lump sum in cash equal to three times:•his highest annual base salary for any of the past three years;•an amount equal to his highest base salary during any of the past three years multiplied by the highest percentage payout of bonus under a short-term incentive plan paid or accrued during any of the past three years; and•the highest one-year cash equivalent amount of fringe benefits paid in any of the past three years;
•any benefits due under any supplemental executive retirement plan in accordance with the provisions of the plan, with the amount of benefits to be adjusted to reflect five additional years of service and five additional years of age (with such additional years of service to decrease by one for each year of employment following the Merger);•welfare benefits for him and his family for three years or, if earlier, until he receives such benefits through subsequent employment; and•outplacement services for one year (with a cost not to exceed $15,000).•willful and continued failure to perform substantially his duties (other than due to physical or mental illness), after a written demand for substantial performance is delivered; or•willful engagement in illegal conduct or gross misconduct that is materially and demonstrably injurious to the Company.•material diminution of his title, responsibilities and duties;•failure to pay compensation;•failure to pay the gross-up described below;•purported termination of employment otherwise than as expressly permitted by the agreement; or•mandatory relocation, other than in connection with a promotion, of Mr. Scheible's principal office to a location more than 35 miles from the location of such office on August 8, 2003.•directly or indirectly owning, managing, operating, lending money to or participating in the ownership, management, operation or control of, or serving as a director, officer, employee, partner, consultant, agent or independent contractor with a business or organization in the printing and packaging business in a capacity that assists such competitor in a material respect in the printing and packaging business in the geographic areas where the Company or any of its subsidiaries or affiliates operate;•owning a controlling interest in a business that competes in a material respect in the printing or packaging business in the geographic areas where the Company or any of its subsidiaries or affiliates operate; or•soliciting or interfering with the Company's suppliers, customers or employees or any of its subsidiaries or affiliates.•a pro-rata incentive bonus for the year in which termination of employment occurs, assuming that all performance targets had been achieved as of the termination date; and•base salary and continued welfare benefits for the longer of the remainder of the employment term, one year or a period equal to one month for each full year of service with the Company.•the willful failure to perform his duties (other than due to physical or mental illness) or other willful and material breach of his obligations under his employments agreement or other incentive award agreement, after a written demand for performance is delivered and a reasonable opportunity for cure has been given;•willful and serious misconduct that caused or is reasonably expected to result in material injury to the Company; or•conviction of, or the entering of a plea of guilty or nolo contendere to, a crime that constitutes a felony.•the assignment of duties that are significantly different from and that result in a substantial diminution of his duties at the commencement of the employment term;•the Company's failure to require a successor to assume the agreement;•a reduction in his base salary; or•the Company's breach of any of its obligations under the employment agreement or any other incentive award agreement granted to Mr. Baldwin.•a pro-rata incentive bonus for the year in which termination of employment occurs, assuming that all performance targets had been achieved; and•base salary and continued welfare benefits for the longer of the remainder of the employment term, one year or a period equal to one month for each full year of service with the Company.•the willful failure to perform his duties (other than due to physical or mental illness) or other willful and material breach of his obligations under his employments agreement or other incentive award agreement, after a written demand for performance is delivered and a reasonable opportunity for cure has been given;•willful and serious misconduct that caused or is reasonably expected to result in material injury to the Company; or•conviction of, or the entering of a plea of guilty or nolo contendere to, a crime that constitutes a felony.•the assignment of duties that are significantly different from and that result in a substantial diminution of his duties at the commencement of the employment term;•the Company's failure to require a successor to assume the agreement;•a reduction in his base salary; or•the Company's breach of any of its obligations under the employment agreement or any other incentive award agreement granted to Mr. Spiller.(1)Under the trust agreement evidencing the Grover C. Coors Trust (the "Coors Trust"), the affirmative vote of a majority of the trustees is required to determine how shares of stock held by the Coors Trust will be voted or to dispose of any shares of stock held by the Coors Trust; therefore, none of the trustees of the Coors Trust is deemed to have beneficial ownership of shares held by the Coors Trust by virtue of the trust agreement (although Jeffrey H. Coors and William K. Coors are deemed to have beneficial ownership of the shares held by the Coors Trust pursuant to the Stockholders Agreement). The trustees of the Coors Trust are William K. Coors, Jeffrey H. Coors, John K. Coors, Joseph Coors, Jr. and Peter H. Coors. The business address for the Grover C. Coors Trust is Coors Family Trusts, Mailstop VR 900, Post Office Box 4030, Golden, Colorado 80401.(3) The amount shown includes (i) 53,429 shares held in joint tenancy with spouse, (ii) 104,848 stock units held in the Company’s 401(k) savings plan, (iii) 250 shares held by GPIC’s Payroll Stock Ownership Plan, (iv) 500 shares held by Jeffrey H. Coors Family, Ltd., (v) 1,726,652 shares held by the May Kistler Coors Trust dated September 24, 1965, as to which Jeffrey H. Coors has voting and investment power with William K. Coors, Joseph Coors, Jr., John K. Coors and Peter H. Coors, as co-trustees, (vi) 30,000 shares held by Mr. Coors’ wife, and (vii) an aggregate of 59,672,623 shares attributable to Mr. Coors solely by virtue of the Stockholders Agreement. The amount shown also includes 1,603,489 shares subject to stock options exercisable within 60 days and 445,043 restricted stock units that are vested within 60 days. (4) The amount shown includes (i) 153,691 shares held by Mr. William Coors’ spouse, (ii) 1,726,652 shares held by the May Kistler Coors Trust dated September 24, 1965, as to which William K. Coors has voting and investment power with Jeffrey H. Coors, Joseph Coors, Jr., John K. Coors and Peter H. Coors, as co-trustees, and (iii) an aggregate of 60,220,443 shares attributable to Mr. Coors solely by virtue of the Stockholders Agreement. The amount shown also includes 3,213 shares subject to stock options exercisable within 60 days. (5) Associates V is the general partner of the CD&R Fund and has the power to direct the CD&R Fund as to the voting and disposition of its shares of the Company’s common stock. Associates II is the managing general partner of Associates V and has the power to direct Associates V as to its direction of the CD&R Fund’s voting and disposition of shares. No person controls the voting and dispositive power of Associates II with respect to the shares owned by CD&R. Each of Associates V and Associates II expressly disclaims beneficial ownership of the shares owned by the CD&R Fund. The business address for each of the CD&R Fund, Associates V and Associates II is 1403 Foulk Road, Suite 106, Wilmington, Delaware 19803. (6) Giovanni Agnellie C.S.A.P.A.Z., an Italian company, is the beneficial owner of more than 60% of the equity interests of EXOR Group S.A. The business address for EXOR Group S.A. is 22-24, Boulevard Royal, L-2449 Luxembourg. (7) The business address for The 1818 Fund II, L.P. is c/o Brown Brothers Harriman & Co., 140 Broadway, 16th Floor, New York, NY 10005. (8) The beneficial owner of HWH Investment Pte. Ltd. is Government of Singapore Investment Corporation (Ventures) Pte Ltd, which is beneficially owned by Minister for Finance Inc. of the Government of Singapore. The business address for HWH Investment Pte. Ltd. is 250 North Bridge Road, Singapore 179101, Republic of Singapore. The number of shares beneficially owned is as of December 31, 2005 according to Amendment No. 1 to Schedule 13G/A filed with the SEC on February 14, 2006. (9) The amount shown includes 6,798,186 shares subject to stock options exercisable within 60 days and 114,075 restricted stock units that are vested within 60 days. (10) The amount shown includes 5,638 shares subject to stock options exercisable within 60 days. (11) The amount shown includes 2,000 shares subject to stock options exercisable within 60 days. (12) The amount shown includes 4,235 stock units held in the Company’s 401(k) savings plan, 163,710 shares subject to stock options exercisable within 60 days and 210,382 restricted stock units that are vested within 60 days. (13) The amount shown includes 189,304 shares subject to stock options exercisable within 60 days and 111,336 restricted stock units that are vested within 60 days. (14) The amount shown includes 2,851 stock units held in the Company’s 401(k) savings plan, 82,765 shares subject to stock options exercisable within 60 days and 161,420 restricted stock units that are vested within 60 days. (15) The amount shown includes 9,714,915 shares subject to stock options exercisable within 60 days and 1,432,579 restricted stock units that are vested within 60 days. (2)Pursuant to the Stockholders Agreement, certain members of the Coors family and related trusts that are parties thereto, including the Coors Trust, Jeffrey H. Coors and William K. Coors, have designated and appointed Jeffrey H. Coors and, in case of his inability to act, William K. Coors, as their attorney-in-fact to perform all obligations under the Stockholders Agreement, including but not limited to, voting obligations with respect to the election of directors. The parties to the Stockholder Agreement retain voting power with regard to all other matters and sole dispositive power over such shares. The business address for William K. Coors and Jeffrey H. Coors is Graphic Packaging Corporation, 814 Livingston Court, Marietta, Georgia 30067.(3)The amount shown includes (i) 53,429 shares held in joint tenancy with spouse, (ii) 140,848 stock units held in the Company's 401(k) savings plan, (iii) 250 shares held by GPIC's Payroll Stock Ownership Plan, (iv) 500 shares held by Jeffrey H. Coors Family, Ltd., (v) 1,726,652 shares held by the May Kistler Coors Trust dated September 24, 1965, as to which Jeffrey H. Coors has voting and investment power with William K. Coors, Joseph Coors, Jr., John K. Coors and Peter H. Coors, as co-trustees, (vi) 30,000 shares held by Mr. Coors' wife, and (vii) an aggregate of 60,019,768 shares attributable to Mr. Coors solely by virtue of the Stockholders Agreement. The amount shown also includes 1,603,489 shares subject to stock options exercisable within 60 days and 313,942 restricted stock units that vest within 60 days.(4)The amount shown includes (i) 153,691 shares held in joint tenancy with spouse, (ii) 1,726,652 shares held by the May Kistler Coors Trust dated September 24, 1965, as to which William K. Coors has voting and investment power with Jeffrey H. Coors, Joseph Coors, Jr., John K. Coors and Peter H. Coors, as co-trustees, and (iii) an aggregate of 60,211,715 shares attributable to Mr. Coors solely by virtue of the Stockholders Agreement. The amount shown also includes 4,426 shares subject to stock options exercisable within 60 days.(5)Associates V is the general partner of the CD&R Fund and has the power to direct the CD&R Fund as to the voting and disposition of its shares of the Company's common stock. Associates II is the managing general partner of Associates V and has the power to direct Associates V as to its direction of the CD&R Fund's voting and disposition of shares. No person controls the voting and dispositive power of Associates II with respect to the shares owned by the CD&R Fund. Each of Associates V and Associates II expressly disclaims beneficial ownership of the shares owned by the CD&R Fund. The business address for each of the CD&R Fund, Associates V and Associates II is 1403 Foulk Road, Suite 106, Wilmington, Delaware 19803.(6)Giovanni Agnelli e C.S.A.P.A.Z., an Italian company, is the beneficial owner of more than 60% of the equity interests of EXOR Group S.A. The business address for EXOR Group S.A. is 22-24, Boulevard Royal, L-2449 Luxembourg.(7)The business address for The 1818 Fund II, L.P. is c/o Brown Brothers Harriman & Co., 140 Broadway, 16th Floor, New York, NY 10005.(8)The beneficial owner of HWH Investment Pte Ltd is Government of Singapore Investment Corporation (Ventures) Pte Ltd which is beneficially owned by Minister for Finance Inc. of the Government of Singapore. The business address for HWH Investment Pte Ltd is 250 North Bridge Road, Singapore 179101, Republic of Singapore.(9)The amount shown includes 7,988,679 shares subject to stock options exercisable within 60 days and 114,075 restricted stock units that vest within 60 days.(10)The amount shown includes 5,638 shares subject to stock options exercisable within 60 days.(11)The amount shown includes 2,000 shares subject to stock options exercisable within 60 days.(12)The amount shown includes 163,710 shares subject to stock options exercisable within 60 days and 105,191 restricted stock units that vest within 60 days.(13)The amount shown includes 133,332 shares subject to stock options exercisable within 60 days and 33,333 restricted stock units that vest within 60 days.(14)The amount shown includes 114,075 shares subject to stock options exercisable within 60 days and 20,280 restricted stock units that vest within 60 days.(15)The amount shown includes 10,799,423 shares subject to stock options exercisable within 60 days and 951,951 restricted stock units that vest within 60 days.
Based solely upon a review of Forms 3 and 4 and amendments thereto furnished to the Company pursuant toRule 16a-3(e) of the Exchange Act during20042005 and Form 5 and amendments thereto furnished to the Company with respect to2004,2005, and written representations from theCompany'sCompany’s reporting persons, the Company believes that the its officers, Directors and beneficial owners have complied with all filing requirements under Section 16(a) applicable to suchpersons, except that Mr. Jeffrey H. Coors filed one Form 4 reporting the payout of deferred compensation in shares late.persons.
AUDIT MATTERSReport of the Audit CommitteeThis report by the Audit Committee is required by the rules of the SEC. It is not to be deemed incorporated by reference by any general statement that incorporates by reference this Proxy Statement into any filing under the Securities Act or the Exchange Act, and it is not to be otherwise deemed filed under either such Act.The Audit Committee is currently comprised of three members, each of which is an"independent“independent director,"” as defined by Section 303A of the NYSE Listed Company Manual. Each of the members of the Audit Committee is financially literate and each qualifies as an"audit“audit committee financialexpert"expert” under federal securities laws. The AuditCommittee'sCommittee’s purposes are to assist the Board in overseeing: (a) the quality and integrity ofthe Company'sour financial statements; (b) the qualifications and independence ofthe Company'sour independent auditors; and (c) the performance ofthe Company'sour internal audit function and independent auditors.In carrying out its responsibilities, the Audit Committee has:•reviewed and discussed the Company's audited financial statements with management;•discussed with the independent auditors the matters required to be discussed with audit committees by Statement on Auditing Standards No. 61, as amended; and•received the written disclosures and the letter from the Company's independent auditors required by Independence Standards Board Standard No. 1 and has discussed with independent auditors their independence.
• reviewed and discussed the audited financial statements with management; • discussed with the independent auditors the matters required to be discussed with audit committees by Statement on Auditing Standards No. 61, and • received the written disclosures and the letter from our independent auditors required by Independence Standards Board Standard No. 1 and has discussed with the independent auditors their independence. Based on the review and discussions noted above andthe Company'sour independentauditors'auditors’ report to the Audit Committee, the Audit Committee has recommended to the Board of Directors thatthe Company'sour audited financial statements be included inthe Company'sour Annual Report onForm 10-K for the fiscal year ended December 31,2004.
2005.Robert W. Tieken, (Chairman)Harold R. Logan, Jr.John R. MillerRobert W. Tieken (Chairman)Harold R. Logan, Jr.John R. MillerPrincipal Accountant—Auditand Non-AuditFeesAggregate fees billed to us forprofessional services renderedthe fiscal years ended December 31, 2005 and December 31, 2004 by our independent auditors, PricewaterhouseCoopers LLPthe Company's principal accountants ("PWC"(“PWC”), are as follows:Year Ended December 31, Year Ended
December 31,2005 2004 2004 2003 (In millions) (in millions) Audit Fees Audit Fees $ 3.8 $ 1.6 $ 5.2 $ 3.8 Audit-Related Fees Audit-Related Fees 0.3 1.5 0.1 0.3 Tax Fees Tax Fees 0.0 0.1 0.1 0.0 All Other Fees All Other Fees 0.1 1.5 0.0 0.1 Total $ 4.2 $ 4.7 Total $ 5.4 $ 4.2
33•as to each proposed nominee for election as a Director, all information relating to such person that is required to be disclosed in solicitations of proxies for election of Directors, or is otherwise required, in each case pursuant to Regulation 14A under the Exchange Act and Rule 14a-11 thereunder, including such person's written consent to being named in the proxy statement as a nominee and to serving as a Director if elected;•as to any other proposal, a brief description of the proposal (including the text of any resolution proposed for consideration), the reasons for such proposal and any material interest in such proposal of such stockholder and of any beneficial owner on whose behalf the proposal is made; and•as to the stockholder giving the notice and any beneficial owner on whose behalf the nomination or proposal is made:•the name and address of such stockholder and beneficial owner, as they appear on the Company's books;•the class and number of shares of the Company's common stock that are owned beneficially and of record by such stockholder and such beneficial owner;•a representation that the stockholder is a holder of record of the Company's common stock entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to propose such business or nomination; and•a representation whether the stockholder or the beneficial owner, if any, intends or is part of a group that intends: (a) to deliver a proxy statement and/or form of proxy to holders of at least the percentage of the Company's outstanding capital stock required to approve or adopt the proposal or elect the nominee; and/or (b) otherwise to solicit proxies from stockholders in support of such proposal or nomination.
•Use any touch-tone telephone to vote your proxy 24 hours a day, 7 days a week, until 12:00 p.m. (CT) on May 16, 2005.•Please have your proxy card and the last four digits of your Social Security Number or Tax Identification Number available. Follow the simple instructions the voice provides you.•Use the Internet to vote your proxy 24 hours a day, 7 days a week, until 12:00 p.m. (CT) on May 16, 2005.•Please have your proxy card and the last four digits of your Social Security Number or Tax Identification Number available. Follow the simple instructions to obtain your records and create an electronic ballot.
7, 2006
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Annual Meeting of Stockholders
| Date | May |
| Time: | 10:00 a.m. local time |
| Place: | Wyndham Vinings Hotel |
| To elect three Class III Directors to serve a three-year term and until the 2009 Annual Meeting of Stockholders; and | ||
| • | To transact any other business that may be properly brought before the Annual Meeting. |
Purposes:
By order of the Board of Directors,  Stephen A. Hellrung Senior Vice President, General Counsel and Secretary Marietta, Georgia April 7, 2006  | ||
YOUR VOTE IS VERY IMPORTANT.
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i
16, 2006
2
3
| • | A Director who is an employee of the Company, or whose immediate family member serves as one of the Company’s executive officers, may not be deemed independent until three years after the end of such employment relationship. | |
| • | A Director who receives, or whose immediate family member receives, more than $100,000 per year in direct compensation from the Company, other than Board and committee fees and pension or other forms of deferred compensation for prior service, may not be deemed independent until three years after he or she ceases to receive more than $100,000 per year in such compensation. Compensation received by an immediate family member for service as one of the Company’s non-executive employees will not be considered in determining independence under this test. | |
| • | A Director who is affiliated with or employed by, or whose immediate family member is affiliated with or employed in a professional capacity by, the Company’s present or former internal or external auditor may not be deemed independent until three years after the end of the affiliation or the employment or auditing relationship. | |
| • | A Director who is employed, or whose immediate family member is employed, as an executive officer of another company where any of the Company’s current executive officers serve on that company’s compensation committee may not be deemed independent until three years after the end of such service or the employment relationship. | |
| • | A Director who is an executive officer, general partner or employee, or whose immediate family member is an executive officer or general partner, of an entity that makes payments to, or receives payments from the Company for property or services in an amount which, in any single fiscal year, exceeds the greater of $1 million or 2% of such other entity’s consolidated gross revenues, may not be deemed independent until three years after falling below that threshold. |
Merger and manages Clayton, Dubilier & Rice Fund V Limited Partnership (the “CD&R Fund”), the holder of approximately 17% of the Company’s common stock.
4
2005.
No, all
2005.
Martin D. Walker, who retired from the Board on June 30, 2005.
2005.
Packaging'sPackaging’s Board of Directors have any separately-designated standing committees?• the integrity of the Company’s financial statements; • compliance with legal and regulatory requirements; • systems of internal accounting and financial controls; • the performance of the annual independent audit of the Company’s financial statements; • the Company’s independent auditor’s qualifications and independence; and • the performance of the internal audit function.
5
2005.
NYSE’s Listed Company Manual. 2005. ”• reviewing and making recommendations as to the compensation of the President and Chief Executive Officer, the four other most highly-compensated executive officers and any other individuals whose compensation the Compensation and Benefits Committee anticipates may become subject to Section 162(m) of the Internal Revenue Code (the “Code”); • approving any equity compensation awards to those of the Company’s Directors who are employees and to other individuals who are “officers” for purposes of Section 16 of the Exchange Act; and • administering the Company’s short- and long-term incentive plans. Mr. Walker servedAll of these directors are “independent directors,” as a memberdefined by Section 303A of the Compensation and Benefits Committee through November 2004, when Mr. Logan was appointed to the Committee.fiveseven meetings during 2004.Miller,Tieken, with Mr. Miller serving as Chairman. Messrs. Beckett, Botta, Miller and MillerTieken are each "independent“independent directors,"” as defined by Section 303A of the NYSE'sNYSE’s Listed Company Manual. As discussed above, Messrs. Conway and Coors wouldare not be considered "independent“independent directors."fourseven meetings during 2004.2005.
6
Logan, Jr.
Information Concerning See “Certain Relationships and Related Transactions — Stockholders Agreement” for information regarding rights that certain stockholders have to designate nominees for director and the Nominees
obligations of certain stockholders to vote for certain nominees.
John D. Beckett, 66,52, has been a member of the Company's Board and the Boards of Directors of the Company's subsidiaries GPI Holding, Inc. and Graphic Packaging International, Inc. since the closing of the Merger in 2003. From 1993 until the closing of the Merger, Mr. Beckett served as one of the directors of GPIC. He has been Chairman of the R. W. Beckett Corporation, a manufacturer of components for oil and gas heating appliances, since 1965 and from 1965 until 2001, Mr. Beckett also served as its President.
Stephen M. Humphrey, 60, has been the Company's President and Chief Executive Officer, a member of the Company's Board of Directors and a member of the Boards of Directors of the Company's subsidiaries GPI Holding, Inc. and Graphic Packaging International, Inc. since 1997. From 1994 through 1996, Mr. Humphrey was Chairman, President and Chief Executive Officer of National Gypsum Company, a manufacturer and supplier of building products and services. From 1981 until 1994, Mr. Humphrey was employed by Rockwell International Corporation, a manufacturer of electronic industrial, automotive products, telecommunications systems and defense electronics products and systems, where he held a number of key executive positions.
John R. Miller, 67, has been a member of the Company'sCompany’s Board and a member of the Boards of Directors of the Company's subsidiaries GPI Holding, Inc. and Graphic Packaging International, Inc. since 2002. Mr. Miller has been a director of Cambrex Corporation, a global diversified life science company since 1998, and since 1985, a director of Eaton Corporation, a global diversified industrial manufacturer. Effective April 30, 2003, Mr. Miller retired as Chairman, President and Chief Executive Officer of Petroleum Partners, Inc., a provider of outsourcing services to the petroleum industry, a position he held since 2000. Mr. Miller formerly served as President and Chief Operating Officer of The Standard Oil Company and Chairman of the Federal Reserve Bank of Cleveland.
Information Concerning Continuing Directors
Class III Directors—Term to Expire in 2006
G. Andrea Botta, 51, has been a member of the Company's Board and a member of the Boards of Directors of the Company'sCompany’s subsidiaries GPI Holding, Inc. and Graphic Packaging International, Inc. since 1996. Mr. Botta has beenis the President of Glenco LLC, a private investment company. From 1999 to January 2006, Mr. Botta served as a managing director of Morgan Stanley. Before joining Morgan Stanley, since September 1999. Previously, he was president
7
Class I Directors—Directors — Term to Expire in 2007
8
Effective in May 2004, each
them in the form of phantom stock.
| • | the highest personal and professional integrity, | |
| • | commitment to driving the Company’s success; | |
| • | an ability to provide informed and thoughtful counsel on a range of issues; and | |
| • | exceptional ability and judgment. |
9
2005.
| Long Term Compensation | ||||||||||||||||||||||||||||||||
| Awards | ||||||||||||||||||||||||||||||||
| Annual Compensation(1) | Restricted | Securities | Payouts | All | ||||||||||||||||||||||||||||
| Other Annual | Stock | Underlying | LTIP | Other | ||||||||||||||||||||||||||||
Name and Principal Position | Year | Salary ($) | Bonus ($) | Compensation ($)(2) | Units ($) | Options (#) | Payouts ($) | Compensation ($) | ||||||||||||||||||||||||
Stephen M. Humphrey | 2005 | 1,000,000 | 500,000 | 208,823 | (3) | — | — | — | — | |||||||||||||||||||||||
| President and Chief | 2004 | 987,500 | 982,563 | 208,473 | (3) | — | — | — | — | |||||||||||||||||||||||
| Executive Officer | 2003 | 937,450 | 570,544 | 206,935 | (3) | 1,365,478 | (4)(5) | 228,150 | — | — | ||||||||||||||||||||||
Jeffrey H. Coors | 2005 | 596,200 | 223,595 | — | — | — | — | 20,525 | (6) | |||||||||||||||||||||||
| Executive Chairman | 2004 | 573,500 | 427,974 | — | — | — | — | 20,325 | (6) | |||||||||||||||||||||||
| 2003 | 220,238 | (7) | 370,185 | — | 1,543,672 | (4)(8) | 1,603,489 | 1,300,000 | 19,325 | (6) | ||||||||||||||||||||||
David W. Scheible | 2005 | 525,000 | 196,901 | 111,625 | (9) | — | — | — | 10,925 | (10) | ||||||||||||||||||||||
| Chief Operating Officer | 2004 | 457,500 | 373,919 | — | — | — | — | 10,413 | (10) | |||||||||||||||||||||||
| 2003 | 166,667 | (11) | 233,450 | — | 1,259,140 | (4)(12) | 163,710 | 1,125,000 | 8,787 | (10) | ||||||||||||||||||||||
Daniel J. Blount | 2005 | 325,000 | 3,120,188 | (13) | — | 43,740 | (14) | — | — | 8,400 | (15) | |||||||||||||||||||||
| Senior Vice President | 2004 | 325,000 | 200,000 | — | — | — | — | — | ||||||||||||||||||||||||
| and Chief Financial | 2003 | 316,477 | 92,525 | — | 783,269 | (16) | 74,879 | — | — | |||||||||||||||||||||||
| Officer | ||||||||||||||||||||||||||||||||
Donald W. Sturdivant | 2005 | 354,167 | 123,938 | (17) | — | — | — | — | 9,436 | (18) | ||||||||||||||||||||||
| Senior Vice President, | 2004 | 308,333 | 259,250 | — | — | — | — | 9,038 | (18) | |||||||||||||||||||||||
| Consumer Packaging | 2003 | 125,000 | (19) | 149,588 | 92,734 | (20) | 966,103 | (4)(21) | 82,765 | 1,085,500 | 7,968 | (18) | ||||||||||||||||||||
| Division | ||||||||||||||||||||||||||||||||
| (1) | In accordance with the rules of the SEC, the compensation set forth in the table does not include (i) medical, dental, group life insurance, relocation or other benefits that are available to all salaried employees and (ii) certain perquisites and personal benefits that do not exceed the lesser of $50,000 or 10% of the Named Executive Officer’s salary and bonus shown in the table. | |
| (2) | Except as otherwise noted, amounts shown consist of certain perquisites, none of which had a value exceeding 25% of the total value of all perquisites provided. | |
| (3) | Includes $12,323, $11,973 and $10,435 of perquisites in 2005, 2004 and 2003, respectively, plus $196,500 in each year, which is the amount of interest that would have been paid on the $5.0 million non-interest bearing loan made to Mr. Humphrey, had such loan borne interest at 3.93% per annum, the applicable federal rate at the time the loan was extended. See “Certain Relationships and Related Transactions — Management Indebtedness” for additional information on the loan made to Mr. Humphrey in November 1999. | |
| (4) | The value of the restricted stock units equals the number of such units granted, multiplied by the price of the Company’s common stock ($3.99) on August 8, 2003, the date of grant. One-third of these restricted stock units vest on each of the first three anniversaries of the date of grant, subject to the Named Executive Officer’s continuous employment. No dividend equivalents are payable with respect to the restricted stock units. |
10
| | | | | | Long Term Compensation | | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | Annual Compensation(1) | Awards | Payouts | | ||||||||||||
| Name and Principal Position | Year | Salary($) | Bonus($) | Other Annual Compensation($)(2) | Restricted Stock Units($) | Securities Underlying Options(#) | LTIP Payouts($) | All Other Compensation($) | |||||||||
| Stephen M. Humphrey President and Chief Executive Officer | 2004 2003 2002 | 987,500 937,450 879,000 | 982,563 570,544 478,890 | 208,473 206,935 206,960 | (3) (4) (6) | — 1,365,478 — | (5) | — 228,150 6,844,500 | (7) | — — — | — — — | ||||||
Jeffrey H. Coors Executive Chairman | 2004 2003 | 573,500 220,238 | (9) | 427,974 370,185 | — — | — 1,543,672 | (5) | — 1,603,489 | 1,300,000 | 20,325 19,325 | (8) (8) | ||||||
David W. Scheible Chief Operating Officer | 2004 2003 | 457,500 166,667 | (11) | 373,919 233,450 | — — | — 1,259,140 | (5) | — 163,710 | — 1,125,000 | 10,413 8,787 | (10) (10) | ||||||
John T. Baldwin Senior Vice President and Chief Financial Officer | 2004 2003 | 350,000 110,038 | 254,265 100,000 | 124,892 27,895 | (12) (14) | — 400,000 | (15) | — 400,000 | — — | 8,200 2,426 | (13) (13) | ||||||
Robert W. Spiller Senior Vice President, Performance Packaging Division | 2004 2003 2002 | 350,000 350,000 88,826 | 255,964 129,102 33,875 | — — — | — 222,066 — | (17) | — 342,225 380,250 | (18) | — — — | 8,200 6,000 3,712 | (16) (16) (16) | ||||||
| (5) | As of December 31, 2005, Mr. Humphrey held 228,150 restricted stock units with an aggregate market value of $520,182. | |
| (6) | The amounts shown include (i) matching contributions on behalf of Mr. Coors to the Company’s 401(k) savings plan of $8,400, $8,200 and $7,200 in 2005, 2004 and 2003, respectively; and (ii) $12,125 for executive life insurance premiums paid by the Company in each of 2005, 2004 and 2003. | |
| (7) | Mr. Coors was appointed Executive Chairman effective August 8, 2003. | |
| (8) | As of December 31, 2005, Mr. Coors held 574,005 restricted stock units with an aggregate market value of $1,308,731. | |
| (9) | Includes Mr. Scheible’s perquisite allowance of $28,500, car allowance of $15,000, and $39,921 of relocation benefits, together with $28,204 of related tax payments. | |
| (10) | Amounts shown include (i) matching contributions on behalf of Mr. Scheible to the Company’s 401(k) savings plan of $8,400, $8,200 and $7,200 in 2005, 2004 and 2003, respectively, and (ii) $2,525, $2,213 and $1,587 for executive life insurance premiums paid by the Company in 2005, 2004 and 2003, respectively. | |
| (11) | Mr. Scheible was appointed as Executive Vice President, Commercial Operations effective August 8, 2003. | |
| (12) | As of December 31, 2005, Mr. Scheible held 315,574 restricted stock units with an aggregate market value of $719,509. | |
| (13) | Includes $3,075,000 paid to Mr. Blount as a special bonus for achieving certain integration goals following the Merger (the “Integration Award”), and a discretionary bonus of $45,188 for 2005. | |
| (14) | The value of the restricted stock units equals the number of such units granted, multiplied by the Company’s common stock price ($4.86) on March 16, 2005, the date of grant. One third of these restricted stock units vest on each of the first three anniversaries of the date of grant, and they are payable two years thereafter following a mandatory holding period. No dividend equivalents are payable with respect to the restricted stock units. As of December 31, 2005, Mr. Blount held 171,504 restricted stock units with an aggregate market value of $391,029. | |
| (15) | The amount shown represents a matching contribution on behalf of Mr. Blount to the Company’s 401(k) savings plan. | |
| (16) | The value of the restricted stock units equals the number of such units granted, multiplied by the price of the Company’s common stock ($4.82) on October 6, 2003, the date of grant. One-third of these restricted stock units vest on August 8, 2004, one-third on August 8, 2005 and one-third on August 8, 2006, subject to Mr. Blount’s continued employment. No dividend equivalents are payable with respect to the restricted stock units. | |
| (17) | In addition to the amount shown, Mr. Sturdivant was awarded an additional $123,938 retention bonus payable on March 1, 2007 if Mr. Sturdivant continues to be employed by the Company through such date. | |
| (18) | The amounts shown include (i) matching contributions on behalf of Mr. Sturdivant to the Company’s 401(k) savings plan of $8,400, $8,200 and $7,200 in 2005, 2004 and 2003, respectively, and (ii) $1,036, $838 and $768 for executive life insurance premiums paid by the Company in 2005, 2004 and 2003, respectively. | |
| (19) | Mr. Sturdivant was appointed Senior Vice President Universal Packaging Division effective August 8, 2003. | |
| (20) | Includes Mr. Sturdivant’s perquisite allowance of $28,500, a car allowance of $15,000 and $49,234 of relocation benefits. | |
| (21) | As of December 31, 2005, Mr. Sturdivant held 242,131 restricted stock units with an aggregate market value of $552,059. |
11
| | | | Number of Securities Underlying Unexercised Options at Fiscal Year-End | Value of Unexercised In-the-Money Options at Fiscal Year-End($)(1) | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Name | Shares Acquired on Exercise (#) | Value Realized ($) | ||||||||||
| Exercisable | Unexercisable | Exercisable | Unexercisable | |||||||||
| Stephen M. Humphrey | N/A | N/A | 6,467,679 | 4,027,223 | 7,751,136 | 95,823 | ||||||
| Jeffrey H. Coors | N/A | N/A | 1,603,489 | — | 1,692,697 | — | ||||||
| David W. Scheible | N/A | N/A | 163,710 | — | — | — | ||||||
| John T. Baldwin | N/A | N/A | 133,332 | 266,668 | 255,331 | 510,669 | ||||||
| Robert W. Spiller | N/A | N/A | 114,075 | 228,150 | 71,867 | 143,735 | ||||||
Number of Securities Value of Unexercised Shares Value Underlying Unexercised In-the-Money Options at Acquired on Realized Options at Fiscal Year-End Fiscal Year-End ($)(1) Exercise (#) ($) Exercisable Unexercisable(2) Exercisable Unexercisable(2) Stephen M. Humphrey — — 6,798,186 (3) 0 0 0 Jeffrey H. Coors — — 1,603,489 0 215,250 0 David W. Scheible — — 163,710 0 0 0 Daniel J. Blount — — 189,304 0 0 0 Donald W. Sturdivant — — 82,765 0 0 0
| (1) | The dollar amounts set forth under this heading are calculated based on a price of $2.28 per share, the closing price of the Company’s common stock on December 30, 2005 (the last trading day of the year) on the NYSE. | |
| (2) | On December 8, 2005, the vesting of all of the unvested stock options granted to employees of the Company was accelerated so that such options vested immediately. This action affected 1,253,112 stock options granted to Mr. Humphrey and 24,960 stock options granted to Mr. Blount and was done to save the Company approximately $3.2 million of compensation expense after January 2006 when Statement of Financial Accounting Standards No. 123R,Accounting for Stock-Based Compensation, becomes effective and requires the expensing of all unvested stock options. | |
| (3) | On July 19, 2005, the Compensation and Benefits Committee approved the amendment of certain stock option agreements covering options granted to employees of the Company during 1996 and 1997. The amendment (i) extended the termination date by three years for a maximum13-year term and (ii) increased the time period after retirement to exercise such options to a maximum of three years (not to exceed the13-year term). This action affected 1,081,675 stock options previously granted to Mr. Humphrey. |
12
| | Years of Service | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Remuneration | ||||||||||||||
| 5 | 10 | 15 | 20 | 25 | 30 | 35 | ||||||||
| $125,000 | 7,957 | 15,915 | 23,872 | 31,830 | 39,787 | 47,745 | 55,702 | |||||||
| $150,000 | 9,707 | 19,415 | 29,122 | 38,830 | 48,537 | 58,245 | 67,952 | |||||||
| $175,000 | 11,457 | 22,915 | 34,372 | 45,830 | 57,287 | 68,745 | 80,202 | |||||||
| $200,000 | 13,207 | 26,415 | 39,622 | 52,830 | 66,037 | 79,245 | 92,452 | |||||||
| $225,000 | 14,957 | 29,915 | 44,872 | 59,830 | 74,787 | 89,745 | 104,702 | |||||||
| $250,000 | 16,707 | 33,415 | 50,122 | 66,830 | 83,537 | 100,245 | 116,952 | |||||||
| $275,000 | 18,457 | 36,915 | 55,372 | 73,830 | 92,287 | 110,745 | 129,202 | |||||||
| $300,000 | 20,207 | 40,415 | 60,622 | 80,830 | 101,037 | 121,245 | 141,452 | |||||||
| $400,000 | 27,207 | 54,415 | 81,622 | 108,830 | 136,037 | 163,245 | 190,452 | |||||||
| $500,000 | 34,207 | 68,415 | 102,622 | 136,830 | 171,037 | 205,245 | 239,452 | |||||||
| $600,000 | 41,207 | 82,415 | 123,622 | 164,830 | 206,037 | 247,245 | 288,452 | |||||||
| $700,000 | 48,207 | 96,415 | 144,622 | 192,830 | 241,037 | 289,245 | 337,452 | |||||||
| $800,000 | 55,207 | 110,415 | 165,622 | 220,830 | 276,037 | 331,245 | 386,452 | |||||||
| $900,000 | 62,207 | 124,415 | 186,622 | 248,830 | 311,037 | 373,245 | 435,452 | |||||||
| $1,000,000 | 69,207 | 138,415 | 207,622 | 276,830 | 346,037 | 415,245 | 484,452 | |||||||
| $1,100,000 | 76,207 | 152,415 | 228,622 | 304,830 | 381,037 | 457,245 | 533,452 | |||||||
| $1,200,000 | 83,207 | 166,415 | 249,622 | 332,830 | 416,037 | 499,245 | 582,452 | |||||||
| $1,300,000 | 90,207 | 180,415 | 270,622 | 360,830 | 451,037 | 541,245 | 631,452 | |||||||
| $1,400,000 | 97,207 | 194,415 | 291,622 | 388,830 | 486,037 | 583,245 | 680,452 | |||||||
| $1,500,000 | 104,207 | 208,415 | 312,622 | 416,830 | 521,037 | 625,245 | 729,452 | |||||||
| $1,600,000 | 111,207 | 222,415 | 333,622 | 444,830 | 556,037 | 667,245 | 778,452 | |||||||
| $1,700,000 | 118,207 | 236,415 | 354,622 | 472,830 | 591,037 | 709,245 | 827,452 | |||||||
| $1,800,000 | 125,207 | 250,415 | 375,622 | 500,830 | 626,037 | 751,245 | 876,452 | |||||||
| $1,900,000 | 132,207 | 264,415 | 396,622 | 528,830 | 661,037 | 793,245 | 925,452 | |||||||
| $2,000,000 | 139,207 | 278,415 | 417,622 | 556,830 | 696,037 | 835,245 | 974,452 | |||||||
Years of Service 5 10 15 20 25 30 35 40 $ 125,000 7,914 15,828 23,742 31,657 39,571 47,485 55,399 63,712 $ 150,000 9,664 19,328 28,992 38,657 48,321 57,985 67,649 77,624 $ 175,000 11,414 22,828 34,242 45,657 57,071 68,485 79,899 91,537 $ 200,000 13,164 26,328 39,492 52,657 65,821 78,985 92,149 105,449 $ 225,000 14,914 29,828 44,742 59,657 74,571 89,485 104,399 119,362 $ 250,000 16,664 33,328 49,992 66,657 83,321 99,985 116,649 133,274 $ 275,000 18,414 36,828 55,242 73,657 92,071 110,485 128,899 147,189 $ 300,000 20,164 40,328 60,492 80,657 100,821 120,985 141,149 161,099 $ 400,000 27,164 54,328 81,492 108,657 135,821 162,985 190,149 216,749 $ 500,000 34,164 68,328 102,492 136,657 170,821 204,985 239,149 272,399 $ 600,000 41,164 82,328 123,492 164,657 205,821 246,985 288,149 328,049 $ 700,000 48,164 96,328 144,492 192,657 240,821 288,985 337,149 383,699 $ 800,000 55,164 110,328 165,492 220,657 275,821 330,985 386,149 439,349 $ 900,000 62,164 124,328 186,492 248,657 310,821 372,985 435,149 494,999 $1,000,000 69,164 138,328 207,492 276,657 345,821 414,985 484,149 550,649 $1,100,000 76,164 152,328 228,492 304,657 380,821 456,985 533,149 606,299 $1,200,000 83,164 166,328 249,492 332,657 415,821 498,985 582,149 661,949 $1,300,000 90,164 180,328 270,492 360,657 450,821 540,985 631,149 717,599 $1,400,000 97,164 194,328 291,492 388,657 485,821 582,985 680,149 773,249 $1,500,000 104,164 208,328 312,492 416,657 520,821 624,985 729,149 828,899 $1,600,000 111,164 222,328 333,492 444,657 555,821 666,985 778,149 884,549 $1,700,000 118,164 236,328 354,492 472,657 590,821 708,985 827,149 940,199 $1,800,000 125,164 250,328 375,492 500,657 625,821 750,985 876,149 995,849 $1,900,000 132,164 264,328 396,492 528,657 660,821 792,985 925,149 1,051,499 $2,000,000 139,164 278,328 417,492 556,657 695,821 834,985 974,149 1,107,149
Sturdivant, $339,356.
13
were not payable from the qualified retirement plan because of limitations under the Code. The Pension Plan Table below sets forthNone of the estimated annual benefits payable upon retirement, including amounts attributable to the non-qualified supplemental retirement plans, for specified remuneration levels and years of service.
| | Years of Service | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Remuneration | ||||||||||||||||
| 5 | 10 | 15 | 20 | 25 | 30 | 35 | 40 | |||||||||
| $125,000 | 9,375 | 20,313 | 31,250 | 42,188 | 53,125 | 64,063 | 75,000 | 78,125 | ||||||||
| $150,000 | 11,250 | 24,375 | 37,500 | 50,625 | 63,750 | 76,875 | 90,000 | 93,750 | ||||||||
| $175,000 | 13,125 | 28,438 | 43,750 | 59,063 | 74,375 | 89,688 | 105,000 | 109,375 | ||||||||
| $200,000 | 15,000 | 32,500 | 50,000 | 67,500 | 85,000 | 102,500 | 120,000 | 125,000 | ||||||||
| $225,000 | 16,875 | 36,563 | 56,250 | 75,938 | 95,625 | 115,313 | 135,000 | 140,625 | ||||||||
| $250,000 | 18,750 | 40,625 | 62,500 | 84,375 | 106,250 | 128,125 | 150,000 | 156,250 | ||||||||
| $275,000 | 20,625 | 44,688 | 68,750 | 92,813 | 116,875 | 140,938 | 165,000 | 171,875 | ||||||||
| $300,000 | 22,500 | 48,750 | 75,000 | 101,250 | 127,500 | 153,750 | 180,000 | 187,500 | ||||||||
| $325,000 | 24,375 | 52,813 | 81,250 | 109,688 | 138,125 | 166,563 | 195,000 | 203,125 | ||||||||
| $350,000 | 26,250 | 56,875 | 87,500 | 118,125 | 148,750 | 179,375 | 210,000 | 218,750 | ||||||||
| $375,000 | 28,125 | 60,938 | 93,750 | 126,563 | 159,375 | 192,188 | 225,000 | 234,375 | ||||||||
| $400,000 | 30,000 | 65,000 | 100,000 | 135,000 | 170,000 | 205,000 | 240,000 | 250,000 | ||||||||
| $425,000 | 31,875 | 69,063 | 106,250 | 143,438 | 180,625 | 217,813 | 255,000 | 265,625 | ||||||||
| $450,000 | 33,750 | 73,125 | 112,500 | 151,875 | 191,250 | 230,625 | 270,000 | 281,250 | ||||||||
| $475,000 | 35,625 | 77,188 | 118,750 | 160,313 | 201,875 | 243,438 | 285,000 | 296,875 | ||||||||
| $500,000 | 37,500 | 81,250 | 125,000 | 168,750 | 212,500 | 256,250 | 300,000 | 312,500 | ||||||||
| $525,000 | 39,375 | 85,313 | 131,250 | 177,188 | 223,125 | 269,063 | 315,000 | 328,125 | ||||||||
| $550,000 | 41,250 | 89,375 | 137,500 | 185,625 | 233,750 | 281,875 | 330,000 | 343,750 | ||||||||
| $575,000 | 43,125 | 93,438 | 143,750 | 194,063 | 244,375 | 294,688 | 345,000 | 359,375 | ||||||||
| $600,000 | 45,000 | 97,500 | 150,000 | 202,500 | 255,000 | 307,500 | 360,000 | 375,000 | ||||||||
| $625,000 | 46,875 | 101,563 | 156,250 | 210,938 | 265,625 | 320,313 | 375,000 | 390,625 | ||||||||
| $650,000 | 48,750 | 105,625 | 162,500 | 219,375 | 276,250 | 333,125 | 390,000 | 406,250 | ||||||||
| $675,000 | 50,625 | 109,688 | 168,750 | 227,813 | 286,875 | 345,938 | 405,000 | 421,875 | ||||||||
| $700,000 | 52,500 | 113,750 | 175,000 | 236,250 | 297,500 | 358,750 | 420,000 | 437,500 | ||||||||
| $725,000 | 54,375 | 117,813 | 181,250 | 244,688 | 308,125 | 371,563 | 435,000 | 453,125 | ||||||||
| $750,000 | 56,250 | 121,875 | 187,500 | 253,125 | 318,750 | 384,375 | 450,000 | 468,750 | ||||||||
| $775,000 | 58,125 | 125,938 | 193,750 | 261,563 | 329,375 | 397,188 | 465,000 | 484,375 | ||||||||
| $800,000 | 60,000 | 130,000 | 200,000 | 270,000 | 340,000 | 410,000 | 480,000 | 500,000 | ||||||||
| $825,000 | 61,875 | 134,063 | 206,250 | 278,438 | 350,625 | 422,813 | 495,000 | 515,625 | ||||||||
| $850,000 | 63,750 | 138,125 | 212,500 | 286,875 | 361,250 | 435,625 | 510,000 | 531,250 | ||||||||
| $875,000 | 65,625 | 142,188 | 218,750 | 295,313 | 371,875 | 448,438 | 525,000 | 546,875 | ||||||||
| $900,000 | 67,500 | 146,250 | 225,000 | 303,750 | 382,500 | 461,250 | 540,000 | 562,500 | ||||||||
| $925,000 | 69,375 | 150,313 | 231,250 | 312,188 | 393,125 | 474,063 | 555,000 | 578,125 | ||||||||
| $950,000 | 71,250 | 154,375 | 237,500 | 320,625 | 403,750 | 486,875 | 570,000 | 593,750 | ||||||||
| $975,000 | 73,125 | 158,438 | 243,750 | 329,063 | 414,375 | 499,688 | 585,000 | 609,375 | ||||||||
| $1,000,000 | 75,000 | 162,500 | 250,000 | 337,500 | 425,000 | 512,500 | 600,000 | 625,000 | ||||||||
Unlike the Employees Retirement Plan, the annual remuneration covered byCompany’s Named Executive Officers participated in the GPIC Retirement Plan is salary only and does not include any of the other compensation items shown in the Summary Compensation Table above. The salary used to compute benefits is the average highest salary amount over a 36 consecutive month period in the last 10 years. Had Mr. Coors and Mr. Scheible retired as of December 31, 2004, the average annual compensation covered by the GPIC Retirement Plan would have been $551,505 and $422,657, respectively. On December 31, 2004, Mr. Coors and Mr. Scheible had 36 and 6 credited years of service under the GPIC Retirement Plan, respectively. The benefit is computed on the basis of a straight-life annuity and is subject to a reduction to reflect, in part, the payment of Social Security benefits.
| Plan Category | (a) Number of securities to be issued upon exercise of outstanding options, warrants and rights | (b) Weighted- average exercise price of outstanding options | (c) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | ||||
|---|---|---|---|---|---|---|---|
| Equity compensation plans approved by stockholders(1) | 19,939,470 | (2) | $ | 6.87 | (3) | 15,722,192 | |
| Equity compensation plans not approved by stockholders | — | — | — | ||||
| Total | 19,939,470 | (2) | $ | 6.87 | (3) | 15,722,192 | |
| (a) | (b) | (c) | ||||||||||
| Number of Securities | Weighted- | Number of Securities Remaining | ||||||||||
| to be Issued Upon | Average | Available for Future Issuance | ||||||||||
| Exercise of | Exercise Price of | Under Equity Compensation | ||||||||||
| Outstanding Options, | Outstanding Options, | Plans (Excluding Securities | ||||||||||
Plan Category | Warrants and Rights | Warrants and Rights | Reflected in Column(a)) | |||||||||
Equity compensation plans approved by stockholders(1) | 19,532,852 | (2) | $ | 6.84 | (3) | 15,169,861 | ||||||
| Equity compensation plans not approved by stockholders | — | — | — | |||||||||
| Total | 19,532,852 | (2) | $ | 6.84 | (3) | 15,169,861 | ||||||
| (1) | These plans are the Graphic Packaging Corporation 2004 Stock and Incentive Compensation Plan (the “2004 Plan”), the 2003 Riverwood Holding, Inc. Long-Term Incentive Plan, the 2003 Riverwood Holding, Inc. Directors Stock Incentive Plan, the Riverwood Holding, Inc. 2002 Stock Incentive Plan, the Riverwood Holding, Inc. Supplemental Long-Term Incentive Plan, the 1996 SIP, the Graphic Packaging Equity Incentive Plan, and the Graphic Packaging Equity Compensation Plan for Non-Employee Directors. With the exception of the 2004 Plan, each of these plans has been amended to provide that no additional awards will be granted thereunder. | |
| (2) | Includes an aggregate of 15,944,338 stock options, 3,557,413 restricted stock units and 31,101 shares of phantom stock. | |
| (3) | Weighted-average exercise price of outstanding options; excludes restricted stock units and shares of phantom stock. |
CHANGE IN CONTROL ARRANGEMENTS
14
| • | base salary for the shorter of the remainder of the employment term or three years; | |
| • | a pro rata bonus for the year in which his employment is terminated, provided that applicable performance objectives have been achieved; | |
| • | continued life, medical, dental, accidental death and dismemberment and prescription drug insurance benefits for as long as base salary is paid; and | |
| • | reimbursement for outplacement and career counseling services in an amount not to exceed the lesser of $25,000 or 20% of base salary. |
Humphrey’s:
| • | willful failure substantially to perform his duties (other than due to physical or mental illness) or other willful and material breach of any of his obligations under the agreement, after a demand for substantial performance is delivered and a reasonable opportunity to cure is given; | |
| • | engaging in willful and serious misconduct that has caused or would reasonably be expected to result in material injury to the Company or its affiliates; or | |
| • | conviction of, or entering a plea of nolo contendere to, a felony. |
| • | the assignment of duties that are significantly different from and that result in a substantial diminution of his duties at the commencement of the employment term; | |
| • | the Company’s failure to require a successor to assume the agreement; | |
| • | a reduction in his base salary; or | |
| • | the Company’s breach of any of its obligations under the agreement, the option agreement with Mr. Humphrey or any other incentive award agreement granted to Mr. Humphrey. |
15
he serves as the Company'sCompany’s Executive Chairman and as the Executive Chairman of the Company'sCompany’s subsidiaries, GPI Holding, Inc. and Graphic Packaging International, Inc. The agreement has a term of three years beginning on August 8, 2003 and provides for an annual base salary of $555,000, which salary will be reviewed annually.
| • | all cash target amounts under GPIC’s long-term incentive plans that were not previously paid or had not expired, regardless of whether the performance targets for those plans had been achieved; | |
| • | the conversion of certain options previously granted under GPIC’s equity incentive plan or long-term incentive plans, which options were immediately exercisable and will remain exercisable until August 8, 2013; and | |
| • | restricted stock units representing the right to receive shares of the Company’s common stock, one-third of which vested on August 8, 2004 and August 8, 2005. The remainder will vest August 8, 2006. However, the restricted shares vest in full immediately if: (1) Mr. Coors’ employment is terminated without cause, due to death, disability or retirement, or he terminates employment for good reason; or (2) upon a change of control. |
| • | the greater of the amount of his highest bonus under the Company’s bonus plan, or any comparable bonus under any predecessor or successor plan, for the last three full fiscal years, and the annual bonus paid or payable to him under the Company’s short-term incentive plan or plans; | |
| • | a lump sum in cash equal to three times: |
| – | his highest annual base salary for any of the past three years; |
16
| – | an amount equal to his highest base salary during any of the past three years multiplied by the highest percentage payout of bonus under a short-term incentive plan paid or accrued during any of the past three years; and | |
| – | the highest one-year cash equivalent amount of fringe benefits paid in any of the past three years; |
| • | any benefits due under any supplemental executive retirement plan in accordance with the provisions of the plan, with the amount of benefits to be adjusted to reflect five additional years of service and five additional years of age (with such additional years of service to decrease by one for each year of employment following the merger); | |
| • | welfare benefits for him and his family for three years or, if earlier, until he receives such benefits through subsequent employment; and | |
| • | outplacement services for one year (with a cost not to exceed $15,000). |
| • | willful and continued failure to perform substantially his duties (other than due to physical or mental illness), after a written demand for substantial performance is delivered; or | |
| • | willful engagement in illegal conduct or gross misconduct that is materially and demonstrably injurious to the Company. |
| • | material diminution of his title, responsibilities and duties; | |
| • | failure to pay compensation; | |
| • | failure to pay thegross-up described below; | |
| • | purported termination of employment otherwise than as expressly permitted by the agreement; or | |
| • | mandatory relocation, other than in connection with a promotion, of Mr. Coors’ principal office to a location more than 35 miles from the location of such office on August 8, 2003. |
| • | directly or indirectly owning, managing, operating, lending money to or participating in the ownership, management, operation or control of, or serving as a director, officer, employee, partner, consultant, agent or independent contractor with a business or organization in the printing and packaging business in a capacity that assists such competitor in a material respect in the printing and packaging business in the geographic areas where the Company or any of its subsidiaries or affiliates operate; | |
| • | owning a controlling interest in a business that competes in a material respect in the printing or packaging business in the geographic areas where the Company or any of its subsidiaries or affiliates operate; or | |
| • | soliciting or interfering with the Company’s suppliers, customers or employees or any of its subsidiaries or affiliates. |
17
| • | all cash target amounts under GPIC’s long-term incentive plans that were not previously paid or had not expired, regardless of whether the performance targets for those plans had been achieved; | |
| • | the conversion of certain options previously granted under GPIC’s equity incentive plan or long-term incentive plans, which options were immediately exercisable and will remain exercisable until August 8, 2013; and | |
| • | restricted stock units representing the right to receive shares of the Company’s common stock, one-third of which vested on August 8, 2004 and August 8, 2005. The remainder will vest on August 8, 2006. However, the restricted shares vest in full immediately if: (1) Mr. Scheible’s employment is terminated without cause, due to death, disability or retirement, or he terminates employment for good reason; or (2) upon a change of control. |
| • | the greater of the amount of his highest bonus under the Company’s bonus plan, or any comparable bonus under any predecessor or successor plan, for the last three full fiscal years, and the annual bonus paid or payable to him under the Company’s short-term incentive plan or plans; | |
| • | a lump sum in cash equal to three times: |
| – | his highest annual base salary for any of the past three years; | |
| – | an amount equal to his highest base salary during any of the past three years multiplied by the highest percentage payout of bonus under a short-term incentive plan paid or accrued during any of the past three years; and | |
| – | the highest one-year cash equivalent amount of fringe benefits paid in any of the past three years; |
| • | any benefits due under any supplemental executive retirement plan in accordance with the provisions of the plan, with the amount of benefits to be adjusted to reflect five additional years of service and five |
18
| additional years of age (with such additional years of service to decrease by one for each year of employment following the merger); |
| • | welfare benefits for him and his family for three years or, if earlier, until he receives such benefits through subsequent employment; and | |
| • | outplacement services for one year (with a cost not to exceed $15,000). |
Scheible’s:
| • | willful and continued failure to perform substantially his duties (other than due to physical or mental illness), after a written demand for substantial performance is delivered; or | |
| • | willful engagement in illegal conduct or gross misconduct that is materially and demonstrably injurious to the Company. |
| • | material diminution of his title, responsibilities and duties; | |
| • | failure to pay compensation; | |
| • | failure to pay thegross-up described below; | |
| • | purported termination of employment otherwise than as expressly permitted by the agreement; or | |
| • | mandatory relocation, other than in connection with a promotion, of Mr. Scheible’s principal office to a location more than 35 miles from the location of such office on August 8, 2003. |
| • | directly or indirectly owning, managing, operating, lending money to or participating in the ownership, management, operation or control of, or serving as a director, officer, employee, partner, consultant, agent or independent contractor with a business or organization in the printing and packaging business in a capacity that assists such competitor in a material respect in the printing and packaging business in the geographic areas where the Company or any of its subsidiaries or affiliates operate; | |
| • | owning a controlling interest in a business that competes in a material respect in the printing or packaging business in the geographic areas where the Company or any of its subsidiaries or affiliates operate; or | |
| • | soliciting or interfering with the Company’s suppliers, customers or employees or any of its subsidiaries or affiliates. |
19
Under the terms of Mr. Baldwin's employment agreement, a termination is for cause if it is due to:
Under Mr. Baldwin's employment agreement, a termination is for "good reason" if it is within 30 days of any of the following and without Mr. Baldwin's consent:
| • | base salary and welfare benefits for a period ending on the first anniversary of the date of termination; | |
| • | a pro-rata incentive bonus for the year in which termination occurs, assuming that all performance targets had been achieved as of the date of termination; | |
| • | the amount, if any, payable under the terms of any severance plan, policy or program in effect on the date of termination; and | |
| • | outplacement and career counseling services with a value not in excess of the lesser of $25,000 and 20% of Mr. Blount’s base salary. |
Employment Agreementor (iii) soliciting or attempting to establish any competitive business relationship with Robert W. Spiller
The Company entered into an Employment Agreement with Robert W. Spiller to serve as Senior Vice President, Performance Packaging Division of the Company and its subsidiary, Graphic Packaging International, Inc. as of September 30, 2002. The Agreement has an initial three-year term that automatically extends for additional one-year periods following the expiration of the initial term. Such agreement was amended as of August 7, 2004. The agreement provides for a minimum base salary of at least $350,000 and for Mr. Spiller's participation in the Company's incentive compensation programs for similarly situated executives at levels commensurate with his position and duties and as established by the Company's Compensation and Benefits Committee, with an annual target bonus opportunity of 70% of base salary. In the event the Company terminates Mr. Spiller's employment without causecustomer, client or Mr. Spiller terminates his employment for good reason, the agreement provides for severance of:
Under the terms of Mr. Spiller's employment agreement, a termination is for cause if it is due to:
Under Mr. Spiller's employment agreement, a termination is for "good reason" if it is within 30 days of any of the following and without Mr. Spiller's consent:
The employment agreement also provides that Mr. Spiller may not work for a competitordistributor of the Company for a period of one year after histermination of employment is terminated or the end of his severance period, whichever is later.
| • | all cash target amounts under GPIC’s long-term incentive plans that were not previously paid or had not expired, regardless of whether the performance targets for those plans had been achieved; |
20
| • | the conversion of certain options previously granted under GPIC’s equity incentive plan or long-term incentive plans, which options were immediately exercisable and will remain exercisable until August 8, 2013; and | |
| • | restricted stock units representing the right to receive shares of the Company’s common stock, one-third of which vested on August 8, 2004 and August 8, 2005, with the remainder vesting in equal increments on August 8, 2006. However, the restricted shares vest in full immediately if (1) Mr. Sturdivant’s employment is terminated without cause, due to death, disability or retirement, or he terminates employment for good reason; or (2) upon a change of control. |
| • | the greater of the amount of his highest bonus under the Company’s bonus plan, or any comparable bonus under any predecessor or successor plan, for the last three full fiscal years, and the annual bonus paid or payable to him under the Company’s short-term incentive plan or plans; | |
| • | a lump sum in cash equal to two times: |
| – | his highest annual base salary for any of the past three years; | |
| – | an amount equal to his highest base salary during any of the past three years multiplied by the highest percentage payout of bonus under a short-term incentive plan paid or accrued during any of the past three years; and | |
| – | the highest one-year cash equivalent amount of fringe benefits paid in any of the past three years; |
| • | welfare benefits for him and his family for two years or, if earlier, until he receives such benefits through subsequent employment; and | |
| • | outplacement services for one year (with a cost not to exceed $15,000). |
| • | willful and continued failure to perform substantially his duties (other than due to physical or mental illness), after a written demand for substantial performance is delivered; or | |
| • | willful engagement in illegal conduct or gross misconduct that is materially and demonstrably injurious to the Company. |
| • | material diminution of his title, responsibilities and duties; | |
| • | failure to pay compensation; | |
| • | failure to pay thegross-up described below; | |
| • | purported termination of employment otherwise than as expressly permitted by the agreement; or | |
| • | mandatory relocation, other than in connection with a promotion, of Mr. Sturdivant’s principal office to a location more than 35 miles from the location of such office on August 8, 2003. |
21
| • | directly or indirectly owning, managing, operating, lending money to or participating in the ownership, management, operation or control of, or serving as a director, officer, employee, partner, consultant, agent or independent contractor with a business or organization in the printing and packaging business in a capacity that assists such competitor in a material respect in the printing and packaging business in the geographic areas where the Company or any of its subsidiaries or affiliates operate; | |
| • | owning a controlling interest in a business that competes in a material respect in the printing or packaging business in the geographic areas where the Company or any of its subsidiaries or affiliates operate; or | |
| • | soliciting or interfering with the Company’s suppliers, customers or employees or any of its subsidiaries or affiliates. |
22
the case may be, has the right to designate a person for nomination for election to the Board, at any time at which the seat occupied by such party'sparty’s designee becomes vacant as a result of death, disability, retirement, resignation, removal or otherwise, such party will be entitled to designate for appointment by the remaining Directors an individual to fill such vacancy and to serve as a Director.
23
24
persons against certain liabilities arising under the federal securities laws, liabilities arising out of the performance of a certain consulting agreement between the Company and CD&R that is no longer effective, and certain other claims and liabilities.
25
April 1, 2004, with Coors Brewing Company (now a subsidiary of Molson Coors Brewing Company) that expires on December 31, 2006. The Company continues to sell packaging products to Coors Brewing Company; such sales accounted for approximately $110.3$84.3 million of the Company'sCompany’s consolidated net sales for the year ended December 31, 2004.
2005.
March 2006.
26
element are discussed below.
Long-Term Incentives and Repricing. In connection with the Merger, some prior long-term incentive grants at Riverwood and GPIC were converted into new stock options and restricted stock
27
For 20052006 and future years, Mr. Humphrey'sHumphrey’s contract sets his target bonus at 100% of base salary, with a maximum bonus opportunity equal to 200% of base salary. The total of Mr. Humphrey'sHumphrey’s base salary and target bonus is at the 75th percentile of the market. Again, this presumes performance goals that represent 75th percentile performance.
28
2006.
29
General
The Company is seeking stockholder approval of an amendment of the 1996 SIP to permit the extension of the terms of certain stock options granted to employees of the Company in 1996 and 1997 and to facilitate a cashless method of exercising stock options that does not require the concurrent sale of shares into the open market. Specifically, the amendment would (i) permit the Compensation and Benefits Committee of the Company to extend (x) the termination date of stock options granted under the 1996 SIP by three years for a maximum 13-year term and (y) the time period after Retirement, as defined in the 1996 SIP, during which the stock options may be exercised to a maximum of three years (but not to exceed the 13-year maximum term), (ii) redefine the term "Retirement" in the 1996 SIP to mean termination of employment by a participant in the 1996 SIP (a "Participant") with age and years of service credit totaling at least 65, with the minimum age at which a participant may be considered retired being 55, and (iii) remove the requirement that shares of the Company's common stock be held for a period of at least six months in order to be used as payment of the exercise price for stock options. The purposes of the amendment are to modify the outstanding stock options so that they provide the compensation and incentive value intended when originally granted, which is currently negatively impacted by the thinly-traded nature of the Company's common stock, and to update the definition of retirement to be consistent with that found in the 2004 Plan.
Material Features of the 1996 SIP
The following summary of the 1996 SIP is qualified in its entirety by the specific language of the 1996 SIP, a copy of which is attached as Appendix A to this Proxy Statement. Capitalized terms used but not defined in this summary shall have the meanings assigned to such terms in the 1996 SIP.
Authorized Shares and Awards. The 1996 SIP authorizes the issuance of up to 10,570,950 shares of common stock (after giving effect to the 15.21-to-1 stock split effected immediately prior to the Merger) to executive officers and other key management employees of the Company selected by the Board to participate. Permitted awards under the 1996 SIP consisted of non-qualified stock options or rights to purchase shares, although the 1996 SIP was amended as of August 8, 2003 to provide that no additional awards would be made thereunder. As of April 1, 2005, only 21 of the 29 Participants in the 1996 SIP had outstanding grants of stock options under the 1996 SIP.
Eligibility. The 1996 SIP authorized awards only to executive officers and other key management employees of the Company and any successor to the Company.
Administration. The Board of Directors is responsible for administering the 1996 SIP, although the Board may delegate all of the powers, duties and responsibilities to the Compensation Committee (or another committee of the Board responsible for compensation of officers) to the full extent permitted by law. As of April 3, 1996, the Board delegated responsibility for administration of the 1996 SIP to the Compensation and Benefits Committee.
Stock Options. Stock options granted under the 1996 SIP must be evidenced by a written agreement between the Participant and the Company that specifies the number of shares subject to options, the exercise price per share, the duration or term of the options and the other terms and conditions of the award. The exercise price per share is determined by the Compensation and Benefits Committee, and, unless otherwise specified in an agreement evidencing an award of stock options, may not be less than the fair market value of a share on the date the option is granted. Under Section 6.3(c) of the 1996 SIP, no option could be exercisable for more than 10 years after the date of grant, although if this proposal to amend the 1996 SIP receives stockholder approval, the last sentence
of Section 6.3(c) will be changed to provide that no options shall be exercisable for more than 13 years after the date of grant.
The 1996 SIP provides that the Compensation and Benefits Committee shall establish procedures governing the exercise of stock options, including procedures for providing notice to the Company and paying the exercise price in full in cash or cash equivalents at the time of exercise. Section 6.4 of the 1996 SIP allows the payment of the exercise price in full or in part in the form of shares of the Company's common stock that have been held for at least six months prior to the date of exercise. If this proposal to amend the 1996 SIP receives stockholder approval, however, the 1996 SIP will be changed to eliminate the requirement that shares tendered in payment be held for six months prior to the date of exercise. This will allow Participants greater flexibility to utilize this method of payment of the exercise price, which is not dependent upon an active public market for the Company's common stock.
Rights to Purchase Common Stock. In addition to stock options, the 1996 SIP also permitted awards of rights to purchase shares directly from the Company from time to time at a price and subject to such terms and conditions as may be established by the Board. Currently no rights to purchase shares are outstanding and no additional awards of such rights may be made.
Termination of Employment. Unless otherwise provided in the agreement evidencing an award of stock options under the 1996 SIP, upon termination of employment due to death, Permanent Disability or Retirement all "Service Options" become fully vested as of the date of such termination and a proportionate share of all "Performance Options" become fully vested pursuant to the formula set forth in Section 8.1 of the 1996 SIP. "Service Options" are defined as options that vest based upon an employee's completion of service and "Performance Options" are defined as options that vest based on the financial performance of the Company and its subsidiaries. Section 8.1 of the 1996 SIP currently specifies that following termination, such vested options are exercisable until the first to occur of (i) the one-year anniversary of the date of the Participant's termination of employment or (ii) the expiration of the term of the option. If this proposal to amend the 1996 SIP is approved, however, Section 8.1 of the 1996 SIP will be changed to permit vested options to be exercisable until the first to occur of (i) the first anniversary of the date of the Participant's termination of employment due to death or Permanent Disability or the third anniversary of the date of the Participant's termination of employment due to Retirement or (ii) the expiration of the term of the option. In addition, the definition of "Retirement" set forth in Section 2.1(bb) of the 1996 SIP will be changed from retirement from active employment at or after age 65 to mean a Participant's termination of employment with age and years of service credit totaling at least 65, with the minimum age at which a Participant may be considered retired being 55. This change will make the definition of Retirement in the 1996 SIP consistent with the 2004 Plan.
Unless otherwise provided in the agreement evidencing an award of stock options under the 1996 SIP, upon termination of employment for Cause, all options, whether vested or unvested, shall terminate immediately. Upon termination for any reason other than death, Permanent Disability, Retirement or Cause, any unvested stock options shall terminate and be cancelled and any vested stock options may be exercised until the first to occur of (i) the 60th day after the date of termination or (ii) the expiration of the term of the options.
Change of Control. The 1996 SIP provides that in the event of a change of control, Participants are entitled to receive a cash payment for each Service Option (whether vested or not) equal to the price per share paid in connection with the change of control transaction less the exercise price of such option. Participants are entitled to receive a similar payment for vested Performance Options based upon the formula set forth in Section 8.1 of the 1996 SIP.
Transferability. No options granted under the 1996 SIP may be sold, transferred, pledged, assigned or otherwise alienated other than by will or the laws of descent and distribution.
Amendment. The 1996 SIP may be amended, modified, terminated or suspended by the Board of Directors, provided that no amendment, modification, termination or suspension of the 1996 SIP will in any manner adversely affect any award previously granted without the consent of the Participant holding such award. Stockholder approval for any such amendment, modification, termination or suspension must be obtained to the extent required by applicable law or if otherwise deemed appropriate by the Company's Board of Directors.
On April 15, 2005, the closing price of the Company's common stock on the NYSE was $3.88 per share.
Summary of U.S. Federal Income Tax Consequences
The following summary generally describes the principal federal income tax consequences of the non-qualified stock options granted under the 1996 SIP as of this time. The summary is general in nature and is not intended to cover all tax consequences that may apply to a particular employee or to the Company. The provisions of the Code and regulations thereunder relating to equity compensation are complicated and their impact in any one case may depend upon the particular circumstances.
In general, when a Participant in the 1996 SIP is granted non-qualified stock options, he or she will not recognize any taxable income. Upon exercise of the stock options, however, the difference between the fair market value of the stock on the date of exercise and the aggregate exercise price will constitute taxable ordinary income to the Participant on the date of exercise. Generally, the Company will be entitled to a deduction in the same year in an amount equal to the income taxable to the Participant. The Participant's basis in shares of common stock acquired upon the exercise of stock options will equal the exercise price plus the amount of income taxable at the time of exercise. Any subsequent disposition of the stock by the Participant will be taxed as a capital gain or loss to the Participant, and will be long-term capital gain or loss if the Participant has held the stock for more than one year at the time of sale.
The Company generally will not be entitled to a federal income tax deduction upon the grant or termination of a non-qualified stock option, or upon the sale or disposition of the shares acquired upon the exercise of a non-qualified stock option. Upon exercise, however, the Company will be entitled to a deduction for federal income tax purposes equal to the amount of ordinary income that a Participant is required to recognize as a result of the exercise, provided that the deduction is not otherwise disallowed under the Code.
Awards of stock options under the 1996 SIP may, in some cases, result in the deferral of compensation that is subject to the requirements of Code Section 409A ("Section 409A"). To date, the U.S. Treasury Department and Internal Revenue Service have issued only preliminary guidance regarding the impact of Section 409A on the taxation of these types of awards. Generally, to the extent that any award that is subject to Section 409A fails to meet certain requirements under Section 409A, the award will be subject to immediate taxation and tax penalties in the year in which the award fails to conform to the requirements of Section 409A. It is the Company's current intent that amendment of awards under the 1996 SIP will be structured and administered in a manner that complies with the requirements of Section 409A.
Option Grants to be Amended
If the amendment to the 1996 SIP outlined above is approved, the Compensation and Benefits Committee currently intends to extend the maximum terms of 3,764,600 stock options granted to 19 employees in June 1996 and March 1997. Under their original terms, 519,575 of such stock options expire in 2006 and 3,245,025 of such options expire in 2007. None of the Company's Named Executive Officers, Directors or nominees for Director will be affected by the extension of the term of the stock options, except Mr. Stephen M. Humphrey, who serves a President and Chief Executive Officer of the
Company and is a nominee for election as a Director at the Annual Meeting, who holds all of the stock options expiring in 2007. Mr. Humphrey has three tranches of 1,081,675 vested stock options with per share exercise prices of $6.57, $4.93 and $3.28, respectively. Other than Mr. Humphrey, no Participant has received 5% or more of the outstanding options under the 1996 SIP.
The only other executive officer of the Company holding stock options that the Compensation and Benefits Committee currently intends to extend is Mr. Michael R. Schmal, who holds 60,840 stock options with an exercise price of $6.57 per share. In addition to Mr. Humphrey and Mr. Schmal, the Compensation and Benefits Committee intends to extend the terms of 458,735 options with an exercise price of $6.57 per share held by 17 management employees of the Company. The Compensation and Benefits Committee does not currently intend to extend the terms of 164,258 stock options with an exercise price of $6.57 per share held by two executive officers of the Company granted in 1999. Including options held by these two executive officers, the Company's executive officers as a group hold 3,470,123 options under the 1996 SIP.
Board Recommendation
The Board of Directors believes that the proposed amendment to the 1996 SIP is in the best interests of the Company and its stockholders.The Board of Directors recommends a vote "FOR" approval of the amendment to the 1996 SIP.
| 08/11/03 | 12/31/03 | 12/31/04 | 12/31/05 | |||||||||||||||||
| Graphic Packaging Corporation | $ | 100.00 | $ | 99.02 | $ | 175.61 | $ | 55.61 | ||||||||||||
| S&P 500 Index | $ | 100.00 | $ | 114.21 | $ | 126.63 | $ | 132.85 | ||||||||||||
| DJ U.S. Container & Packaging Index | $ | 100.00 | $ | 118.85 | $ | 140.22 | $ | 137.50 | ||||||||||||
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| | 08/11/03 | 12/31/03 | 12/31/04 | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Graphic Packaging Corporation | $ | 100.00 | $ | 99.02 | $ | 175.60 | |||
| S&P 500 Index | $ | 100.00 | $ | 114.21 | $ | 126.64 | |||
| DJ U.S. Container & Packaging Index | $ | 100.00 | $ | 118.86 | $ | 140.22 | |||
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Name | Number of Shares | Percentage | ||||||
5% Stockholders: | ||||||||
Grover C. Coors Trust(1)(2) | 51,211,864 | 25.77 | % | |||||
Jeffrey H. Coors(1)(2)(3) | 64,025,627 | 31.89 | % | |||||
William K. Coors(1)(2)(4) | 62,103,999 | 31.25 | % | |||||
Clayton, Dubilier & Rice Fund V Limited Partnership(5) | 34,222,500 | 17.22 | % | |||||
EXOR Group S.A.(6) | 34,222,500 | 17.22 | % | |||||
The 1818 Fund II, L.P.(7) | 11,291,400 | 5.68 | % | |||||
HWH Investment Pte. Ltd.(8) | 10,545,400 | 5.31 | % | |||||
Directors and Named Executive Officers: | ||||||||
Stephen M. Humphrey(9) | 6,988,311 | 3.40 | % | |||||
John D. Beckett(10) | 73,265 | * | ||||||
| G. Andrea Botta | 5,264 | * | ||||||
| Kevin J. Conway | 0 | * | ||||||
| William R. Fields | 0 | * | ||||||
Harold R. Logan, Jr.(11) | 39,728 | * | ||||||
| John R. Miller | 23,167 | * | ||||||
| Robert W. Tieken | 21,207 | * | ||||||
David W. Scheible(12) | 378,327 | * | ||||||
Daniel J. Blount(13) | 346,270 | * | ||||||
Donald W. Sturdivant(14) | 247,911 | * | ||||||
All Directors and executive officers as a group (16 persons)(15) | 73,441,643 | 35.00 | % | |||||
| (1) | Under the trust agreement evidencing the Grover C. Coors Trust (the “Coors Trust”), the affirmative vote of a majority of the trustees is required to determine how shares of stock held by the Coors Trust will be voted or to dispose of any shares of stock held by the Coors Trust; therefore, none of the trustees of the Coors Trust is deemed to have beneficial ownership of shares held by the Coors Trust by virtue of the trust agreement (although Jeffrey H. Coors and William K. Coors are deemed to have beneficial ownership of the shares held by the Coors Trust pursuant to the Stockholders Agreement). The trustees of the Coors Trust are William K. Coors, Jeffrey H. Coors, John K. Coors, Joseph Coors, Jr. and Peter H. Coors. The business address for the Grover C. Coors Trust is Coors Family Trusts, Mailstop VR 900, Post Office Box 4030, Golden, Colorado 80401. | |
| (2) | Pursuant to the Stockholders Agreement, certain members of the Coors family and related trusts that are parties thereto, including the Coors Trust, Jeffrey H. Coors and William K. Coors, have designated and appointed Jeffrey H. Coors and, in case of his inability to act, William K. Coors, as theirattorney-in-fact to perform all obligations under the Stockholders Agreement, including but not limited to, voting obligations with respect to the election of directors. The parties to the Stockholder Agreement retain voting power with regard to all other matters and sole dispositive power over such shares. The business address for William K. Coors and Jeffrey H. Coors is Graphic Packaging Corporation, 814 Livingston Court, Marietta, Georgia 30067. |
31
| Name | Number of Shares | Percentage | ||||
|---|---|---|---|---|---|---|
| 5% Stockholders: | ||||||
| Grover C. Coors Trust(1)(2) | 51,211,864 | 25.79 | % | |||
| Jeffrey H. Coors(1)(2)(3) | 64,039,489 | 31.94 | % | |||
| William K. Coors(1)(2)(4) | 62,096,484 | 31.27 | % | |||
| Clayton, Dubilier & Rice Fund V Limited Partnership(5) | 34,222,500 | 17.23 | % | |||
| EXOR Group S.A.(6) | 34,222,500 | 17.23 | % | |||
| The 1818 Fund II, L.P.(7) | 11,291,400 | 5.69 | % | |||
| HWH Investment Pte. Ltd.(8) | 10,647,000 | 5.36 | % | |||
| Directors and Named Executive Officers: | ||||||
| Stephen M. Humphrey(9) | 8,254,854 | 3.99 | % | |||
| John D. Beckett(10) | 62,123 | * | ||||
| G. Andrea Botta | 13,294 | * | ||||
| Kevin J. Conway | 0 | * | ||||
| Harold R. Logan, Jr.(11) | 28,586 | * | ||||
| John R. Miller | 12,025 | * | ||||
| Robert W. Tieken | 10,065 | * | ||||
| Martin D. Walker | 31,389 | * | ||||
| David W. Scheible(12) | 273,154 | * | ||||
| John T. Baldwin(13) | 176,665 | * | ||||
| Robert W. Spiller(14) | 134,355 | * | ||||
| All Directors and executive officers as a group (18 persons)(15) | 74,330,245 | 35.34 | % | |||
plans.
“Tax Fees.”
The Audit Committee has consideredmeetings. In 2004 and determined the fees charged for services other than "Audit Fees" discussed above are compatible with maintaining independence by PWC. Beginning May 6, 2004, 100%2005, all of the audit and non-audit services provided by PWCour independent public accountant were pre-approved by the Audit Committee in accordance with the Audit Committee Charter.
Director.
34
12, 2006.
| • | as to each proposed nominee for election as a Director, all information relating to such person that is required to be disclosed in solicitations of proxies for election of Directors, or is otherwise required, in each case pursuant to Regulation 14A under the Exchange Act andRule 14a-8 thereunder, including such person’s written consent to being named in the proxy statement as a nominee and to serving as a Director if elected; | |
| • | as to any other proposal, a brief description of the proposal (including the text of any resolution proposed for consideration), the reasons for such proposal and any material interest in such proposal of such stockholder and of any beneficial owner on whose behalf the proposal is made; and | |
| • | as to the stockholder giving the notice and any beneficial owner on whose behalf the nomination or proposal is made: |
| – | the name and address of such stockholder and beneficial owner, as they appear on the Company’s books; | |
| – | the class and number of shares of the Company’s common stock that are owned beneficially and of record by such stockholder and such beneficial owner; | |
| – | a representation that the stockholder is a holder of record of the Company’s common stock entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to propose such business or nomination; and | |
| – | a representation whether the stockholder or the beneficial owner, if any, intends or is part of a group that intends: (a) to deliver a proxy statementand/or form of proxy to holders of at least the percentage of the Company’s outstanding capital stock required to approve or adopt the proposal or elect the nominee;and/or (b) otherwise to solicit proxies from stockholders in support of such proposal or nomination. |
35
By Order of | ||
| ||
Appendix A
RIVERWOOD HOLDING, INC.STOCK INCENTIVE PLANSection 1. Purpose
The purpose of this Riverwood Holding, Inc. Stock Incentive Plan is to foster and promote the long-term financial success of the Company and the Subsidiaries and to increase materially stockholder value by (a) motivating superior performance by participants in the Plan, (b) providing participants in the Plan with an ownership interest in the Company and (c) enabling the Company and the Subsidiaries to attract and retain the services of an outstanding management team upon whose judgment, interest and special effort the successful conduct of its operations is largely dependent.
2.1. Definitions. Whenever used herein, the following terms shall have the respective meanings set forth below:
(a) "Affiliate" means, with respect to any person, any other person controlled by, controlling or under common control with such person.
(b) "Award Agreement" means the agreement evidencing the grant of any Incentive Award under the Plan, including a Subscription Agreement and an Option Agreement.
(c) "Board" means the Board of Directors, of the Company.
36
(d) "CD&R Fund" means the Clayton, Dubilier & Rice Fund V Limited Partnership, a Cayman Islands exempted limited partnership, and any successor investment vehicle managed by Clayton, Dubilier & Rice, Inc.
(e) "Cause" shall mean (i) the willful failure of the Participant to perform substantially his employment-related duties, (ii) the Participant's willful or serious misconduct that has caused or could reasonably be expected to result in material injury to the business or reputation of Company or any Subsidiary, (iii) the Participant's conviction of, or entering a plea of guilty ornolo contendereto, a crime constituting a felony or (iv) the breach by the Participant of any written covenant or agreement with the Company or any Subsidiary not to disclose any information pertaining to the Company or any Subsidiary, not to compete or interfere with the Company or any Subsidiary or relating to the take-along rights described in Section 10.3 hereof; provided that, with respect to any Participant who is party to an employment or individual severance agreement with the Company or RIC, "Cause" shall have the meaning, if any specified in such agreement.
(f) "Change in Control" means the first to occur of the following events after the Effective Date:
(i) the acquisition by any person, entity or "group" (as defined in Section 13(d) of the Securities Exchange Act of 1934, as amended), other than the Company, the Subsidiaries, any employee benefit plan of the Company or the Subsidiaries, the CD&R Fund, any Investor or any Affiliate of the CD&R Fund or of an Investor, of 50% or more of the combined voting power of the Company's or RIC's then outstanding voting securities;
(ii) the merger or consolidation of the Company or RIC, as a result of which persons who were stockholders of the Company or RIC, as the case may be, immediately prior to such merger or consolidation, do not, immediately thereafter, own, directly or indirectly, more than 50% of the combined voting power entitled to vote generally in the election of directors of the merged or consolidated company;
(iii) the liquidation or dissolution of the Company or RIC other than a liquidation of RIC into the Company or into any Subsidiary; and
(iv) the sale, transfer or other disposition of all or substantially all of the assets of the Company or RIC to one or more persons or entities that are not, immediately prior to such sale, transfer or other disposition, Affiliates of the Company, RIC, the CD&R Fund or any Investor.
(g) "Change in Control Price" means the price per share of Common Stock paid in conjunction with any transaction resulting in a Change in Control (as determined in good faith by the Board if any part of such price is payable other than in cash).
(h) "Committee" means the Compensation Committee of the Board (or such other committee of the Board which shall have jurisdiction over the compensation of officers).
(i) "Common Stock" means the Class A Common Stock, par value $.01 per share, of the Company.
(j) "Company" means Riverwood Holding, Inc., a Delaware corporation formerly known as New River Holding, Inc., and any successor thereto.
(k) "EBITDA", for any period, shall, unless otherwise provided in an Award Agreement, have the meaning assigned to such term in the Credit Agreement, dated as of March 21, 1996, among RIC Holding, Inc., the other borrowers party thereto, Chemical Bank, as administrative agent, and the lenders party thereto from time to time, as such agreement may be assumed by RIC as successor in interest to RIC Holding, Inc., and as the same may be amended from time to time.
(l) "Effective Date" means April 8, 1996.
(m) "Employee" means any executive officer or other key management employee of the Company.
(n) "Extraordinary Termination" means a termination of a Participant's employment with the Company and the Subsidiaries by reason of the Participant's death, Permanent Disability or Retirement.
(o) "Fair Market Value" means, as of any date, the fair market value on such date per share of Common Stock as determined in good faith by the Executive Committee of the Board. In making a determination of Fair Market Value, the Executive Committee shall give due consideration to such factors as it deems appropriate, including, without limitation, the earnings and certain other financial and operating information of the Company and the Subsidiaries in recent periods, the potential value of the Company and the Subsidiaries as a whole, the future prospects of the Company and the Subsidiaries and the industries in which they compete, the history and management of the Company and the Subsidiaries, the general condition of the securities markets, the fair market value of securities of companies engaged in businesses similar to those of the Company and the Subsidiaries and a valuation of the Common Stock, which shall be performed, with respect to the 1996 fiscal year, as promptly as practicable following the first business day of the 1997 fiscal year of the Company and each subsequent fiscal year by an independent valuation firm chosen by the Executive Committee, provided, however, that the Fair Market Value per share of Common Stock determined as of any date prior to January 1, 1997 shall be deemed to equal $100 unless the Executive Committee determines otherwise. Notwithstanding the foregoing, following a Public Offering, Fair Market Value shall mean the average of the high and low trading prices for a share of Common Stock on the primary national exchange (including NASDAQ) on which the Common Stock is then traded on the trading day immediately preceding the date as of which such Fair Market Value is determined. The determination of Fair Market Value will not give effect to any restrictions on transfer of the shares
of Common Stock or the fact that such Common Stock would represent a minority interest in the Company.
(p) "Incentive Award" means an award of Options under the Plan or the right to purchase Common Stock pursuant to Article VIII of the Plan.
(q) "Investors" means each of the investors who purchased shares of Common Stock or shares of Class B Common Stock of the Company concurrently with the consummation of the merger contemplated by the Merger Agreement, and their "specified affiliates", within the meaning of the Stockholders Agreement of the Company, as amended from time to time.
(r) "Merger Agreement" means the Agreement and Plan of Merger, dated as of October 25, 1995, among CDRO Acquisition Corporation, an indirect, wholly owned subsidiary of the Company, RIC Holding, Inc. a wholly owned subsidiary of the Company, and Riverwood International Corporation.
(s) "New Employer" means a Participant's employer, or the parent or a subsidiary of such employer, immediately following a Change in Control.
(t) "Option" means the right granted to a Participant under the Plan to purchase a stated number of shares of Common Stock at a stated price, not less than Fair Market Value on the date of grant, for a specified period of time.
(u) "Option Agreement" means an agreement between the Company and the Participant setting forth the terms and conditions of any Options granted hereunder, which agreement shall, unless the Board otherwise determines, be substantially in the form attached hereto as Exhibit B.
(v) "Participant" means any Employee designated by the Board to participate in the Plan.
(w) "Performance Option" means an Option granted pursuant to the Plan which vests in accordance with the provisions of Section 6.3(b) based upon the financial performance of the Company and the Subsidiaries.
(x) "Permanent Disability" means a physical or mental disability or infirmity that prevents the performance of a Participant's employment-related duties lasting (or likely to last, in the judgment of the Board) for a period of six months or longer and within 30 days after RIC notifies the Participant in writing that it intends to replace him, the Participant shall not have returned to the performance of his employment-related duties on a full-time basis. The Board's reasoned and good faith judgment of Permanent Disability shall be final, binding and conclusive and shall be based on such competent medical evidence as shall be presented to it by such Participant and/or by any physician or group of physicians or other competent medical expert employed by the Participant, the Company or RIC to advise the Board; provided that, with respect to any Participant who is party to an employment or individual severance agreement with the Company or RIC, "Permanent Disability" shall have the meaning, if any, assigned in such agreement to such term or to a similar term such as "Disability" or "Disabled".
(y) "Plan" means this Riverwood Holding, Inc. Stock Incentive Plan, as the same may be amended from time to time.
(z) "Public Offering" means the first day as of which sales of Common Stock are made to the public in the United States pursuant to an underwritten public offering of the Common Stock led by one or more underwriters at least one of which is an underwriter of nationally recognized standing.
(aa) "Registration and Participation Agreement" means the Registration and Participation Agreement, dated as of March 27, 1996, among the Company and certain stockholders of the Company, as the same may be amended from time to time.
(bb) "Retirement" means a Participant's retirement from active employment with the Company and the Subsidiaries at or after age 65.
(cc) "RIC" means Riverwood International Corporation, a Delaware corporation formerly known as Riverwood International USA, Inc., and any successor thereto.
(dd) "Service Option" means an Option granted pursuant to the Plan which vests in accordance with the provisions of Section 6.3(a) based upon a Participant's completion of service.
(ee) "Subscription Agreement" means the management stock subscription agreement entered into by the Company and a Participant setting forth the terms and conditions of any purchase of Common Stock by such Participant under the Plan which agreement shall be substantially in the form attached hereto as Exhibit A, unless the Board determines otherwise.
(ff) "Subsidiary" means any corporation or other person, a majority of whose outstanding voting securities or other equity interests is owned, directly or indirectly, by the Company.
2.2. Gender and Number. Except when otherwise indicated by the context, words in the masculine gender used in the Plan shall include the feminine gender, the singular shall include the plural, and the plural shall include the singular.
Section 3. Eligibility and Participation
Participants in the Plan shall be those Employees selected by the Board to participate in the Plan from time to time. The selection of an Employee as a Participant shall neither entitle such Employee to nor disqualify such Employee from participation in any other award or incentive plan.
Section 4. Powers of the Board
4.1. Power to Grant and Establish Terms of Awards. The Board shall, subject to the terms of the Plan, determine the Participants to whom Incentive Awards shall be granted and the terms and conditions of such Incentive Awards, provided that nothing in the Plan shall limit the right of members of the Board who are Employees to receive Incentive Awards hereunder.
4.2. Administration. The Board shall be responsible for the administration of the Plan. Any authority exercised by the Board under the Plan shall be exercised by the Board in its sole discretion. The Board, by majority action thereof, is authorized to prescribe, amend and rescind rules and regulations relating to the administration of the Plan, to provide for conditions and assurances deemed necessary or advisable to protect the interests of the Company and the Subsidiaries, and to make all other determinations necessary or advisable for the administration and interpretation of the Plan or to carry out its provisions and purposes. Determinations, interpretations or other actions made or taken by the Board pursuant to the provisions of the Plan shall be final, binding and conclusive for all purposes and upon all persons.
4.3 Delegation by the Board. All of the powers, duties and responsibilities of the Board specified in the Plan may, to the full extent permitted by applicable law, be exercised and performed by the Committee or any other duly constituted committee of the Board, in any such case, to the extent authorized by the Board to exercise and perform such powers, duties and responsibilities.
Section 5. Stock Subject to Plan
5.1. Number. Subject to the provisions of Section 5.3, the maximum number shares of Common Stock subject to Incentive Awards under the Plan (including shares that become available for grant pursuant to Section 5.2) may not exceed, in the aggregate, (i) 695,000 shares, reduced by (ii) the number of shares of Common Stock, not to exceed 5,000 shares, covered by Awards offered but not granted under Plan in the initial offering and grant of Awards hereunder. The shares to be delivered
under the Plan may consist, in whole or in part, of Common Stock held in treasury or authorized but unissued shares of Common Stock, not reserved for any other purpose.
5.2. Canceled, Terminated or Forfeited Awards. Any shares of Common Stock subject to any portion of an Incentive Award which for any reason expires, or is canceled, terminated, forfeited or otherwise settled without the issuance of such shares of Common Stock, shall again be available for award under the Plan, subject to the maximum limitation specified in Section 5.1.
5.3. Adjustment in Capitalization. The number and class of Incentive Awards (and the number of shares of Common Stock available for issuance upon exercise or settlement of such Incentive Awards) granted under the Plan, and the number, class and exercise price of any outstanding Options, may be adjusted by the Board, in its sole discretion, if it shall deem such an adjustment to be necessary or appropriate to reflect any Common Stock dividend, stock split or share combination or any recapitalization, merger, consolidation, exchange of shares, liquidation or dissolution of the Company.
6.1. Grant of Options. Options may be granted to Participants at such time or times as shall be determined by the Board. Each Option granted to a Participant shall be evidenced by an Option Agreement that shall specify the exercise price at which a share of Common Stock may be purchased pursuant to such Option, the duration of such Option and such other terms and conditions consistent with the Plan as the Board shall determine, including customary representations, warranties and covenants with respect to securities law matters. Unless otherwise determined by the Board, such Option Agreement shall also state that the holder thereof is entitled to the benefits of and shall be bound by the obligations set forth in the Registration and Participation Agreement, dated as of March 27, 1996 and as the same may be amended from time to time, among the Company and certain stockholders of the Company, to the extent set forth therein.
6.2.Option Price. The exercise price per share of Common Stock to be purchased upon exercise of an Option shall be determined by the Board but shall not be less than the Fair Market Value on the date the option is granted.
6.3.Exercise of Options.
(a)Service Options. Unless otherwise provided by the Board in the Option Agreement evidencing such Award, subject to the continuous employment of the Participant with the Company or one of the Subsidiaries, Service Options granted to a Participant shall become vested in five equal annual installments on each of the first five anniversaries of the date of grant,providedthat in all events 100% of such Service Options shall become exercisable (i) at the time and under the circumstances described in Sections 9.1 or 10, if applicable, or (ii)(x) in the event that the CD&R Fund and, if applicable, its Affiliates effect a sale or other disposition of all of the Common Stock then held by the CD&R Fund and its Affiliates to one or more persons other than any person who is an Affiliate of the CD&R Fund and (y) thereafter, the Participant's employment with the Company and the Subsidiaries is terminated by the Company other than for Cause or, to the extent provided in the Award Agreement evidencing such Service Options, by the Participant for "good reason" (as defined in such Option Agreement) (a "Disposition Transaction and Termination"), as of the date of such termination.
(b)Performance Options. Unless otherwise provided by the Board in the Option Agreement evidencing such Award, subject to Section 9.1 and 10, no portion of any Performance Options shall become vested unless and until the Company shall have achieved the EBITDA target specified in the Option Agreement evidencing such Performance Options and provided the Participant is in the continuous employment of the Company or one of the Subsidiaries from the date of grant to the date such target is achieved, provided, however, that in the event of a Disposition Transaction and Termination, a proportionate share of any Performance Options that have not vested and become exercisable on or prior to the date of such Disposition Transaction and Termination shall vest and become exercisable as of such date, such proportionate share to equal the product of (i) the percentage obtained by dividing (x) the cumulative EBITDA achieved by the Company as of the last day of the calendar quarter ending coincident with or immediately prior to the date of the Disposition Transaction and Termination by (y) the EBITDA target specified in the Option Agreement, multiplied by (ii) the total number of Shares subject to the Performance Options. Notwithstanding the foregoing provisions of this paragraph (b), subject to the continuous employment of the Participant with the Company or one of the Subsidiaries, Performance Options shall become vested in full, nine years and six months following the date of grant, regardless of whether the applicable EBITDA target shall have been achieved.
(c)Conditions. Notwithstanding any other provision herein, the Board may accelerate the vesting or exercisability of any Option, all Options or any class of Options, at any time and from time to time. On or before the date upon which any Employee will exercise any exercisable Option, the Company and such Employee shall enter into a Subscription Agreement with respect to the Common Stock to be purchased upon exercise of such Option. Notwithstanding any other provision of the Plan, no Option shall be exercisable for more than 10 years after the date on which it is granted.
6.4.Payment. The Board shall establish procedures governing the exercise of Options, which procedures shall generally require that written notice of the exercise thereof be given and that the exercise price thereof be paid in full in cash or cash equivalents, including by personal check, at the time of exercise. The exercise price of any Options exercised at any time following a Public Offering may be paid in full or in part in the form of shares of Common Stock that have been owned by the Participant for at least six months, based on the Fair Market Value of such shares of Common Stock on the date of exercise, subject to such rules and procedures as may be adopted by the Board and, if the Board deems it necessary or appropriate, subject to shareholder approval of the Plan. Subject to Section 6.3, as soon as practicable after receipt of a written exercise notice and payment in full of the exercise price of any Options, the Company shall deliver to the Participant a certificate or certificates representing the shares of Common Stock acquired upon the exercise thereof, bearing appropriate legends if applicable.
Section 7. Terms of Offers to Purchase Common Stock
7.1.Offers to Purchase Common Stock. Offers to purchase Common Stock may be made to Participants at such time or times as shall be determined by the Board. Each purchase of Common Stock by a Participant shall be made pursuant to a Subscription Agreement that shall include customary representations, warranties, covenants and other terms and conditions with respect to securities law matters and such other terms and conditions as the Board shall determine. Unless otherwise determined by the Board, such Subscription Agreement shall also state that in respect of any shares of Common Stock purchased by the Participant pursuant to such Subscription Agreement (i) prior to a Public Offering, such shares shall be subject to certain repurchase rights of Holding and the CD&R Fund and (ii) such Participant shall be entitled to certain of the benefits (relating to the right to participate in certain sales and purchases of Common Stock by the Investors) set forth in the Registration and Participation Agreement and shall be bound by the obligations set forth in such
Registration and Participation Agreement, in each case, to the extent set forth in the Subscription Agreement evidencing the purchase of such Common Stock.
7.2.Purchase Price. The purchase price per share of Common Stock to be purchased under the Plan shall be determined by the Board.
Section 8. Termination of Employment
8.1.Extraordinary Termination. Unless otherwise provided in the Option Agreement or otherwise determined by the Board, in the event that a Participant's employment with the Company and the Subsidiaries terminates by reason of an Extraordinary Termination, then (i) all Service Options granted to such Participant shall become fully vested as of the date of such termination, (ii) if the Performance Options granted to such Participant have not become vested on or prior to the date of such termination, a proportionate share of such Performance Options shall become vested as of the date of such termination, such proportionate share to equal the percentage obtained by dividing (A) the cumulative EBITDA achieved during the period from the date of grant (or such other date specified in the applicable Option Agreement) to the last day of the calendar quarter ending coincident with or immediately prior to the Participant's termination of employment, by (B) the cumulative EBITDA target specified in such Option Agreement and (iii) all such Service Options and vested Performance Options shall remain exercisable solely until the first to occur of (x) the one year anniversary of the date of the Participant's termination of employment or (y) the expiration of the term of any such Option. Any Performance Options held by the Participant that are not vested as of the date of an Extraordinary Termination shall terminate and be canceled immediately upon such Extraordinary Termination and all other Options that are not exercised within the period described in the preceding sentence shall terminate and be canceled upon the expiration of such period.
8.2.Termination for Cause. Unless otherwise provided in the Award Agreement or otherwise determined by the Board, in the event a Participant's employment with the Company and the Subsidiaries is terminated by the Company or a Subsidiary for Cause, any Options held by such Participant (whether or not then vested or exercisable) shall terminate and be canceled immediately upon such termination of employment and any Common Stock purchased by the Participant may be repurchased for a purchase price calculated in accordance with the terms of the Subscription Agreement.
8.3.Other Termination of Employment. Unless otherwise determined by the Board at the time of grant, the Board shall provide in the Option Agreement evidencing options granted hereunder that,, in the event that a Participant's employment with the Company and the Subsidiaries terminates for any reason other than (i) an Extraordinary Termination or (ii) for Cause, any Options then held by such Participant that have become vested on or prior to the date of such termination shall, subject to Section 8.4, remain exercisable until the first to occur of (x) the 60th day after the expiration of the period, if any, specified in such Participant's Option Agreement during which the Company or the CD&R Fund has a right to purchase such Options from the Participant or (y) the expiration of the term of such Option. Any Options held by the Participant that are not vested Options as of the date of the Participant's termination of employment shall terminate and be canceled immediately upon such termination, and any vested Options that are not exercised within the period described in the preceding sentence shall terminate and be canceled upon the expiration of such period.
8.4.Certain Rights upon Termination of Employment Prior to Public Offering. Unless otherwise determined by the Board at the time of grant, the Board shall provide in each Award Agreement evidencing Incentive Awards granted hereunder that, upon a termination of a Participant's employment with the Company and the Subsidiaries prior to a Public Offering for any reason, the Company and the CD&R Fund and its Affiliates shall have successive rights to repurchase for cash any vested Options or shares of Common Stock then held by the Participant, and, upon an Extraordinary Termination, the
Participant shall have the right to require the Company to repurchase shares of Common Stock then owned by him (provided the Participant has held such shares of Common Stock for at least six months), for a repurchase price equal to the Fair Market Value, reduced in the case of any Options by the exercise price per share of Common Stock for such Option, and upon such additional terms and conditions as are set forth in such Award Agreement.
9.1.Accelerated Vesting and Payment.
(a)Service Options and Vested Performance Options. Unless the Board otherwise determines in the manner set forth in Section 9.2, in the event of a Change in Control, each outstanding Service Option (regardless of whether such Option is at such time otherwise exercisable) and each outstanding Performance Option that has become vested prior to the Change in Control, without regard to this Section 9.1, shall be canceled in exchange for a payment in cash of an amount equal to the product of (i) the excess, if any, of the Change in Control Price over the Option Price, multiplied by (ii) the number of shares of Common Stock covered by such Option.
(b)Performance Options. Unless the Board otherwise determines in the manner set forth in Section 9.2, in the event of a Change of Control prior to the date as of which Performance Options have become vested in accordance with Section 6.3(b), a proportionate share (determined in accordance with the immediately succeeding sentence) of each outstanding Performance Option shall be canceled in exchange for a payment in cash of an amount equal to the product of (i) the excess, if any, of the Change in Control Price over the Option Price, multiplied by (ii) the number of shares of Common Stock covered by the vested portion of the Performance Option. Such proportionate share shall be determined in accordance with the formula described in Section 8.1 based on the cumulative EBITDA achieved as of the date of the Change in Control.
(c)Timing of Option Cancellation Payments. The cash payment described in paragraphs (a) and (b) above shall be payable in full, as soon as reasonably practicable, but in no event later than, 30 days following the Change in Control, unless provided otherwise by the Board in the Award Agreement evidencing such Options.
9.2.Alternative Options. Notwithstanding Section 9.1, no cash settlement or other payment shall be made with respect to any Option in the event that the transaction constituting the Change in Control is to be accounted for using the "pooling of interest" method of accounting. In such event, each Option then held by a Participant shall become fully vested immediately prior to the consummation of such transaction and each such Participant shall have the right, subject to compliance with all applicable securities laws, to (i) exercise his Options in connection with the Change in Control or (ii) provided such opportunity is made available by the New Employer, exchange such Options for fully exercisable options to purchase common stock of the New Employer having substantially equivalent economic value to the Options being exchanged therefor (determined at the time of the Change in Control).
9.3Certain Take-Along Rights Prior to a Public Offering. Unless otherwise determined by the Board at time of grant, the Board shall provide in each Subscription Agreement evidencing Incentive Awards granted hereunder that, upon certain transactions constituting a Change in Control, the Participant will be required to sell shares of Common Stock then owned by him, for a cash payment per share of Common Stock equal to the Change in Control Price, and upon such additional terms and conditions as are set forth in such Subscription Agreement.
Section 10. Amendment, Modification, andTermination of the Plan
The Board at any time may terminate or suspend the Plan, and from time to time may amend or modify the Plan. No amendment, modification, termination or suspension of the Plan shall in any manner adversely affect any Incentive Award theretofore granted under the Plan, without the consent of the Participant holding such Incentive Award. Shareholder approval of any such amendment, modification, termination or suspension shall be obtained to the extent mandated by applicable law, or if otherwise deemed appropriate by the Board.
Section 11. Miscellaneous Provisions
11.1.Nontransferability of Awards. No Options granted under the Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. All rights with respect to any Option granted to a Participant under the Plan shall be exercisable during his lifetime only by such Participant. Restrictions, if any, on the transfer of Common Stock purchased pursuant to Section 7.1 of the Plan or upon exercise of any Options shall be set forth in the applicable Award Agreement evidencing such Incentive Award, including without limitations, restrictions described in Section 8.4 herein.
11.2.Beneficiary Designation. Each Participant under the Plan may from time to time name any beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit under the Plan is to be paid or by whom any right under the Plan is to be exercised in case of his death. Each designation will revoke all prior designations by the same Participant, shall be in a form prescribed by the Board and will be effective only when filed by the Participant in writing with the Board during his lifetime. In the absence of any such designation, benefits remaining unpaid or Options or Deferred Stock Units outstanding at the Participant's death shall be paid to or exercised by the Participant's surviving spouse, if any, or otherwise to or by his estate.
11.3.No Guarantee of Employment or Participation. Nothing in the Plan shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate any Participant's employment at any time and for any reason, nor confer upon any Participant any right to continue in the employ of the Company or any Subsidiary. No Employee shall have a right to be selected as a Participant, or, having been so selected, to receive any Incentive Awards under the Plan.
11.4.Tax Withholding. The Company and the Subsidiaries shall have the power to withhold, or require a Participant to remit to the Company or a Subsidiary promptly upon notification of the amount due, an amount determined by the Company or such Subsidiary to be sufficient to satisfy all Federal, state, local and foreign withholding tax requirements in respect of any Incentive Award and the Company may (or may cause a Subsidiary to) defer payment of cash or issuance or delivery of Common Stock until such requirements are satisfied. The Board may permit or require a Participant to satisfy his tax withholding obligation hereunder in such other manner, subject to such conditions, as the Board shall determine.
11.5.Indemnification. Each person who is or shall have been a member of the Committee or the Board shall be indemnified and held harmless by the Company and RIC to the fullest extent permitted by law against and from any loss, cost, liability or expense (including any related attorney's fees and advances thereof) in connection with, based upon or arising or resulting from any claim, action, suit or proceeding to which he may be made a party or in which he may be involved by reason of any action taken or failure to act under or in connection with the Plan or any Award Agreement and from and against any and all amounts paid by him in settlement thereof, with the Company's approval, or paid by him in satisfaction of any judgment in any such action, suit or proceeding against him, provided he shall give the Company an opportunity, at its own expense, to handle and defend the same before he undertakes to handle and defend it on his own behalf. The foregoing right of indemnification shall not be exclusive and shall be independent of any other rights of indemnification to which such persons may be entitled under the Company's or RIC's Articles of Incorporation or By-laws, by contract, as a matter of law or otherwise.
11.6.No Limitation on Compensation. Nothing in the Plan shall be construed to limit the right of the Company to establish other plans or to pay compensation to its employees in cash or property, in a manner which is not expressly authorized under the Plan.
11.7.Requirements of Law. The granting of Incentive Awards and the issuance of shares of Common Stock shall be subject to all applicable laws, rules and regulations, and to such approvals by any governmental agencies or national or foreign securities exchanges as may be appropriate or required, as determined by the Board. Notwithstanding any other provision of the Plan or any Award Agreement, no Incentive Awards shall be granted under the Plan, and no shares of Common Stock shall be issued upon exercise of, or otherwise in connection with, any Incentive Award granted under the Plan, if such grant or issuance would result in a violation of applicable law, including the federal securities laws and any applicable state or foreign securities laws.
11.8.Governing Law. The Plan, and all agreements hereunder, shall be construed in accordance with and governed by the laws of the State of New York, except to the extent that the corporate law of the State of Delaware specifically and mandatorily applies.
11.9.No Impact On Benefits. Incentive Awards granted under the Plan are not compensation for purposes of calculating an Employee's rights under any employee benefit plan, except to the extent provided in any such plan.
11.10.Freedom of Action. Subject to Section 10, nothing in the Plan or any Award Agreement shall be construed as limiting or preventing the Company or any Subsidiary from taking any action with respect to the operation or conduct of its business that it deems appropriate or in its best interest.
11.11.Term of Plan. The Plan shall be effective as of the Effective Date. The Plan shall expire on the tenth anniversary of the Effective Date (except as to Incentive Awards outstanding on that date), unless sooner terminated pursuant to Section 10.
11.12.No Right to Particular Assets. Nothing contained in this Plan and no action taken pursuant to this Plan shall create or be construed to create a trust of any kind or any fiduciary relationship between the Company and the Subsidiaries, on the one hand, and any Participant or executor, administrator or other personal representative or designated beneficiary of such Participant, on the other hand, or any other persons. Any reserves that may be established by the Company or any Subsidiary in connection with this Plan shall continue to be held as part of the general funds of the Company or such Subsidiary, and no individual or entity other than the Company or such Subsidiary shall have any interest in such funds until paid to a Participant. To the extent that any Participant or his executor, administrator or other personal representative, as the case may be, acquires a right to receive any payment from the Company or any Subsidiary pursuant to this Plan, such right shall be no greater than the right of an unsecured general creditor of the Company or such Subsidiary.
11.13.Notices. Each Participant shall be responsible for furnishing the Board with the current and proper address for the mailing of notices and delivery of agreements and shares of Common Stock. Any notices required or permitted to be given shall be deemed given if directed to the person to whom addressed at such address and mailed by regular United States mail, first-class and prepaid. If any item mailed to such address is returned as undeliverable to the addressee, mailing will be suspended until the Participant furnishes the proper address.
11.14.Severability of Provisions. If any provision of this Plan shall be held invalid or unenforceable, such invalidity or unenforceability shall not affect any other provisions hereof, and this Plan shall be construed and enforced as if such provision had not been included.
11.15.Incapacity. Any benefit payable to or for the benefit of a minor, an incompetent person or other person incapable of receiving such benefit shall be deemed paid when paid to such person's guardian or to the party providing or reasonably appearing to provide for the care of such person, and such payment shall fully discharge the Committee, the Company and other parties with respect thereto.
11.16.No Rights as Stockholder. No Participant shall have any voting or other rights as a stockholder of the Company with respect to any Common Stock covered by any Incentive Award until the issuance of a certificate or certificates to the Participant for such Common Stock. No adjustment shall be made for dividends or other rights for which the record date is prior to the issuance of such certificate or certificates.
11.17.Headings and Captions. The headings and captions herein are provided for reference and convenience only, shall not be considered part of this Plan and shall not be employed in the construction of this Plan.
GRAPHIC PACKAGING CORPORATION
10:00 a.m. (local time)
Atlanta, Georgia 30339
| COMPANY # | ||||
| • | Use any touch-tone telephone to vote your proxy 24 hours a day, 7 days a week, until 12:00 p.m. (CT) on May 15, 2006. | |
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Proposal 1.
| 1. Election of directors: | 01 | o | Vote FOR | o | Vote WITHHELD | |||||
| 02 William R. Fields | all nominees | from all nominees | ||||||||
03 Harold R. Logan, Jr. | ||||||||||
| (except as marked) |
Address Change? Mark Box | o | Indicate changes below: | Date | ||||
Signature(s) in Box | |||||||
| Please sign exactly as your name(s) appears on Proxy. If held in joint tenancy, all persons should sign. Trustees, administrators, etc., should include title and authority. Corporations should provide full name of corporation and title of authorized officer signing the proxy. | |||||||