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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Allegion Plc | NYSE:ALLE | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
2.00 | 1.63% | 124.88 | 124.9901 | 123.03 | 123.85 | 374,162 | 23:58:15 |
¨
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Preliminary Proxy Statement
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¨
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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x
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Definitive Proxy Statement
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¨
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Definitive Additional Materials
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¨
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Soliciting Material Pursuant to §240.14a-12
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Allegion Public Limited Company
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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x
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No fee required.
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¨
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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1)
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Title of each class of securities to which transaction applies:
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2)
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Aggregate number of securities to which transaction applies:
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3)
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Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
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4)
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Proposed maximum aggregate value of transaction:
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5)
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Total fee paid:
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¨
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Fee paid previously with preliminary materials.
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¨
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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1)
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Amount Previously Paid:
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2)
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Form, Schedule or Registration Statement No.:
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3)
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Filing Party:
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4)
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Date Filed:
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When
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June 4, 2020, at 2:00 p.m. Eastern Daylight Time
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Location
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Allegion, 11819 N. Pennsylvania Street, Carmel, Indiana
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Record Date
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Only shareholders of record as of the close of business on April 9, 2020, are entitled to receive notice of, and to vote at, the Annual General Meeting.
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Items to be Voted on
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1. Elect as directors the 7 nominees named in the accompanying Proxy Statement.
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2. Provide advisory approval of the Company’s named executive officers.
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3. Advisory vote on whether “say-on-pay” should occur every one, two or three years.
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4. Approve appointment of independent auditors of the Company and authorize the Audit and Finance Committee of the Board of Directors to set the auditors’ remuneration.
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5. Renew the Board of Directors’ existing authority to issue shares.
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6. Renew the Board of Directors’ existing authority to issue shares for cash without first offering shares to existing shareholders (Special Resolution).
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7. To conduct such other business properly brought before the meeting.
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By Order of the Board of Directors,
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Hatsuki Miyata
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Secretary
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Registered Office Address:
Block D, Iveagh Court, Harcourt Road
Dublin 2, Ireland
Company No. 527370
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U.S. Mailing Address:
c/o Schlage Lock Company LLC
11819 N. Pennsylvania Street
Carmel, Indiana 46032
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Page
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ANNUAL GENERAL MEETING OF SHAREHOLDERS
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MEETING AGENDA AND VOTING RECOMMENDATIONS
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Agenda Item
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Vote Required
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Board Recommendation
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Page
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1.
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Election of seven directors named in the proxy statement
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Majority of votes cast
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FOR
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2.
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Advisory approval of the compensation of the Company’s named executive officers (“Say-on-Pay”)
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Majority of votes cast
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FOR
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3.
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Advisory vote on whether an advisory shareholder vote to approve the compensation of the Company’s named executive officers should occur every one, two or three years (“Say-on-Frequency”)
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Plurality of votes cast
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ONE YEAR
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4.
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Appointment of PricewaterhouseCoopers as the independent auditors of the Company and authorize the Audit and Finance Committee of the Board of Directors to set the auditors’ remuneration
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Majority of votes cast
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FOR
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5.
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Renewal of the Board of Directors’ existing authority to issue shares
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Majority of votes cast
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FOR
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6.
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Renewal of the Board of Directors’ existing authority to issue shares for cash without first offering shares to existing shareholders (Special Resolution)
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75% of votes cast
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FOR
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CORPORATE GOVERNANCE HIGHLIGHTS
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Board Conduct and Oversight
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ü
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Code of Conduct applied to all directors, officers and employees
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ü
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Board oversight of risk management, including information technology, data privacy and cybersecurity
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ü
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Board oversight of environmental, health, safety and sustainability matters
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ü
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Executive officer and director stock ownership guidelines
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ü
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Annual Board and Committee self-assessments of its performance and effectiveness
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ü
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One-on-one interviews with individual directors to ensure thoughtful, candid feedback
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ü
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Annual review of the Corporate Governance Guidelines and all Committee Charters
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ü
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Ongoing review of emerging topics and developments in governance best practices
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ü
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Succession planning at all levels, including for Board and CEO
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ü
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Monitor relations with shareholders, customers, employees, the communities in which the Company operates and other stakeholders
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Board Independence and Participation
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ü
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6 of 7 director nominees are independent by New York Stock Exchange (“NYSE”) standards and the Company’s Corporate Governance Guidelines
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ü
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Independent Lead Director
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ü
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Executive sessions of independent directors generally held at each of the Board and Committee meetings
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ü
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All three Board Committees (Audit and Finance, Compensation, and Corporate Governance and Nominating) are fully independent
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ü
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Retirement age (70)* and term limit (10 years) for independent directors
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ü
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2 of 7 director nominees are women or ethnically diverse
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ü
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Balance of new and experienced directors, with tenure of incumbent directors averaging 4.3 years
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ü
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Average age of director nominees is 61.7 years old
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ü
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Each of the Committees has the ability to hire outside experts and consultants as needed
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ü
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All incumbent directors* attended 100% of Board meetings and, on average, 98.2% of all Committee meetings held in 2019. No director attended less than 93.3% of all Committee meetings
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ü
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Independent directors have full access to management and other employees
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Shareholder Rights and Engagement
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ü
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Annual election of directors
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ü
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Majority voting in uncontested director elections
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ü
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Hold advisory approval of executive compensation (“Say-on-Pay” votes) annually for advisory approval by shareholders
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ü
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Hold “Say-on-Frequency” votes regarding advisory approval of executive compensation
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ü
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No option repricing without shareholder approval
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ü
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Investor Day event held periodically (most recently in March 2019) in person and via live webcast with recordings and transcripts available on our website following the event to provide updates on our business, strategy and exposure to our leadership team
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ü
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Senior management attendance each year at major investor conferences
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ü
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In 2019, reached out to holders of over 50% of our shares to discuss any questions or concerns about our corporate governance and compensation practices and to understand any particular issues that are top of mind for such shareholders
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Other Governance Best Practices
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ü
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Align pay with Company performance
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ü
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Clawback provisions for performance-based compensation
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ü
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No hedging or any form of short-term speculative trading of Company stock
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ü
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No pledging of Company stock
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ü
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“Double trigger” vesting provisions in change in control agreements
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ü
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No tax gross-ups in change in control agreements
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ü
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No excessive perquisites
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ü
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No dividend equivalents on unearned awards
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ENVIRONMENTAL, SOCIAL AND GOVERNANCE (“ESG”)
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EXECUTIVE COMPENSATION
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•
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Create and reinforce our pay-for-performance culture;
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•
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Align the interests of management with our shareholders and other stakeholders;
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•
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Attract, retain and motivate executive talent by providing competitive levels of salary and targeted total pay;
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•
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Provide incentive compensation that promotes desired behavior without encouraging unnecessary and excessive risk; and
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•
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Integrate with our performance management process of goal setting and formal evaluation.
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•
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Annual adjusted revenue of $2,878 million, an increase of 11.9% compared to prior year;
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•
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Adjusted Earnings Before Interest, Tax, Depreciation and Amortization (“EBITDA”) of $684 million, an increase of 11.6% compared to prior year;
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Available Cash Flow of $447 million, an increase of 11.2% compared to prior year;
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Adjusted earnings per share of $4.93, an increase of 10.8% compared to prior year; and
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•
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Total shareholder return of 89.25% for the 2017-2019 performance period, which falls into the 97th percentile of the S&P 400 Capital Goods Index.
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OUR DIRECTOR NOMINEES
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Committee Memberships
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Nominee
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Age
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Director Since
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Principal Occupation
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Independent
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Kirk S. Hachigian (Lead Director)
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60
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2013
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Former Non-Executive Chairman of JELD-WEN Holding, Inc.
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ü
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•
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•
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C
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Steven C. Mizell
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60
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2020
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Executive Vice President and Chief Human Resources Officer at Merck & Co., Inc.
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ü |
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•
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•
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•
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Nicole Parent Haughey
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48
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2017
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Former Chief Operating Officer of Mimeo.com
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ü |
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•
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•
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•
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David D. Petratis
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62
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2013
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Chairman, President and Chief Executive Officer of Allegion plc
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•
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•
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•
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Dean I. Schaffer
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68
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2014
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Former Partner of Ernst & Young LLP
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ü
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•
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C
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•
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Charles L. Szews
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63
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2018
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Former Chief Executive Officer of Oshkosh Corporation
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ü
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•
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•
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Martin E. Welch III
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71
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2013
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Former Executive Vice President and Chief Financial Officer of Visteon Corporation
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ü
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C
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•
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•
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Audit and Finance Committee
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Compensation Committee
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Corporate Governance and Nominating Committee
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C
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Chair
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BOARD EXPERTISE AND SKILLS
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K. Hachigian
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S. Mizell
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N. Parent Haughey
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D. Petratis
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D. Schaffer
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C. Szews
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M. Welch
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Knowledge and Skills
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Financial Expertise based on experience gained as a CFO, audit professional or financial analyst
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•
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•
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•
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•
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Finance / Capital Allocation skills based on experience as a CEO, CFO or other financial professional
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•
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•
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•
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•
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•
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•
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International experience outside of the United States
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•
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•
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•
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•
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•
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•
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Technology / Engineering experience or education
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•
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•
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•
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•
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•
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Marketing / Sales experience in understanding, assessing, developing and implementing marketing, sales and customer engagement strategies
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•
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•
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•
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•
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Services experience based on current or prior industry experience
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•
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•
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•
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•
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•
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Compensation / HR experience based on HR expertise or CEO / head of business role with people management or as Compensation Committee Chair
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•
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•
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•
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•
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•
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•
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Strategy / M&A experience and knowledge based on evaluating and implementing business and investment strategies, incl. M&A
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•
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•
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•
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•
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•
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•
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•
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Experience
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CEO / Business Head based on current or prior role(s)
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•
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•
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•
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•
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Industrial / Manufacturing experience and knowledge based on industry experience
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•
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•
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•
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•
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•
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Academia / Education based on experience teaching at or serving in an advisory or Board capacity at higher education institutions
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•
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•
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•
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•
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•
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Government / Public Policy based on experience working in highly regulated industries or in a government capacity
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•
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•
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Financial Services experience and skills based on experience as a financial professional or analyst
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•
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•
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Boards of Other Public Companies based on service on other public boards
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•
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•
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•
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•
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•
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ADVISORY VOTE ON THE COMPENSATION OF THE COMPANY’S NAMED EXECUTIVE OFFICERS
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ADVISORY VOTE ON THE FREQUENCY OF HOLDING A SAY-ON-PAY VOTE
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APPOINTMENT OF INDEPENDENT AUDITORS
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RENEWAL OF BOARD OF DIRECTORS’ EXISTING AUTHORITY TO ISSUE SHARES
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RENEWAL OF BOARD OF DIRECTORS’ EXISTING AUTHORITY TO ISSUE SHARES FOR CASH WITHOUT FIRST OFFERING SHARES TO EXISTING SHAREHOLDERS
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2021 ANNUAL GENERAL MEETING
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Deadline for shareholder proposals for inclusion in the proxy statement:
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December 18, 2020
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Deadline for business proposals and nominations for director to be brought before the 2021 Annual General Meeting:
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March 8, 2021
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PROXY STATEMENT
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Item 1. Election of Directors
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Item 2. Advisory Approval of the Compensation of Our Named Executive Officers
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•
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Create and reinforce our pay-for-performance culture;
|
•
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Align the interests of management with our shareholders and other stakeholders;
|
•
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Attract, retain and motivate executive talent by providing competitive levels of salary and targeted total pay;
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•
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Provide incentive compensation that promotes desired behavior without encouraging unnecessary and excessive risk; and
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•
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Integrate with our performance management process of goal setting and formal evaluation.
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Item 3. Advisory Vote on the Frequency of Holding a Say-on-Pay Vote
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a)
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One year;
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b)
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Two years;
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c)
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Three years; or
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d)
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Abstain.”
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Item 4. Approval of Appointment of Independent Auditors
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Audit and Finance Committee Report
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Fees of the Independent Auditors
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2019
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2018
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Audit Fees (a)
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$
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4,399,000
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$
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4,013,500
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Audit-Related Fees (b)
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480,000
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116,500
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Tax Fees (c)
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2,159,000
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737,060
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All Other Fees (d)
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317,900
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2,900
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Total
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$
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7,355,900
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$
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4,869,960
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(a)
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Audit Fees for the fiscal years ended December 31, 2019 and 2018 were for professional services rendered for the audits of the Company’s annual consolidated financial statements, including its internal controls over financial reporting, quarterly reviews, statutory audits, and issuance of consents.
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(b)
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Audit-Related Fees for the fiscal years ended December 31, 2019 and 2018 consist of employee benefit plan audits, financial and tax due diligence and other attest services that are not related to performing the audit or review of our consolidated financial statements.
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(c)
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The Tax Fees for the fiscal years ended December 31, 2019 and 2018 relate to consulting services.
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(d)
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All Other Fees for the fiscal year ended December 31, 2019 and 2018 includes license fees for technical accounting and financial statement disclosure software. All Other Fees for the fiscal year ended December 31, 2019 also includes consulting fees for a benchmarking project.
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Item 5. Renewal of the Board of Directors’ Existing Authority to Issue Shares
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Item 6.
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Renewal of the Board of Directors’ Existing Authority to Issue Shares for Cash Without First Offering Shares to Existing Shareholders
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(a)
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the allotment of equity securities in connection with a rights issue in favor of the holders of ordinary shares (including rights to subscribe for, or convert into, ordinary shares) where the equity securities respectively attributable to the interests of such holders are proportional (as nearly as may be) to the respective numbers of ordinary shares held by them (but subject to such exclusions or other arrangements as the directors may deem necessary or expedient to deal with fractional entitlements that would otherwise arise, or with legal or practical problems under the laws of, or the requirements of any recognized regulatory body or any stock exchange in, any territory, or otherwise); and
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(b)
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the allotment (other than pursuant to sub-paragraph (a) above) of equity securities up to an aggregate nominal value of $46,109 (4,610,915 shares) (being equivalent to approximately 5% of the aggregate nominal value of the issued ordinary share capital of the Company as of April 1, 2020 (the latest practicable date before this proxy statement)),
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CORPORATE GOVERNANCE GUIDELINES AND PRACTICES
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•
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Selecting individuals for Board members and evaluating the performance of the Board, its committees and individual directors;
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•
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Selecting, monitoring, evaluating and compensating senior management;
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•
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Selecting the CEO and assuring that management succession planning is adequate;
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•
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Reviewing and approving significant corporate actions;
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•
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Reviewing and monitoring implementation of management’s strategic plans and capital allocation strategy;
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•
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Reviewing and approving the Company’s annual operating plans and budgets;
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•
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Monitoring corporate performance and evaluating results compared to relevant peers, the Company’s strategic plans and other long-range goals;
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•
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Reviewing the Company’s financial controls and reporting systems;
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•
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Reviewing and approving the Company’s financial statements and financial reporting;
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•
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Reviewing the Company’s ethical standards and legal compliance programs and procedures;
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•
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Overseeing the Company’s management of enterprise risk, including cybersecurity; and
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•
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Monitoring relations with shareholders, customers, employees, the communities in which the Company operates and other stakeholders.
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Responsibilities of the Lead Director
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•
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Chair the meetings of the independent directors when the Chairman is not present;
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•
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Ensure the full participation and engagement of all Board members in deliberations;
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•
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Lead the Board in all deliberations involving the CEO’s employment, including hiring, contract negotiations, performance evaluations and dismissal;
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•
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Counsel the Chairman on issues of interest/concern to directors and encourage all directors to engage the Chairman with their interests and concerns;
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•
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Work with the Chairman to develop an appropriate schedule of Board meetings and approve such schedule, to ensure that the directors have sufficient time for discussion of all agenda items, while not interfering with the flow of Company operations;
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•
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Work with the Chairman to develop the Board and Committee agendas and approve the final agendas;
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•
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Keep abreast of key Company activities and advise the Chairman as to the quality, quantity and timeliness of the flow of information from Company management that is necessary for the directors to effectively and responsibly perform their duties; although Company management is responsible for the preparation of materials for the Board, the Lead Director will approve information provided to the Board and may specifically request the inclusion of certain material;
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•
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Engage consultants who report directly to the Board and assist in recommending consultants that work directly for Board Committees;
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•
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Work in conjunction with the Corporate Governance and Nominating Committee (“Corporate Governance Committee”) in compliance with Corporate Governance Committee processes to interview all Board candidates and make recommendations to the Board of Directors;
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•
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Assist the Board and Company officers in assuring compliance with and implementation of the Company’s Corporate Governance Guidelines; work in conjunction with the Corporate Governance Committee to recommend revisions to the Corporate Governance Guidelines;
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•
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Call, coordinate and develop the agenda for and chair executive sessions of the Board’s independent directors; act as principal liaison between the independent directors and the CEO;
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•
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Work in conjunction with the Corporate Governance Committee to identify for appointment the members of the various Board Committees, as well as selection of the Committee chairs;
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•
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Be available for consultation and direct communication with major shareholders in coordination with the CEO;
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•
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Make a commitment to serve in the role of Lead Director for a minimum of three years; and
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•
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Help set the tone for the highest standards of ethics and integrity.
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•
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Meeting with the Lead Director following each Board meeting to discuss any open matters from the meeting and to receive feedback from the Lead Director regarding issues arising at the executive session(s) of the independent directors;
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•
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Having regular, open and candid conversations with the Lead Director to discuss important issues and seek guidance when appropriate;
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•
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Using the Lead Director as a sounding board and mentor;
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•
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Keeping the Lead Director, and as appropriate the full Board, informed about key developments and concerns; and
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•
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Consulting with the Lead Director on the preparation of Board meeting agendas and content, meeting schedules and the background material provided to the Board.
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•
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The Audit and Finance Committee oversees risks associated with our systems of disclosure controls and internal controls over financial reporting, our compliance with legal and regulatory requirements and risks associated with foreign exchange, insurance, credit and debt. The Audit and Finance Committee also oversees risks related to information technology, data privacy and cybersecurity.
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•
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The Compensation Committee considers risks related to the attraction and retention of talent and risks related to the design of compensation programs and arrangements.
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•
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The Corporate Governance and Nominating Committee oversees risks associated with our governance policies and practices as well as sustainability.
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DIRECTOR INDEPENDENCE
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COMMUNICATION WITH DIRECTORS
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CODE OF CONDUCT
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ANTI-HEDGING POLICY AND OTHER RESTRICTIONS
|
COMMITTEES OF THE BOARD
|
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Audit and Finance
|
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Compensation
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Corporate Governance and Nominating
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Kirk S. Hachigian
|
ü
|
|
ü
|
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Chair
|
|||
Steven C. Mizell
|
ü
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|
ü
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|
ü
|
|||
Nicole Parent Haughey
|
ü
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|
ü
|
|
ü
|
|||
Dean I. Schaffer
|
ü
|
|
Chair
|
|
ü
|
|||
Charles L. Szews
|
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|
ü
|
|
ü
|
|||
Martin E. Welch III
|
Chair
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ü
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ü
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Compensation Committee
|
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Key Functions
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|
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|
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Establish executive compensation policies.
Approve the CEO’s compensation based on the evaluation by the Board of the CEO’s performance against the goals and objectives set by the Board.
Approve compensation of officers.
Review and approve executive compensation and benefit programs.
Oversee our equity compensation plan.
Review and recommend significant changes in principal employee benefit programs.
Approve and oversee Compensation Committee consultants.
For a discussion concerning the processes and procedures for determining executive compensation and the role of executive officers and compensation consultants in determining or recommending the amount or form of compensation, see “Compensation Discussion and Analysis.”
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Independence
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The Board has determined that each member of the Compensation Committee is “independent” as defined in the NYSE listing standards and our Corporate Governance Guidelines. In addition, the Board has determined that each member of the Compensation Committee qualifies as a “Non-Employee Director” within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934 and an “outside director” within the meaning of Section 162(m) of the Code.
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Corporate Governance and Nominating Committee
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Key Functions
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|
|
|
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Identify individuals qualified to become directors and recommend the candidates for all directorships.
Recommend individuals for election as officers.
Review our Corporate Governance Guidelines and make recommendations for changes.
Consider questions of independence and possible conflicts of interest of directors and executive officers.
Take a leadership role in shaping our corporate governance.
Oversee our sustainability efforts.
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||
|
||
|
||
|
||
|
||
|
||
|
Independence
|
|
|
|
|
|
The Board has determined that each member of the Corporate Governance Committee is “independent” as defined in the NYSE listing standards and our Corporate Governance Guidelines.
|
Board
|
5
|
|
Audit and Finance Committee
|
13
|
|
Compensation Committee
|
11
|
|
Corporate Governance and Nominating Committee
|
6
|
|
ENVIRONMENTAL, HEALTH, SAFETY AND SUSTAINABILITY
|
•
|
Integration of sound environmental, health, safety (EHS) and sustainability strategies in our business functions, including objectives and measurements;
|
•
|
Periodic, formal evaluation of our compliance status and annual review of objectives and targets;
|
•
|
Engaging in training and education for employees to help them understand their roles in supporting the EHS and sustainability issues associated with their jobs and work areas;
|
•
|
Making continuous improvements in EHS and sustainability management systems and performance, including reduction in the usage of natural resources, waste minimization, prevention of pollution and prevention of workplace accidents, injuries and risks;
|
•
|
Designing, operating and maintaining our facilities in a manner that minimizes negative EHS and sustainability impacts;
|
•
|
Use of materials responsibly, including, where feasible, the recycling and reuse of materials; and
|
•
|
Acting in a way that shows sensitivity to community concerns about EHS and sustainability issues.
|
SOCIAL
|
GOVERNANCE
|
Name
|
|
Fees earned
or paid
in cash
($)
|
|
Stock Awards
($)(a)
|
|
All Other
Compensation
($)(b)
|
|
Total
($)
|
C. Cico (c)
|
|
140,000
|
|
100,067
|
|
—
|
|
240,067
|
K. S. Hachigian
|
|
165,000
|
|
100,067
|
|
—
|
|
265,067
|
S. C. Mizell (d)
|
|
—
|
|
—
|
|
—
|
|
—
|
N. Parent Haughey
|
|
140,000
|
|
100,067
|
|
—
|
|
240,067
|
D. I. Schaffer
|
|
152,000
|
|
100,067
|
|
—
|
|
252,067
|
C. L. Szews
|
|
140,000
|
|
100,067
|
|
—
|
|
240,067
|
M. E. Welch
|
|
155,000
|
|
100,067
|
|
—
|
|
255,067
|
(a)
|
The amount represents the aggregate grant date fair value of the annual grant of RSUs to our independent, non-employee directors, computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. As of December 31, 2019, each independent, non-employee director held 981 RSUs in relation to the RSU grant awarded in 2019.
|
(b)
|
The aggregate amount of perquisites and other personal benefits received by each independent, non-employee director in 2019 was less than $10,000.
|
(c)
|
Ms. Cico retired from the Board on January 27, 2020.
|
(d)
|
Mr. Mizell was appointed to the Board on February 6, 2020.
|
Name
|
|
Position
|
D. D. Petratis
|
|
Chairman, President and Chief Executive Officer
|
P. S. Shannon
|
|
Senior Vice President and Chief Financial Officer
|
J. N. Braun
|
|
Senior Vice President, General Counsel and Chief Compliance Officer
|
T. P. Eckersley
|
|
Senior Vice President and President - Americas
|
L. V. Moretti
|
|
Senior Vice President and President - EMEIA
|
•
|
Executive Summary
|
•
|
Compensation Philosophy and Design Principles
|
•
|
How We Make Compensation Decisions
|
•
|
Compensation Elements
|
•
|
2019 Compensation Structure Decisions
|
•
|
2019 Incentive Program Designs and Compensation Values for 2019 Performance
|
•
|
2020 Compensation
|
•
|
Other Compensation and Tax Matters
|
EXECUTIVE SUMMARY
|
$2,878m of Annual Adjusted Revenue
|
|
$447m Available Cash Flow
|
11.9% Annual Adjusted Revenue Growth
|
|
Available Cash Flow (“ACF”) increased by 11.2% over the prior year
|
$684m Adjusted EBITDA
|
|
$4.93 Adjusted EPS
|
|
97th Percentile TSR
|
Adjusted Earnings Before Interest, Tax, Depreciation and Amortization grew 11.6%
over the prior year
|
|
Adjusted Earnings Per Share (“EPS”) increased 10.8%
over the prior year
|
|
Total Shareholder Return (“TSR”)
of 89.25% for the 2017-2019 Performance Period
|
NEO
|
|
Base Salary
($)
|
|
Annual Incentive Target Value
($)
|
|
Long-term Incentive Target Value
($)
|
|
Total Target Compensation
($)
|
||||
D. D. Petratis
|
|
1,000,000
|
|
|
1,200,000
|
|
|
3,900,000
|
|
|
6,100,000
|
|
P. S. Shannon
|
|
562,065
|
|
|
421,549
|
|
|
1,100,000
|
|
|
2,083,614
|
|
J. N. Braun
|
|
432,600
|
|
|
259,560
|
|
|
575,000
|
|
|
1,267,160
|
|
T. P. Eckersley
|
|
463,500
|
|
|
324,450
|
|
|
600,000
|
|
|
1,387,950
|
|
L. V. Moretti*
|
|
380,906
|
|
|
247,589
|
|
|
460,000
|
|
|
1,088,495
|
|
*
|
Ms. Moretti is paid in Euros. The U.S. Dollar (“USD”) amounts above are shown as of April 1, 2019 based on the Euro to USD exchange rate of 1.1220.
|
|
|
COMPENSATION PHILOSOPHY AND DESIGN PRINCIPLES
|
Compensation Committee Practices
|
||
Independence of Committee members
|
|
Committee members satisfy the NYSE independence standards, are “non-employee directors” under SEC rules and satisfy the requirements of an “outside director” for purposes of the Internal Revenue Code (the “Code”).
|
Independent compensation consultant
|
|
The Compensation Committee retains and annually reviews the independence of its compensation consultant.
|
Annual risk assessment
|
|
The Compensation Committee annually assesses the materiality and likelihood of our compensation program to ensure that our plans and awards are designed and working in a way to not encourage excessive risk taking.
|
Mitigate undue risk
|
|
We mitigate undue risk in our compensation program by instituting governance policies such as capping potential payments under our incentive plans, instituting clawback provisions, utilizing multiple performance metrics, including absolute and relative metrics, striking a balance between short- and long-term incentives and adopting stock ownership requirements.
|
Performance-based compensation
|
|
We grant a high percentage of performance-based compensation. We believe this is essential to creating a pay-for-performance culture.
|
Target pay at the median level
|
|
We generally target total direct compensation opportunities at the competitive market median and allow performance (both operational and shareholder return) to determine actual or realized pay. Actual pay may be above or below the target median based on performance.
|
Stock ownership guidelines
|
|
The Compensation Committee has adopted stock ownership guidelines: (i) equal to six times base salary for the CEO; (ii) equal to three times base salary for the CFO; (iii) equal to two times base salary for the CEO’s direct reports who are executive officers at Senior Vice President level; and (iv) equal to one times base salary for the CEO’s direct reports who are executive officers at Vice President level. The executive officer must achieve compliance with the guidelines by the fifth anniversary of the officer’s appointment. All executive officers are in compliance with the guidelines.
|
Clawback policy
|
|
We have the right to seek recoupment of all or part of annual cash incentives or PSUs if there is a restatement of our financial statements for any such year which results from fraud or intentional misconduct committed by an award holder.
|
Anti-hedging and pledging policy
|
|
We prohibit our directors and executive officers from (i) purchasing any financial instruments designed to hedge or offset any decrease in the market value of our securities and (ii) engaging in any form of short-term speculative trading in our securities. Directors and executive officers are also prohibited from holding our securities in a margin account or pledging our securities as collateral for a loan unless pre-approved by the Corporate Governance and Nominating Committee.
|
“Double Triggers” in change in control agreements
|
|
The NEOs and other executive officers do not receive change in control benefits unless their employment is terminated without cause (or by the executive for good reason) within a specified period following a change in control.
|
No tax gross ups on change in control benefits
|
|
The NEOs and other executive officers are not entitled to tax gross ups in the event that their change in control benefits are subject to the “golden parachute” excise tax under the Code.
|
HOW WE MAKE COMPENSATION DECISIONS
|
Compensation Benchmarking Peer Group
|
•
|
Are similar to us in terms of certain factors, including one or more of the following: size (i.e., revenue, market capitalization and growth characteristics), industry, lifecycle stage, and global presence; and
|
•
|
Have NEOs whose scope of responsibilities are comparable in terms of breadth and complexity.
|
Acuity Brands
|
Diebold
|
Masco Corp
|
Roper Technologies
|
A.O. Smith
|
Flir Systems
|
Masonite International
|
Simpson Manufacturing
|
Belden
|
Fortune Brands Home & Security
|
NCI Building Systems
|
Steelcase
|
Brady
|
Hubbell
|
Owens Corning
|
USG
|
Carlisle Companies
|
Lennox International
|
Rockwell Automation
|
|
Companies Removed
|
|
Companies Added
|
NCI Building Systems
|
|
National Instruments Corp.
|
USG
|
|
Trimble Inc.
|
|
|
Zebra Technologies Corporation
|
Acuity Brands
|
Diebold
|
Masco Corp
|
Roper Technologies
|
A.O. Smith
|
Flir Systems
|
Masonite International
|
Simpson Manufacturing
|
Belden
|
Fortune Brands Home & Security
|
National Instruments Corp
|
Steelcase
|
Brady
|
Hubbell
|
Owens Corning
|
Trimble Inc
|
Carlisle Companies
|
Lennox International
|
Rockwell Automation
|
Zebra Technologies Corp
|
Performance Peer Group
|
COMPENSATION ELEMENTS
|
|
|
Salary
|
|
AIP
|
|
PSUs
|
|
Options
|
|
RSUs
|
|
|
|
|
|
|
|
|
|
|
|
Who Receives
|
|
All NEOs
|
||||||||
|
|
|
|
|
|
|
||||
When Granted / Received
|
|
Reviewed annually
|
|
Annually for prior year performance
|
|
First Quarter Annually
|
||||
|
|
|
|
|
|
|
||||
Form of Delivery
|
|
Cash
|
|
Equity
|
||||||
|
|
|
|
|
||||||
Type of Performance
|
|
Short Term Emphasis
|
|
Long Term Emphasis
|
||||||
|
|
|
|
|
|
|
||||
Performance / Service Period
|
|
Ongoing
|
|
1 Year
|
|
3 Years
|
||||
|
|
|
|
|
|
|
|
|
||
How Payout is Determined
|
|
Compensation Committee Discretion
|
|
Formulaic; Compensation Committee Approves
|
|
Formulaic; Compensation Committee Approves
|
|
Stock Price on Exercise/Vest Date
|
||
|
|
|
|
|
|
|
|
|
||
Most Recent Performance Measure
|
|
N/A
|
|
Mix of Financial and Individual Goals
|
|
EPS & Relative TSR
|
|
Stock Price Appreciation
|
2019 COMPENSATION STRUCTURE DECISIONS
|
NEO
|
|
2018 Base Salary
($)
|
|
2019 Base Salary
($)
|
|
Increase
(%)
|
|||
D. D. Petratis
|
|
950,000
|
|
|
1,000,000
|
|
|
5.3
|
|
P. S. Shannon
|
|
530,250
|
|
|
562,065
|
|
|
6.0
|
|
J. N. Braun
|
|
420,000
|
|
|
432,600
|
|
|
3.0
|
|
T. P. Eckersley
|
|
463,500
|
|
|
463,500
|
|
|
—
|
|
L. V. Moretti
|
|
406,074
|
|
|
380,906
|
|
|
(6.2)*
|
*
|
In 2019, Ms. Moretti’s base salary was increased from €329,600 to €336,488. The USD amounts above are shown as of April of the applicable year based on the Euro to USD exchange rate on that day. The decrease in salary from 2018 to 2019 is a result of the fluctuation in the exchange rate.
|
NEO
|
|
2018 Target AIP
(% of Base Salary)
|
|
2019 Target AIP
(% of Base Salary)
|
|
Target AIP
Increase
(%)
|
|
2018 Target
LTI
($)
|
|
2019 Target
LTI
($)
|
|
Target LTI
Increase
($)
|
|||
D. D. Petratis
|
|
120
|
|
120
|
|
—
|
|
3,650,000
|
|
|
3,900,000
|
|
|
250,000
|
|
P. S. Shannon
|
|
75
|
|
75
|
|
—
|
|
1,000,000
|
|
|
1,100,000
|
|
|
100,000
|
|
J. N. Braun
|
|
60
|
|
60
|
|
—
|
|
525,000
|
|
|
575,000
|
|
|
50,000
|
|
T. P. Eckersley
|
|
70
|
|
70
|
|
—
|
|
600,000
|
|
|
600,000
|
|
|
—
|
|
L. V. Moretti
|
|
65
|
|
65
|
|
—
|
|
400,000
|
|
|
460,000
|
|
|
60,000
|
|
2019 INCENTIVE PROGRAM DESIGNS AND COMPENSATION VALUES FOR 2019 PERFORMANCE
|
Annual Incentive Plan Design
|
Base Salary
|
|
X
|
|
Target Percentage
|
|
X
|
|
Financial Performance Score
|
|
X
|
|
Individual Performance Score
|
|
=
|
|
AIP Award
|
Financial Performance
|
Revenue
|
|
+
|
|
EBITDA
(Corporate)
or
Operating Income (“OI”)
(Regions)
|
|
+
|
|
Available Cash Flow
(“ACF”) (Corporate)
or
Operating Cash Flow
(“OCF”) (Regions)
|
|
=
|
|
Financial
Performance Score
|
(1/4 Weight)
|
|
|
(1/2 Weight)
|
|
|
(1/4 Weight)
|
|
|
|
|
Corporate
|
|
|
||||
|
|
Pre-established Financial Targets (in millions)
|
|
Payout as a % of Target
|
||||
|
|
Revenue
($)
|
|
EBITDA
($)
|
|
ACF
($)
|
|
|
Threshold
|
|
2,760
|
|
642
|
|
416
|
|
50%
|
Target
|
|
2,874
|
|
689
|
|
440
|
|
100%
|
Maximum
|
|
3,027
|
|
759
|
|
509
|
|
200%
|
|
|
Americas
|
|
|
||||
|
|
Pre-established Financial Targets (in millions)
|
|
Payout as a % of Target
|
||||
|
|
Revenue
($)
|
|
OI
($)
|
|
OCF
($)
|
|
|
Threshold
|
|
2,009
|
|
568
|
|
580
|
|
50%
|
Target
|
|
2,094
|
|
606
|
|
599
|
|
100%
|
Maximum
|
|
2,195
|
|
660
|
|
705
|
|
200%
|
|
|
EMEIA
|
|
|
||||
|
|
Pre-established Financial Targets (in millions)
|
|
Payout as a % of Target
|
||||
|
|
Revenue
($)
|
|
OI
($)
|
|
OCF
($)
|
|
|
Threshold
|
|
576
|
|
57
|
|
70
|
|
50%
|
Target
|
|
594
|
|
62
|
|
82
|
|
100%
|
Maximum
|
|
623
|
|
68
|
|
97
|
|
200%
|
Individual Performance
|
Actual Financial Performance vs. Target Goals
|
|
|
Financial Target Goals
($)
|
|
Adjusted Actual Performance
($)
|
|
Performance as a % of Target Goal
|
|
Financial Performance Score
|
||||
Corporate
|
|
|
|
|
|
|
|
|
||||
Revenue
|
|
2,874
|
|
|
2,878
|
|
|
100.8
|
%
|
|
|
|
EBITDA
|
|
689
|
|
|
684
|
|
|
94.7
|
%
|
|
98.35%
|
|
ACF
|
|
440
|
|
|
447
|
|
|
103.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Americas
|
|
|
|
|
|
|
|
|
||||
Revenue
|
|
2,094
|
|
|
2,115
|
|
|
110.2
|
%
|
|
|
|
OI
|
|
606
|
|
|
616
|
|
|
118.8
|
%
|
|
113.46
|
%
|
OCF
|
|
599
|
|
|
614
|
|
|
106.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
EMEIA
|
|
|
|
|
|
|
|
|
||||
Revenue
|
|
594
|
|
|
591
|
|
|
92.7
|
%
|
|
|
|
OI
|
|
62
|
|
|
58
|
|
|
57.2
|
%
|
|
75.26%
|
|
OCF
|
|
82
|
|
|
80
|
|
|
94.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Evaluated Individual Performance
|
NEO
|
|
Individual
Performance Score
|
D. D. Petratis
|
140
|
|
P. S. Shannon
|
150
|
|
J. N. Braun
|
130
|
|
T. P. Eckersley
|
140
|
|
L.V. Moretti
|
130
|
D. D. Petratis
|
•
Top quartile financial performance as compared to Allegion peer group and key indices
•
Refreshed Allegion’s global strategy and proactively communicated to the investment community, shareholders and employees
•
Continued excellence in industry leading safety results and sustainability efforts with a focus on reduction of energy usage and waste
•
Established a global system of customer satisfaction and quality with common metrics across Allegion
•
Significant increase in employee engagement as measured by the Gallup Engagement Census
|
P. S. Shannon
|
•
Delivered strong execution of capital deployment to maximize shareholder value
•
Successful execution of Investor Day, including communication of refreshed strategy
•
Continued enhancement and execution of comprehensive tax strategy while minimizing impact of global legislative reform
•
Developed digital transformation plan and improved financial processes
•
Completed successful debt refinancing
|
J. N. Braun
|
•
Successfully managed and mitigated legal exposure globally
•
Provided strong leadership on several global initiatives including plant moves, restructurings, and debt refinancing
•
Strengthened several global programs including Data Privacy and Ethics and Compliance
•
Obtained record U.S. patents issued in 2019
•
Led authorized seller efforts to protect our brands and product quality
|
T. P. Eckersley
|
•
Delivered above plan across all metrics including Revenue, Operating Income and Operating Cash Flow
•
Strong leverage on revenue growth resulting in year over year margin expansion
•
Continued to deliver strong electronics growth through product innovation
•
Accelerated the Digital Transformation of the business, enhancing customer experience and creating new value driving top line growth
•
Led year over year improvements in overall employee engagement as measured by the Gallup Engagement Census
|
L. V. Moretti
|
•
Delivered organic revenue growth, strong price realization and cash conversion for the region
•
Continued to deliver solid electronics growth
•
Executed difficult plant and restructuring moves effectively
•
Delivered strong safety results
•
Significant increase in employee engagement as measured by the Gallup Engagement Census
|
2019 AIP Award
|
NEO
|
|
Target AIP Amount
(A)($)
|
|
Financial Performance Score
(B) *
|
|
AIP Earned from Financial Performance
(C)=(A)x(B)($)
|
|
Individual Performance Score
(D)
|
|
2019 AIP Award
(E)=(C)x(D)($)
|
||||
D. D. Petratis
|
|
1,200,000
|
|
|
98.35
|
%
|
|
1,180,200
|
|
|
140%
|
|
1,652,280
|
|
P. S. Shannon
|
|
421,549
|
|
|
98.35
|
%
|
|
414,593
|
|
|
150%
|
|
621,890
|
|
J. N. Braun
|
|
259,560
|
|
|
98.35
|
%
|
|
255,277
|
|
|
130%
|
|
331,860
|
|
T. P. Eckersley
|
|
324,450
|
|
|
106.66
|
%
|
|
346,058
|
|
|
140%
|
|
484,482
|
|
L. V. Moretti **
|
|
243,175
|
|
|
85.65
|
%
|
|
208,280
|
|
|
130%
|
|
270,763
|
|
*
|
The Financial Performance Score for Mr. Eckersley and Ms. Moretti represent a weighted combination of the corporate score (45%) and the applicable regional score (55%).
|
**
|
The amounts for Ms. Moretti are based on the Euro to USD exchange rate as of February 6, 2020 which was 1.1020 Euro to the U.S. dollar.
|
Long-Term Incentive Program Design
|
EPS Performance*
|
|
% of Target PSUs Earned **
|
|
Below Threshold
|
|
No award earned
|
|
Threshold
|
|
50
|
%
|
Target
|
|
100
|
%
|
Maximum
|
|
200
|
%
|
TSR Performance Relative to
S&P 400 Capital Goods Index
|
|
% of Target PSUs Earned **
|
|
< 25th Percentile
|
|
No award earned
|
|
25th Percentile
|
|
50
|
%
|
50th Percentile
|
|
100
|
%
|
>= 75th Percentile
|
|
200
|
%
|
|
|
|
*
|
EPS is calculated in accordance with GAAP, subject to adjustment by the Compensation Committee based on pre-approved categories.
|
**
|
Results are interpolated between percentiles achieved. The Compensation Committee retains the authority and discretion to make downward adjustments to the calculated PSU award payouts regardless of actual performance. Beginning with the 2019-2021 performance period, threshold for EPS increased from 25% to 50%.
|
Equity Awards Granted in 2019
|
NEO
|
|
Target
2019-2021
PSU Award
($)
|
|
Target
2019-2021
PSU Award
(#)
|
|
Stock
Option Award
($)
|
|
Stock
Option Award
(#)
|
|
RSU
Award
($)
|
|
RSU
Award
(#)
|
||||||
D. D. Petratis
|
|
2,040,109
|
|
|
22,139
|
|
|
975,006
|
|
|
49,796
|
|
|
975,046
|
|
|
11,070
|
|
P. S. Shannon
|
|
575,477
|
|
|
6,245
|
|
|
275,001
|
|
|
14,045
|
|
|
275,074
|
|
|
3,123
|
|
J. N. Braun
|
|
300,870
|
|
|
3,265
|
|
|
143,756
|
|
|
7,342
|
|
|
143,835
|
|
|
1,633
|
|
T. P. Eckersley
|
|
313,863
|
|
|
3,406
|
|
|
150,002
|
|
|
7,661
|
|
|
150,000
|
|
|
1,703
|
|
L.V. Moretti
|
|
240,696
|
|
|
2,612
|
|
|
115,013
|
|
|
5,874
|
|
|
115,032
|
|
|
1,306
|
|
PSUs Earned for 2017 - 2019 Performance Period
|
Performance Metric
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
Actual
|
|
% Payout Earned
|
EPS*
|
|
$3.98
|
|
$4.44
|
|
$4.95
|
|
$4.93
|
|
196
|
TSR
|
|
25th percentile
|
|
50th percentile
|
|
>= 75th percentile
|
|
97th percentile (89.25% TSR)
|
|
200
|
*
|
EPS was adjusted to eliminate the impact of: (i) loss on divestitures; (ii) restructuring; and (iii) trade name impairments.
|
NEO
|
|
Target PSUs Awarded
(#)
|
|
PSUs Earned
(#)
|
||
D. D. Petratis
|
|
23,318
|
|
|
46,170
|
|
P. S. Shannon
|
|
5,917
|
|
|
11,716
|
|
J. N. Braun
|
|
3,133
|
|
|
6,204
|
|
T. P. Eckersley
|
|
3,829
|
|
|
7,582
|
|
L. V. Moretti
|
|
2,089
|
|
|
4,138
|
|
2020 COMPENSATION
|
NEO
|
|
2020 Base Salary
($)
|
|
2020 Target Annual Incentive
(as a % of Base Salary)
|
|
2020 Target
Annual LTI
($)
|
||
D. D. Petratis
|
|
1,000,000
|
|
|
125
|
|
4,300,000
|
|
P. S. Shannon
|
|
584,800
|
|
|
75
|
|
1,300,000
|
|
J. N. Braun
|
|
445,400
|
|
|
60
|
|
625,000
|
|
T. P. Eckersley
|
|
500,000
|
|
|
70
|
|
600,000
|
|
L. V. Moretti**
|
|
396,334
|
|
|
65
|
|
475,000
|
|
**
|
Ms. Moretti is paid in Euros. The USD amounts above are based on the Euro to USD exchange rate of 1.1020 as of February 6, 2020.
|
OTHER COMPENSATION AND TAX MATTERS
|
SUMMARY COMPENSATION TABLE
|
Name and
Principal Position
|
|
Year
|
|
Salary
($)
|
|
Bonus
($)
|
|
Stock
Awards
($)(a)
|
|
Option
Awards
($)(b)
|
|
Non-
Equity
Incentive
Plan
Compensation
($)(c)
|
|
Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)(d)
|
|
All
Other
Compensation
($)(e)
|
|
Total
($) |
|||||||
D. D. Petratis
|
|
2019
|
|
986,539
|
|
|
—
|
|
3,015,155
|
|
|
975,006
|
|
|
1,652,280
|
|
|
1,395,741
|
|
|
527,724
|
|
|
8,552,445
|
|
Chairman,
President and CEO
|
|
2018
|
|
950,000
|
|
|
—
|
|
3,017,362
|
|
|
912,511
|
|
|
1,805,225
|
|
|
673,578
|
|
|
228,104
|
|
|
7,586,780
|
|
|
2017
|
|
950,000
|
|
|
—
|
|
2,776,707
|
|
|
837,501
|
|
|
1,657,371
|
|
|
1,244,129
|
|
|
308,895
|
|
|
7,774,603
|
|
|
P. S. Shannon
|
|
2019
|
|
553,499
|
|
|
—
|
|
850,551
|
|
|
275,001
|
|
|
621,890
|
|
|
1,399,933
|
|
|
147,104
|
|
|
3,847,978
|
|
Senior Vice President and CFO
|
|
2018
|
|
523,452
|
|
|
—
|
|
826,706
|
|
|
250,008
|
|
|
629,750
|
|
|
117,933
|
|
|
47,735
|
|
|
2,395,584
|
|
|
2017
|
|
493,760
|
|
|
—
|
|
704,632
|
|
|
212,518
|
|
|
600,698
|
|
|
959,824
|
|
|
105,508
|
|
|
3,076,940
|
|
|
J. N. Braun
|
|
2019
|
|
429,208
|
|
|
—
|
|
444,705
|
|
|
143,756
|
|
|
331,860
|
|
|
—
|
|
99,953
|
|
|
1,449,482
|
|
|
Senior Vice President and General Counsel
|
|
2018
|
|
414,615
|
|
|
—
|
|
434,050
|
|
|
131,253
|
|
|
353,005
|
|
|
—
|
|
47,955
|
|
|
1,380,878
|
|
|
|
2017
|
|
395,746
|
|
|
—
|
|
373,114
|
|
|
112,509
|
|
|
322,080
|
|
|
—
|
|
76,645
|
|
|
1,280,094
|
|
||
T. P. Eckersley
|
|
2019
|
|
463,500
|
|
|
—
|
|
463,863
|
|
|
150,002
|
|
|
484,482
|
|
|
551,013
|
|
|
113,553
|
|
|
2,226,413
|
|
Senior Vice President - Americas
|
|
2018
|
|
459,865
|
|
|
—
|
|
496,139
|
|
|
150,009
|
|
|
409,651
|
|
|
42,392
|
|
|
47,712
|
|
|
1,605,768
|
|
|
2017
|
|
441,923
|
|
|
—
|
|
455,993
|
|
|
137,506
|
|
|
409,596
|
|
|
373,147
|
|
|
84,288
|
|
|
1,902,453
|
|
|
L. V. Moretti (f)
|
|
2019
|
|
377,563
|
|
|
—
|
|
355,728
|
|
|
115,013
|
|
|
270,272
|
|
|
—
|
|
215,030
|
|
|
1,333,606
|
|
|
Senior Vice President - EMEIA
|
|
2018
|
|
388,043
|
|
|
—
|
|
330,755
|
|
|
100,020
|
|
|
334,082
|
|
|
—
|
|
474,823
|
|
|
1,627,723
|
|
|
|
2017
|
|
374,586
|
|
|
—
|
|
248,794
|
|
|
75,012
|
|
|
377,917
|
|
|
—
|
|
444,945
|
|
|
1,521,254
|
|
(a)
|
The amounts shown in this column reflect the aggregate grant date fair value of PSU awards and any RSU awards granted for the year under ASC Topic 718 and do not reflect amounts paid to or realized by the NEOs. In determining the aggregate grant date fair value of the PSU awards, the awards are valued assuming target level performance achievement. If the maximum level performance achievement is assumed, the aggregate grant date fair value of the PSU awards granted in 2019 would be as follows:
|
Name
|
|
Maximum Grant Date Value of PSU Awards
($) |
|
D. D. Petratis
|
|
4,080,218
|
|
P. S. Shannon
|
|
1,150,954
|
|
J. N. Braun
|
|
601,740
|
|
T. P. Eckersley
|
|
627,726
|
|
L. V. Moretti
|
|
481,392
|
|
(b)
|
The amounts in this column reflect the aggregate grant date fair value of stock option grants for financial reporting purposes for the year under ASC 718 and do not reflect amounts paid to or realized by the NEOs. For a discussion of
|
(c)
|
This column reflects the amounts earned as annual awards under our AIP program. AIP awards are paid in cash.
|
(d)
|
Amounts reported in this column reflect the aggregate increase in the actuarial present value of the benefits under the qualified Pension Plan (the “Pension Plan”), Supplemental Pension Plan, KMP and EOSP, as applicable. The increase in pension benefits value is attributable to the additional year of service and age, the annual AIP award and any annual salary increase and any changes in the interest rates used to value the benefits. The plans do not permit above-market or preferential earnings on any nonqualified deferred compensation.
|
(e)
|
The following table summarizes the components of this column for 2019:
|
Name
|
|
Company Matching Contributions
($)(1)
|
|
Tax Equalization ($)(2)
|
|
Tax
Assistance
($)(2)
|
|
Other
Benefits
($)(3)
|
|
Total
($)
|
||||
D. D. Petratis
|
|
358,399
|
|
|
—
|
|
—
|
|
169,325
|
|
|
527,724
|
|
|
P. S. Shannon
|
|
118,584
|
|
|
—
|
|
—
|
|
28,520
|
|
|
147,104
|
|
|
J. N. Braun
|
|
86,433
|
|
|
—
|
|
—
|
|
13,520
|
|
|
99,953
|
|
|
T. P. Eckersley
|
|
84,518
|
|
|
—
|
|
—
|
|
29,035
|
|
|
113,553
|
|
|
L. V. Moretti
|
|
6,668
|
|
|
92,391
|
|
|
104,103
|
|
11,868
|
|
|
215,030
|
|
(1)
|
Represents matching contributions under our ESP and Supplemental ESP plans for Messrs. Petratis, Shannon, Braun and Eckersley, and contributions under the Italian Providential fund for Ms. Moretti. Note: For Messrs. Petratis, Shannon, Braun and Eckersley, these amounts also include a one-time contribution that was made by the Company in 2019, respectively, to correct an administrative error in contribution calculations (which resulted in an underfunding of contributions) in 2018 and early 2019.
|
(2)
|
Represents tax equalization provided to Ms. Moretti to mitigate the impact of being required to live in a high tax jurisdiction and the tax assistance provided by the Company for the additional tax owed as a result of the income imputed from the tax equalization payment for the 2018 tax year.
|
(3)
|
The other benefits the NEOs received in 2019 are:
|
Name
|
|
Aircraft Use
($)(i)
|
|
Other
($)(ii)
|
|
Total
($)
|
|||
D. D. Petratis
|
|
143,329
|
|
|
25,996
|
|
|
169,325
|
|
P. S. Shannon
|
|
—
|
|
28,520
|
|
|
28,520
|
|
|
J. N. Braun
|
|
—
|
|
13,520
|
|
|
13,520
|
|
|
T. P. Eckersley
|
|
—
|
|
29,035
|
|
|
29,035
|
|
|
L. V. Moretti
|
|
—
|
|
11,868
|
|
|
11,868
|
|
(i)
|
Represents the aggregate incremental costs, including flight time, fuel surcharge, catering, taxes, peak travel adjustment fees, and ground transportation to/from the airport, as applicable, of the hired aircraft for personal travel by Mr. Petratis, up to a total of $145,000 per year, as approved by the Compensation Committee. On occasion, Mr. Petratis’ and other NEO’s family or other personal guests may accompany them on the hired aircraft used for business purposes, provided that certain conditions under the Company’s aircraft policy are met. To the extent such occasions arise, Mr. Petratis and the other NEOs are subject to imputed taxable income at the Standard Industry Fare Level (SIFL) rates for any personal passengers on that flight and the Company does not provide tax gross-ups for such imputed income.
|
(ii)
|
Represents: (a) the incremental cost of the leased cars, calculated based on the lease, insurance, fuel and maintenance costs; (b) auto allowance; (c) financial counseling services; (d) executive health program; and (e) product rebate program reimbursements, as relevant.
|
(f)
|
Cash amounts for Ms. Moretti were paid in Euros. For reporting purposes, these amounts have been converted from Euro to United States dollars in this table and throughout this Proxy Statement. Where amounts are reported as a point in time, Euros were converted to United States dollars using the closing currency exchange rate as of December 31, 2019. Where payments were made throughout the year, unless otherwise noted, Euros were converted to U.S. dollars using the closing currency exchange rate as of the last day of the month in which the cash compensation was received or deemed to have been received.
|
2019 GRANTS OF PLAN-BASED AWARDS
|
Name
|
|
Grant Date
|
Estimated Future Payouts
Under Non-Equity
Plan Awards
|
|
Estimated Future Payouts
Under Equity
Incentive Plan Awards
|
All Other Stock Awards: Number of Shares of Stock or Units
(#)(c)
|
All Other Option Awards: Number of Securities Underlying Options
(#)(c)
|
Exercise
or Base
Price of
Option
Awards
($/Sh)
(d)
|
Closing Stock Price on Grant Date
($/Sh)
|
Grant
Date
Fair
Value of
Stock
and
Option
Awards
($)(e)
|
|||||||||
Threshold
($)(a)
|
Target
($)(a)
|
Maximum
($)(a)
|
|
Threshold
(#)(b)
|
Target
(#)(b)
|
Maximum
(#)(b)
|
|||||||||||||
D. D. Petratis
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
AIP
|
|
2/6/2019
|
600,000
|
|
1,200,000
|
|
2,400,000
|
|
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
||
PSUs (2019-2021)
|
|
2/21/2019
|
—
|
—
|
—
|
|
11,070
|
22,139
|
|
44,278
|
—
|
—
|
—
|
—
|
2,040,109
|
|
|||
Options
|
|
2/21/2019
|
—
|
—
|
—
|
|
—
|
—
|
—
|
—
|
49,796
|
88.08
|
88.23
|
975,006
|
|
||||
RSUs
|
|
2/21/2019
|
—
|
—
|
—
|
|
—
|
—
|
—
|
11,070
|
—
|
—
|
—
|
975,046
|
|
||||
P. S. Shannon
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
AIP
|
|
2/6/2019
|
210,774
|
|
421,549
|
|
843,098
|
|
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
||
PSUs (2019-2021)
|
|
2/21/2019
|
—
|
—
|
—
|
|
3,123
|
6,245
|
|
12,490
|
—
|
—
|
—
|
—
|
575,477
|
|
|||
Options
|
|
2/21/2019
|
—
|
—
|
—
|
|
—
|
—
|
—
|
—
|
14,045
|
88.08
|
88.23
|
275,001
|
|
||||
RSUs
|
|
2/21/2019
|
—
|
—
|
—
|
|
—
|
—
|
—
|
3,123
|
—
|
—
|
—
|
275,074
|
|
||||
J. N. Braun
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
AIP
|
|
2/6/2019
|
129,780
|
|
259,560
|
|
519,120
|
|
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
||
PSUs (2019-2021)
|
|
2/21/2019
|
—
|
—
|
—
|
|
1,633
|
3,265
|
|
6,530
|
—
|
—
|
—
|
—
|
300,870
|
|
|||
Options
|
|
2/21/2019
|
—
|
—
|
—
|
|
—
|
—
|
—
|
—
|
7,342
|
88.08
|
88.23
|
143,756
|
|
||||
RSUs
|
|
2/21/2019
|
—
|
—
|
—
|
|
—
|
—
|
—
|
1,633
|
—
|
—
|
—
|
143,835
|
|
||||
T. P. Eckersley
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
AIP
|
|
2/6/2019
|
162,225
|
|
324,450
|
|
648,900
|
|
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
||
PSUs (2019-2021)
|
|
2/21/2019
|
—
|
—
|
—
|
|
1,703
|
3,406
|
|
6,812
|
—
|
—
|
—
|
—
|
313,863
|
|
|||
Options
|
|
2/21/2019
|
—
|
—
|
—
|
|
—
|
—
|
—
|
—
|
7,661
|
88.08
|
88.23
|
150,002
|
|
||||
RSUs
|
|
2/21/2019
|
—
|
—
|
—
|
|
—
|
—
|
—
|
1,703
|
—
|
—
|
—
|
150,000
|
|
||||
L. V. Moretti
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
AIP
|
|
2/6/2019
|
125,615
|
|
251,230
|
|
502,459
|
|
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
||
PSUs (2019-2021)
|
|
2/21/2019
|
—
|
—
|
—
|
|
1,306
|
2,612
|
|
5,224
|
—
|
—
|
—
|
—
|
240,696
|
|
|||
Options
|
|
2/21/2019
|
—
|
—
|
—
|
|
—
|
—
|
—
|
—
|
5,874
|
88.08
|
88.23
|
115,013
|
|
||||
RSUs
|
|
2/21/2019
|
—
|
—
|
—
|
|
—
|
—
|
—
|
1,306
|
—
|
—
|
—
|
115,032
|
|
(a)
|
The target award levels for the AIP program were established by the Compensation Committee in February 2019. Refer to Compensation Discussion and Analysis under the heading “Annual Incentive Program” for a description of the Compensation Committee’s process for establishing AIP program award levels. The amounts reflected in the “Estimated Future Payouts Under Non-Equity Incentive Plan Awards” columns represent the threshold, target and maximum amounts for awards under the AIP program. The amounts shown in the threshold, target and maximum
|
(b)
|
The amounts reflected in the “Estimated Future Payouts Under Equity Incentive Plan Awards” columns represent the threshold, target and maximum amounts for PSU awards for the 2019-2021 performance period. PSUs are granted under the 2013 Stock Plan. The PSUs pay $0 for performance below threshold. For a description of the Compensation Committee’s process for establishing PSU target award levels and the terms of PSU awards, please refer to Compensation Discussion and Analysis under the heading “Long-Term Incentive Program” and the “Post-Employment Benefits” section below.
|
(c)
|
The amounts in these columns reflect the stock option and RSU awards granted in February 2019 under the 2013 Stock Plan. For a description of the Compensation Committee’s process for determining stock option and RSU awards and the terms of such awards, see Compensation Discussion and Analysis under the heading “Long-Term Incentive Program” and the “Post-Employment Benefits” section below.
|
(d)
|
The 2013 Stock Plan requires stock options to be granted at an exercise price equal to the fair market value of our ordinary shares on the date of grant. The fair market value is defined as the average of the high and low price of our ordinary shares listed on the NYSE on the grant date.
|
(e)
|
The grant date fair value of the equity awards granted in 2019 was calculated in accordance with ASC 718. We caution that the actual amount ultimately realized by each NEO from the stock option awards will likely vary based on a number of factors, including stock price fluctuations, differences from the valuation assumptions used and timing of exercise or applicable vesting. For a description of the assumptions made in valuing the equity awards see Note 15, “Share-Based Compensation” to our consolidated financial statements contained in its 2019 Form 10-K. For PSUs, the grant date fair value has been determined based on achievement of target level performance.
|
OUTSTANDING EQUITY AWARDS AT DECEMBER 31, 2019
|
Name
|
|
|
|
Option Awards
|
|
Stock Awards
|
|||||||||||||||||||
|
Grant Date
|
|
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
(a)
|
|
Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable
(a)
|
|
Option
Exercise
Price
($)
|
|
Option
Expiration
Date
(b)
|
|
Number of Shares or Units of Stock that have Not Vested
(#)(c)
|
|
Market Value of Shares or Units of Stock that have Not Vested
($)(d)
|
|
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that have Not Vested
(#)(e)
|
|
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights that have Not Vested
($)(d)
|
||||||||
D.D. Petratis
|
|
2/21/2019
|
|
—
|
|
49,796
|
|
|
88.0800
|
|
|
2/21/2029
|
|
11,070
|
|
|
1,378,658
|
|
|
22,139
|
|
|
2,757,191
|
|
|
|
|
2/22/2018
|
|
14,287
|
|
|
28,574
|
|
|
86.9300
|
|
|
2/22/2028
|
|
6,998
|
|
|
871,531
|
|
|
20,994
|
|
|
2,614,593
|
|
|
|
2/13/2017
|
|
30,644
|
|
|
15,322
|
|
|
71.8350
|
|
|
2/13/2027
|
|
3,887
|
|
|
484,087
|
|
|
23,318
|
|
|
2,904,024
|
|
|
|
2/16/2016
|
|
47,289
|
|
|
—
|
|
57.8500
|
|
2/16/2026
|
|
—
|
|
—
|
|
—
|
|
—
|
||||||
|
|
2/20/2015
|
|
41,947
|
|
|
—
|
|
57.8500
|
|
2/20/2025
|
|
—
|
|
—
|
|
—
|
|
—
|
||||||
|
|
3/11/2014
|
|
38,344
|
|
|
—
|
|
54.1250
|
|
|
3/11/2024
|
|
—
|
|
—
|
|
—
|
|
—
|
|||||
|
|
12/13/2013
|
|
43,243
|
|
|
—
|
|
43.3600
|
|
12/13/2023
|
|
—
|
|
—
|
|
—
|
|
—
|
||||||
P.S. Shannon
|
|
2/21/2019
|
|
—
|
|
14,045
|
|
|
88.0800
|
|
|
2/21/2029
|
|
3,123
|
|
|
388,938
|
|
|
6,245
|
|
|
777,752
|
|
|
|
|
2/22/2018
|
|
3,914
|
|
|
7,829
|
|
|
86.9300
|
|
|
2/22/2028
|
|
1,918
|
|
|
238,868
|
|
|
5,752
|
|
|
716,354
|
|
|
|
2/13/2017
|
|
7,776
|
|
|
3,888
|
|
|
71.8350
|
|
|
2/13/2027
|
|
987
|
|
|
122,921
|
|
|
5,917
|
|
|
736,903
|
|
|
|
2/16/2016
|
|
11,823
|
|
|
—
|
|
57.8500
|
|
|
2/16/2026
|
|
—
|
|
—
|
|
—
|
|
—
|
|||||
|
|
2/20/2015
|
|
10,487
|
|
|
—
|
|
57.8500
|
|
|
2/20/2025
|
|
—
|
|
—
|
|
—
|
|
—
|
|||||
|
|
3/11/2014
|
|
9,586
|
|
|
—
|
|
54.1250
|
|
|
3/11/2024
|
|
—
|
|
—
|
|
—
|
|
—
|
|||||
J.N. Braun
|
|
2/21/2019
|
|
—
|
|
7,342
|
|
|
88.0800
|
|
|
2/21/2029
|
|
1,633
|
|
|
203,374
|
|
|
3,265
|
|
|
406,623
|
|
|
|
|
2/22/2018
|
|
—
|
|
4,110
|
|
|
86.9300
|
|
|
2/22/2028
|
|
1,007
|
|
|
125,412
|
|
|
3,020
|
|
|
376,111
|
|
|
|
|
2/13/2017
|
|
—
|
|
2,059
|
|
|
71.8350
|
|
|
2/13/2027
|
|
523
|
|
|
65,134
|
|
|
3,133
|
|
|
390,184
|
|
|
T.P. Eckersley
|
|
2/21/2019
|
|
—
|
|
7,661
|
|
|
88.0800
|
|
|
2/21/2029
|
|
1,703
|
|
|
212,092
|
|
|
3,406
|
|
|
424,183
|
|
|
|
|
2/22/2018
|
|
2,348
|
|
4,698
|
|
|
86.9300
|
|
|
2/22/2028
|
|
1,151
|
|
|
143,346
|
|
|
3,452
|
|
|
429,912
|
|
|
|
|
2/13/2017
|
|
5,031
|
|
|
2,516
|
|
|
71.8350
|
|
|
2/13/2027
|
|
639
|
|
|
79,581
|
|
|
3,829
|
|
|
476,864
|
|
|
|
2/16/2016
|
|
7,882
|
|
—
|
|
57.8500
|
|
|
2/16/2026
|
|
8,644
|
|
|
1,076,524
|
|
|
—
|
|
—
|
||||
|
|
2/20/2015
|
|
6,992
|
|
|
—
|
|
57.8500
|
|
|
2/20/2025
|
|
—
|
|
—
|
|
—
|
|
—
|
|||||
|
|
3/11/2014
|
|
6,391
|
|
|
—
|
|
54.1250
|
|
|
3/11/2024
|
|
—
|
|
—
|
|
—
|
|
—
|
|||||
L.V. Moretti
|
|
2/21/2019
|
|
—
|
|
5,874
|
|
|
88.0800
|
|
|
2/21/2029
|
|
1,306
|
|
|
162,649
|
|
|
2,612
|
|
|
325,298
|
|
|
|
|
2/22/2018
|
|
1,566
|
|
3,132
|
|
|
86.9300
|
|
|
2/22/2028
|
|
768
|
|
|
95,647
|
|
|
2,301
|
|
|
286,567
|
|
|
|
|
2/13/2017
|
|
2,744
|
|
|
1,373
|
|
|
71.8350
|
|
|
2/13/2027
|
|
349
|
|
|
43,464
|
|
|
2,089
|
|
|
260,164
|
|
|
|
2/16/2016
|
|
4,729
|
|
|
—
|
|
57.8500
|
|
|
2/16/2026
|
|
—
|
|
—
|
|
—
|
|
—
|
|||||
|
|
2/20/2015
|
|
4,195
|
|
|
—
|
|
57.8500
|
|
|
2/20/2025
|
|
—
|
|
—
|
|
—
|
|
—
|
|||||
|
|
4/8/2014
|
|
3,520
|
|
|
—
|
|
51.2950
|
|
|
4/8/2024
|
|
—
|
|
—
|
|
—
|
|
—
|
(a)
|
These columns represent stock option awards. These awards become exercisable in three equal installments beginning on the first anniversary after the date of grant, subject to continued employment or retirement.
|
(b)
|
Stock option awards expire on the tenth anniversary of the grant date.
|
(c)
|
This column represents unvested RSUs. Except as described in the following sentence, RSUs become exercisable in three equal installments beginning on the first anniversary after the date of grant, subject to continued employment or retirement. Mr. Eckersley’s grant of 17,287 RSUs on February 16, 2016 vested 50% on December 31, 2018 and vests 50% on December 31, 2020.
|
(d)
|
The market value was computed based on $124.54, the closing market price of our ordinary shares on the NYSE at December 31, 2019.
|
(e)
|
This column represents unvested and unearned PSUs. PSUs generally vest upon the completion of a three-year performance period. The receipt of the shares subject to the award is subject to achievement of the performance goals as certified by the Compensation Committee, and continued employment. The outstanding PSUs are reflected at the target level because we currently believe that is the probable outcome of the performance conditions.
|
2019 OPTION EXERCISES AND STOCK VESTED
|
Name
|
|
Option Awards
|
|
Stock Awards
|
||||||||||||
Number of Shares
Acquired on Exercise
(#)
|
|
Value
Realized on
Exercise
($)
|
|
Number of Shares
Acquired on
Vesting
(#)
|
|
Value
Realized on
Vesting
($)
|
||||||||||
D. D. Petratis
|
|
—
|
|
|
—
|
|
29,988
|
|
|
2,700,046
|
|
|||||
P. S. Shannon
|
|
42,142
|
|
|
2,723,464
|
|
|
12,167
|
|
|
1,091,463
|
|
||||
J. N. Braun
|
|
8,273
|
|
|
295,982
|
|
|
6,478
|
|
|
581,113
|
|
||||
T. P. Eckersley
|
|
32,007
|
|
|
2,535,805
|
|
|
8,030
|
|
|
720,319
|
|
||||
L. V. Moretti
|
|
—
|
|
|
—
|
|
4,821
|
|
|
408,003
|
|
2019 PENSION BENEFITS
|
Name
|
|
Plan
Name
|
|
Number of Years
Credited Service
(#)(a)
|
|
Present Value of
Accumulated
Benefit
($)(b)
|
|
Payments
During
Last Fiscal
Year
($)
|
||||
D. D. Petratis
|
|
EOSP
|
|
6.42
|
|
|
|
5,694,325
|
|
|
|
—
|
P. S. Shannon
|
|
Qualified Pension Plan
|
|
17.67
|
|
|
|
294,088
|
|
|
|
—
|
|
|
Supplemental Pension Plan
|
|
17.67
|
|
|
|
1,095,600
|
|
|
|
—
|
|
|
EOSP
|
|
18.00
|
|
|
|
4,841,213
|
|
|
|
—
|
J. N. Braun (c)
|
|
—
|
|
—
|
|
|
|
—
|
|
|
|
—
|
T. P. Eckersley
|
|
Qualified Pension Plan
|
|
12.17
|
|
|
|
199,440
|
|
|
|
—
|
|
|
Supplemental Pension Plan
|
|
12.17
|
|
|
|
472,539
|
|
|
|
—
|
|
|
KMP
|
|
12.17
|
|
|
|
1,776,031
|
|
|
|
—
|
L. V. Moretti (c)
|
|
—
|
|
—
|
|
|
|
—
|
|
|
|
—
|
(a)
|
Under the EOSP or the KMP, for officers covered prior to May 19, 2009 by Ingersoll Rand, a full year of service is credited for any year in which they work at least one day. In the Pension Plan, the Supplemental Pension Plan, the EOSP and the KMP for officers first covered on or after May 19, 2009 by Ingersoll Rand, the number of years of credited service is based on elapsed time (i.e., credit is given for each month in which a participant works at least one day).
|
(b)
|
The amounts in this column reflect the estimated present value of each NEO’s accumulated benefit under the plans indicated. The calculations reflect the value of the benefits assuming that each NEO was fully vested under each plan. The benefits were computed as of December 31, 2019, consistent with the assumptions described in Note 12, “Pensions and Post-retirement Benefits Other than Pensions,” to our consolidated financial statements contained in the 2019 Form 10-K.
|
(c)
|
Mr. Braun and Ms. Moretti do not participate in any Company defined benefit plan.
|
2019 NONQUALIFIED DEFERRED COMPENSATION
|
Name
|
|
Executive Contributions in Last Fiscal Year
($)(a)
|
|
Registrant
Contributions
in Last Fiscal
Year
($)(b)
|
|
Aggregate
Earnings in
Last Fiscal
Year
($)(c)
|
|
Aggregate
Withdrawals/
Distributions
($)
|
|
Aggregate
Balance at
Last Fiscal
Year End
($)(e)
|
||||
D. D. Petratis
|
|
|
|
|
|
|
|
|
|
|
||||
EDCP
|
|
1,674,731
|
|
—
|
|
849,240
|
|
|
—
|
|
3,504,344
|
|
||
Supplemental ESP
|
|
—
|
|
335,999
|
|
|
172,982
|
|
|
—
|
|
1,297,970
|
|
|
P. S. Shannon
|
|
|
|
|
|
|
|
|
|
|
|
|||
EDCP
|
|
—
|
|
—
|
|
1,196,297
|
|
|
—
|
|
3,716,115
|
|
||
Supplemental ESP
|
|
—
|
|
101,784
|
|
|
162,591
|
|
|
—
|
|
1,033,447
|
|
|
J. N. Braun
|
|
|
|
|
|
|
|
|
|
|
||||
Supplemental ESP
|
|
—
|
|
64,033
|
|
|
28,976
|
|
|
—
|
|
208,342
|
|
|
T. P. Eckersley
|
|
|
|
|
|
|
|
|
|
|
|
|
||
EDCP
|
|
—
|
|
—
|
|
548,939
|
|
|
(54,447
|
)
|
|
1,943,787
|
|
|
Supplemental ESP
|
|
—
|
|
67,718
|
|
|
61,730
|
|
|
—
|
|
641,605
|
|
|
L. V. Moretti (d)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
(a)
|
The annual deferrals (salary and AIP awards) are all reflected in the Salary column, the Non-Equity Incentive Plan column and the Stock Awards column, respectively, of the Summary Compensation Table.
|
(b)
|
The amounts in this column are included in the All Other Compensation column of the Summary Compensation Table. Note: For Messrs. Petratis, Shannon, Braun and Eckersley, these amounts also include a one-time Supplemental ESP contribution that was made by the Company in 2019, respectively, to correct an administrative error in contribution calculations (which resulted in an underfunding of contributions) in 2018 and early 2019.
|
(c)
|
This column represents gains and losses on investments, as well as dividends on ordinary shares or ordinary share equivalents. The earnings or losses reported in this column are not included in the Summary Compensation Table.
|
(d)
|
Ms Moretti does not participate in any Company non-qualified deferred compensation plan.
|
(e)
|
This column includes the amounts reflected in the table below which are also reported in the Summary Compensation Table.
|
Name
|
|
EDCP
|
|
Supplemental ESP
|
||
D. D. Petratis
|
|
922,558
|
|
|
1,034,103
|
|
P. S. Shannon
|
|
—
|
|
308,254
|
|
|
J. N. Braun
|
|
—
|
|
145,815
|
|
|
T. P. Eckersley
|
|
1,122,594
|
|
|
261,128
|
|
L. V. Moretti
|
|
—
|
|
—
|
POST-EMPLOYMENT BENEFITS
|
•
|
death or disability, RSUs and stock options shall immediately vest and the stock options remain exercisable for a period of three years or the original expiration date, whichever is earlier;
|
•
|
retirement, RSUs (other than Mr. Eckersley’s special grant in 2016) and stock options shall continue to vest in accordance with their original vesting schedule and the stock options remain exercisable for a period of five years;
|
•
|
group termination, RSUs and stock options immediately vest in the portion of the awards that would have vested within twelve months of termination and all vested stock options remain exercisable for a period of three years following termination or the original expiration date, whichever is earlier;
|
•
|
retirement, group termination or job elimination, PSUs vest pro-rata based on the time worked during the performance period and the achievement of performance goals through the end of the performance period; and
|
•
|
death or disability, PSUs vest pro-rata based on target level performance during the performance period.
|
•
|
any accrued but unpaid base salary;
|
•
|
an amount equal to the NEO’s target annual bonus for the year in which the termination occurred, pro-rated for the months of service and based on the Company’s actual performance for the year; and
|
•
|
a lump sum severance payment equal to the three times (CEO) or two times (other NEOs) the sum of:
|
▪
|
the NEO’s annual salary in effect on the termination date, or, if higher, the annual salary in effect immediately prior to the event that constitutes “good reason”; and
|
▪
|
the NEO’s target annual incentive award for the year of termination.
|
POST-EMPLOYMENT BENEFITS TABLE
|
|
|
Retirement
($)
|
|
Involuntary
without
Cause
($)
|
|
Change in
Control
($)
|
|
Disability
($)
|
|
Death
($)
|
|||||
D. D. Petratis
|
|
|
|
|
|
|
|
|
|
|
|||||
Severance (a)
|
|
—
|
|
4,400,000
|
|
|
6,600,000
|
|
|
—
|
|
—
|
|||
2019 Earned but Unpaid AIP Award(s) (b)
|
|
1,652,280
|
|
|
1,652,280
|
|
|
1,652,280
|
|
|
1,652,280
|
|
|
1,652,280
|
|
PSU Award Payout (c)
|
|
5,709,009
|
|
|
5,709,009
|
|
|
5,709,009
|
|
|
5,709,009
|
|
|
5,709,009
|
|
Value of Unvested Equity Awards (d)
|
|
6,432,052
|
|
|
6,432,052
|
|
|
6,432,052
|
|
|
6,432,052
|
|
|
6,432,052
|
|
Enhanced Retirement Benefits (e)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|||||
Outplacement (f)
|
|
—
|
|
—
|
|
25,000
|
|
|
—
|
|
—
|
||||
Health Benefits (g)
|
|
—
|
|
—
|
|
64,339
|
|
|
—
|
|
—
|
||||
Total
|
|
13,793,341
|
|
|
18,193,341
|
|
|
20,482,680
|
|
|
13,793,341
|
|
|
13,793,341
|
|
P. S. Shannon
|
|
|
|
|
|
|
|
|
|
|
|||||
Severance (a)
|
|
—
|
|
983,614
|
|
|
1,967,228
|
|
|
—
|
|
—
|
|||
2019 Earned but Unpaid AIP Award(s) (b)
|
|
621,890
|
|
|
621,890
|
|
|
621,890
|
|
|
621,890
|
|
|
621,890
|
|
PSU Award Payout (c)
|
|
1,473,051
|
|
|
1,473,051
|
|
|
1,473,051
|
|
|
1,473,051
|
|
|
1,473,051
|
|
Value of Unvested Equity Awards (d)
|
|
1,762,174
|
|
|
1,762,174
|
|
|
1,762,174
|
|
|
1,762,174
|
|
|
1,762,174
|
|
Enhanced Retirement Benefits (e)
|
|
—
|
|
—
|
|
1,314,703
|
|
|
—
|
|
—
|
||||
Outplacement (f)
|
|
—
|
|
—
|
|
25,000
|
|
|
—
|
|
—
|
||||
Health Benefits (g)
|
|
—
|
|
—
|
|
44,234
|
|
|
—
|
|
—
|
||||
Total
|
|
3,857,115
|
|
|
4,840,729
|
|
|
7,208,280
|
|
|
3,857,115
|
|
|
3,857,115
|
|
(a)
|
Refer to the description of how severance is calculated in the section above entitled Post-Employment Benefits.
|
(b)
|
Amounts represent the actual award earned for the 2019 performance period.
|
(c)
|
For “Involuntary Without Cause,” this assumes group termination or job elimination. For the “Change in Control,” “Death” and “Disability,” these amounts represent a pro-rata portion of the outstanding PSUs. Amounts are based on the closing stock price on December 31, 2019 ($124.54).
|
(d)
|
The amounts shown represent (i) the value of eligible unvested RSUs, which is calculated based on the number of unvested RSUs multiplied by the closing stock price on December 31, 2019 ($124.54) and (ii) the intrinsic value of the unvested stock options, which is calculated based on the difference between the closing stock price on December 31, 2019 ($124.54), and the relevant exercise price. For purposes of a “Change in Control,” we assume that an alternate award is not provided and the vesting of the unvested awards accelerate. For retirement eligible employees, the eligible equity awards do not accelerate but continue to vest on the same basis as active employees. Because Messrs. Petratis, Shannon, Eckersley and Braun and Ms. Moretti are all retirement eligible, their equity awards, other than Mr. Eckersley’s special RSU award granted in 2016, would continue to vest after termination of employment for any reason other than cause.
|
(e)
|
In the event of a change in control of the Company and a termination of the NEOs, the present value of the pension benefits under the EOSP, KMP and Supplemental Pension Plans would be paid out as lump sums. The amounts shown under change of control represent the estimated benefit provided in excess of the EOSP amount shown in the Pension Benefits Table. While there is no additional benefit to the NEOs as a result of involuntary resignation without cause or in the event of a death or disability, there are differences (based on the methodology mandated by the SEC) between the numbers that are shown in the Pension Benefits Table and those that would actually be payable to the NEO under these termination scenarios.
|
(f)
|
For the “Change in Control” column, the amount represents the maximum expenses we would reimburse the NEO for professional outplacement services.
|
(g)
|
Represents our cost of continued active coverage for thirty-six months for the CEO and twenty-four months for the other NEOs.
|
|
|
Retirement
($)
|
|
Involuntary
without
Cause
($)
|
|
Change in
Control
($)
|
|
Disability
($)
|
|
Death
($)
|
|||||
J. N. Braun
|
|
|
|
|
|
|
|
|
|
|
|||||
Severance (a)
|
|
—
|
|
—
|
|
1,384,320
|
|
|
—
|
|
—
|
||||
2019 Earned but Unpaid AIP Award(s) (b)
|
|
331,860
|
|
|
331,860
|
|
|
331,860
|
|
|
331,860
|
|
|
331,860
|
|
PSU Award Payout (c)
|
|
776,113
|
|
|
776,113
|
|
|
776,113
|
|
|
776,113
|
|
|
776,113
|
|
Value of Unvested Equity Awards (d)
|
|
924,706
|
|
|
924,706
|
|
|
924,706
|
|
|
924,706
|
|
|
924,706
|
|
Enhanced Retirement Benefits (e)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|||||
Outplacement (f)
|
|
—
|
|
—
|
|
25,000
|
|
|
—
|
|
—
|
||||
Health Benefits (g)
|
|
—
|
|
—
|
|
32,604
|
|
|
—
|
|
—
|
||||
Total
|
|
2,032,679
|
|
|
2,032,679
|
|
|
3,474,603
|
|
|
2,032,679
|
|
|
2,032,679
|
|
T. P. Eckersley
|
|
|
|
|
|
|
|
|
|
|
|||||
Severance (a)
|
|
—
|
|
—
|
|
1,575,900
|
|
|
—
|
|
—
|
||||
2019 Earned but Unpaid AIP Award(s) (b)
|
|
484,482
|
|
|
484,482
|
|
|
484,482
|
|
|
484,482
|
|
|
484,482
|
|
PSU Award Payout (c)
|
|
904,476
|
|
|
904,476
|
|
|
904,476
|
|
|
904,476
|
|
|
904,476
|
|
Value of Unvested Equity Awards (d)
|
|
1,023,636
|
|
|
1,023,636
|
|
|
2,100,160
|
|
|
2,100,160
|
|
|
2,100,160
|
|
Enhanced Retirement Benefits (e)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|||||
Outplacement (f)
|
|
—
|
|
—
|
|
25,000
|
|
|
—
|
|
—
|
||||
Health Benefits (g)
|
|
—
|
|
—
|
|
31,987
|
|
|
—
|
|
—
|
||||
Total
|
|
2,412,594
|
|
|
2,412,594
|
|
|
5,122,005
|
|
|
3,489,118
|
|
|
3,489,118
|
|
L. V. Moretti
|
|
|
|
|
|
|
|
|
|
|
|||||
Severance (a)
|
|
—
|
|
—
|
|
1,257,081
|
|
|
—
|
|
—
|
||||
2019 Earned but Unpaid AIP Award(s) (b)
|
|
270,091
|
|
|
270,091
|
|
|
270,091
|
|
|
270,091
|
|
|
270,091
|
|
PSU Award Payout (c)
|
|
451,034
|
|
|
451,034
|
|
|
559,368
|
|
|
559,368
|
|
|
559,368
|
|
Value of Unvested Equity Awards (d)
|
|
662,620
|
|
|
662,620
|
|
|
662,620
|
|
|
662,620
|
|
|
662,620
|
|
Enhanced Retirement Benefits (e)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|||||
Outplacement (f)
|
|
—
|
|
—
|
|
25,000
|
|
|
—
|
|
—
|
||||
Health Benefits (g)
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
||||
Total
|
|
1,383,745
|
|
|
1,383,745
|
|
|
2,774,160
|
|
|
1,492,079
|
|
|
1,492,079
|
|
CEO PAY RATIO DISCLOSURE
|
•
|
Using the Internet and voting at www.proxyvote.com;
|
•
|
Calling 1-800-690-6903 and following the telephone prompts to vote by proxy; or
|
•
|
Completing, signing and returning a proxy card by mail. If you received a Notice and did not receive a proxy card, you may request one at sendmaterial@proxyvote.com.
|
•
|
By notifying the Company’s Secretary in writing: c/o Allegion plc, Block D, Iveagh Court, Harcourt Road, Dublin 2, Ireland;
|
•
|
By submitting another properly signed proxy card with a later date or another Internet or telephone proxy at a later date but prior to the close of voting described above; or
|
•
|
By voting in person at the Annual General Meeting.
|
Name
|
|
Ordinary Shares (a)
|
|
Notional Shares (b)
|
|
Options
Exercisable or RSUs Vesting
Within 60 Days (c)
|
||||
K. S. Hachigian
|
|
5,585
|
|
|
—
|
|
981
|
|
||
S.C. Mizell (d)
|
|
—
|
|
|
—
|
—
|
|
—
|
|
|
N. Parent Haughey
|
|
779
|
|
|
—
|
|
981
|
|
||
D. I. Schaffer
|
|
5,418
|
|
|
—
|
|
981
|
|
||
C. L. Szews
|
|
779
|
|
|
—
|
|
981
|
|
||
M. E. Welch
|
|
5,418
|
|
|
—
|
|
981
|
|
||
D. D. Petratis
|
|
217,729
|
|
|
18,945
|
|
|
91,138
|
|
|
P. S. Shannon
|
|
31,525
|
|
|
21,857
|
|
|
56,069
|
|
|
J. N. Braun
|
|
8,160
|
|
|
—
|
|
6,561
|
|
||
T. P. Eckersley
|
|
14,678
|
|
|
7,367
|
|
|
36,062
|
|
|
L. V. Moretti
|
|
19,441
|
|
|
—
|
|
21,651
|
|
||
All directors and executive officers
as a group (18 persons)(e)
|
|
351,296
|
|
|
48,169
|
|
|
266,653
|
|
(a)
|
Represents ordinary shares held directly.
|
(b)
|
Represents ordinary shares and ordinary share equivalents notionally held under the EDCP that are not distributable within 60 days of the Record Date.
|
(c)
|
Represents ordinary shares as to which directors and executive officers had stock options exercisable or RSUs that vest within 60 days of the Record Date, under the 2013 Stock Plan.
|
(d)
|
Mr. Mizell was appointed to the Board on February 6, 2020.
|
(e)
|
The Company’s ordinary shares beneficially owned by all current directors and executive officers individually and as a group (including shares issuable under exercisable options or vesting RSUs) aggregated less than 1% of the total outstanding ordinary shares. Ordinary shares and ordinary share equivalents notionally held under the EDCP are not counted as outstanding shares in calculating these percentages because they are not beneficially owned; the directors and executive officers have no voting or investment power with respect to these shares or share equivalents.
|
Name and Address of Beneficial Owner
|
|
Amount and Nature of
Beneficial Ownership
|
|
Percent
of Class (a)
|
The Vanguard Group
100 Vanguard Blvd
Malvern, Pennsylvania 19355
|
|
10,046,590 (b)
|
|
10.89%
|
BlackRock, Inc.
55 East 52nd Street
New York, New York 10055
|
|
9,563,367 (c)
|
|
10.37%
|
AllianceBernstein L.P.
1345 Avenue of the Americas
New York, New York 10105
|
|
6,954,923 (d)
|
|
7.54%
|
Aristotle Capital Management, LLC
11100 Santa Monica Blvd., Suite 1700
Los Angeles, California 90025
|
|
6,292,648 (e)
|
|
6.82%
|
(a)
|
The ownership percentages set forth in this column are based on the Company’s outstanding ordinary shares on the Record Date and assumes that each of the beneficial owners continued to own the number of shares reflected in the table above on such date.
|
(b)
|
Information regarding The Vanguard Group and its stockholdings was obtained from a Schedule 13G/A filed with the SEC on February 12, 2020. The filing indicated that, as of December 31, 2019, Vanguard had sole voting power as to 143,742 shares, shared voting power as to 32,958 shares, sole dispositive power as to 9,880,379 shares and shared dispositive power as to 166,211 shares.
|
(c)
|
Information regarding Black Rock, Inc. and its stockholdings was obtained from a Schedule 13G/A filed with the SEC on February 4, 2020. The filing indicated that, as of December 31, 2019, BlackRock had sole voting power as to 7,795,654 shares and sole dispositive power as to 9,563,367 shares.
|
(d)
|
Information regarding AllianceBernstein L.P. and its stockholdings was obtained from a Schedule 13G/A filed with the SEC on February 18, 2020. The filing indicated that, as of December 31, 2019, AllianceBernstein L.P. had sole voting power as to 5,923,448 shares, sole dispositive power as to 6,946,700 shares, and shared dispositive power as to 8,223 shares.
|
(e)
|
Information regarding Aristotle Capital Management, LLC and its stockholdings was obtained from a Schedule 13G filed with the SEC on February 14, 2020. The filing indicated that, as of December 31, 2019, Aristotle Capital Management, LLC had sole voting power as to 4,439,803 shares and sole dispositive power as to 6,292,648 shares.
|
EQUITY COMPENSATION PLAN INFORMATION
|
Plan Category
|
|
Number of Securities to
be Issued upon
Exercise of Outstanding
Options, Warrants and
Rights
|
|
Weighted-Average
Exercise Price of
Outstanding
Options,
Warrants and
Rights
|
|
Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation
Plans (Excluding
Securities Reflected in
First Column)
|
||||
Equity compensation plans approved by
security holders (1)
|
|
4,920,861
|
|
|
$
|
67.58
|
|
|
3,079,139
|
|
Equity compensation plans not approved by security holders (2)
|
|
84,721
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
5,005,582
|
|
|
$
|
67.58
|
|
|
3,079,139
|
|
(1)
|
Represents the 2013 Stock Plan. The weighted average exercise price includes stock options and stock appreciation rights outstanding under the 2013 Stock Plan. PSUs are included assuming target performance.
|
(2)
|
Represents the EDCP. Plan participants acquire our shares under the EDCP as a result of the deferral of salary, annual incentive awards and PSUs.
|
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